The ‘real deal’ may cost taxpayers another €36 million as Steward files for bankruptcy

Taxpayers will have to foot the bill for a €36 million loan Bank of Valletta gave to the concessionaire in the hospitals’ privatisation deal, a senior official at the bank told The Shift while explaining that the bank’s risk was covered.

“The bank issued the loan to Steward Health Care only after the government gave its full guarantee. Thus,  in  the case of Steward’s bankruptcy, BOV is still fully covered as the government will be forced to make up for any shortfall.”

This is in addition to the hundreds of millions the government has already spent during the concession’s term, estimated at €400 million.

Steward Health Care, the owner of the government’s “fraudulent” hospital concession, has filed for bankruptcy in the US, declaring a staggering $9 billion in debts and liabilities.

BOV sources told The Shift that the bank is “not worried about the implications of this bankruptcy”.

“The bank is very well covered on this loan despite all the uninformed comments in the media, including by politicians,” a senior official said.

The official said this meant the loans would be repaid in full, interests included, through taxpayers’ funds.

“That is not a concern for the bank. Politicians made these decisions, and they should answer them. BOV still acted correctly,” he said.

The government guarantee was signed by former finance minister Edward Scicluna and his Permanent Secretary Alfred Camilleri, who now faces criminal charges.

Following last Monday’s filing for bankruptcy in the US, Steward Health Care has now put all of its 32 hospitals for sale in an attempt to shore up funds to pay its debts.

Court documents filed in Massachusetts show that Steward Health Care’s liabilities include $1.2 billion in loans, $6.6 billion in long-term rent obligations, $1 billion in unpaid bills from medical vendors and suppliers, and $290 million in employee wages and benefits.

In 2018, days before he visited Steward Health Care’s headquarters in Boston, Chris Fearne told a Labour Party conference that Steward’s Gozo Hospital would be better than Malta’s main hospital, Mater Dei.

Neither VGH nor Steward has ever come up with any investment to build a new Gozo General Hospital as obliged in the original 30-year concession signed in 2015 by disgraced former prime minister Joseph Muscat.

Despite Steward Health Care missing all deadlines, the government continued to pay them tens of millions of euro annually.

An investigation conducted by OCCRP, The Shift, and The Times of Malta showed those millions went straight into the pockets of so-called investors, who lived the high life off Maltese taxpayers’ backs.

Deputy Prime Minister Chris Fearne resigned yesterday in the wake of charges he faces in relation to the magisterial inquiry into the privatisation of three of Malta’s public hospitals.