Top civil servants confirm Abela wanted a second deal with Steward Healthcare

The three permanent secretaries charged with criminal offences related to the hospitals’ fraudulent concession deal have confirmed in court that despite his claims to the contrary, Prime Minister Robert Abela was about to sign a second deal with Steward Health Care, and they stopped him.

This means that despite early warnings that the multi-billion deal struck by the disgraced former Prime Minister Joseph Muscat was little more than a scam, the Labour government twice attempted to renegotiate the deal and give Steward better conditions and more money.

Through a judicial protest filed last Monday just before their official arraignment, Alfred Camilleri, Ronald Mizzi, and Joseph Rapa, the top three civil servants at the time of the concession, accused Victoria Buttigieg, then State Advocate, of a conflict of interest as they claimed that she had attended meetings with them on the new deals that had to be struck with Steward.

However, in their protest, they let slip that it was true that Robert Abela was close to signing a new deal with Steward and claimed that it was thanks to them that he did not.

While Buttigieg, now Attorney General, denied these claims, The Shift is informed that then-Health Permanent Secretary Joseph Rapa got cold feet at the eleventh hour and declined to sign the deal.

Muscat’s first attempt to renegotiate

Following the insolvency of Vitals Global Healthcare (VGH) and the acquisition of the concession by Steward Health Care, at the time dubbed as “the real deal” by Health Minister Chris Fearne,  Joseph Muscat had started negotiations to give Steward a better deal and an opportunity to receive millions more in government funds.

An investigation by the Auditor General shows that between 2018 and 2019, Konrad Mizzi led secret negotiations to allow Steward to scrap the medical tourism element of the concession and instead start acting as a service provider.

Draft agreements show that in return, Joseph Muscat, Keith Schembri, and Konrad Mizzi, with the help of top civil servants, agreed that Steward would receive a 9% increase in payments.

Political turmoil erupted as the deal was about to be signed in November 2019, ending Muscat’s career. The deal was scrapped.

A second attempt by Robert Abela

When Robert Abela became Prime Minister in January 2020, another round of negotiations started with the promise to strike a new deal with Steward.

One of Abela’s first meetings at Castille was with his disgraced former predecessor Joseph Muscat, in which Armin Ernst, the President of Steward, was introduced to Abela.

The second set of negotiations took place between January 2020 and August 2021, and Robert Abela roped in his father and former President George Abela to represent him during these meetings.

New terms for Steward were discussed and agreed upon during a crucial meeting held at the Office of the Prime Minister on August 27, 2020.

The Prime Minister’s assistant, Ian Borg, Steward’s CEO, Armin Ernst, and his lawyer, Ron Galea Cavallazzi, from the legal firm Camilleri Preziosi, were also present for this meeting.

The new agreement was to consist of two tiers: a design-and-build contract for the renovation and building necessary at St Luke’s, Karen Grech, and the Gozo General Hospital and a separate Management Services Agreement through which the government was to pay tens of millions a year to Steward for the running of the hospitals.

Subsequent discussions, led by Alfred Camilleri, then the Finance Ministry Permanent Secretary, over the following weeks, led to a final draft for a new concession agreement.

During a final meeting held in August 2021, when the details of the hospitals’ scandal were becoming much clearer, Deputy Prime Minister Chris Fearne informed Steward that, according to legal advice obtained from the State Advocate and the Director General at the Department of Contracts, the government couldn’t sign a new deal, as this would be illegal.

Robert Abela has publicly denied that he wanted to strike a second deal with Steward.