Ms Carolan Lennon:

On the question of cost and value for money, the vast majority of our prices are regulated and the driver behind that regulated price is most usually cost orientation, in other words, they take the costs into account in setting the price. The cost we charge for a pole or for access to a duct is built up from a model that sets out the cost to maintain a duct and pole network in rural Ireland. Our pricing model applies across the entire country, so one is averaging the cost. It is more expensive in rural Ireland but we have a bigger overhead network in rural areas compared to in urban areas.

In terms of ComReg's powers of governance, Eir voluntarily signed up to a voluntary regulatory governance model and as part of that we agreed to a review of every product we had no matter how old or how few customers were on it and we would check it for equivalence, that is where we treat wholesale customers exactly the same as retail customers and for non-discrimination and we would review all the customers and we would share with ComReg the output of that review and then we would generate a report and share it with industry. We signed up to do that and we hired some consultants to help us and we spent a great deal of money and time and effort to get this done and as we finished a product, we sent all our reports into ComReg. ComReg was well aware of the progress we were making and what we were finding. Once we had it all done, we did find discrepancies but these did not arise because people deliberately decided to discriminate one against another. Let me give a good example, we found a discrepancy that some retail faults were being repaired quicker than wholesale faults. We were looking to see what was driving that and what we discovered was the retail business had decided to extend the opening hours of their contact centre, which meant that a retail customer would report it for a longer period. All the communications go into the same hopper in the morning but because they were being taken in later they were first into the hopper. It was not a case of somebody waking up and deciding to discriminate against wholesale customers, but doing something that he or she thought was for the benefit of customers and not thinking through the process and possible knock-on effects.

We found there were changes in processes in this period. Many issues related to older products. We reported them in the Stiles report, as mentioned, and the reaction of industry was astonishing. Industry did not acknowledge that we were being transparent and that we fixed all the issues raised and there were additional issues to be fixed. Instead industry said that it was disgraceful and this set off the review of our regulatory governance model. We have been working with ComReg in the past 12 months, in particular in the past three to four months to understand those requirements, to document what we do and make changes where we need to. For example the Open Eir team is incentivised only on Open Eir deliverables and not on anything to do with the retail or group side of the business. We are moving buildings in the next month or so and the Open Eir team will be in different buildings. Before reaching the final agreement with ComReg we are starting to implement those changes. Eir made a voluntary decision to engage in the process and to be transparent. I remember talking to the industry at the time and saying that we were always going to find something, some of these products have been there for years and some have a small number of customers on them. Things have changed over time. Nobody is deliberately trying to discriminate but there are definitely going to be idiosyncrasies or changes and what we vow is that we will find them, that we will be transparent, we will report them and we will fix them. That is pretty much what we did.

Deputy Dooley in particular asked about the 300,000. I hate to be reminding people of the background, the Department approached every operator at the time, stating that it wished to finalise a map and wanted to know if they had any plans to do more building in rural Ireland. A number of operators, including ourselves, came forward and outlined their plans, but the reality is that the only operator that spent its own money, some €250 million to reach 330,000 homes, businesses and farms in rural Ireland was Eir. To say that is the cause of other people dropping out is something that I challenge. SSE became a partner in the Enet consortium well after the 300,000 was already gone and left the consortium. It is easy to say that people left because of the 300,000 but the reality is that-----