Only one bidder for €150 million food tender for government-run hospitals

The government has so far failed to explain how a tender for the supply of food to patients across all government-run hospitals was issued for a duration of 15 years, contrary to standard practice in the EU.

While EU procurement rules do not specify the number of years a tender is to be issued for, the norm is three. This is rarely more than five years.

“Fifteen years is a very long time to award such a large tender to only one service provider across all Maltese hospitals. There might be economic and logistical reasons for doing so, but this is still almost unheard of in the EU,” Brussels sources said.

The health ministry did not reply to questions asking for an explanation.

The call was published on Christmas Eve, when the country is usually in full festive mode, considered a good time to bury news.

The multi-million-euro tender attracted only one bid from Kore Catering JV, which consists of Seabank DB Group and James Caterers. These companies have dominated similar government contracts in past years.

Their offer of €152 million for the first ten years of the tender is higher than the estimated contract value, established to be €146 million. The call allows for an extension of an additional five years after the first ten.

Both companies already have the majority of major government tenders related to the supply of patient food services in government hospitals.

The issue of duration is not new, since similar tenders were issued by the former PN administration. The difference is that not all hospitals were included and administrated by one company.

In this case, the only hospital left out of the tender was St Vincent De Paul, which has over 1,000 residents. But the same Seabank DB-Group/James Caterers consortium already acquired a 15-year contract for SVDP in 2017.

An investigation by the NAO found the SVDP contract to be irregular and suggested that the government revoke it. The government ignored the Auditor General and has now proceeded to do the same with other public hospitals.

The new tender specifies that the winning bidder must supply at least three meals daily to some 2,200 patients in Malta and Gozo. The service provider would also have to invest in new trolley equipment and a new digital meal-ordering system.