National Broadband Plan: Government warned of risk to exchequer

“A national solution to a national problem.” That is how the Taoiseach describes the National Broadband Plan (NBP).

National Broadband Plan: Government warned of risk to exchequer

“A national solution to a national problem.” That is how the Taoiseach describes the National Broadband Plan (NBP).

He made the comments as the Government signed the contract that paves the way for the start of the rollout of high-speed broadband to almost 540,000 premises around the country that currently cannot get it.

Since the plan was first announced back in August 2012 by the then minister for communications Pat Rabbitte, it has been a case of one step forward and two steps backward. Mr Rabbitte promised completion by 2015, at a cost to taxpayers of around €500m. That never happened. His immediate successor, Alex White, promised that 85% of Irish homes would have high speed broadband by 2018. That never happened either and, by then, projected costs had more than doubled.

Mr Varadkar now promises completion within seven years and has also said he would wager that the cost of the plan would come in at less than the €3bn budget.

Good luck with that, given the vast cost over-run of the National Children’s Hospital and the fact that the cost of providing rural broadband has already increased several times since it was originally mooted. The estimated cost to the exchequer of the NBP increased from €1bn to €3bn between December 2015 and April 2018. On top of that, Robert Watt, the secretary general of the Department of Public Expenditure, has warned that the plan posed “unprecedented risk to the exchequer”.

There is also the issue of ownership of the network. At the end of the investment and contract period, the broadband infrastructure will belong to the consortium Granahan McCourt to keep or sell. It is reasonable to ask if taxpayers should be funding a private distribution system that the State will never own and it is still unclear whether the Government can limit the amount that contractors will charge individual customers at the edges of the distribution network.

Back in May of this year, when the Government gave the plan the go-ahead, Communications Minister Richard Bruton argued that allowing the successful consortium to ultimately own the network reduces costs, lowers State risk and incentivises continuous investment. Mr Bruton contended that all other options would take longer, cost more and deliver a product with lower ambition.

Let us hope for all our sakes that the Taoiseach’s “national solution” does not come back to bite him and that the plan does not become an “Irish solution to an Irish problem”, a phrase taken to mean any official response to a controversial issue which is half-baked, or expedient or no more than a prevaricate compromise. It was most notably used by Charles Haughey when, as minister for health, he legalised the sale of contraception.

High-speed internet for rural Ireland is as important as rural electrification in the 1930s. The NBC has the potential to become a game-changer for more than half a million homes, farms and businesses across rural Ireland. It also has the potential to become an unmitigated disaster.

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