Friday 02 December 2022

Steward Health Care Malta rebuts claims made by Health Minister

Steward Health Care Malta is surprised by the Health Minister’s statements in the Maltese Parliament supporting the current contractual terms of the hospitals concession, which have been widely acknowledged by independent observers – both within Malta and in the European Union – to be wholly unsuitable and inappropriate. 

In fact, two different administrations with the same Health Minister throughout have, over three consecutive years (2019, 2020 and 2021), negotiated complete agreements with Steward Malta specifically in order to put the flawed original concession agreed with Vitals Global Healthcare (VGH) on a viable footing – clearly acknowledging that the current framework is unworkable.

Unfortunately, the Government failed to finalise these agreements, meaning that the Maltese people have not been able to benefit fully from the outcome of a viable concession.  Had the Government’s early commitment to renegotiate been brought to successful conclusion, the much-needed new hospitals would now be nearing completion. 

The minister’s view contradicts that of the National Audit Office, whose review found that the concession’s terms were based on incorrect information, and that the data provided on its cost structure was inaccurate from the moment the tender was issued. Steward Malta states that a payment structure based on a faulty baseline is not tenable and created a non-viable, non-financeable Private-Public Partnership (PPP) from the start. The origins of these terms as negotiated with VGH and the reasons for their presence are under investigation, a period that did not involve Steward Malta. 

The minister also contradicts the European Commission’s view, made in writing to the Government across several investigations over several years, that the concession does not fall within PPP parameters as dictated by EU rules and is simply not fit for purpose. As a result, the concession was placed back onto the Government of Malta’s balance sheet, meaning that Steward Malta was not able to finance and build new hospital facilities.  On several occasions since 2018, the Government informed the EU that a negotiated solution with Steward Malta was underway, but a conclusion has yet to be reached. 

The failings of the original plans meant that the Maltese people would not benefit from proper facilities. For instance, the planned Barts Medical School within the Gozo General Hospital campus was not fit for the intended purpose, and Barts made it clear they would not set up base in Malta if the facility was not built to a level suitable for world class education. Steward Malta worked with Barts to build a medical school substantially larger than that anticipated in the concession, but without additional compensation, and in record time. Through this concerted effort, Steward Malta helped cement Barts entry to Malta.  

These problems alone make delivering certain aspects of the concession impossible, and have undermined Steward’s ability to fulfil its obligations. 

Steward Malta has nevertheless worked hard to invest in its facilities and people for the benefit of the Maltese patients and, as the minister says, services have significantly improved under Steward’s management. Steward Malta has continued to invest across all its hospitals, including during the uniquely challenging period of the pandemic, with results that improved the experiences of patients and staff.

When Steward Malta was asked to take over the concession, the Government of Malta conveyed its representations and commitments which, however, were never kept. These are on record. Steward Malta is complying with the substance of the original contract insofar as it can in this context, and seeks only that the Government complies with its side of the agreement too. 

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