What we know
On November 23rd 2016 Mr Naughten, Mr Donohoe Mr, McManus (Chairman Eircom) and Mr Robert Watt (SG Dept PER) had meetings in the Department of Public Expenditure. FOI’s to DPER seeking a note of the meetings turned up nothing – apparently no notes exist. Separately we asked DCCAE by means of a series of questions submitted to the Joint Oireachtas Committee whether any of their officials had attended that meeting with Mr Naughten. They responded that none had.
Shortly after the November meeting, history relates that the Eircom 300K program throttled-up and the subsequent agreement dated April 4th 2017 confirms the beginning of the roll-out from Q4 2016. The negative consequences of that agreement to the overall NBP are now a matter of record. The only notable difference between the proposal put to Minister White by Eircom in 2015 and the proposal made to Mr Naughten in 2016 was a slightly shorter time frame and a signature on an written agreement that had no meaningful penalty for non-delivery.
One of the NBP bidders questioned us on social media as to why we were surprised by this turn of events. We also know (from an insecurely redacted FOI) that in early 2017 one bidder sought a €4M guarantee for their continued participation in the bid. The bidder explicitly threatened to leave the process unless its demand was met. According to the department, the threat was rebuffed, in part because it would have meant paying both losing bidders €4 million each.
We also know also that the extension of the enet (e-Nasc Eireann Teoranta) MANS concessions was concluded in the same timeframe and we know that the market review of enet’s product pricing structure, the subject of complaint by ISPs, has still not concluded eighteen months after the consultants Analysys Mason delivered their report.
The questions clearly are,
- Was there a connection between the precipitate extension of the enet concessions and the threat by one bidder to leave the NBP process unless they were guaranteed €4M euro?
- Why were enet’s own calculations used as the source data for Norcontel’s report on extension vs re-tender options in relation to the MANS concessions?
- Is/was there a connection between the delay in completing the pricing review of enet’s MANS products and enet’s continued participation in the NBP process?
Returning to the original fateful decision, we have been told – believably – of the devastation that the Eircom 300K agreement made to the process and the plan. However the various accounts and justifications for the decision differ depending on the source and are as follows,
- The 300K deal was made as a purely pragmatic political move in order to accelerate rural broadband.
- The European Commission insisted that the Eircom 300K network was a legitimate private investment under State Aid Guidelines and had to be protected from state-subsidised competition.
- The refusal by the Department (of the Eircom proposal) was indeed defensible, but the threat of endless litigation from Eircom, and consequent delay to the overall NBP, was so powerful that the Minister was forced to concede.
- The Minister sought additional advice from the Attorney General who advised conceding to Eircom.
In the last eighteen months IrelandOffline has attempted to question the Department of Communications Climate Action and Environment, the Department of Public Expenditure and Reform and the European Commission in relation to the Eircom 300K decision.
We have written to the Comptroller and Auditor General and we have attempted to raise a formal complaint with the European Commission (DG Competition) and subsequently made a complaint to the European Ombudsman on the failure of DG Competition to give us standing or acknowledge our complaint.
We have submitted FOI requests for relevant reports to the Department and attempted to have officials answer our questions live and in person in front of members of the Joint Oireachtas Committee.
Prior to that we laid out the case against the Eircom 300K network to both the Department and ComReg.
We are none the wiser.
[…] recap on what we know so far, a more detailed document is available here and is available as a separate post on our […]