Mr. Mark Griffin:

I thank the Chair. The national broadband plan is a transformational national project that is unparalleled and is unique in terms of its ambition, scale and complexity. It will deliver high-speed and affordable broadband initially to 550,000 homes, schools and business premises in Ireland. Over the 25 years of the contract, it is expected to serve over 600,000 premises. In line with the Government commitment, this will ensure that 100% of premises in rural Ireland, including those in the hardest to reach places, will have a broadband service that is in line with the rest of country. This will be done as part of a single programme over seven years, and it will be delivered within the budget of €2.6 billion.

2020 was the first year of the NBP contract. It saw a significant level of mobilisation activity by National Broadband Ireland, including the recruitment of personnel, procurement of materials and contractors, installation of equipment and exchanges and building IT systems to support the network. Surveys and designs were progressed to inform the build programme, resulting in the first homes being connected to the new fibre network in January 2021 in County Cork. Over the course of 2021, the project continued to build momentum. By the end of last month, almost 296,000 premises were surveyed, build works were under way in almost 120,000 premises and a further 34,500 premises were passed. Some 54,500 premises could order or preorder a service, while 469 broadband connection points, BCPs, including 200 primary schools, have been connected by NBI to date, with many of the public BCPs now supporting remote working.

Well over 1,000 people, all of them in Irish companies, are employed in the project. There have been delays to the roll-out programme compared to the targets set in the contract. Like many other construction projects, the NBP has been significantly impacted by the Covid-19 pandemic. The specific challenges for the project due to Covid and the mitigations put in place by NBI are set out in the briefing note that has been provided to the committee.

Reuse of the existing rural network, comprising about 1.5 million poles and 10,000 km of duct to lay the NBP fibre network is a condition of state aid and makes sense from a value-for-money and sustainability perspective. While it was anticipated that elements of the rural network would need to be mediated or upgraded, the extent of the remediation required, particularly the underground network, is greater than was envisaged when the contract was signed. Both Eir and NBI are addressing these issues, including the introduction by Eir at the end of last year of rapid response teams to support the timely remediation of network issues as they are identified. Eir has also increased the volume of poles and ducts to be provided under the make-ready programme, which is a positive development.

Given the reliance on the Eir network, ongoing close collaboration between NBI and Eir is essential to the successful delivery of the project. Additional resources have been brought into NBI and its subcontractors. Local authority licensing issues have been substantially revolved, following intensive engagement between the Department, the Local Government Management Agency and the County and City Management Association, working with NBI. The contract makes provision for dealing with delays to delivery of the network and provides for circumstances where subsidy will be permanently withheld where milestones have not been met. Where there are unprecedented events, such as the Covid-19 pandemic, NBI can seek what is termed "relief" under the contract and additional time to meet contract milestones without facing deductions to their subsidy payments due from the Department.

In circumstances where such relief is permitted, no sanctions would apply. In other circumstances, the contract provides that sanctioned provisions relating to delays in the delivery of the network are applicable with respect to any delays that occur from the end of contract year 2, which is from 1 February this year. Sanctions will be applied as appropriate and will be calculated and imposed in line with the contract. This places a significant pressure and incentive on NBI to speed up the delivery of milestones missed. Due to delays in rolling out the network, NBI as a commercial company is also losing out on critical revenues from customers it should have connected by now.

Regarding the ownership and financial structures of NBI, the ownership structure of NBI remains the device in the contract awarded by the Department. The Minister has rights of consent under the contract in respect of changes in ownership or control and NBI must notify the Minister in advance of any such event arising. There have been no notifications of changes to ownership or control to date.

The social, economic and environmental benefits of the national broadband plan cannot be overstated. As each home, school and business is connected, the benefits of the plan will be experienced in the daily lives of people across the country. Without the national broadband plan, the market would not deliver broadband to all citizens in all parts of the country. My Department is fully seized of the transformational nature and benefits of the national broadband plan and we are fully committed to driving the project forward. We are also fully seized of the scale of the investment the Government is making in this project and the necessity of ensuring value for money throughout. Robust governance for a project of this nature, scale and cost is paramount. There is a skilled and resourced multidisciplinary team in the Department implementing the protections and provisions drafting into the contract. The national broadband plan is supplemented by external legal, financial and technical advisers on network build and service metrics, project costs, procurement of materials and subcontractors. Corporate governance requirements are being overseen by the Department. My Department is engaging with NBI to finalise its roll-out plan for 2022. This plan will be completed by the end of March and relevant details can be provided to the committee at that stage. I look forward to assisting committee members in any questions they may have.