Business Irish

Monday 20 May 2019

New doubts cast over rural broadband plan

New Communications Minister Richard Bruton replaced Denis Naughten
New Communications Minister Richard Bruton replaced Denis Naughten
Adrian Weckler

Adrian Weckler

New questions over the future of the National Broadband Plan are emerging with sources close to the State tendering process casting doubt over its future.

The Irish Independent understands that the sole remaining bidder for the tender is reassessing its position in light of what it sees as political delays to a time-sensitive process.

If the Granahan-McCourt-led consortium pulls out, it would create a huge problem for the Government, which would face the prospect of scrapping the current tender and telling 540,000 rural residents that they will not receive broadband for at least another five years.

The Government is currently waiting on an audit report from consultant Peter Smyth on whether meetings between former Communications Minister Denis Naughten and Granahan McCourt boss David McCourt disrupted "the integrity of the procurement process".

Mr Naughten was replaced by Richard Bruton after he was forced to resign earlier this month when Taoiseach Leo Varadkar indicated that he had lost confidence in his judgement following a series of meetings with Mr McCourt.

Both Mr McCourt and Mr Naughten have vociferously denied any improper conduct related to the meetings, despite procurement rules that severely restrict any bid-related contact between a serving Minister and a bidder for a tender.

Under the National Broadband Plan, rural fibre connections to 540,000 homes and businesses were due to begin in 2019 but that now looks likely to be delayed until 2020 at the earliest.

The current bid is being financed by McCourt, Oak Hill and the private family fund of Walter Scott, the Nebraska billionaire who sits on the board of Warren Buffett's Berkshire Hathaway.

The National Broadband Plan has been dogged by a series of delays and withdrawals, with the two largest bidders, Eir and Siro pulling out due to doubts over the scheme's viability.

Last week, Eir CEO Carolan Lennon suggested that the National Broadband Plan may be fundamentally unworkable, indicating a hardening of industry attitude against the project.

Government sources insist that the scheme can still proceed and that a positive report from auditor Peter Smyth in early November would bring the process back on track.

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