BIRKIRKARA, Malta — For a man facing a criminal investigation and fighting a snap election while holding the presidency of the Council of the EU, Joseph Muscat appears remarkably relaxed.
Waving at passersby from his car on the way to a campaign stop in a dusty town in central Malta, the prime minister shrugs off his narrow lead in opinion polls and a judicial inquiry into allegations his wife received $1 million from the daughter of Azerbaijan’s president.
“My mind is at peace on that,” he said in an interview that took place in his car. The allegations are, he added, “an absolute lie.”
Rather than waiting to be cleared of the accusations before calling an election, Muscat decided to go ahead anyway, in order to protect the country’s economy. “I had the feeling that the economy is going so well that the allegations that were being leveled against me could in a way jeopardize [this],” he said. “I didn’t want to risk that.”
The opposition Nationalist Party, whose nearly unbroken quarter-century tenancy at the prime minister’s Castille residence was interrupted by Muscat’s election victory in 2013, accuses him of undermining the rule of law and the independence of institutions such as the police, and wrecking the island’s reputation abroad by selling EU citizenship to Russian oligarchs.
Muscat’s popularity with the locals, however, is very much in evidence, echoing the personality cult of the Labour prime minister from 1971 to 1984, Dom Mintoff. Muscat’s book — “Joseph: The best time for the country is yet to come” — was published in time for the June 3 election and billboards across the island proclaim: “Joseph Muscat has fulfilled his promises.”
“You can’t escape politics, nor can politicians escape the electorate” — Nationalist Party leader Simon Busuttil
To be sure, Muscat has overseen an economic boom, partly financed by the sale of EU passports to non-EU nationals, which has allowed him to introduce free childcare and bring unemployment to record lows.
But in a country of just 430,o00 people, Muscat — and his main rival, Nationalist leader Simon Busuttil — also understands that politics is personal.
“You’re a Nationalist or a Labour supporter before you’re Maltese,” said Mario Thomas Vassallo, who teaches public policy at the University of Malta. “We are surrounded by politics, you can’t escape it.”
The island’s 13 electoral districts each send 5 MPs to parliament, elected through the single transferable vote system used in many former U.K. colonies. In the past three elections, turnout was over 93 percent.
“Malta is the size of a medium-sized city with the attributes of a state,” said Busuttil. “You can’t escape politics, nor can politicians escape the electorate.”
In their apartment in a housing project in the town of Birkirkara, an elderly couple blink at pre-positioned TV cameras awaiting a visit by Muscat, whose portrait stands on a table in the hallway. After stopping outside to pose for selfies, he sweeps in, flanked by bodyguards and a reporter from the Labour Party’s news channel, chats to them like an old friend for five minutes, then heads for the next campaign stop.
Muscat is taking such trouble at least partly because he is struggling to fend off the Nationalists’ electoral challenge. The latest poll in the newspaper Malta Today, published last weekend, put Muscat’s Labour just four points ahead, with a record 19 percent of voters still undecided just a week ahead of the vote.
‘I would resign’
Muscat’s troubles began in April last year when the Panama Papers scandal broke and more than 11 million documents from the Panamanian law firm Mossack Fonseca were leaked.
The papers named Muscat’s chief of staff Keith Schembri and former Energy Minister Konrad Mizzi. Not long after Labour swept to power in 2013, the two men instructed lawyers to set up offshore trusts in New Zealand and companies in Panama. They then tried to set up accounts with eight different banks in tax havens across the world — and failed.
Muscat stood by both men, keeping them onside for “special projects.” He denies there was anything untoward in what they did but did acknowledge that he “could have handled it better.”
Muscat’s troubles didn’t end there. More allegations surfaced last month that identified the prime minister’s wife Michelle as the beneficial owner of a third Panamanian company and as the apparent recipient of a $1 million payment from the daughter of Azerbaijan’s president.
Muscat’s response was to submit himself and his wife to an investigation by a magistrate — shortly before calling a snap election, though he said he had been planning an early ballot before the allegations involving his wife surfaced. Last week he suggested that the leaks may have been orchestrated by the Kremlin, angry over his refusal to allow a Russian ship to refuel on its way to Syria last year.
“If [the magistrate] finds any sort of connection between me or my wife and any undeclared accounts, companies or structures, I would resign,” he said.
Since then, leaked reports compiled by Malta’s anti-money laundering authority appear to implicate both Schembri and Mizzi in kickback schemes involving the island’s passport sale project and power-plant privatization plans. Magistrates are now investigating the reports, although both men continue to deny any wrongdoing.
