David Darmanin After a 38-page report issued by the General Workers’ Union on Friday implied suspicious behaviour and corruption in the Shipyards on an alleged €80 million lost on the Fairmount project, the management at Malta Shipyards Ltd yesterday issued a preliminary reaction to the Union’s claims.
“With all due respect, such observations may lead to wrong impressions,” MSL said, adding that the losses directly attributable to the Fairmount project amounted to €37.7 million. The remaining €42.3 million would have still been spent – with or without the Fairmount project, the Shipyards said.
The Fairmount project included the conversion of two semi-submersible barges: the Fjell and the Fjord. After media reports had revealed that the Shipyards had made substantial losses out of the project, government commissioned auditing firm PricewaterhouseCoopers to carry out an independent inquiry, with the aim of establishing what went wrong with the project.
Although the PWC report had outlined that the loss was of €37 million, in tandem with what the Shipyards are reiterating, GWU secretary-general Tony Zarb Friday said that the GWU calculations of €80 million losses had not been contested.
The report also said that originally, the Shipyards had estimated a total of 1.2 million man hours, but in the contract, former Shipyards marketing manager Graham Crouser had changed it to 650,000 hours.
The union also raised questions on the appointment of Crouser, and asked why he was allowed to leave the country before his contract expired. Zarb said that Crouser, who already had a bad track record before joining MSL, was now working in shipyards in Gibraltar.
The report lays blame for the Fairmount loss on the Shipyards due to mismanagement, ruling out the possibility of human error – saying that the situation is mainly due to contract conditions, the way negotiations were carried out, underestimations in quotes and irregular management. Zarb also pointed his finger at Infrastructure Minister Austin Gatt as being politically “responsible for this mess”.
In its reply, the Ministry for Infrastructure, Transport and Communications on Friday said that it was still evaluating the contents of the report, but that the issue was being “politicised” and that the PWC report was not being given due consideration. The Ministry said that the union does not have any hard evidence to back its claim of corruption.
While the GWU claims that the PWC report was delayed for suspicious reasons, the Shipyards’ statement clarified that such delays were due to the fact that the auditing firm’s terms of reference had been extended to investigate the entire Fairmount project, and not the shipyard subcontractor as per originally agreed.
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