€5bn National broadband plan faces Oireachtas inquiry

Cross-party support for an Oireachtas committee investigation into the €5bn national broadband plan is likely to be agreed as the Government urges opposition parties to back the plan.

Communications Minister Richard Bruton confirmed the Government had considered setting up a State broadband company, similar to Irish Water, amid more than a dozen alternatives.

These alternatives were more costly, would take longer, and did not commit to the broadband coverage desired by the Government, he told the Oireachtas communications committee.

The committee has agreed to a request by Fianna Fáil to consider a detailed investigation into the plan. A special meeting of its TDs and senators tomorrow will decide this.

If agreed, the probe will examine the €220m equity of the Granahan McCourt consortium bid for the €3bn contract, as well as the role played by Frank McCourt, a brother of one of the investors in the project.

Mr Bruton said the consortium would initially invest €175m in equity, then €45m in working capital. He said the company would have to take the “entire risk” with the project and only when it completes parts of the network would it be paid by the State.

Mr Bruton moved to play down fears the consortium would make huge financial gains, saying it would in early years only take in revenue of €10m. The consortium would operate in a “controlled environment”.

Mr Bruton faced questions over alternatives to the Granahan McCourt bid. He told Fianna Fáil TD Timmy Dooley: “They fail on either being more costly or risky to the State or fail in meeting the ambition set in the first place.”

The only alternative was to reduce the benefits to the company bidding, he added.

Furthermore, a suite of performance indicators were in place for the plan. This included the threat of penalties, clawbacks, checkpoint reviews, a standalone board with a government representative, and feedback on the network’s progress in reaching 540,000 premises.

“We will be riding shotgun with the team that we will put together... to protect the State,” said Mr Bruton. Mr Dooley said there are outstanding questions over the “financial standing” of the remaining bidder.

Sinn Féin’s Brian Stanley said there are concerns that the consortium rolling out the high-speed network could sell this after 2028. He said the sell-off of State-owned Eircom had been “disastrous”.

Mr Stanley said:

There is no other show in town for you on this or the taxpayer. We become absolute prisoners in this. There is no reverse to get back out of this.

Mr Bruton again tried to allay concerns, saying if the consortium or project sold after 10 years, there would be a clawback for the state. Furthermore, if the company fails to deliver some of the infrastructure, the state can become the owner of the project, the committee heard.

Green Party leader Eamon Ryan agreed with the proposal for an Oireachtas probe.

“We are going to have to do further investigative work, to ensure the public interest is protected in this contract,” said Mr Ryan.

Mr Bruton said restarting the project would take a minimum of 37 months with a new tendering process.

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