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THE OIREACHTAS COMMUNICATIONS Committee will meet again later this week to decide whether to launch an investigation into the National Broadband Plan.
Fianna Fáil’s Communications spokesperson Timmy Dooley said he will be “pushing strongly” for an inquiry into the project in order to “get to bottom of what has gone on here”.
The move comes after it was confirmed today that the firm designated as the preferred bidder for the National Broadband Plan will invest an initial €220 million in equity and working capital to help fund the project.
The figure was confirmed by the Taoiseach today during Leaders’ Questions, with Leo Varadkar stating that the €220 million upfront investment is €175 million equity and €45m in working capital.
The announcement of the €220 million figure from the preferred bidder today incited fury among the opposition today, who’ve already expressed outrage at the high cost of the plan and the timing of the announcement just before the local and European elections.
Both Fianna Fáil and Labour raised concerns about the long-term plan of the bidder.
Flipped
Fianna Fáil’s Michael McGrath said he is concerned about the consortium flipping the company in a few years from now.
“It seems to me that Granahan McCourt are going to be relying on revenue raised by consumers in order to meet their commitments. And there is a real concern here that because of the nature of the consortium, in essence it is an investment firm that is bringing in some expertise, but it’s not a firm of itself that has expertise in this area.
“You may well see a scenario where this contract is flipped on, that this contract is sold on within a period of time and indeed those who are waiting too long for broadband will be left high and dry, so the nature and the tone of the advice from the Department of Public Expenditure and Reform was quite striking, and was incredibly strong and forceful and was repeated and sustained.
“This was not one letter, it was not one memo, it was the internal spending watchdog within Government flashing the red lights and shouting stop, you should not proceed and so we will continue to ask questions and piece together all the information we have here,” said McGrath.
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Appearing before an Oireachtas committee today, Communications Minister Richard Bruton said it is likely the company will only make €10 million in revenue in first year of operation. He estimated this to rise to €150 million annually in future years.
When asked how much the service user will pay, the minister said homeowners will pay €30 per month for the 150Mbs fibre broadband service, even in the remotest rural areas.
In relation to the ESB rolling out the network, Bruton said the government looked at the option, stating that the government cannot just hand a new tender contract to the ESB, stating a new tender would have to be issued, where all could re-apply and it could take up to 36 months to complete.
Last week, Cabinet signed off on the National Broadband Plan despite warnings from senior civil servants at the Department of Public Expenditure and Reform who “strongly recommended against” the decision.
The plan aims to lay down fibre cables capable of delivering high-speed internet to more than 540,000 homes, farms and businesses across rural Ireland.
While the plan could cost as much as €2.97 billion to the State, the government will not actually own the network when it is finished despite its larger investment.
Leaders’ Questions dominated by NBP
Varadkar appealed to the opposition not rule out the NBP before they have listened to all the hearings on the matter. He said the contract has not yet been signed, and it is unlikely it will be signed by September or October.
The Taoiseach said alternatives were looked at by government, but “there isn’t a better option”.
If the government does not proceed with this contract, it will be many years before another plan is put forward and it will be “back to square one”, said Varadkar.
“I don’t agree that it is unprecedented,’ the Taoiseach said today when asked about a reference in the documents released last week that the risk to the taxpayer is “unprecedented”.
Varadkar said the investment is not unprecedented, stating that €8 billion was found to fund Ireland’s motorways. Sinn Féin’s Mary Lou McDonald said a serious question mark hangs over the consortium and its capacity to deliver the project.
The Taoiseach said the company has the capacity to deliver, adding that the cost-benefit-analysis “stacks up” and is “conservative” as it doesn’t take in the societal benefits.
Labour’s Brendan Howlin asked the Taoiseach about why the State will not end up owning the network. He raised concerns about the network being sold on after eight years, stating that vulture funds will buy it up.
“It will be milked” for all its assets are worth, he said.
A State-owned broadband company could put up the same cash, generate the same revenue, and end up returning a dividend to the Irish public, he argued, stating that private investors are borrowing today on the back of the premise of getting revenue in the years to come.
Howlin admitted that the selling off of Eircom was a “disaster” but urged the Taoiseach not to make the same mistake with the roll out of broadband.
Varakar said the NBP is a plan that the Labour Party can be “proud of”, stating that it initially began under two Labour ministers.
