Confusion over broadband plan after Eir’s €1bn claim
The National Broadband Plan has been thrown into fresh confusion after Taoiseach Leo Varadkar said the Government will consider Eir’s claim it could deliver it for less than €1bn.
The telecommunications company last night confirmed that it will provide details in the coming days to the Department of Communications as to how it proposes to deliver rural broadband for one-third of the current estimated cost.
Mr Varadkar told the Dáil that he is “all ears” on how Eir might deliver rural broadband for €1bn when the cost is currently running at around €3bn. But he warned that neither a private nor state company could “just be given a contract” and therefore the process would have to be restarted to allow Eir back in.
He added that the contributions at the communications committee raised as many questions as answers.
“One thing we want to find out is how there can be such a difference between the €2.7bn bid from Eir and this new offer of €1bn. My concern, and that of the department is that rather than Eir making up the difference, a big part of it would be met by imposing higher connection charges and fees on those 500,000 homes, farms, and businesses in rural areas than are imposed on those in urban Ireland.”
The Department of Communications wrote to Eir, which pulled out of the tender process midway through, after company CEO Carolan Lennon told the Oireachtas Communications Committee that it has almost finished supplying broadband to 340,000 rural homes and is confident Eir could bring fibre to the remaining homes in the NBP for the reduced price.
Responding to questions from Fianna Fáil leader Micheál Martin, the Taoiseach said it was a “big turn-around” for the company to now say that it can do the project for €1bn.
“If that is the case, then I am all ears. This morning, the Department of Communications, Climate Action, and Environment issued a letter to Eir, seeking further details and clarification about what it has said.
We need to know whether this offer is real and stacks up, and what kind of delay would be imposed on people in rural Ireland waiting for broadband if we went back to a new procurement process.
Mr Martin welcomed the fact that the Government is “at least” going to reassess the NPB and has made contact with Eir. But he accused the Government of having an “almost cavalier approach” to the ballooning costs of the rural broadband project on a monthly basis.
He told the Dáil: “The Eir submission points out that, in April 2017, €787m was the KPMG estimate of the subsidy that would be required, and that is after 300,000 customers have been taken out of the intervention area.”
Mr Martin claimed former communications minister Denis Naughten had “got too close” to the one remaining bidder, the consortium led by businessman David McCourt.”
“He, of course, had had all sorts of dinners with Granahan McCourt, which I worry about. That does not look good for public procurement, and the taxpayer is now caught for €3bn,” Mr Martin told the Dáil.
In a statement to the Irish Examiner, an Eir spokesman said: “We received an email from the Department of Communications, Climate Action, and the Environment this morning and have begun drafting a response to their questions.”
