12 July 2006

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Business Today

Ambassador to Spain silent on resignation call

Karl Schembri

Malta’s Ambassador to Spain, Gaetan Naudi, has said he will limit his response to Labour’s call for his resignation in written replies to the Foreign Ministry, in the wake of a damning National Audit Office report detailing the squandering of public funds at the defunct Voice of the Mediterranean three years ago.
Naudi was then Permanent Secretary at the foreign ministry when Richard Muscat was MD for three years, in which according to NAO, Muscat ignored public procurement regulations when spending thousands of liri The NAO report lambastes Naudi for failing to scrutinise public expenditure at the station.
“Since the Ministry of Foreign Affairs is part of the government’s administration, the same ministry was duty bound to monitor VOM’s activities and ensure that all government financial regulations and procedures were being followed,” the report said, adding that the ministry should now “re-coup payments which were not directly due or which were adjusted to give higher payment advantages to certain service providers or part time employees”.
Contacted yesterday, Naudi confirmed he was asked for his explanations by the new Permanent Secretary at the foreign ministry, Cecilia Attard Pirotta, but would not divulge his replies.
“I will limit myself to commenting to my superiors, which I have already done,” he said yesterday.
The Opposition has also called for Muscat’s resignation, who is now serving as Malta’s ambassador to Ireland, but he has defended himself insisting he was not bound by government procurement regulations.
Among the direct orders he issued, Muscat gave a Lm36,000 annual contract to his son for internet radio.
The NAO’s report vindicates MaltaToday’s revelations back in 2003, when the station was just about to close three years after Muscat was appointed its Managing Director.
In fact, the Foreign Ministry which was responsible for financing and overseeing the station’s operations is now seeking Muscat’s and Naudi’s explanations.
“The current Permanent Secretary, Ms Cecilia Attard Pirotta, who was appointed after the period in question, has asked the public officers mentioned in the report to submit their statements in reaction to the Auditor’s report,” a spokesman for Foreign Minister Michael Frendo told MaltaToday last Sunday. “These include the former Permanent Secretary Mr Gaetan Naudi and former VOM Managing Director Mr Richard Muscat.”
Contacted at his office in Ireland, Muscat said he had “many objections” to the auditor’s investigating his running of the Maltese-Libyan shortwave radio station but was happy that “no impropriety” was blamed on his part.
Yet the NAO did accuse him of “problems and irregularities” in the operations of the radio station, with the major contracts and investments carried out by direct order. His response is that he has been turned into “a scapegoat”.
NAO suggested that the Permanent Secretary should appoint an administrator for VOM or set up an ad hoc board in conjunction with the Libyan authorities until a decision is taken on the future of the radio station and its assets.
Labour’s spokesman on foreign affairs, Leo Brincat, called for Muscat’s and Naudi’s resignations in a press conference on Monday.
“Since the auditor general’s report highlights the abuse and the blatant breach of the government’s financial regulations in the way VOM was run, placing the blame squarely on the station’s managing director and singling out the permanent secretary for serious lack of financial and administrative control, we feel they should both resign,” he said. “In the light of this report we feel the two are not worthy to represent Malta in such prestigious posts.”

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