In a statement today, National Broadband Ireland (NBI) – the entity set up by Granahan McCourt to deliver the plan – said it will be required to meet financial obligations of €2.4 billion in the delivery of the project over the next 25 years.
With Granahan McCourt the investors behind the project, NBI said today this initial tranche of €220 million is invested ahead of the government subsidies, “thereby placing this investment at risk first”.
NBI also said in a statement today that it is at risk in the event that commercial take-up of broadband is lower than expected.
“A return will only be generated if the project is delivered on time, and within budget – with any overrun costs borne by NBI,” it said. It also said that the State has clawback mechanisms in the event that there is over performance.
The company added that it was currently negotiating contracts with over 40 specialist subcontractors to help deliver the project and wouldn’t be disclosing “commercially sensitive information” which could “prejudice these negotiations”.
With additional reporting by Christina Finn
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@ObsidianShine: No to them all. No votes to any of these Partys. Get them out of Government as soon as possible. They don’t deserve to sit in the Dail.
@Declan Edward: The greatest insult delivered to irish electorate who are footing the bill was the redaction of money figures from documents distributed to dail by minister cos in min words ‘contractor dont like them .. and we pay for as long a electorate take this froom TD u will get more and more . I mean go to local TD and tell them that number one THE DAIL act for us .. it his job and m martin seem to be incapable of having the minsiter account to the DAIL by having all the contract unredacted present to the dail for a debate and a vote.
The rural vote being bought with €3,000,000,000 of your taxes. There is no need for this lunacy, global low cost high speed satellite broadband should be up and running in 6 years. Meanwhile we’ll still be spending €7,000 to run a cable to a house
Bury them Friday week, this is surely one financial scandal too far. And why is a certain person getting a sniff of this with the Moriarty tribunal file gathering dust in the DPPs office?
@The Risen: you’re joking right? Do you even know how slow satellite broadband is? Max is about 25meg.
It’s basically worthless. Nothing comes close to fibre and even at present we’re nowhere near what it’s capable of.
Gigabyte internet might sound excessive but in 10-30 it will be a pittance.
Bill gates once said no one needs more than 512kb of ram back in the 90’s. Now we have phones with 8gb of ram
Theoretical speed of fibre is over 1 petabyte so we’re only scratching the surface but fibre optic technology is going to be around for a very long long time.
@The Risen: you’re pinning it on Starlink? Now i know you’re clueless. At best it can only offer a 1gb and it’s only 6 or 7 years away for US coverage.
For global coverage they’d need over 9000 satellites in orbit. Do you really want all that flying around orbiting us like a junkyard.
@The Risen: Amazing how many networking experts have shown up in the comments over the past week! You’re arguing large portions of the country to remain uninhabitable for a magic beans project that may not be seen in Ireland for decades if ever. You’re also advocating for the government to abandon a 7 year plan and promise?
At least be honest and admit this is about you an urban dweller being unhappy over large sums being spent in an area you’ll receive no benefit from. FF have it right in saying that the ESB should be carrying out this project and we the state should have ownership over it, your view that it should be abandoned entirely while we wait for future technology is disgusting and a horrible way to treat rural Ireland.
@Rochelle: Oh quit the faux angst. There are several better ways of doing it. A combination of bringing fibre to where there is a good case for it and satellite for more remote dwellings could be looked at. This current plan is a travesty. Follow the money.
@The Risen: has startlink been deployed yet you numpty?
No it hasn’t. Therefore the current limits are around 25meg.
Starlink uses a satellite based network to provide higher speeds across the earth. However it would require over 9 thousand of them to cover the globe and you’d get about a gig. More satellites could be added to increase speeds but our space would be a junkyard.
Starlink will be good for ensuring everyone anywhere on earth can get broadband but it’s not a direct fibre competitor.
Nothing is faster than fibre at present for internet speeds and not likely for decades.
If you had any clue about technology you’d know this instead of reading it off a cornflakes box.
@Airblazer: and oh I am against this. It a a farce of a project.
It should be ripped up and the contract given to the ESB and guarantee we own the infrastructure.
@Rochelle: If you want to live in the back arse of nowhere you cannot expect urban taxpayers to pay for anything like this. There is a reason why property is so expensive in urban areas its because you pay for convenience of services and the like. you want broadband pay 7k for it.
