Thursday 17 October 2019

Revealed: €300m bill for 27,110 to have broadband

Audit reveals cost of extending access to most remote premises

Stock image / PA
Stock image / PA
Philip Ryan

Philip Ryan

The Government has been told that extending high-speed broadband to the remotest 27,110 homes, business and schools in rural Ireland will cost at least €300m, Independent.ie can reveal.

An independent audit of the State tender for the €3bn National Broadband Plan, which has been seen by this newspaper, also reveals the Government could save €650m if it reduced the scale of the project to 80pc.

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However, this would mean 108,383 premises in some of the most remote parts of the country would not have access to high-speed broadband.

This includes 3,906 homes in Dublin, 13,143 in Cork, 5,833 in Galway and 3,533 in Limerick.

Minister for Communications Richard Bruton will present the report to his Cabinet colleagues at a meeting this week where the Government will sign off on the National Broadband Plan.

Last Friday, Taoiseach Leo Varadkar said he wanted to ensure that the project could not be completed for a cheaper price before he signed off on the final plan.

The KPMG review of the tender concluded that the only way to reduce the cost of the first-of-its-kind broadband project was to significantly scale back the size of the massive infrastructure plan.

The report was commissioned due to serious concerns over the rising cost of the project. The consultancy firm reviewed the implications of reducing the delivery of high speed broadband to 80pc and 95pc of the country.

Under the two scenarios, alternative solutions would be identified to bring connectivity to homes not covered under the plan.

Reducing the number of houses being connected to high-speed broadband by 5pc would save €300m.

However, this would mean not connecting 3,346 premises in Cork, 2,181 in Kerry, and 2,381 in Wexford. The figures suggest the cost per home of connecting the most remote 27,110 homes in the country will be around €11,000.

The Government estimates that around 50,000 people would be impacted by not extending the plan to the final 5pc of homes.

Reducing the State's intervention by 20pc or 108,383 houses would save €650m. This suggests the cost per home for this group would be almost €6,000.

However, Government sources estimated around 216,000 people would lose if the final 20pc of homes are not connected.

The figures in the KPMG report do not include VAT or contingency planning costs which have been factored into the final €3bn contract cost.

The KPMG report concluded that "the preferred option" would be to "continue with the current procurement process" and aim to provide 100pc broadband coverage across the entire country.

The report said reducing the scale of the broadband project would have economic disadvantages around regional development and promoting remote working.

It would also create a "significant challenge" to the Government's "digital agenda" which includes the introduction of new technologies in schools and hospitals.

A source close to the Minister for Communications said: "Minister Bruton was resolutely opposed to any reduction in the scope of the plan. This is about the future of rural Ireland. We simply can't leave any home, farm or business behind."

A consortium led by American businessman Frank McCourt will be given the green light to begin the broadband project once the Cabinet reaches agreement.

Sunday Independent

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