Prime minister backpedals on Scicluna deal following public outrage

Less than 48 hours after Prime Minister Robert Abela was forced to accept a compromise deal with Central Bank Governor Edward Scicluna, Abela announced the former finance minister would take a golden handshake of €100,000, half of what he agreed only last Tuesday.

Earlier this week, following a meeting at Castille, Abela announced that Scicluna had agreed to step aside from his role as Central Bank Governor but would retain his full salary and perks. Scicluna confirmed this in media interviews, saying he would stay on until the end of his term.

The quick change of direction was the result of public outrage at Scicluna’s demand to keep his full salary for the rest of his term – 17 months – while someone else did his job.

Yesterday, Abela was forced to make a U-turn, saying that his former finance minister would be paid half his salary, amounting to €5,750 a month.

Scicluna is facing criminal charges in relation to the fraudulent deal on three of Malta’s public hospitals, which the court has since annulled.

The court found prima facie evidence that Scicluna should be tried on charges related to the VGH/Steward Healthcare deal.

The Castille meeting

On Tuesday, Abela called a meeting at Castille to address Scicluna’s resistance and avoid further humiliation. It has been widely reported and confirmed by The Shift that Scicluna did not budge during that meeting, refusing to resign and threatening he would challenge the government before the European Court of Justice.

Scicluna only changed his mind when Minister Owen Bonnici told him he could keep his full salary if he suspended himself. Government sources told The Shift that Scicluna also asked to keep all his perks, including a car and his personal diver, which was accepted.

“His objections and resistance immediately softened as soon as the monetary carrot was dangled before him,” a senior government official told The Shift. “The moment Scicluna was offered the money, he started reversing his earlier bold stance and finally accepted the offer.”

Yesterday, two days after his deal with the prime minister, Scicluna said he had discussed the matter with his family and decided to take half his dues instead of his full salary as he “wanted to be treated the same as all civil servants”.

His stance contradicts what he had been insisting on since his indictment, that his appointment was different from any other, saying the rules did not apply to him as the European Central Bank had “its own rules”.

The Central Bank Governor is not a civil servant and is appointed by the president based on political decisions made by the President on the recommendation of the cabinet.

Scicluna will never return

Although the 78-year-old former finance minister announced that he was still Governor and would clear his name in a few months, legal sources told The Shift that this was far from the truth.

“Scicluna would not have even started facing his trial by the time his term ends. This means that this was just a sort of golden handshake to avoid further embarrassment for the prime minister,” a veteran lawyer explained, shedding light on the legal implications of Scicluna’s actions.

Following the indictment, the Attorney General is now responsible for issuing the formal charges for a trial.

This will only start in a few years. Many other trials will have to take place first. Scicluna will now just join the queue, the legal sources said.

Appointed Central Bank Governor in 2021, an appointment that was also a compromise made for him to step aside from the finance ministry, Scicluna’s five-year term will end in December 2025, when he turns 80.

Scicluna increased the Central Bank Governor’s salary a few weeks before he took the post.

According to his last published declaration of assets, which goes back to 2020, just a few months after he was moved from the finance ministry, Scicluna owns two villas in San Pawl tat-Tarġa, Naxxar. He declared €750,000 in bank deposits. He also received almost €50,000 in pensions, connected to his political posts, including as MEP.

His permanent secretary, Alfred Camilleri, facing similar charges as his former boss, did not follow Scicluna’s example. Although no longer in the public service, Camilleri resigned as chairman of the Malta Philharmonic Orchestra.

Deputy Prime Minister Chris Fearne also stepped back, as did Permanent Secretary Ronald Mizzi, avoiding the prime minister further embarrassment.