Tuesday 18 June 2019

Eddie Molloy: 'Broadband plan reeks of 'politics and party above policy' mistakes'

‘Putting fibre into every home’: Taoiseach Leo Varadkar listens to Communications Minister Richard Bruton at the launch of the National Broadband Plan
‘Putting fibre into every home’: Taoiseach Leo Varadkar listens to Communications Minister Richard Bruton at the launch of the National Broadband Plan
Eddie Molloy

Eddie Molloy

The letter sent by Robert Watt, secretary general of the Department of Public Expenditure and Reform, to his counterpart in the Department of Communications, Climate Action and Environment, Mark Griffin, expressing his anxiety regarding the proposed contract for the National Broadband Plan (NBP), is remarkable for its sheer force.

Mr Watt sets out his "fundamental concerns in relation to the unprecedented risk that the State is being asked to bear in the event that the current NBP is recommended for approval by the Government".

Dated April 16, his letter seems like a last-ditch attempt, after months of earlier objections that were not satisfactorily resolved, to head off a reckless Government decision to go ahead with this €3bn, 25-year contract to put fibre optic cable into every home and business in Ireland.

Extensive detail of the deliberations among civil servants and others has been made available by Finance Minister Paschal Donohoe. This transparency is to be welcomed, especially when we compare it with the withholding of documentation surrounding numerous recent scandals in the areas of justice, policing, cervical screening and the ballooning costs of the National Children's Hospital (NCH).

Mr Donohoe's justification for rejecting the advice of his secretary general is unconvincing. In a series of public statements, justification of his position may be summarised as: "Of course I listen to all the advice I get, from many different sources, but as minister I have to weigh it all up and make the decision that is in the best interests of the people of Ireland."

The timing of this highly questionable announcement suggests a rather different, less noble, rationale that, if expressed, would say: "Of course I listen to all the advice I get, from many different sources, but as a politician facing local and European elections, I have to weigh it all up and make the decision that is in the best interests of my party, Fine Gael."

There are striking echoes here of decentralisation, a decision to disperse 10,000 public servants around the country, sprung on the public by Charlie McCreevy, to boost the chances of Fianna Fáil candidates in the local elections of 2003. The old, discredited political culture that ultimately wrecked the public finances hasn't gone away.

Mr Donohoe's assertion, against all common sense, that the €400m a year needed over the next five years for the NBP will not affect other vital infrastructure projects is not credible.

The Department of Public Expenditure and Reform says there will have to be cancellation or delay, just for example, of flood-relief works and the building of schools, care centres and social housing around the country, not least in rural areas. His reassurances are no more convincing than Simon Harris's guarantee that no long-awaited capital projects in the HSE will be affected by the massive over-runs in the cost of the NCH.

Digging still deeper into this hole that we are to believe contains limitless funds, Richard Bruton, the minister responsible for the NBP, assures us that the contract shifts the main risk to the private contractor, while Mr Watt details how the opposite is true. Mr Bruton hypes up the Government's case: "Ireland is the first country to commit to putting fibre into every home." There may be good reasons why other countries are not doing so. In any case, we know to our cost where this kind of hubris gets us, as with the plan to build the "best children's hospital in the world".

Mr Donohoe's defence of the NBP further damages his reputation for responsible management of public finances. He repeatedly used the word "prudence" to frame his 2019 Budget, delivered in October 2018, that was explicitly deemed imprudent by the Irish Fiscal Advisory Council and most other commentators.

In spite of warnings from numerous authoritative bodies, including the council, he produced a Budget that was imprudent on several grounds: It did not factor in the information available at the time about the €400m over-run on the NCH; it failed to grasp the nettle of carbon taxes, now a matter of great public concern; it spent unsustainable windfall corporate taxes; and gave insufficient weight to other risks, including Brexit.

Above all, the promise to initiate a "rainy day" fund in 2020, with a sum of €500m, three years after it was supposed to have been started, showed scant regard for the risks we face. With a national debt of €200bn, this would be comparable to a home owner with a mortgage debt of €400,000 putting aside €1,000 for a rainy day, when there was a real danger of losing his job imminently.

The crafting of the 2019 Budget presented by Mr Donohoe and the Government as "responsible" would, of course, have involved listening to all the advice they could get, from many sources, weighing it all up and making decisions that would be in the best interests of the people. However, the true explanation for such a high-risk, imprudent and irresponsible budget was that there was a real prospect of a general election being triggered before Christmas 2018.

With the economy booming again, what could possibly go wrong, you might ask. In 'Irish Governance in Crisis', published in 2012, Niamh Hardiman and her co-authors spelled out the order of political values that gave us the crash of 2007-2008, as well as previous crashes: first comes 'my own re-election', second comes 'success for my party' and in third place comes policy, that is doing the right thing. This culture still prevails, putting politics before policy, most especially when it comes to elections.

So, everything can go wrong, once again. The Department of Public Expenditure and Reform, the Irish Fiscal Advisory Council, the OECD and other external bodies can issue all the stark warnings they want and the Government will listen to the advice of all these sources, weigh it all up and make decisions that are in the best interests of the people of Ireland.

With a general election not far off, let's hope that this is what they genuinely do this time, prompted by public servants willing to speak truth to power. As Hardiman says, "The public service should not be seen as simply passively discharging the policies of the government of the day."

  • Eddie Molloy, PhD, is a management consultant

Irish Independent

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