Brian Stanley (Laois, Sinn Fein) | Oireachtas source

I welcome the opportunity to address the issue. There is no doubt about whether rural broadband is needed. I represent a rural constituency and I see the urgency of it. We have been banging this drum for several years since 2012 and especially since I took over this brief three years ago. We are all in agreement in that sense. The issue is whether the taxpayer is getting value for money, whether the State will have ownership of the infrastructure, and whether it would have been given full transparency.

Some light was shone on these matters yesterday. The document released yesterday by the Department outlined how flawed the procurement process has been from the beginning and why the Government must have a plan B, something I have called for many times. The Government has been told repeatedly by the Department of Public Expenditure and Reform that this project, under the current model, is doomed. The Government has completely dismissed the evidence-based advice from high-ranking senior civil servants in that Department. The Fine Gael Government is acting in a completely reckless way and is leaving the taxpayer open to unprecedented financial risk while major question marks remain over the credibility of the private operator to deliver the project. This is nothing short of being fiscally irresponsible.

This comes only a short time after the revelations around the national children's hospital and the waste of €500 million on water meters that are not now being used. Some of those meters are being pulled up out of the ground. The Department of Public Expenditure and Reform has warned the Government about its major concerns in respect of the credibility of the cost-benefit analysis of the national broadband plan, under which the taxpayer is putting in almost €2 billion or €1.95 billion up to 2026. In fact, Mr. Robert Watt, the most senior person and the Secretary General of that Department, went so far as to say that the vast majority of the risk of this project would be retained by the State, that is, the taxpayer, while the private operator is insulated from risk since the company is putting up a fraction of the equity and will recoup its full investment by 2028. In reality, the taxpayer is putting up the bulk of the money but it will not own one metre of cable or one pole at the end of the project, by which time we will have a valuable network in place. The private operator will get the full benefits of the profit and will pick up a nice network. It will have landed into the company's hands.

Is it any wonder the Department has called so clearly for this to be stopped? Mr. Brendan Ellison, a principal officer in the Department of Public Expenditure and Reform, has strongly recommended that this plan does not go ahead on the grounds that it does not reflect value for money. In fact, both Mr. Ellison and Mr. Watt have called for the cancellation of the procurement process.

As far back as 2012, Sinn Féin argued that we should proceed with a model of ownership based on the ESB network. There can be no doubt about what the Department has said. I have before me a document from 2018 in which the Department of Communications, Climate Action and Environment sets out clearly that the most likely way of achieving the results needed in terms of the Government objective of providing high-speed broadband would be to mandate an existing or new semi-State or State agency to build high-speed broadband. The 2019 contingency plan states that the creation of a dedicated broadband agency in State control would most likely result in advancing Government ambitions of providing high-speed broadband. This year, Mr. Robert Watt went further. He said that the alternative course of action should be pursued and that the procurement process should be cancelled. That is what he said.

We have the infrastructure to do it a different way. I have been constantly highlighting the point in the Chamber and outside during the past three years. The State-owned metropolitan area networks, MANs, infrastructure covers 94 regional towns and the backhaul system criss-crosses the State. The Government has completely ignored the possibility of using this.

It is interesting to note that the Department of Communications, Climate Action and Environment and the Department of Public Expenditure and Reform have proposed that in the event of the procurement process collapsing, we should not retender to the private market but move instead to an alternative State ownership model. In 2019, the Department of Communications, Climate Action and Environment contingency planning report concluded that the best model to proceed with to deliver high-speed broadband to every home in Ireland would be the State model. Under that process a mandate would be given to an existing or new semi-State or State agency to build the network and provide the service. The Department also estimated that the capital and operating costs would be similar to that of the current contract. Furthermore, both reports argue that a new broadband State agency to deliver the service would comply with state aid rules. That is something the Minister has turned his face against. He has told us that it would not, but our research has told us differently. The Department is agreeing with what I have been saying about this. Mr. Brendan Ellison in the Department of Public Expenditure and Reform has gone further and called for the immediate cancellation of the current process in order for an alternative State-owned model to proceed within the Department of Communications, Climate Action and Environment. The Minister needs to explain comprehensively to the House why the Government has chosen not to consider this model of ownership as an alternative, given that both the Department of Public Expenditure and Reform and the Department of Communications, Climate Action and Environment have pushed this as a viable and affordable alternative.

Sinn Féin is of the view that it is essential for the State to retain control of this large project and vital infrastructure. This is no tiddlywinks project. It is a major project. The Minister outlined the problems with the privatisation of Telecom Éireann in 1999 by Fianna Fáil and the difficulties that caused for us, and we can all see that. Here we go again with another major telecommunications infrastructure project.

Mr. Ellison suggested that there is a high risk that the private operator may not even have the capacity to deliver the project. Rural Ireland needs to know whether this plan is even feasible. These memorandums from the Department suggest that the plan is already doomed. In the contract, the State has the opportunity in year 4 and year 6 to either halt or take back control of the project in the event of the private operator not being able to deliver. I have heard the Minister trumpet this but by that stage, the taxpayer, after four years, has put in €1.2 billion. After six years, the taxpayer has put in €1.95 billion. That is what it states in the documents. The taxpayer is taking all the risk. How much will Granahan McCourt have put in by then? Is it damn all? That is what I believe it will have put in by year 6. One has to ask why the taxpayer is front-loading the project and taking all the risk.

How much is the private operator putting in? By 2026, the taxpayer will have contributed €2.2 billion to this project. We were made aware yesterday that the private company will have all its money back by 2028. The taxpayer is essentially bankrolling the project to the tune of €3 billion and in eight years' time, when it has made its money back, this company can just flip the project, sell it on for a profit and abandon rural Ireland. We have been asked to put much in and the documents yesterday clearly indicated that the private operator has been asked to contribute far less than the taxpayer.

Will rural Ireland be left stranded with no control, and with this House having no control, despite having put in €3 billion and being left at the mercy of one private monopoly? The whole network could be stripped of assets as we have seen in the past, or parts of it could be obsolete. What about the standard connection fee? Much has been of this €100. I learned in the briefing with departmental officials yesterday that some households in rural areas will have to pay several thousand, or even tens of thousands for hard-to-reach households, as a connection fee. That issue has been glossed over and needs to be addressed. The Minister is asking the taxpayer and householders to support this project when we still do not know what the private operator is contributing. Every key figure relating to this deal was redacted in the documents that we received yesterday.

The Government is hiding behind commercial sensitivity when there is only one bidder left for a once-off deal. It does not make sense. The fact is that the Minister has agreed to go ahead with it. The figure was agreed with Granahan McCourt months ago. The Minister should now clear up whether the State or the private operator will invest the bulk of the money. It jumps out off the pages of yesterday's documents that the taxpayer will invest more. Could it be the case that the private investor is putting in damn all in the crucial first six years? There are another six or seven months, according to yesterday's information, until the contract will be signed. We said back in 2012 and again last October or November, when the pause button was pressed on this, that there was an opportunity to stop and look at this project. There is no doubt that we all want it. I have not heard anybody say that we should not go ahead with it. There is an opportunity during these extra seven months to test this matter. It should be tested before the Committee of Public Accounts and the Joint Committee on Communications, Climate Action and Environment. We need another plan. Is this project fatally flawed? Are there alternatives such as suggested by officials in the Minister's Department? We now know from the contingency documents produced by the Departments that there are viable options. These options include State ownership. We need to tease these out and come up with the best one for rural Ireland to deliver broadband where it is badly needed.

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