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Dáil
‹ Ceisteanna ó Cheannairí - Leaders' Questions

Broadband tender process

Summary

Micheál Martin challenged the Taoiseach on reports about the national broadband plan tender, questioning whether the bidder had changed at the last minute, whether the consortium had the capacity to deliver, and whether costs had escalated. The Taoiseach defended the process, said the tender was still being evaluated, denied the report could be stood over, and accused the Opposition of trying to undermine the project.

Yesterday the Taoiseach, the Minister for Communications, Climate Action and Environment and, crucially, the Minister for Finance stated that no decision had been made or would be made on the broadband tendering process and particularly that no decision would be made on the last remaining bid. However, in today's Irish Independent we read that the lead bidder for the national broadband plan is preparing to fast-track rural connections next year. The report stated:

The move would mean that the first of 540,000 rural homes and businesses under the State-sponsored scheme would get high-speed broadband in 2019, ahead of the expected 2020 rollout...

A contract is expected to be signed in January, with the subsidy cost and other contractual terms to be finalised in the coming weeks.

It is all in marked contrast to what we were told yesterday in this House. Is this the case? Can the Taoiseach confirm that a decision to proceed has actually been taken behind the scenes? We note that only €74 million was allocated in the 2019 Estimate for the roll-out of this plan, which compares with an industry estimate of anything from €1 billion to €1.5 billion as the actual cost of the plan.

Two discussions seem to be under way in parallel: one in the Dáil where nothing is actually disclosed by Government and where the actual potential cost of the project is not spelled out or detailed in any way; and then in the media, helped by Government and other sources, a different story is spun. There is a need for much more transparency and honesty in the Dáil about the national broadband plan roll-out. We need to ground the plan in some reality and not with repeated broken promises.

Yesterday I asked the Taoiseach a very basic question as to whether the new bidder was a new consortium. His reply was quite remarkable. He said:

The consortium has changed but it is not a new consortium. It is a consortium that has changed in its composition during the process, not a new one.

For the record, the September 2017 consortium that submitted to the tendering process comprised Enet - the leader, Granahan McCourt Capital, SSE plc and John Laing Group. By the final tender in September 2018 it was Granahan McCourt Capital - the leader, Nokia, Actavo, the Kelly Group and the KN Group are all now suddenly at the 11th hour in there. That is a changed consortium. The key question is whether the Government is satisfied that the new consortium has the capacity to deliver this project.

The Irish Times has an interesting article by Eoin Burke Kennedy with substantial questions. Why has the industry in Ireland shunned this particular project given the significant Government subsidy?

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The Deputy's time is up.

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That is on offer and the market is up for grabs. Is the Government satisfied that this new consortium contrived at the 11th hour has the capacity to deliver the project? Can the Taoiseach confirm that contracts will be signed in January? Will he confirm that the costs are a multiple of what the Government originally expected?

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Leo Varadkar The Taoiseach Fine Gael

I thank the Deputy for raising this important matter, the issue of broadband and the national broadband plan in particular. I restate in the House my commitment to ensure that the national broadband plan happens. We have gone from a position two years ago when this Government of Fine Gael and Independents came into office where only about half the premises in Ireland had access to high-speed broadband.

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Who was in government before then?

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Leo Varadkar The Taoiseach Fine Gael

We are now at 75% and I want us to get to 100% as soon as possible. I appreciate that 500,000 homes, businesses and farms throughout the country do not currently have access to high-speed broadband. There are 1 million people living in those homes and the more people who get connected, the more frustrated the people who are being left out become. I am determined to ensure we get this done as quickly as it can be done and as affordably as possible. I receive reports on the matter from the Department at least every two weeks.

In response to the Deputy's questions, I obviously cannot comment on behalf of industry; the Deputy would need to ask its representatives his question about industry. On the newspapers, I do not write the newspapers. I know the Deputy believes I do on occasion; it is one of his conspiracy theories.

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The Taoiseach spins them.

