The secrecy and the formula

Call it extra-sensory empathy or (if you really must) overweening presumption, but I feel it in my bones that Joseph Muscat would like me to come to his rescue. Here I come, pro bono.

Muscat pooh-poohed the story this website ran yesterday about his severance pay. He didn’t argue the facts; he argued about what they meant. He accused The Shift of being selective about the facts it reported. But even I, his pro bono defence lawyer, must regretfully admit my client was inadvertently selective.

The result: he didn’t shut the discussion down. He simply raised more questions.

Take his statement that there was “nothing secret” about the financial arrangements. Why, then, did it take one and a half years, and several Freedom of Information requests and parliamentary questions, to get this information? Why was it denied?

Ladies and gentlemen of the jury, let me point out that the secrecy was entirely on the part of the Robert Abela administration. My client had nothing to do with it.

He would have preferred the whole arrangement to be public the way it is in, say, the UK and Ireland and with the EU Commission.

It is because the UK is entirely transparent that, right after David Cameron resigned as prime minister, it was reported that he accepted a tax-free £20,000 payout (three months salary), instead of the full prime minister pension.

It’s because the UK severance payments for ministers are regulated by law that we know that, when ministers lose their Cabinet seat, they receive a sum in the region of £17,000, equivalent to three months of their annual salary (unless they’re over 65).

UK ministers get the payment even when they are fired for incompetence or resign in disgrace. There is much debate, of course, about the fairness of such payments, but the law is clear.

Hence why it was evidently in my client’s interest that the terms of the severance agreement were made public immediately. So what if he stepped down in disgrace while garlanded with the wreath of the most corrupt man of 2019? Public transparency, like the UK’s, would have made clear that those considerations are irrelevant.

Instead, government resistance to giving out the information raises suspicions. It looks like a cover-up.

Complete transparency is still needed. Here, I allow, my client did not help himself.

He included the severance payment (€250,000) for Richard Cachia Caruana, the former permanent representative to the EU, which has nothing to do with prime ministerial packages. If Cachia Caruana needs to be dragged in, then his package is to be compared to Kurt Farrugia’s, Muscat’s former communications chief: he was appointed to head Malta Enterprise on a salary that will go up to €180,000 and a payout of over €250,000 if he’s ever fired for whatever reason.

(To those who mutter darkly that this comparison does not reflect well on my client, may I remind you all that Cachia Caruana is a classic energy-guzzling big beast, whereas Muscat appointed a man who will help us meet our climate change targets: compact, with a tiny footprint, and who expends far less energy than Cachia Caruana.)

Back to the nub. The Shift reports that Muscat had a payout of €120,000, which happens to be the equivalent of two years’ salary for a prime minister. The 2004 Cabinet memo that the government kept referring to, however, refers to a severance payment of a minimum of six months’ salary.

Neither Muscat nor the government has revealed the formula by which the €120,000 was calculated. Instead, Muscat compared amounts: his with Lawrence Gonzi’s.

Muscat gives only the amount he pocketed after tax. He doesn’t give the figure for the transitional allowance that, he says, he renounced. He compares all this with Gonzi’s severance payment (before or after tax? We’re not told) and the transitional allowance that Gonzi accepted. Gonzi’s gross total comes up to slightly more than Muscat’s net total — assuming my client has not been absent-minded with the truth.

That’s not comparing like with like. Besides, Gonzi was prime minister for three years more than Muscat. That’s why the formula for calculating the payout matters. How it’s calculated, and whether it’s changed in any way, is what makes all the difference.

This is not because we should begrudge generous payments to prime ministers. Severance payments for, say, EU commissioners are very generous (and may stretch up to three years); but the reason is to be able to insist that former commissioners do not go to work immediately for companies they previously regulated.

Likewise, former UK prime ministers are entitled to £115,000 a year to run a private office that pursues both political and social initiatives. This is to spare the country the spectacle of a former prime minister becoming a de facto lobbyist for private interests.

If, therefore, that Maltese formula for calculating severance payments for prime ministers has been changed — say, to become more in line with European practice elsewhere — there is nothing necessarily wrong with that.

Nor would there necessarily be anything wrong if Muscat was awarded, in the national interest, a more generous package consisting in allowances for maintaining a private office, etc.

What is wrong is that the government does not declare it. It raises suspicions of hypocrisy and money-grubbing.

I put it to you, ladies and gentlemen of the jury, that my client would rather starve than give even the faintest impression of mendacity and greed.

I am sure he will join me in insisting that the government publish forthwith the formula by which the prime minister’s severance payment was calculated in 2019. Moreover, it should declare any other allowance, if any, that my client is receiving.

If the government continues to dawdle, I am convinced my client will volunteer the information himself.

He wants us to be the best in Europe even in this. I rest my case.