The financing of Fawlty Towers

Townsquare.Fawlty Tower

The saga of the Mrieħel and the Townsquare towers is now entering a new phase, with the planning appeal stopwatch due to start ticking shortly –  most probably towards the end of the month. It is known that, so far, Sliema Local Council and a number of environmental NGOs will be appealing against the 4 August decision of the Planning Authority to approve the “Fawlty Towers” at Mrieħel and Townsquare Sliema .

Financing of the projects is next. The banks cannot increase their already substantial exposure to loans that are dependent on building speculation. Consequently, the developers will inevitably have to seek the involvement of private citizens and, possibly, institutional investors. Most probably, the process for financing the projects has already commenced; it will involve the issuing of bonds to the public and will normally be sponsored by a bank and a stock-broking agency.

The bank or banks and stockbrokers sponsoring the bond issue will have to ensure that the bonds are subject to an “appropriateness and suitability testing” subject to such direction as the Malta Financial Services Authority  may consider necessary and suitable. Also, in the light of past local unpleasant experiences, the Authority will undoubtedly be guided by the need to ensure  that prospective investors fully understand the inherent risks of the proposed investments.  It will also ensure that detailed information is published in the form of a suitable prospectus in which the small print is both legible and understandable.

Those who finance the high-rise projects should shoulder responsibility for their impact together with the Planning Authority and the developers. They will potentially make it happen, so they should carry the can. It is important to get this message through: those who will invest in the Gasan and Tumas bonds intended to finance the “Fawlty  Towers”  should receive more than a monetary return on their investment. The moment they sign up they will also assume co-responsibility – with the developers, the Planning Authority, the bank or banks and the sponsoring stockbrokers – for this projected development .

Word is going around on the need to boycott the services and products placed on the market by the Gasan and Tumas Groups. Journalist Jürgen Balzan, writing in Malta Today described these services and products as being wide-ranging (hotels, car-dealerships, gaming, finance and property) which easily impact on the daily life of a substantial number of Maltese citizens. However, such a boycott’s only link with  the “Fawlty  Towers”  would be through the owners.  It would be preferable for a boycott to have a direct link with the offensive action.  In this context, the forthcoming bond issue to finance the “Fawlty  Towers”  presents itself as a suitable opportunity.

A boycott is a non-violent instrument of protest that is perfectly legitimate in a democratic society. The boycotting of the forthcoming bond issue would send a clear message that people will not be complicit in further ruining the  urban fabric of Sliema and ensure that development at Imrieħel is such that the historic landscape is fully respected.

A social impact assessment, if properly carried out, would have revealed the apprehensions of the residents in particular the residents on the Tignè peninsula. But, unfortunately, as stated by Sliema Green Local Councillor Michael Briguglio, the existing policy-making process tends to consider such studies as an irritant rather than as a tool for holistic management and community participation.

We have had some recent converts on the desirability of social impact assessments, such as Professor Alex Torpiano, Dean of the Faculty for the Built Environment at the University of Malta. Prof. Torpiano, in an opinion piece published by the Malta Independent this week, stressed that spatial planning in Malta needs a social-economic dimension. Unfortunately, I do not recollect the professor himself practising these beliefs as the leading architect in the MIDI and Cambridge projects on the Tignè peninsula,  a stone’s throw from Townsquare!

Investing in this bond issue is not another private decision: it will have an enormous impact on the community.

Responsibility for this ever-increasing environmental mess has to be shouldered by quite a few persons in Malta. Even the banks have a very basic responsibility – and not one to be shouldered just by the Directors: the shareholders should also take an interest before decisions are taken and not post-factum.

I understand that the Directors of APS Bank have already taken note of the recent  statements regarding the environment by  Archbishop Charles Scicluna. As such, it stands to reason that APS will (I hope) not be in any way associated with the financing process for the “Fawlty  Towers”.  However, there is no news as yet from the other banks, primarily from the major ones – ie Bank of Valletta and HSBC.

