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Steward Was Given Assurances By Joseph Muscat When It Was Pressured To Take Over Failing Hospitals Concession

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Steward Healthcare was given certain assurances by the government when they were brought in to save Vital Global Healthcare’s failing concession of three Maltese state-hospitals, Lovin Malta can confirm.

Sources have insisted that the healthcare operator was given assurances by former Prime Minister Joseph Muscat and former Tourism Minister Konrad Mizzi.  They say Steward was reportedly pressured into concluding the deal by December 2017, before payroll at Vitals Global Healthcare would come in and reveal the dismal financial situation.

Mizzi’s presence may puzzle some. However, he had served as the Minister responsible for Private-Public Partnerships from 2013 onwards.

Mizzi had even kept the portfolio, which also covers other highly controversial projects like Electrogas, when he was made to resign as Health and Energy Minister following the Panama Papers scandal.

Contacted by Lovin Malta, Steward said:

“In December 2017, when it became apparent that VGH was unable to make payroll, (leaving hundreds of nurses, doctors, and health professions without their pay) and was further unable to buy critical hospital supplies, we realised that the decision needed to be taken there and then or risk having a major service interruption.”

“The government at that time, which was brought in to give its consent to the deal, encouraged the take-over and provided sufficient reassurance on the otherwise bigger picture around the concession.”

It is still unclear what these assurances were. However, it seems that it relates to the change in contract.

Steward has been the operators of the concession to manage three state hospitals, St Luke’s, Karin Grech, and the Gozo General Hospital, ever since VGH dropped out of the 30-year agreement just 21 months into operations over mounting financial pressure.

VGH left a trail of debt in its wake, which reportedly stands at €36 million. However, its CEO Ram Tumuluri still made off with a €5 million bonus.

Issues surrounding the concession have defined the first few months of 2020, with Steward recently calling for an urgent meeting with Prime Minister Robert Abela over its failure to cough up some €18 million in due reimbursements.

Meanwhile, Opposition leader Adrian Delia has called for the deal to be scrapped in its entirety and for the hospitals to be returned to Maltese citizens. The involvement of Nexia BT in the VGH negotiation procedure has also raised eyebrows.

Speaking to the newsroom, Steward explained:

“It is no secret that Steward took over the concession in Malta at a time when the concession was failing, which made the decision to take over when we did both a sensitive and a critical one.”

“As a health care organisation which operates hospitals across the United States, we have long understood that not delivering on our mission to deliver high-quality care, day in and day out, literally puts lives at stake.”

“At the time, a thorough review of the contractual agreements was carried out by the company, and certain issues were flagged. These mostly related to legal drafting of the contracts, and certain interpretations of the text which were found to be misleading, unclear or not of a level acceptable by way of international legal standards.”

“Here once more, Steward was assured that there would be no problem in updating the agreements to reflect these needed improvements.”

“Over the past years, Steward has continued to work within the boundaries of the original contract while engaged in active negotiations with the health ministry and OPM around the issues mentioned above.”

“Steward has not centred the discussions around the need for increased financing as it has been claimed in the media, but on making improvements to the contracts to enable project finance and the realisation of the wider project to deliver quality and sustainable care to the people of Malta and Gozo.”

It remains to be seen how the situation will develop. However, Abela is being evasive on the issue, telling Net News decisions would be taken but failed to say who would take responsibility for the failures of the controversial hospital deal.

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Julian is the Editor at Lovin Malta with a particular interest in politics, the environment, social issues, and human interest stories.

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