@The Risen: still clueless about communications. Do you get what would happen if you had 300,000 satellite links downloading … It would drop down to sub 1mbps each of you even got connected. Satellite is simply not viable for mass communications, and those that claim low latency doing get the whole “speed of light” thing! Fibre is the most viable, followed by fibre distribution with microwave links to get to hard to reach fibre distribution points. Each of which would have a large cost that needs subsidy, otherwise they won’t happen.
@The Risen: you believe Elin musk unfortunately he has to break the laws of physics to achieve this.
this will be one of the most important prices of infrastructure since rural electrification. yet all people can do is throw dumb rocks at it. oh and I don’t be voting fg so it didn’t buy my vote
@The Risen: I highly doubt it. I’ve been working in IT for the past 22 years and know a spoofer when I see one. You’re laughing at 1gb.
Guaranteed in 20 years time you’ll be one of the ones screaming why didn’t they use forward thinking if they went with your suggestion. As anyone with any degree of cop on knows what’s viable today isn’t so viable in 10 years.
@Renton Burke: Starlink will have latency comparable to existing cable and fibre, as the satellites are much closer to the ground. Oh, and light loses transmission speed through matter e.g. an estimated 30% when its sent through an optical cable. Starlink will transmit using a network of lasers travelling full light speed in the vacuum of space.
But given your condescending tone, I’m sure you’re well aware of all that already :)
@Peter Hughes: ridiculous comment, the same could be said for urban dwellers about electricity and water, if you want access to clean water dont live in the city
@Peter Hughes: ridiculous comment, you could say the same for urban dwellers about water and electricity, if you want access to clean water live in the countryside
“SpaceX has said it will offer speeds of up to a gigabit per second, with latencies between 25ms and 35ms. Those latencies would make SpaceX’s service comparable to cable and fiber. Today’s satellite broadband services use satellites in much higher orbits and thus have latencies of 600ms or more, according to FCC measurements.”
@John Kelly: The ESB is a semi state, they dont get to decided, we the people decide. If ESB poles were used, along with cables which allowed fibre to blown, we would would have a state asset worth having, it would fund itself.
What risk? There’s none when you invest 200 million, get 3 Billion of public money, you own everything at the end and according to the reports the profits will be huge.
Spinning lies again from FG.
@M Stuart: Be about 5 stone overweight, have hair that looks like it came off a Shetland pony and bribe Tipperary based politicians and you’ll be flying
People should not vote for FG in the elections. This broadband issue will turn out like the childrens hospital fiasco with spiraling costs. Give it to the esb.
@bopter: it’s almost Gemma o’doherty like the obsession to tie dob to any public tender to give it an air of corruption. Even if siteserv are a subcontractor, I don’t think he had influence on this (unlike the Digicel corruption).
It’s a win win…whatever they spend, they will get multiples in return. Also there is no risk as I’m sure they will have a deal in place to get any money back plus a percentage if any issues…..
This is yer man bruton last horrahh first took no flack over the schools shifted out of there just in time for this fiasco… soaking up the flack befor he fs off into the sunset
@Michael Nolan: he’s a slithery weasel. He made a mess of education-”we’ll have the best education system in Europe in 10 yrs”…whilst he cuts funding to the point that we have the worst investment in the western world, invests in two forms of examination that have proven to have failed but they’ve invested s they’re still ploughing on 5 yrs later, has overseen the mass migration of young teachers to the point that we have a major shortage, then he jumps ship and does what he’s told to get this deal done…..the guys a conman!
@Bruce van der Gutschmitzer: a bit harsh there .. I have two boys in secondary .. getting a great education. No shortage of teachers .. resource made available to one of them . You are listening to the teacher unions too much. That’s my.personal experience not something I read ..
@Bruce van der Gutschmitzer: all they want in the universities is students from abroad it’s all about the money ….they couldn’t give a rats..they don’t walk our streets.. they don’t drink in our pubs.. their kids don’t go to the same schools they don’t use our hospitals could go on
@John Kelly: and I have my own personal experience. I see it in primary and especially secondary. For example, 5 Spanish teachers graduated last year and 9 this year. In our country. They’ve to take it off as a subject in many schools now as they can’t fill the positions.
What a band of clowns.
We, the people will pay for a network that will be own by a private company…is it even Irish owned ?
