Naughten told sole broadband bidder its price was too high

Former minister for communications Denis Naughten advised the sole remaining bidder for the contract to supply high-speed broadband to remote rural areas that it was asking for too much money for the project last June.

Mr Naughten’s warning to Granahan McCourt, the sole bidder for the Government contract, is revealed in the report on the tender process published on Tuesday.

The report was requested by the Taoiseach, Leo Varadkar, after the resignation of Mr Naughten last month. The former minister was forced to resign after it was revealed he had several private meetings with David McCourt, the US businessman who leads the remaining bidder.

The report says that while the private meetings gave “cause for concern”, it found the integrity of the process itself has not been undermined by them. The Government on Tuesday said the process would continue, with the new Minister for Communications, Richard Bruton, saying he hoped the Government would be in a position to award the contract or not in the coming weeks.

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Discussions

While the report found that Mr Naughten did not influence the process in Mr McCourt’s favour, it is clear that he was involved in discussions with the bidder on the costs of the project.

It reveals that Mr Naughten attended a meeting last June in which he made clear to the bidder that the price they were seeking was too high for the State.

Concerns about the rising cost of the National Broadband Plan have been growing in Government for months

“The former minister was in attendance to emphasise that he could not bring the potential subsidy likely to be sought on foot of the bidder’s proposal to Government for approval,” the report says.

Mr Naughten’s private contacts with Mr McCourt continued after that time, including a dinner in New York and a telephone call in August after a further meeting between officials from Mr Naughten’s department and representatives of Mr McCourt.

Backlash

Concerns about the rising cost of the National Broadband Plan have been growing in Government for months. While Ministers are afraid of a political backlash in rural Ireland if the project is abandoned, there are concerns about escalating costs and also about the level of demand for high-speed broadband in many rural areas.

Last night, Mr Naughten welcomed the findings of the report, “which concludes that I ‘did not influence or seek to influence’ the conduct of the tender process in favour of Granahan McCourt”.

However, asked if Mr Naughten could return to the Cabinet, a spokesman for the Taoiseach said, “There is no vacancy at Cabinet.

“The Taoiseach considers it a partial or qualified vindication. As the Smyth report finds, the private meetings with McCourt, of which the former minister did not give a full account of to the Dáil, were a cause for serious concern,” he said.