17 November 2004

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The shoe’s on the other foot

Reverse psychology

Public opinion is somewhat dead or, better still, so delirious about other matters that it cannot focus on the gravity of the situation. The Mater Dei fiasco and Government’s failure to react to an extensive expose’ in the ‘j’accuse’ style is shocking to say the least.
Last Sunday, our sister newspaper, MaltaToday published facts and figures from official documents that confirmed the Prime Minister had caved in to Skanska’s demands.
And yet, in a fine example of reverse psychology, the Prime Minister declared victory despite the Skanska negotiations being an abject failure.
The Times, following the Premier’s lead, praised the outcome of the negotiations, forgetting altogether that the contract signed in 2000 stipulated in black and white that the cost of the hospital would be Lm93 million. Contracts are binding as our lawyer Prime Minister is well aware of and yet Skanska failed to deliver on time and within budget. If the subcontractors asked for more and did not deliver as expected, that is Skanska’s responsibility.
Data extracted from the official documents presented in Parliament clearly show that since September 2003 Skanska had been projecting construction costs, including management and design fees, to the tune of around Lm139 million. This amounts to around Lm45 million more than what had been agreed upon in 2000.
Lm139 million also happens to be the amount Government accepted to pay Skanska after the ‘successful’ negotiations held throughout the summer. Facts speak for themselves and facts show it was Government that caved in to Skanska’s demands.
However, The Times chose to put much of the blame for the increased cost on the short-lived Labour government when it changed the hospital plans.
This type of blame-it-on-Labour game is completely out of place because the final contract with Skanska for an enlarged hospital was signed in 2000, two full years after Labour lost the election to the PN.
The buck should not stop with the Maltese public. How do structural works projected at Lm13 million rise to Lm18 million in Dr Gonzi’s newly negotiated package? And how do management fees projected at Lm9.8 million end up costing Lm15.8 million in the new deal?
If the PM declares that his negotiations were a victory, to us it reads more like a fiasco.
The Maltese premier should be applauded for deciding to review his predecessors’ hopeless approach to the Mater Dei question, but he cannot by any stretch of the imagination declare a victory.
If there is someone who should be held responsible for this awful mess, it has to be former Prime Minister Eddie Fenech Adami. He has never managed to provide answers as to why this hospital turned out to be such a long drawn and costly affair.
This hospital will be finished, we are told, 15 years after the first stone was laid in 1992. The date for completion, 1 July 2007, also coincides with Gonzi’s birthday in what is an embarrassing coincidence for both the PM and the nation.
This is not the end to the Mater Dei story. We are still awaiting answers as to why the PM chose to cave in to Skanska and stop insisting on the Lm93 million bill.
It is a sad episode in our long history of incompetent fiscal management.

Copyright © Newsworks Ltd. Malta.
Editor: Saviour Balzan
The Malta Financial & Business Times, Newsworks Ltd, Vjal ir-Rihan, San Gwann
Tel: (356) 21382741-3, 21382745-6 | Fax: (356) 21385075 | E-mail