Passports Fund pulls €4.4m from health upgrades amid procurement scandal

Malta’s Passports Fund stopped financing a €10 million health-centre upgrade programme after concerns emerged about procurement, implementation and compliance with the funding agreement.

The National Development and Social Fund (NDSF), which administers proceeds from Malta’s former cash-for-passports scheme, disclosed that it refused to reimburse outstanding claims submitted by the Health Ministry’s Primary Health Care and did not renew the agreement when it expired.

The decision follows serious findings against former Primary Health Care CEO Roseanne Camilleri and former financial controller Alfred Farrugia over procurement irregularities in refurbishment projects at the Birkirkara and Qormi health centres.

The scandal emerged when Minister Chris Fearne was responsible for the Ministry.

An Internal Audit and Investigations Department report, revealed by The Shift, accused Camilleri and her executives of “gross administrative irregularities, incompetence and misconduct”.

The report found that the projects proceeded without technical drawings, bills of quantities, detailed cost estimates or an appointed architect or project manager. Neither the ministry’s Central Procurement and Supplies Unit nor the Foundation for Medical Services was involved.

Camilleri and Farrugia reportedly obtained three direct quotations despite lacking common, detailed specifications against which the bids could be compared.

Much of the work was awarded through direct orders to GM Developments Ltd, owned by regular Health Ministry supplier Simon Grech. The cost eventually exceeded €1.5 million, compared with an original estimate of €300,000.

According to the internal investigation, Camilleri attempted to place responsibility for the irregularities on Farrugia, claiming she was unaware that procurement rules were not being followed and that no contract with the contractor was in place.

Investigators rejected her explanation, pointing to her presence at an on-site meeting with prospective contractors and concluding that, as CEO, she was ultimately responsible for the entity’s operations.

Despite a recommendation for disciplinary action, no action was taken against Camilleri.

She was later moved to Mount Carmel Hospital and nominated by Prime Minister Robert Abela as Malta’s ambassador to Liechtenstein.

The NDSF’s newly published annual report does not name Camilleri, Farrugia, GM Developments or the health centres connected to the reimbursement claims it rejected.

The NDSF agreed in 2019 to provide €10 million for the upgrading of more than 50 clinics and eight health centres across Malta and Gozo. Approximately €5.55 million had been paid by the end of 2025, leaving some €4.4 million unspent.

The Fund said procurement and implementation issues connected to works claimed under the remaining funding tranche came to its attention during 2025. After examining compliance with the grant agreement, it refused further reimbursement claims and allowed the agreement to lapse.

The amount claimed and rejected has not been disclosed.

Responsibility for procurement and project implementation rested with Primary Health Care, while expenditure was reviewed by an independent technical monitor appointed by the NDSF.

The Fund is now discussing a possible revised proposal with Primary Health Care’s new management. No decision has been taken on how the remaining €4.4 million will be used.

Roseanne Camilleri is still heading the Ministry’s mental health service.