Contracts related to the power station and hospital were not being investigated because corruption was not normally present in such pacts, Prime Minister Joseph Muscat said this afternoon.

Addressing a news conference on the third year of his government’s legislature at Castille, Dr Muscat said corruption won't be found there.

He acknowledged that governance issues had distracted attention from the government's achievements and this was something that had to be addressed.

“I understand governance issues have distracted from the good things we have done and we have to address this.”

He insisted that an audit of Energy Minister Konrad Mizzi's Panama accounts would uncover facts. The audit, he said, would uncover if the Opposition leader's accusation that there was a bag of money was true. If it was, Dr Mizzi would have to leave, he said.

The Prime Minister was asked whether Dr Mizzi and his chief of staff Keith Schembri should resign for the Panama scandal not to remain a millstone around the government's neck.

To another question as to and why Dr Mizzi and Mr Schembri opened a Panama company at the same time, the Prime Minister insisted the claims were not correct.

Dr Muscat said he was surprised the Nationalist Party did not wait for the ministerial declarations later this month to see whether Dr Mizzi would have declared the New Zealand trust and Panama company.

Had they waited, the issue would have blown up in their face because Dr Mizzi was going to declare his assets, he said.

The Prime Minister, however, avoided speaking about Mr Schembri.

Three years in office

The Prime Minister, who started the news conference recalling the day his Cabinet took the oath of office three years ago today, said that his government had then found problems at Enemalta, the European Commission had been asking for higher taxes to tune of €60 million and there were other problems that needed to be addressed.

His government, Dr Muscat said, had delivered change. The economy grew, employment rose, civil liberties were improved and poverty was reduced, even if marginally.

He acknowledged that mistakes were made and that more needed to be done on the environment and good governance.

Various people had, however, benefitted from government measures and 48,500 individuals had enjoyed tax cuts to the tune of €60 million.

The GDP growth rate at 6.3 per cent was unprecedented and this would enable the government to increase social benefits. Fuel stability also meant people benefitted from €40 million in price reductions.

Women in the labour market increased to 53 from 44 per cent over the past three years and more than 8,000 first time buyers saved €24 million following the removal of stamp duty.

Dr Muscat also said the in work benefit helped low income families but there was still a section of society that had not yet benefitted from economic growth.

Widow pensions had increased by 17 per cent and those on low pensions, some 12,000, saw increases worth €13 million per year. Moreover, out of stock medicines were a thing of the past, Dr Muscat said.

He went through the government’s various measures and achievements, including the "revolutionary" free child care.

PM should have sackedMizzi and Schembri - PN

In a reply, the Nationalist Party said the Prime Minister should have announced he had sacked Dr Mizzi and Mr Schembri  and the fact that he did not dismiss them raised grievous questions on Dr Muscat himself.

Dr Muscat, the PN said, opted to celebrate the third anniversary of his government in the midst of a corruption crisis with new facts about the biggest scandal in a series continuously being uncovered.

Instead of accountability, transparency and meritocracy, the government was surrounded by scandals and everyone now acknowledged that Malta had never had a government that was as corrupt as this one in its first three years in office.

The Nationalist Party referred to the wealth it had left behind and said this was being grabbed by the people who were close to the government who were receiving very high wages from the people’s money. A total 540 people were employed in positions of trust and were being paid large amounts, some with salaries of up to €1,000 a week.

And apart from the high food prices, fuel prices were also being kept high in spite of a 60 per cent drop in the price of oil.

The past three years, the PN said, were years of deceit and incompetence. The new power station, which should have been operating for a year, had not led to any resignations, two magistrates were appointed in breach of the constitution and projects initiated by the Nationalist government had not yet been concluded.

Incompetence and deceit could also be seen in the Żonqor and other scandals, the PN said.