If it is like that then I suggest that the private company pay for everything.
This is treason no other words. But as usual the same parasites will vote FFG in again….its all going to end bad again in the coming years, the next meltdown will be worse because we won’t have any score to borrow to fill the holes….we borrowed tens of billions last time…not happening again folks
Spend 200 million for a 3 billion Government asset sound like a great deal those dinners with Naughten and Breen have turned out to be extraordinarily expensive
FG must be getting serious grief at the doors if they have told the upfront cost after denying to tells for two weeks
I know in the UK there is a law that if enough people sign a petition on a particular matter it does be raised and debated in parliament, is there another similar vehicle in Ireland?
There must be a way for the people to prevent this government rail-roading un in to billions more debt than what is right and fair. If this and the hospital was done correctly billions would be saved, surely the cant be allowed just plough on when the whole country is disgusted..
@Eugene Tyson: unfortunately an alternative is not there. I’m giving Sinn Fein my vote. They haven’t had a try yet, I’m willing to give them a chance. BTW Labour screwed us as much as FFG, Yet you left them out of the list.
@Rob Cahill: Honestly, I really think we should just not vote for any of them ever again. Things need to change. For anyone else other than a main Party. We need 1 term of them being out of power, we need a shift in thinking. We need leaders to step up.
I’d say Da Valera and Collins are rolling in their graves! This country is a shambles, and it’s only just over 100 years since we fought for it back. We may need to fight for it again!
This is the Irish water scam all over again. Let the people fix everything up & then it’s given away for “ Private Profit” It’s ludicrous, who the hell buys something then gives it away? It’s sickening!
I just can’t understand the logic behind laying cable to every house. 5G is currently being trialed in Dublin, surely it would be more economically to put a 5g mast on a hill somewhere that could server 20houses ?
Beggars belief how this government continuously seems to piss our money down the tubes at every single opportunity!
These guys need to be held accountable
Seems to be a fair swap to me, rural Ireland helped pay for the Luas via taxes, now Dublin people taxes help to pay for rural Ireland broadband. Private company run is suspicious, though. Is it really more efficient that a government minister running the project?
@John Kelly: reminds me of an episode of the BBC show, The New Statesman, where Rick Mayall as Alan B’Stard campaigned to bring back hanging and succeeded. Then given the job to find a private contractor to build gallows all over the country. He, himself gets framed and convicted of murder and sent to hanging from the gallows, but as they hung him the gallows fell apart as they were made with balsa-wood to cut costs and put money in his pocket. Under British law, anyone surviving gallows hanging is set free.
I can imagine this national broadband going a similar way :-)
@WoodlandBard: Pal Dublin taxes pay for ALL Dublin infrastructure, you don’t have a balls notion what you are on about, Dublin subsidies pay for rural educate yourself and stop complete rubbish. Please do explain exactly who in rural Ireland actually pays tax, famers?, they don’t pay a washer tax…industry pays all tax and it’s all located in urban areas bar the odd company.
@Renton Burke: Dublin generates nearly 60 percent of tax but only has one third the population of the country, please before you spout nonsense do some basic research on what you are talking about.
@John Kelly: There is an economy outside the m50 and it’s in urban areas…rural areas account for a much smaller amount of tax generated but expect to get first rate services to every farm in the middle of nowhere…again if you want services move to urban areas if not then stop complaining.
@Peter Hughes: It’s like this Peter, rural people will not stand for being second class citizens any longer when it comes to broadband. All political parties on the ground in rural Ireland are well aware of this even if they spout nonsense on the national airwaves about the ESB or other unicorn alternatives. €3 billion is a pittance to invest in rural Ireland and will pay for itself many times over.
@Renton Burke:100% correct Renton. The majority of tax is generated off the backs of rural workers travelling to cities. Give us our broadband and let us take our workers back and entice business out of the cities. Win/Win for everybody in rural and urban areas alike.
@WoodlandBard: Absolutely correct regarding the Luas. All the whining about spending money on broadband in rural Ireland is pure bebrudgery and nothing else.
I will be one of those available on service under the NBP when it comes on stream. Someone earlier in the comments put the cost per connection at €7,000. This cost is over 25yrs, which works out at a little over €20 per month. I wouldn’t have a problem with the Gov applying a charge, something like the PSO for electric, say of €10 per month and keeping it there until the State recoups it’s initial investment. Borrow the €3 Billion and let the charge on users pay down the loan. That way the taxpayer is off the hook and the whingers might take a long overdue break.