“It’s the police who need to assess each and every report, and then to make an assessment for themselves,” said Muscat.
Muscat, who is suing a Maltese journalist for libel for publishing the Mossack Fonseca documents that implicate Mizzi and Schembri, sees himself as a “victim” of what he calls the “very, very free” Maltese media tossing “unfounded allegations” into the political discourse.
“It hurts,” he said.
While the Maltese media includes popular, independent newspapers like the English-language Times of Malta, Malta Today and Malta Independent, many people get their news from party-owned papers and broadcasters: Media.Link Communications produces the pro-Nationalist NET TV and newspaper In-Nazzjon; One Productions runs a pro-Labour news and radio broadcaster.
According to Joseph Borg, a professor in media law who used to chair the editorial board of the public broadcasting company, the news coverage they provide “is not journalism really, it’s mainly propaganda.”
An EU-funded study published in December described Malta as “the only EU country that has such extensive media ownership by the political parties” and emphasized the government’s “big influence” on public broadcasters via its ability to appoint members of the managerial and editorial boards.
In 2013, the Organization for Security and Cooperation in Europe noted concerns that Malta’s public broadcaster TVM was “heavily biased” toward the incumbent Nationalists during the election; similar accusations of pro-Labour bias have been leveled against TVM since Muscat came to power.
In the same way that Mintoff used to complain that international institutions such as the Council of Europe were being manipulated by the Nationalists to criticize his leadership, Muscat blames opposition lies and manipulation for the scandals engulfing his government and for the scrutiny from the press.
The European Parliament, which will debate the state of the rule of law in Malta in June, has been used, he argues, by Nationalist MEPs such as Roberta Metsola — described by the Labour Party’s newspaper in 2014 as “a traitor” — and David Casa for misleading “well-meaning people.”
“It’s instigated locally,” said Muscat. “The timing is very unfortunate and it’s politically motivated.”
In the opinion of George Vital Zammit, head of public policy at the University of Malta, the problem is much bigger than that. “The institutions have been weakened over time,” he said. “It’s a slippery slope.”
The previous Nationalist government was no stranger to corruption and bribery allegations, such as those related to oil purchases for the island’s power company Enemalta between 2004 and 2008.
Widespread disillusionment with the government, exacerbated by then Prime Minister Lawrence Gonzi’s mishandling of a referendum on divorce, contributed to Muscat’s crushing election victory. The charismatic Labour leader poached votes from the Nationalists by committing to clean up the island’s politics and make politicians accountable for their actions.
Even so, opposition leader Busuttil says corruption has become endemic under Muscat, and has focused the Nationalist campaign on what he portrays as the collapse of the rule of law in Malta.
His party has made Muscat the focus of a negative campaign and its billboards feature the prime minister flanked by Schembri and Mizzi, to emphasize their close ties.
Muscat, who accuses his opponent of rubbishing the island’s reputation abroad, argued that he has “never ever attacked an institution” and had even voluntarily given up some prime ministerial powers regarding the appointment of judges.
Busuttil says he would go further if elected and submit senior appointments to approval by a two-thirds parliamentary majority, something the last Nationalist government did not do.
“I want to shed powers to make the system abuse-proof,” the Nationalist Party leader told POLITICO.
One focus of concern is law enforcement: The island is currently on its fifth police commissioner since Labour came to power and the opposition is so skeptical about the independence of the police force that Busuttil has handed over the evidence he’s received anonymously directly to magistrates, rather than to police.
Another area of worry is Malta’s role in tax avoidance, following two major dumps of documents in the past month pointing to companies and individuals using the island nation to avoid paying tax, though Muscat said the tax system — overhauled by the Nationalists in the 1990s and signed off by the European Commission in 2006 — is compliant with international standards.
Muscat’s critics say the appointment of party loyalists to government positions has also ballooned since he took office, with over 600 people given such positions across the civil service, according to a government response to a parliamentary question. Kevin Aquilina, dean of the law faculty at the University of Malta, argued that this bypasses the processes laid out in the island’s constitution.
For him, the underlying problem is simple: “The prime minister is a very strong person and he can basically get away with anything.”
Muscat gave the Labour Party the biggest majority in its history in 2013 and now runs it like his personal fiefdom, according to critics such as Marlene Farrugia. She left Labour in 2014 to set up her own party — which is now an ally of the Nationalists — over concerns about the government’s environmental record. Many colleagues sympathized, she said, but “didn’t have the guts” to follow.
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