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Leo Varadkar The Taoiseach Fine Gael

The Irish Independent, no doubt, is staffed by very professional journalists who write their own stories; they do not need me to write them for them.

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The Taoiseach would not say that in America.

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Leo Varadkar The Taoiseach Fine Gael

To answer the Deputy's question again, I cannot stand over the veracity of that story.

A final bid, a final tender, has been received by the Department. The Department is now evaluating that with the help of KPMG and some other external experts. We anticipate that the Government will be able to make a decision in the coming weeks as to whether we can accept that tender.

I have seen various estimates of costs. It is important to say that as this is a 30 year project, the cost will be spread over 30 years. It is a bit like a motorway building project, for example. We do not pay for it all in the Estimates this year; the cost is spread over 30 years. That explains why next year's Estimates do not provide for hundreds of millions or billions of euro. It is a bit like a mortgage; one pays for it over a period of 25 or 30 years.

The Deputy asked about the consortium. I said yesterday - the Deputy quoted me correctly - that it is not a new consortium, but the composition has changed, and that is my position. In that regard, it is a little bit like Fianna Fáil, its composition changes from time to time. Its members are not the same people who were here three years ago or five years ago-----

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The Taoiseach can talk.

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Leo Varadkar The Taoiseach Fine Gael

-----and from time to time its leader may change, but they are still the same Fianna Fáil.

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The private sector companies have delivered broadband to date and not the Government. This is a multibillion euro project. It is not a laughing matter. I asked the Taoiseach a very serious question. This is a new consortium. Is it the new norm that in a major tendering process organised by Government the bidder can change at the last minute? There is an uneasy silence about this. It is being glossed over. It might not suit people to directly analyse and assess this. I believe it raises fundamental questions about how we go about tendering major State contracts. A State subsidy of up to €500 million is involved here.

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And the procurement directives.

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This is not about changing individuals and so on. It is a fundamental issue. All the original bidders know who is in the competition.

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I thank the Deputy. The time is up now.

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Is it acceptable at the 11th hour to end up with a completely different bidder with no telecommunications experience? The two major telecommunications providers in the country have shunned the deal.

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The time is up, Deputy, please.

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That is why it is being assessed independently.

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It is the process he is talking about.

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I have asked a very basic question. This is a new consortium, not a changed one. It is being glossed over. There is a terribly uneasy silence about it. People are not giving me a straightforward honest answer. Is it acceptable that a consortium changes at the 11th hour?

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Leo Varadkar The Taoiseach Fine Gael

It is not a new consortium. The leadership has changed and the composition has changed, but it is not a new consortium.

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Deputies, please.

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Leo Varadkar The Taoiseach Fine Gael

What is unusual is that we are in this House discussing a tender process and evaluation that is under way. We have had big projects like this in the past.

They may not have been as big as this one but they were big. I refer to the projects relating to the new national children's hospital, the major inter-urban motorways or the schools bundle. I do not recall having a debate-----

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The mobile phone licence.

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Leo Varadkar The Taoiseach Fine Gael

-----about the tender processes relating to or consortiums involved in those projects.

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It was never down to one.

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Leo Varadkar The Taoiseach Fine Gael

It raises a question for me, namely, what are the motivations of the Opposition.

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The mobile phone licence.

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Leo Varadkar The Taoiseach Fine Gael

Are they trying to undermine this process?

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To get it done right.

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Leo Varadkar The Taoiseach Fine Gael

Are they trying to make comments under the protection of privilege-----

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It is just to get answers.

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Leo Varadkar The Taoiseach Fine Gael

-----which others may use to undermine the national broadband project?

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That is shocking.

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We are entitled to get answers.

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Leo Varadkar The Taoiseach Fine Gael

Is their plan to try to scupper this project so that people in rural Ireland-----

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That is shocking.

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The Taoiseach had to sack a Minister because of it.

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Leo Varadkar The Taoiseach Fine Gael

-----will be denied the infrastructure they need?

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