Judge Franco Depasquale has nullified a controversial decision to hand over the management of three hospitals to a consortium.
In a damning judgment, Judge Franco Depasquale ruled that the Gozo General Hospital, St Luke’s Hospital, and Karin Grech Hospital should be returned to the government due to fraud and the failure to meet targets.
The decision has put Joseph Muscat’s government under the spotlight with former PN leader Adrian Delia, who instituted the case against the deal, called the ruling “a victory for Malta.”
In response, the government said it was analyzing the ruling and promised to safeguard national interests, employment, and hospital services.
The hospitals were handed over in 2015 to Vitals Global Healthcare, a company with no previous experience in managing hospitals.
When it failed to live up to its obligations, the concession was handed to US company Steward Healthcare. Both Vitals and Steward Healthcare were found to have acted fraudulently in the ruling delivered on Friday.
Judge Depasquale ruled that there was fraud in three stages of the process. The shareholders of Vitals had already concluded a memorandum of understanding with the government before it published its intention to privatize the hospitals.
Vitals abused its position, and its investors used fraudulent tactics to get the concession. VGH had an apparent conflict of interest that should have led to its disqualification, and it kept the memorandum of understanding hidden, evidence of its fraudulent intent.
Adrian Delia argued that both the original concessionaire and its successor had failed to fulfill contractual obligations, including the creation of state-of-the-art facilities, a medical campus in Malta and Gozo, and the modernization of the Gozo General Hospital.
Since neither Vitals nor Steward had met those milestones, the concession was rescinded, and the hospitals returned to the people.
Delia summoned a long line of witnesses, including high-profile figures such as Muscat, Konrad Mizzi, who was in charge of the health portfolio at the time of the Vitals deal, and current health minister Chris Fearne.
Muscat and Mizzi have both stood by the deal, insisting they acted in the public’s best interest. By contrast, Fearne has been keen to distance himself from the whole affair, saying he had very little to do with the original deal.
The ruling has put the government under scrutiny, and there are calls for accountability from those responsible for the controversial deal. The decision is a victory for the people of Malta, who will see the hospitals returned to the government’s management.