@Tommy Roche: Despite the State investing over €3B in this broadband,the State won’t own the asset,the private company will, unlike the ESB which is 95% State owned!
Everyone else pulled out .. these guys are willing to pony up a shed load of money ….how bad .. but I have no doubt this project will be killed off by the jury of public opinion . Its 2.5 billion investment by them over 25 years
@John Kelly: John, it’s €billions. It’s Ireland. We are 84k km2 – compared to Britain who are 242.5 km2. UK rollout is estimated at £3bn (€3.5bn euro) for literally 3 times the size of the country. And they plan to have it all done by 2033, which is only 14 years away, not 25 years as proposed by our Government.
Ireland is a tiny nation, in comparison to our nearest neighbour. It’s an absolute joke it costs this much. The scale of the project is nowhere near the scale of the UK.
You really need to consider that it’s €2.5bn to €3bn that Ireland is spending, likely to rise €10bn with inflation over 25 years – remember that the next time your family member is made homeless, or lying on a trolley bed, or rotting corpse in a morgue, or failed servical check that results in their early death.
But as long as you have broadband you’ll be fine… it’s all about being connected.
@John Kelly: What they are proposing at the moment is old tech and they seem to think they’ll have guaranteed subscribers which is very wishful thinking. Just look at the advances in technology the last 10years there’s a good chance 3billion will be spent with little or no return
The problem is firstly Denis Naughten having his din dins with the company head. Then the contractor provides small capital outlay. Now this all looks wrong. Will you really see Fibre to the door unlikely.
Every home and business has to have fiber, it’s that simple. It’s just like any other service people need and will need even more so in the near future.
The problem is how they are implementing it.
Essentially outsourcing it to a bunch of financiers with no technical expertise of any types of these rollouts.
They’re only interested in the ownership of the end product, take that off them and they’ll run. That alone has to make you think.
Guarantee you the ESB could roll this out for a billion or less. They are a semi state company so they don’t have to make profit from it either.
Plus they already own all the electricity poles that can be made use of in certain areas.
How come they always wait til the deal is done before they’re outraged???? Piss and moan after but do nothing beforehand to block the squandering of taxpayers money on a dead duck????
to quote US senator, Everett Dirksen, ‘a billion here, a billion there pretty soon you’re talking about real money’………..the posh boys (rich and thick) strike again!
A last minute Varadkar Ploy to garner votes from the electorate, and a financial folly for which their great grandchildren will be indebted long after his “bankrupting for votes” is forgotten. When will people ever wake up and say no to electorate abuse and manipulation by self serving politicians?
It takes 11 days to count 1 million. It takes 31 years, 251 days to count to 1 billion, 3 billion is just a plain stupid amount of money to invest in Fibre, especially when it still won’t be delivered to the last 5%
We need a cost effective National Broadband Plan. Fibre for most but not all, as has found to be the quickest and most effective delivery method in every other country in the world.
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Deliver and present advertising and content 99 partners can use this special purpose
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Certain information (like an IP address or device capabilities) is used to ensure the technical compatibility of the content or advertising, and to facilitate the transmission of the content or ad to your device.
Match and combine data from other data sources 72 partners can use this feature
Always Active
Information about your activity on this service may be matched and combined with other information relating to you and originating from various sources (for instance your activity on a separate online service, your use of a loyalty card in-store, or your answers to a survey), in support of the purposes explained in this notice.
Link different devices 53 partners can use this feature
Always Active
In support of the purposes explained in this notice, your device might be considered as likely linked to other devices that belong to you or your household (for instance because you are logged in to the same service on both your phone and your computer, or because you may use the same Internet connection on both devices).
Identify devices based on information transmitted automatically 88 partners can use this feature
Always Active
Your device might be distinguished from other devices based on information it automatically sends when accessing the Internet (for instance, the IP address of your Internet connection or the type of browser you are using) in support of the purposes exposed in this notice.
Save and communicate privacy choices 69 partners can use this special purpose
Always Active
The choices you make regarding the purposes and entities listed in this notice are saved and made available to those entities in the form of digital signals (such as a string of characters). This is necessary in order to enable both this service and those entities to respect such choices.
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