Joseph Muscat ordered illegal €241,000 contract for Konrad Mizzi

The chairman of the Malta Tourism Authority said that it was outgoing prime minister Joseph Muscat who had instructed tourism chief Johann Buttigieg to give his former minister, Konrad Mizzi, a three-year consultancy job worth €241,000 upon his resignation.

The letter from Gavin Gulia to public standards commissioner George Hyzler is included in a report on the €80,400 a year revolving-doors job given to Mizzi, and withdrawn by Robert Abela soon after, following a complaint by Green Party chairperson Carmel Cacopardo.

In his verdict, Hyzler declared that Muscat’s direct order was against the law, as laid down in the Standards in Public Life Act, as well as a breach of ministerial ethics for behaviour that did not respect the country’s laws.

“In my view, Dr Muscat’s instruction for Dr Mizzi to be engaged as consultant is a: discretionary power that represented an abuse of powers as laid down in Article 22 [of SiPL Act]; a breach of ministerial ethics that obliges ministers to see that departments and entities under their purview are managed properly and diligently; a breach of ethics where ministers are required to exercise the highest level of diligence on public funds.”

Muscat himself was asked to comment on his decision, to which he replied to Hyzler that even during the December crisis - when his chief of staff Keith Schembri resigned in the wake of the arrest of Yorgen Fenech as the alleged mastermind in the Caruana Galizia assassination - “government’s responsibility was to give the tourism industry continuity.”

He refuted all suggestions that his decision had been unethical.

Muscat said Mizzi, whose secret Panama company was revealed in the 2016 Panama Papers scandal, was needed since the MTA was in a transitionary phase with the appointment of a new CEO and because the Air Malta restructuring was still being implemented.

Muscat even claimed the complaint was “a generic allegation” and “partisan criticism unfounded in fact and at law.”

He insisted that as Prime Minister and minister responsible for MTA after the resignation of Mizzi, he acted within his legal powers when appointing the former tourism minister as a consultant, so that the authority could execute government policy on tourism promotion.

But Hyzler said this was not Muscat’s job, but that of the MTA’s board at law to decide on such recruitment.

Even the total payment itself breached a €232,937 limit set by the Tourism and Travel Services Act on contracts: Mizzi’s perks included a chauffeur-driven car, international health insurance for his family, paid communications, and an €11,400 cash bonus if Mizzi drove his own car.

Muscat replied that Hyzler’s suggestion that the consultancy salary was excessively higher than his ministerial €60,000 salary, was a matter of subjective opinion. “One must consider the critical need of the services recruited. I cannot see the relevance of such a comparison, when a minister does not give professional services to the State but serves in a political position according to the Constitution.”

Hyzler also said that MTA chief executive Johann Buttigieg failed to refer Muscat’s instruction to Gulia, and instead rendered himself complicit in Muscat’s overweening power that ignored the MTA board’s duties.

Hyzler said that Gulia did not declare when he found out about the consultancy, or what he action he took when he found it; “none of them took any action to safeguard the law or the public purse, and for that, they neglected their responsibilities.”

Hyzler said it was bad practice for a minister to overrule or ignore the board of a government entity, creating a space for abuse. “These entities are not there to serve as cover for potentially abusive behaviour by ministers. Ministers must distance themselves from decisions on workers’ employment and contract awards due to the peril of favouritism or non-meritorious awards.”