Editorial | A deal neatly stitched-up

The extension of the Dragonara casino land lease approved unanimously by Parliament without a call for tenders is at best inexplicable, at worst a neatly stitched-up affair.

Minister Chris Cardona’s decision to table a parliamentary motion for a 64-year lease extension for the prime land in St Julians has shocked gaming industry operators.

Operators always believed the government would issue a competitive process when the Dragonara lease closes next year. After all, that is what happened in 2010 and 1999.

But Cardona thought otherwise and his explanation so far has been anything but convincing.

The land may be privately owned but the company that has the leasehold, Casma Ltd, is wholly government-owned.

The Dragonara leasehold is a government asset, which Cardona was duty bound to manage in the public’s best interest.

Irrespective of whether Casma could have gone ahead with its private dealings with Dragonara Gaming without having to seek parliamentary approval, Cardona, as a minister of State, had the obligation to ensure the public got the best deal possible.

Simply extending Dragonara Gaming’s lease by a whopping 64 years in what is effectively a direct order, is not on and has all the makings of a stitched-up affair.

The extension is worse when one considers that Dragonara Gaming got a discount on the annual rent payment. The company has not only acquired the lease for the long-term but will be getting it on the cheap.

A competitive process may have yielded a better return for the public.

But it is not just the public interest that has been let down.

The process is also unfair on gaming operators that may have wanted to compete for the leasehold but were not given a chance.

What is certain is that Dragonara Gaming was given a double advantage over the rest. It will continue enjoying its rights on the prime land for more than six decades without having to compete for the privilege. To add salt to the wound, it was also given a discount on the lease payment at a time when the rental market is hitting the stars.

This is unfair competition that erodes industry’s trust.

The economy needs trust to continue performing well but when businesses start feeling that some are more privileged than others that could spell serious trouble.

Cardona has a lot of explaining to do over how he handled this affair. Why did he avoid a competitive process?

He rushed the matter through parliament at a time when the Prime Minister was not even present in the country and without the deal being presented to Cabinet. Why?

But even the Opposition has a lot of explaining to do. Amazingly, nobody from the Opposition benches even bothered to raise as much as one question over the lease extension when Cardona put forward the motion. It was approved unanimously.

The silence in Parliament on Tuesday was deafening.

MPs from both sides of the House rendered themselves party to the fiasco Cardona piloted for the benefit of Dragonara Gaming and its ultimate owners, Johann Schembri and the Bianchi family.