Project Green to rent offices for €400,000 a year, but that’s par for the course

Project Green – the new government agency aiming to green the island and being run by prospective MEP candidate Steve Ellul – is looking to rent office space for its operations for an eye-watering €2 million for a five-year duration.

At just over €400,000 a year, the government appears to be splashing out big time on the initiative spearheaded by Environment and Energy Minister Miriam Dalli and CEO Steve Ellul – possibly to the further chagrin of incumbent and other prospective Labour Party MEP candidates, some of whom have been crying foul over what they see as preferential treatment being given to Ellul and his candidacy.

Bids for the lease contract – worth over €33,000 a month for five years – will be weighted 70% on its technical specifications and 30% on its price.

The draft agreement also stipulates that the lease can be renewed once for an additional five years at the same rate.

The amount is exorbitant but, when comparing it with some of the other outrageous leases the government has entered into – such as those for the premises of the Malta Business Registry in Zejtun and those of Transport Malta in Paola and Lija – it is pretty much par for the course.

For the premises Transport Malta is renting from the General Workers’ Union at the A3 Towers in Paola, the government is paying €490,000 a year under a lease agreement that began in August 2014.

The GWU acquired four floors of the A3 Towers for €1.7 million in 2012 from JPM Brothers, owned by the Montebello brothers, the same owners of the former Jerma Palace Hotel in Marsascala.

The premises of the Malta Business Registry (MBR) is meanwhile being rented by the government at an even higher rate, with the Auditor General having described the €2 million per year being paid for the Zejtun premises as “prohibitive”.

An audit found that through a 15-year agreement, signed in 2018 under the guidance of Economy Minister Silvio Schembri, the government will be paying a total of €31,264,126 to use the premises at the Alex Mercieca Bathroom Centre.

In addition, the lease agreement, which was concluded following an expression of interest instead of a public tender, did not include expenses amounting to more than €5 million, also funded by taxpayers, for the floors in shell form to be transformed into offices.

The publicly-funded improvements will be passed back to the owner of the private building at the end of the lease in 2033.  The NAO audit found these costs “prohibitive” and warned that this contract “raises questions on value for money”.

As for Project Green’s new premises, the €2,047,000 price tag, extendable for another five years at the same rate, is an Estimated Procurement Value meant as guidance for bidders and is not to be considered as a binding capping price.

Ellul’s landing at Project Green just ahead of his prospective MEP run and the massive amount of publicity he is accruing from an extremely popular €700 million public greening project has rubbed his fellow MEP contenders the wrong way.

The Shift has reported that some current Labour MEPs have expressed their frustration with the situation and have informally complained to the Office of the Prime Minister.

Among their gripes is the fact that he is also being backed by Environment Minister Miriam Dalli, herself a former MEP and the most successful candidate in the 2019 election.

Dalli has now appointed Ellul to lead the agency with its multi-million-euro annual budget, which has been continually and highly publicised in the media since he took the role.

Ellul was recruited from the banking sector as Dalli’s consultant and quickly began appearing on Labour’s One TV and PBS as a commentator.

While it is almost a certainty among Labour insiders that Ellul is preparing to contest the 2024 MEP elections, he has so far not publicly confirmed his electoral intentions and has only said he is leaving his options open.

Ellul has also been given total control of the agency with not even a board of directors or chairman to answer to. Instead, Project Green Agency is more of a one-man show – where he is earning over €90,000 a year and responds directly to Minister Dalli and her permanent secretary.