Infrastructure Minister Austin Gatt said today that the dockyard had been a historic and political failure for the country which had cost taxpayers €980,693,257 in 40 years. In his view, he said, privatisation should have been taken in hand years ago.

Speaking in parliament during the debate on a motion to transfer the ship repair facilities to Palumbo spa, Dr Gatt said the dockyard had cost the country of €70,000 per day for the past 40 years.

The dockyard losses were a constant as governments, prime ministers, ministers,directors and workers changed. The losses continued even as various management systems were adopted.

"We cannot deny the fact that the dockyard has been a historic failure for the country. It has also been a political failure, with the enterprise having been kept open despite the mounting losses over many years," Dr Gatt said.

In this context, the decision to privatise the 'yard should have been taken a long time ago.

Another constant, Dr Gatt said, was that in the past 40 years the dockyard was always government-owned, and the tendency was that problems such as this were found in governemnt enterprises.

It was also evident that this problem was not tackled before because the dockyard was never allowed to function on commercial lines. Among the reasons were the political militancy of the General Workers' Union. One only needed to speak to the directors and managers on the behaviour of the union after 2003 when many reforms were meant to be brought in. As efforts were made to implement the Appledore report which everybody said he agreed with, there was a whole series of unofficial strikes and other actions. This showed how wrong political trade-unionism was, Dr Gatt said.

Just as wrong was how some Opposition politicians continued to regard the dockyard workers as their 'red army' an attitude which continued to make management difficult.

Another problem was that managers and workers were in the same union, making the enforcement of discipline by the management difficult.

"The lesson from the dockyard is that while trade union rights are important and should be respected, when trade unionism becomes political and political purposes take priority over trade union purposes, things go wrong," Dr Gatt said. The attitude of the GWU in the dockyard was far different from how the GWU acted in the private sector, Dr Gatt said.

While this was not the only reason for the demise of the dockyard, it was certainly a very major contributing cause.

Dr Gatt said the Fairmount ship conversion contract which was being blamed for the closure of the dockyard had cost the 'yard €32 million. Over the same period the dockyard lost over €100 million. Under the Sant government, it lost €135 million.

Privatisation, he said, had been on the cards ever since Malta joined the EU. The EU had allowed state aid to the shipyard up to 2008 and it was evident that by that year the shipyard either became profitable, or it would have to close. Before the last election the prime minister had been clear that the 'yard was heading towards privatisation because profitability had not been achieved.

In 2008 after the elections, the government was faced with a situation that it could not give further state aid to the dockyard, nor could it issue financial guarantees. Meanwhile, the losses were continuing to mount. The choice was a simple one - closure and possibly conversion into a waterfront and hotel facilities or retention of the dockyard, but in private hands.

A well run dockyard was clearly an asset for the country, and the government had therefore opted for privatisation.

It was evident, Dr Gatt said, that the Maltese wanted to work in a well-run dockyard. A small recruitment advert published in the inside pages of a newspaper recently attracted hundreds of applications.

This, Dr Gatt said, was the inevitable conclusion of a story which had been smeared by politics and had led to a financial failure which accounted for a quarter of the national debt, Dr Gatt said.

Labour MP Chris Agius said the dockyard workers had worked diligently and completed contracts on time and the root of the dockyard's ills were government appointments to the management of the enterprise. He said the dockyard workers were promised that the dockyard would remain open, but the opposite had happened.

He pointed out that while Dr Gatt had said that the dockyard had not made a profit since 1982, the PN was in government for most of the years since, and the ultimate responsibility was political.