Chief Minister Picardo Defends Gibraltar's Reputation Against 'Biased' Auditor's Report

Picardo Addresses Parliament on Auditor's Report

Chief Minister Fabian Picardo addressed the Gibraltar Parliament on September 23rd and 24th, 2025, asserting that the former Principal Auditor's report posed the most significant risk to Gibraltar's international reputation. He vehemently condemned claims within the report that alleged unconstitutional actions on his part, particularly concerning the auditing of the Gibraltar Savings Bank (GSB). Picardo moved a motion to reject specific sections of the report, describing its findings as 'inaccurate, unfair, and biased'.

Allegations and Government's Rebuttal

The controversial 500-page report, covering the 2018/2019 period and authored by former Principal Auditor Tony Sacramento, contained several serious allegations. These included claims that Chief Minister Picardo acted unconstitutionally by preventing an anti-money laundering compliance audit of the Gibraltar Savings Bank. The report also highlighted:

• £13 million in ex-gratia payments made without adequate explanation between April 2018 and May 2025.
• The unusual transfer of 38 police officers to other public sector roles with protected pay and conditions, potentially linked to the McGrail Commission of Inquiry.
• Obstruction of access to information by senior officials.

In response, Chief Minister Picardo stated that the assertion he was blocked from auditing the Gibraltar Savings Bank reflected a 'fundamental misunderstanding of the law and his remit'. He clarified that the GSB is not a government department, agency, or authority, and therefore does not fall under the statutory auditing powers of the Principal Auditor. Instead, its accounts are reviewed by external auditors such as PwC and overseen by senior public officials. Picardo further noted that successive Financial Secretaries and Bank Directors, including the former Principal Auditor himself in earlier correspondence, had agreed that audits of the Savings Bank were by invitation only.

Reputational Damage and Legal Counsel

Fabian Picardo warned that the allegations, which he deemed 'factually and legally incorrect', carried serious international consequences, including the risk of Gibraltar being 'grey or blacklisted'. He accused Tony Sacramento of breaching standards of independence and impartiality, suggesting political bias, and stated that the report was 'fatally flawed'. The Chief Minister's position is supported by legal advice from leading constitutional counsel, Jonathan Fisher KC, who confirmed that the auditor had acted outside his constitutional remit. Picardo emphasized that the report failed to adhere to principles of natural justice by not allowing individuals to respond before being criticized in a public document.

Political Fallout and Opposition's Reaction

The government has previously expressed 'deep concern' over the report's 'content, tone and methodology', describing it as 'tabloid style'. The publication of the report has intensified political tensions, with the Leader of the Opposition, Keith Azopardi, tabling a motion of no confidence in the Chief Minister, characterizing Picardo's actions as an 'assault on democracy'. The government, however, maintains that it has a record of cooperative engagement with the Auditor's office, contradicting claims of obstruction.