Enet

We will resume our engagement with broadband providers. We have been busy all day meeting a number of groups. I welcome Enet, and thank its representatives for being here. They are here voluntarily to assist the committee and to provide information to us. We are here to listen and learn. The Department of Communications, Climate Action and Environment appeared before this committee some time ago to discuss the NBP, the process of which has been ongoing for a couple of years. We wanted to interrogate the process to date, in terms of costs incurred so far and the future costs of the plan, and we decided that we needed to inform ourselves on the matter, being Deputies with no great expertise in the communications area. Deputy Farrell has indicated that he has some knowledge in the area.

I worked in the accounts department; that was as far as I got.

He probably knows a little bit more than the rest of us. We decided that we needed to inform ourselves, and we are pleased to have so many people appearing before us today. We thank them all for coming. All of the information we are using and gathering will be distilled in due course. When we speak to the Department about the national broadband plan and other issues we will be far better informed than we were at 9 o'clock this morning. That is the purpose of this meeting, and we thank the witnesses in advance for providing information.

I want to stress that we are not here to examine the financial statements of the witnesses. They are here to help us. We are not here to interrogate them. If the witnesses are asked a question about the Department that they feel is more appropriate for the Department to answer they can tell us. Please do not hold back on that issue.

I welcome Mr. Peter McCarthy, chief executive officer of Enet. He is accompanied by Mr. David Eyre, chief commercial officer, and Ms Claire Murphy, general counsel. I remind everyone in the room to put their mobile phones on to airplane mode or to switch them off; merely putting them onto silent mode can still interfere with the recording system.

I advise witnesses to the fact that by virtue of section 17(2)(l) of the Defamation Act 2009, they are protected by absolute privilege in respect of the evidence they give to the joint committee. If, however, they are directed by it to cease giving evidence on a particular matter and continue to do so, they are entitled thereafter only to qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person or an entity by name or in such a way as to make him, her or it identifiable.

I invite Mr. McCarthy to make his opening statement.

Mr. Peter McCarthy

My introduction is quite long, so with the Chair's permission, I might just read a shortened version of it. I believe the opening statement is on the formal record.

We will note and publish it, but if Mr. McCarthy is talking about this statement, which looks like it would take ten minutes, we are happy for him to read it into the record. Everyone watching will want to hear what he has to say. It is fine for us; we have the opening statement in front of us. However, it is no good if we have the document while the people watching do not know what is being said. Mr. McCarthy can summarise or skip the odd sentence here or there, but I have no problem with the length of the statement.

Mr. Peter McCarthy

I thank the committee for the invitation to attend this session. I am the group CEO of Enet. I am accompanied today by Mr. David Eyre, chief commercial officer, and Ms Claire Murphy, general counsel and company secretary. As we have mentioned in our briefing materials, our entire leadership team is relatively new to Enet but we are here today to support the committee’s work to the best of our ability.

The invitation to attend this session is designed to support the examination of matters related to the national broadband plan, NBP. As such, we intend to outline our role in the NBP project. While Enet, as a sub-contractor to the bidder, NBI, is subject to confidentiality regarding aspects of the plan, we will do our best to address the questions posed to us. I would also like to take the opportunity to highlight Enet's operation of the metropolitan area networks, MANs, which is a State asset.

Our company is based in Limerick, has staff of nearly 115 people and operates the largest alternative wholesale telecoms network in Ireland. It operates over 5,400 km of fibre infrastructure, including the Irish state’s metropolitan area networks – known generally as the MANs - and proprietary metro networks, a unique backhaul infrastructure and one of the largest licensed wireless networks in the country. As it stands, Enet operates the MANs in 94 cities and towns across Ireland, operates over 3,700 km of backhaul fibre along the Irish Rail network and has access to Bord Gais and ESBT fibre, as well as access to Waterway Ireland’s fibre.

Enet’s operations are at the very heart of Irish telecoms. Our customers - almost 70 in total - some of which are the country’s largest service providers, use our services to systematically improve their retail services and to bring high-quality broadband to more than one million end users throughout Ireland.

Enet’s shareholder is the Irish Infrastructure Fund, IIF, which now owns 100% of the business. The IIF invests capital for 28 institutional investors, 25 of which are Irish pension funds including university trusts, union pensions, religious orders, construction worker pensions, pensions from a number of Irish companies, as well as Government bodies. It has been stated previously that ISIF is one of the investors in IIF. The fund purchased a 78% stake in Enet from Granahan McCourt, GMC, in July 2017. The IIF subsequently agreed terms to acquire the remaining 22% in September 2018. This transaction closed on 5 December 2018, and included the resignation of the GMC representative directors, effectively ending the GMC involvement in Enet. Today the primary board of Enet has three board directors nominated by the IIF.

In December 2015, the Department of Communications, Climate Action and Environment launched its NBP procurement process. At that time, Enet’s shareholder, Granahan McCourt, developed a consortium to participate in the tender process. In March 2016, the consortium lodged its pre-qualifying questionnaire, PQQ. At this stage and throughout, Granahan McCourt was formally the lead bidder, and Enet’s envisaged role was that of a key subcontractor. In September 2018, the final PQQ was lodged. At this point, Enet’s role remained unchanged and we were reaffirmed as a key subcontractor. Neither Enet or its shareholder, IIF, are directors, shareholders or direct advisers to the consortium.

We do acknowledge that, for most of the procurement process, the consortium was described as Enet-led. At the commencement of the process, Granahan McCourt had control of Enet, both as a shareholder and with its chairman. David McCourt referenced this in a Newstalk interview with Pat Kenny in October 2018 when discussing the consortium name, when he stated, "it was called Enet because at the time I owned Enet and I was running Enet and it was a convenient name to call it."