This is a defining moment in environmental action in Malta. It is time for those that matter to stand up to be counted – and the sooner the better.

published by the Malta Independent on Sunday – 21 August 2016

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Greening the Constitution

Chadwick Lakes 02

Alternattiva Demokratika – The Green Party –  is in agreement that 50 years after its adoption Malta’s Constitution needs to be updated.  However such an exercise, as emphasised in AD’s 2013 electoral manifesto, should be carried out with the direct involvement of civil society. The Constitution belongs to all of us.

There are a number of issues which require careful consideration. In AD’s 2013 electoral manifesto at least fourteen such issues are identified. They vary in scope from electoral reform to widening the issues in respect of which discrimination is prohibited, by including protection from discrimination on the basis of sexual orientation. AD also proposes the introduction of a Constitutional provision in favour of a balanced budget, thereby ensuring that government is forced to discard budget deficits and consequently to control the spiralling public debt.

One very important issue is the need to entrench environmental rights and duties in the Constitution. The proposed Constitutional Convention, supported by AD, should aim at Greening the Constitution. That is, it should aim at addressing environmental rights and duties such that they are spelled out in unequivocal terms.  Environmental rights and duties should as a minimum be spelled out as clearly as property rights in the Constitution. They are worthy of protection just as the rights of individual persons.

Article 9 of the Constitution very briefly states that “The State shall safeguard the landscape and the historical and artistic patrimony of the nation.”  Further, in article 21 of the Constitution we are informed that this (and other safeguards) “shall not be enforceable in a Court” but that this (safeguard) shall be “fundamental to the governance of the country” and that it shall be the aim of the State to apply it in making laws.

It is not conducive to good governance to first declare adherence to specifc safeguards, but then specifically excluding the Courts from ensuring that such safeguards are being observed.

The strategy of announcing principles but then not providing the legislative framework for their implementation was also taken up in environmental legislation. In fact articles 3 and 4 of the 2010 Environment and Development Planning Act  announce a whole list of sound environmental principles. However  in article 5 of the same Act it is then stated that these cannot be enforced in a Court of Law!

When I had the opportunity of discussing the Environment and Development Planning Bill with Mario de Marco (then Parliamentary Secretary responsible for Tourism and the Environment) I had proposed on behalf of the Greens that the declarations  in articles 3 and 4 of the Bill should not be just guiding principles. They ought to be made enforceable by our Courts subject to the introduction of  a suitable transition. Unfortunately Dr de Marco did not take up the Greens proposal.

As things stand today, article 3 of the Environment and Development Planning Act announces very pompously that the government,  as well as every person in Malta, has the duty to protect the environment. Furthermore it is announced that we are duty bound to assist in the taking of preventive and remedial measures to protect the environment and manage resources in a sustainable manner.

Article 4 goes further:  it  states that government is responsible towards present and future generations.  It then goes on to list ten principles which should guide government in its endeavours.  Integrating environmental concerns in decisions on socio-economic and other policies is first on the list. Addressing pollution and environmental degradation through the implementation of the polluter pays principle and the precautionary principle follows immediately after.  Cooperation with other governments and entities enshrines the maxim of “think global, act local” as Malta both affects and is affected by environmental impacts wherever they occur.  The fourth guiding principle is the need to disseminate environmental information whilst the fifth one underlines the need of research as a basic requirement of sound environment policy.  The waste management hierarchy is referred to in the sixth principle followed immediately by underlining the requirement to safeguard biological diversity and combatting all forms of pollution.  Article 4 ends by emphasising that the environment is the common heritage and common concern of mankind and underlines the need to provide incentives leading to a higher level of environmental protection.

Proclaiming guiding principles in our Constitution and environmental legislation is not enough. Our Courts should be empowered in order that they are able to ensure that these principles are actually translated into concrete action.   Government should be compelled to act on the basis of Maltese legislation as otherwise it will only act on environmental issues when and if forced to by the European Union as was evidenced in the past nine years.

Greening the Constitution by extending existing environmental provisions and ensuring that they can be implemented will certainly be one of the objectives of the Greens in the forthcoming Constitutional Convention.

published in the Times of Malta 18 May 2013