State pays €132m to National Broadband Ireland despite six-month rollout delay

The committee heard that one of NBI’s main subcontractors had at one point 40% of its staff dedicated to the project absent either with Covid, or as close contacts of a positive case. File photo

The State has paid €132.3m to date to National Broadband Ireland, the body charged with delivery of the National Broadband Plan, despite the rollout being at least six months behind schedule.

The Public Accounts Committee today heard that one of the reasons the plan has been so delayed to date is that one of NBI’s main contractors, Kelly Group from the UK, “postponed” setting up an Irish operation. 

Just 27,000 premises are thus far ready for connection to the network against a 2021 target of 115,000.

That led to a situation where a company expected to perform roughly one-third of the initial work on the plan in 2021 never came on stream, secretary-general of the Department of Communications Mark Griffin told the committee.

The PAC heard that the plan’s main milestones to date have been achieved, per the remedial plan put in place with NBI once it became clear the 2021 target could not be matched.

Mr Griffin said that “a whole swathe of problems” had led to the plan falling behind, such as supply chain and logistical delays, delays in recruiting staff, travel restrictions and a lack of accommodation for cross-island contractors, and Covid-related problems.

He said that one of NBI’s main subcontractors had at one point 40% of its staff dedicated to the project absent either with Covid, or as close contacts of a positive case.

The committee heard that a revised estimate for 130,000 connections by the end of 2022, against an overall target for the €3bn plan of 544,000 properties connected, is now seen as the “minimum” to be achieved by that date.

The department’s lead on the plan, Fergal Mulligan, said his group is “currently trying to establish if they can catch up” on the time lost on the project to date.

No penalties for missed milestones are due to come into play before February of next year. Some 50 people within the Department itself are currently dedicated to the plan, which is currently contracted to be concluded by the year 2027.

Mr Griffin said there is “no attempt on my behalf to duck the fact that we are behind”, adding that the Department does not simply “accept what NBI tells us at face value”.

He said the company is “looking at taking on additional subcontractors” in a bid to scale-up the process.

Asked about the fact the Department of Public Expenditure and Reform had specifically objected to the granting of the initial contract to Granahan McCourt - the consortium which formed NBI - in 2019 due to “credibility issues” and the fact Granahan was the sole bidder, Ken Cleary of that Department told the committee that while those concerns had been “articulately expressed”, it is “a matter of implementation now”.

The “key point”, Mr Griffin said, is that despite those concerns “the Government approved the plan”.