Bid process 'caused concern'

The Moriarty Tribunal: A civil servant involved in selecting the winning bid for the State's second mobile phone licence has expressed concern about aspects of the process.

Mr Sean McMahon, a member of the project team that adjudicated the competition, said he felt that the views of regulatory officials on the quality of the final draft report on the licence competition were not given the attention they were due.

Mr McMahon, a Department of Communications official, said it would have been "extremely risky" for the team to call for a decision from the minister, Mr Michael Lowry, on the basis of the report it had received.

He also expressed concern about a "speeding up" of the process that was taking place at the time the team met on October 9th, 1995.

At this stage, he expected the qualitative assessment of the two front-runners in the competition, the Persona and Esat Digifone bids, to continue, he told Mr Jerry Healy SC, for the tribunal.

He agreed with counsel that there was political pressure to get the process concluded in late October 1995. There was "a tension" between his desire for more time and the Minister's desire to speed up the process.

Asked how he felt the selection process should have proceeded, Mr McMahon said he believed the project team should have sat in plenary to consider the top two bids in detail. Everyone would revisit all that had been done and "chip in as necessary".

The group would then proceed until it had examined every measure it had that might separate the two bids. "That might not be achievable, but we should have attempted something like that." Asked if he wasn't satisfied with the decision of the report in relation to the ranking of the top two bids, Mr McMahon said he was not satisfied that the report could justify a decision.

"Virtually everyone" at the meeting accepted that the report could not substantiate a decision. The collective view was that "here was a lot more to be done". It was "too early" to pick between the two bids.

"No view was formed, but we knew there were two clear frontrunners. We knew they were close." Two weeks later, on October 23th, the team met again to make a decision. At this meeting, Mr McMahon said, there was a strong view that there was "a clear winner".

No matter how much further analysis there was, it wouldn't change the final result, he told counsel. "I felt it was probably the right result but it would be preferable to have a report which would substantiate it." He was happy on the day that Esat was ahead, and that remained his opinion to this day.

However, Mr McMahon said he still expected to receive a final draft report that would deal with the matters he had raised.

Two days later, he learned that Mr Lowry had called a press conference to announce the decision of the project team to award the licence to the Esat consortium led by businessman Mr Denis O'Brien. No further report was produced.

Mr McMahon said it seemed "pointless" to raise the question of the report when the press conference was already under way.

Asked about Esat's financial problems at the time, the witness said: "If I had felt at any time, even after the announcement, that there was something wrong, I would have had no compunction about going to the Minister and saying so."