26 July 2006

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Business Today

Government should shoulder political responsibility on VOM fiasco – Mangion

As new witnesses were called to testify yesterday evening about the Voice of the Mediterranean (VOM) fiasco, the Chairman of the Parliamentary Accounts Committee Charles Mangion called on the government to “assume political responsibility” for the extravagant spending of public funds at the defunct radio station.
The Opposition MP said that while the Attorney General’s opinion was that VOM did not fall under government procurement procedures, the government still had to answer for bad governance and negligence that led to the squandering of public funds.
“The Public Accounts Committee can only scrutinise the National Audit Office’s report into the operations of VOM, it has no executive powers,” Mangion said, as the hearings are drawing to a close. “We’ll need another couple of sessions to conclude, but it will be up to the government to take the measures it has to take once all the sessions are over.”
Mangion said that even if government procurement regulations did not strictly apply, the funds issued by the Maltese side remained public money.
“Ultimately it’s about bad governance and negligence and if the government wants to be accountable it knows exactly what it has to do,” Mangion said, adding that even Richard Muscat’s position as ambassador had to be reviewed.
Indeed, the star testimony at the committee hearings was the main protagonist, Richard Muscat, the former managing director of the radio station and now Ambassador to Ireland.

On Monday he insisted he was never requested to follow government procurement regulations and that he followed in his predecessors’ footsteps, although upon further questioning he did admit that one of the members on the board of councillors, Alfred Zarb, had drawn his attention to ask for quotations.
And while Muscat claimed that a second contract for internet radio required much more work and manpower after the station relocated its premises, the audit manager at the National Audit Office insisted the contracts were totally identical.
Among the most glaring expenditures listed by the National Audit Office, Muscat spent Lm140,000 on the internet radio in a contract awarded “solely on mutual trust.
Ambassador to Spain Gaetan Naudi – the former permanent secretary who is now being questioned about his total exoneration of Muscat in a report he had concluded in December 2003 – said he had only looked at the second contract when he drew up his report, drawing the anger of MLP Deputy Leader Charles Mangion who in the PAC session in question criticised Naudi for failing in his responsibilities towards the ministry.
Muscat had also spent Lm83,000 on technical equipment and wiring, Lm61,000 on furniture and fittings and Lm56,000 on security, fire fighting and soundproofing equipment and another Lm31,900 on motor vehicles. Lm8,278 were spent on fireworks for Project Odyssey, an international activity aimed at promoting peace.
Muscat also bought a Lm10,000 vehicle for himself and another one costing Lm15,000 for his deputy, “far in excess of that allowed in similar ranks in the public sector” according to NAO. Muscat said on Monday that his deputy, a Libyan, had ordered the car while he was abroad. Although the board of councillors were “shocked” about the contract, no action was taken about it.
According to the NAO, Muscat “continued to refurbish the station and expand its activities on his understanding that the funds from the other party (Libya) would be forthcoming. However this did not materialise and VOM entered into substantial commitments which could not be sustained from the funds that were allocated by the Maltese party”.
Also, while NAO said the amount of direct orders issued under Muscat totalled around Lm250,000, Muscat said he could not remember the total.

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