Oireachtas Joint and Select Committees

Wednesday, 3 July 2019

Joint Oireachtas Committee on Communications, Climate Action and Environment

National Broadband Plan: Discussion (Resumed)

Mr. Mark Griffin:

We listened closely to what the chief executive officer, CEO, said in her evidence last Tuesday. We received a letter on Friday evening and have been studying that closely since. It has been in the possession of the committee for a number of days. I will recap on a couple of points that I made in my opening statement. The suggestion in Eir's letter is not a formal proposal. It suggests that it could deliver broadband in the intervention area for between €512 million and €1.55 billion if it was allowed to deliver it outside what it calls the constraints of the national broadband plan procurement process. In the letter, it refers to €1.55 billion as its mid-case scenario. That is somewhat similar to the mid-case scenario that we set out in the national broadband plan documentation which we published, which is approximately €2.1 billion. The key points that I would draw at a high level from the Eir letter is that it recognises that the national broadband plan is a public policy intervention with societal and political objectives, which is likely to influence the solution chosen. It is, and we will speak more about that this evening.

It is not making a formal offer to replace the national broadband plan procurement process. It remains firmly committed to supporting the plan and the provision of poles and duct products for National Broadband Ireland which are very important in the roll-out of the network in the intervention area. It sets out, in what it calls a hypothetical scenario, how it could deliver high speed broadband in the intervention area if it were asked do so and the estimated cost. The letter reiterates positions on governance advanced by Eir when participating in the national broadband plan process, how the contract imposes obligations over and above those required by regulations, concerns about the risk of contagion where regulatory equivalents could force Eir to offer what it considers to be more onerous services and prices throughout the country as a whole. These are issues on which we engaged with Eir in the period leading up to its withdrawal from the process in January 2018.

There are a few critical points that are probably worth drawing out and saying a little about. I will ask colleagues to come in on them.

On governance and what it calls the constraints of complex and onerous provisions, we characterise them as obligations and sound governance mandated by state aid rules and contract law. They are particularly important when speaking about how we protect €2 billion of taxpayers' money. The system that operates for Eir's 300,000 customers is designed for commercial intervention where a commercial company is spending its own money. We are speaking about spending €2 billion of taxpayers' money. Therefore, we need a different model with greater oversight. The aide-memoirewe sent earlier in the day will be useful in that regard. I will ask Mr. Mulligan to speak about it.

The other thing that came through in evidence last week - it was raised again by Deputies in the discussion with the ESB - was the Eir overbuild. There are questions about why that approach is being taken by the bidder in terms of whether the infrastructure for Eir's 300,000 customers should be used, what happens if it is done in a particular way, whether additional costs will be incurred and the technology impacts and constraints. Again, this was the subject of the document received from Analysys Mason this morning, about which I will ask Mr. Neary to speak momentarily. Another point that is very important and which, in looking at the transcripts, generated a lot of discussion - Deputy Dooley raised this issue in his discussion with ComReg - concerns the nature and cost of connections in the 300,000 customer intervention area, the approach been taken in that regard and what we are doing in the national broadband plan intervention area. It is important that we tease out the differences and why we are doing it. I will ask Mr. Mulligan to speak about governance because he has spent the past four of five years of his life in the bowels in dealing with the issue.

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