€100 million awarded in ‘emergency’ tenders in three years; Gozo Ministry leads list of issuers

Over the past three years, the government has awarded tenders collectively worth at least €100 million via a system known as ‘accelerated procedure,’ viewed by many in the business community as an underhand route to granting direct orders to ‘friends.’

According to stringent EU public procurement rules, tenders should be issued in a competitive manner assuring transparency, accountability and a fair level playing field among business competitors. The use of direct orders and the so-called’ accelerated procedure’ is normally limited to rare exceptions usually related to emergency works.

However, the Maltese government’s increasing use of ‘accelerated procedures’ in cases where no emergency or urgent works were involved or could be justified has prompted concern among the business community and their representatives including the Malta Chamber and the Chamber of SMEs – the former GRTU.

Adding to this concern is the fact that the Finance Ministry has repeatedly approved the use of the ‘accelerated procedure’ for the procurement of goods and services through what is being viewed as a new form of direct order.

According to information tabled recently in parliament, in response to questions by opposition MP Chris Said, in the less than two and a half years since the beginning of 2019, various government Ministries and departments have used the ‘accelerated procedure’ system more than 300 times.

The Gozo Ministry tops the list of those utilizing the system, supposedly used only in exceptional case: it has issued a total of 28 direct orders using this method, to the value of more than €2.5 million.

Gozo Channel (operations) Ltd – which falls under the remit of the same Ministry, currently headed by Clint Camilleri – has issued as many as 31 ‘accelerated procedure’ tenders to the value of almost €3 million.

Business operators who spoke to The Shift said that “it is crystal clear that the accelerated procedure is being abused by some Ministries, particularly in Gozo, which has apparently discovered a new ‘legal’ system to allocate tenders to friends directly.”

According to the business operators who regularly tender for government procurement services, both the National Audit Office and the Department of Contracts should investigate what is going on in this area as the high number of accelerated procedure tenders “cannot be justified by any stretch of the imagination.”

The Gozo Ministry has been embroiled in a number of procurement controversies over the last years as multi-million tenders were allocated to various business operators, mainly Gozitan, close to the government.

This has seen a situation in which even unlawful operations, such as an illegal concrete batching plant operated by Prax Concrete – owned by Gozitan construction magnate Joseph Portelli – have been given multi-million tenders, including the ongoing building of a public natatorium in Victoria, estimated to cost some €9 million.

The Shift has also exposed how hundreds of tons of concrete illicitly produced by the Portelli clan has been utilised in the project, while the company has been paid tens of thousands of euros in taxpayers’ funds.

The Gozo Curia is also a favorite on the government’s direct orders list, with many of its properties leased to the Government for various uses.

According to the information tabled in Parliament, the largest volume of direct orders through the ‘accelerated procedure’ were issued in 2020, when they amounted to more than €45 million in contracts.

In 2019, 142 ‘accelerated procedure’ tenders worth almost €38 million were awarded, and so far this year the government has already used the ‘emergency’ procedure 55 times, to grant €17 million worth of contracts.

These ‘accelerated procedure’ tenders come on top of the tens of millions euros being distributed by the government and its agencies through direct orders.

The NAO has warned various Ministries to reduce their dependency on direct orders and ‘accelerated procedures’, as these might be illegal, however the government appears to have completely ignored its recommendations and continues to employ these systems to award lucrative contracts worth millions to friends and ‘benefactors’.

Political parties depend heavily on donations from the business community to survive and it is widely known that beneficiaries of tenders and direct orders are generally expected to contribute towards party coffers, particularly those of the party in government.

Ministers and political candidates also depend on donations, in cash and in kind, to run their personal political campaigns.