MEPA officers did do their job properly. They did end up with the right conclusions/recommendations.

The politically appointed MEPA board members decided to overrule these recommendations and approved the proposal.
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Quoting from Cultural Heritage Advisory Committee notes / recommendation :

Il-Kumitat ikkunsidra it-talba u jirrileva li l-proġett ta’ żvilupp propost huwa inaċċettabli fi kwalunkwe kas u il-proposta ta’ żvilupp mhiex kompatibli mal-kuntest urban ta’ fejn jinsab is-sit. Għalhekk il-kumitat hu tal-fehma li din it-talba ma għandiex tiġi milqugħa.
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Quoting from MEPA’s case officer conclusion of his report on these applications :

in view of the above comments and issues, since the proposed demolition is contrary to the Structure Plan and the design of the replacement fails to respect the urban context of the area, works proposed cannot be favourably considered. Hence a refusal is being recommended.
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MEPA’s board final decision : APPROVED

I am sorry but the only phrase that came first to my mind was “f**k him and the switchers” and the second “God help us”

http://www.timesofmalta.com/articles/view/20131023/opinion/Building-building-everywhere.491553#.Umm8sHBmiSo

What are the inhabitants doing?

Let me crib a line from elsewhere.

Short of assassination there is little people can do when their political masters have forgotten the true meaning of the democracy of which they are forever prating, and are determined to have their own way at all costs.

We need to learn in Malta that legal compliance is a social norm in developed societies and not some target we pretend to aim to reach when convenient.