It`s Not a Gift at All

27^th January 2006

The Malta Independent - Friday Wisdom

I consider it an insult to the intelligence of the Maltese nation that the Prime Minister and the minister responsible for the health sector have this week described the Mater Dei project as a gift to the Maltese nation. Broad grins and photo sessions wearing hard hats do not change the reality that this hospital is an extended financial tragedy, which started in 1992 and lingers on interminably.

A gift is something you receive without payment on special occasions from those who really care about you – and takes the form of a material object of value, which is meant to bring happiness to the receiver.

Mater Dei fits nowhere within this definition. It is certainly not something the Maltese nation is receiving for free from some “sugar daddy”. We are paying for it through our nose, with the original budget exceeded in multiple terms and with the bill still going up and counting – so that when one adds into it the cost of relocation from St Luke’s and the cost of money which has been sunk into the project while it is still in its interminable development stage, we will approach the Lm250 million mark – cost of land excluded.

That someone who really cares for us is giving it to us, is questionable. Certainly, they care about our votes, but if their care was to be measured by decisions like the Mater Dei saga, then one could well conclude that with friends like these, who needs enemies!

Whether the Mater Dei, when and if it is completed and rendered fully operational, would bring us happiness, is still something to be seen. But all indications are that the operational cost of this new hospital would make a severe stress on public finances and could well bring into question – more than it already is – the sustainability of universal free public health services. It could be the straw – or more accurately the monstrous pipe – that breaks the camel’s back.

It is high time that the Auditor General puts together as special team of experts to give independently sourced information about the governance of public spending on this hospital project. Because no matter how you turn around the figures they grossly miss the test of logic and fail every value for money test that one can think of.

If one were to take the publicly admitted total cost figure of Lm145 million – excluding the cost of medical equipment and cost of relocation – and round it up to Lm170 million to include the cost of financing such capital during the development stage, that would mean a cost of Lm212,500 per bed spread over 800 beds.

If one generously assumes that each bed is in a separate room – which is not the case as there are multi-bedded wards – that figure would be three times as much of the cost of completion of a five star standard hotel with 300 plus rooms, excluding the cost of land, but including all equipment necessary for full operation – including the food and beverage departments.

With Lm65,000 cost per hotel room normally housing two beds, one should be able to finish to very high standards a five star hotel project absorbing in the cost of each room the cost of the remaining common parts of the project – kitchens, restaurants, swimming pools, gym, reception etc included.

Now, the comparison makes sense, as ultimately, – medical equipment apart – a hospital is not different from a hotel, as they both offer guest accommodation. If the hospital has some special features which make its development cost more expensive, these are well compensated by the fact that I am taking a per room cost for a hotel and comparing to a per bed cost for the hospital and that the hospital need not be finished off to the luxurious standards of a five-star hotel.

How can one therefore explain this monstrous difference, except through negligence, bad planning and duplication of work that often has to be re-thought and re-done due to continuous changes to the specifications? Which comparable project of its size has taken 15 years to complete, assuming that it will truly be completed and rendered operational within the next 18 months?

From our governments, we do not expect gifts, unless they want to harden the false perception of an all seasons Santa among those who prefer state support, rather than own personal development. From our governments, we expect correct governance coupled with reasonable initiatives to think through their major investment decisions responsibly. The decision to start the Mater Dei hospital at Tal-Qroqq was capricious and ill-thought from the start. Health services provisioning would have been better served by extension of St Luke’s on the Pieta side by relocating the St Augustine school to a better and more convenient location, rather than under the hospital chimney, and a long-term plan for gradual re-development in situ of the various existing block of St Luke’s.

It’s not a gift at all!