As regards the MANs, they were implemented by Government in response to market failure and the need to provide high-speed, open-access broadband networks in regional towns and cities. Following an open tender process, Enet was appointed in 2004 to manage the 28 phase 1 MANs. In 2009, following a further open tender process, Enet was appointed to manage the 60 phase 2 MANs. Ownership of the 88 MANs remains with the State. To date, Enet has made revenue share payments to the State in excess of €8.8 million and has also made MAN-related infrastructure investments totalling €31 million, with that value residing with the State. From Enet’s review of the policy deliverables which we have detailed in our briefing materials already provided to the committee, we believe that both the MANs and our operation of same has delivered in excess of the anticipated policy outcomes.

Our role has been about value creation for the State. It has supported balanced geographical foreign direct investment, reduced costs to customers and enhanced State assets. This has been acknowledged by a number of Ministers and public servants over the years. No business is perfect. People come and go, processes fail, markets go up and down but, most important, we always seek to improve what we do and to do so with professionalism and integrity. With Irish pension money as the foundation of our shareholding today, and with close to 115 people directly employed through our business and hundreds more indirectly providing services to us, our primary focus is on improving everything we do to deliver the high standard of service required in the market place today.

For clarification, Mr. McCarthy said that Enet was a subcontractor to the bidder, NBI. Who is NBI?

Mr. Peter McCarthy

It is National Broadband Ireland.

Who are they?

Mr. Peter McCarthy

National Broadband Ireland is Granahan McCourt.

Enet is only a subcontractor, even though the bid has your name on it.

Mr. Peter McCarthy

This is because the chairman was in control of Enet at the time. He was the face of the business and he chose to call it the Enet consortium.

Mr. McCarthy is saying the Irish Infrastructure Fund has purchased a 78% stake in Enet from Granahan McCourt.

Mr. Peter McCarthy

It has now acquired the full 100%.

In Enet.

Mr. Peter McCarthy

Yes.

We were a bit confused and had a letter today from the NTMA about the structure. The Irish Infrastructure Fund has units but not a shareholding. We are trying to get our heads around who is who. Who owns NBI?

Mr. Peter McCarthy

I do not know but I presume it is controlled by Granahan McCourt.

Has there been a change in the ownership structure of the main bidder? I thought Granahan McCourt was the bidder from day 1. A lot of people are utterly lost as to the sequence of this.

Mr. Peter McCarthy

As a result of the operation of the State-owned metropolitan area networks, Enet has a unique perspective on what State intervention in the telecoms market can do to create competition, remove the barriers to foreign direct investment and reduce the cost of bandwidth. Enet, therefore, has always been supportive of the national broadband plan, NBP, and the Government's vision for a ubiquitous high-speed broadband network. In December 2015, the Department of Communications, Climate Action and Environment formally launched its procurement process for the NBP. At that time, Enet's shareholder was Granahan McCourt and that company developed a consortium to participate in the tender process. A number of Enet staff were seconded onto the project to work on the bid on behalf of the consortium. We have no seconded staff any more in the consortium.

In March 2016, the consortium lodged its prequalifying questionnaire, PQQ, which was the first formal milestone in the process. At this stage and throughout, Granahan McCourt was formally the lead bidder.

And still is.

Mr. Peter McCarthy

And still is. Enet's envisaged role is that of key subcontractor providing services such as capacity via the MANs, co-location via MAN-enabled co-location sites and the Enet proprietary network, services in backhaul capacity, the provision of wireless access and network operations management. In September 2018, the final PQQ was lodged by Granahan McCourt, the lead bidder, to reflect a change in bidder composition. At that point, Enet's role remained unchanged and we were reaffirmed as the key subcontractor, the same role as we had originally. For the avoidance of doubt, neither Enet or its shareholder, the Irish Infrastructure Fund, are directors of, shareholders in or direct advisers to the consortium.

We acknowledge that for most of the procurement process, the shorthand term "Enet-led consortium" was used in media coverage. In all likelihood this came about because Granahan McCourt owned the business.

That is helpful. At prequalification, the financial side of the consortium is coming through Granahan McCourt and Enet, as the key subcontractor, has a proven track record of being able to deliver as an operator in the system with operational knowledge of this type of project.

Mr. McCarthy must be the most modest person ever to have appeared at the Committee of Public Accounts because there was a press release from the Minister yesterday announcing a 50% cut in the rate Enet will charge for fibre, from €5 to €2.60 per metre. That is a phenomenal reduction in price and it is remarkable that Mr. McCarthy did not make a reference to it. He is here to discuss MANs and maybe his script was prepared before this announcement was made. In any event, we were very pleased to announce this price reduction for the operating demands network and its customers at the Committee of Public Accounts this morning. What was the timing of the cut and how did it come about? Some customers were thrilled at the good news which they heard overnight.

Mr. Peter McCarthy

I appreciate that some of the terminology we have used today is somewhat industry-specific and it is appropriate to define what dark fibre is, because what we are talking about is dark fibre. Dark fibre is the physical fibre optic cable and one must consider that it is a physical infrastructure product. Some refer to it as "unlit fibre" because physical infrastructure does not carry a 1 Gbps service, which is referred to as a "managed service". Managed services are where one puts the electronics on it and the dark fibre is the cable product.

Hardware.

Mr. Peter McCarthy

Service providers have different operating models and some prefer to procure dark fibre as opposed to managed service. Enet is the only operator in the regional Irish market which openly sells both duct and dark fibre products and we price it on a per metre basis, which is a global standard for pricing such products. One metre or 100 m of dark fibre would be cheaper than 500 m normally. Depending on the distances involved in the geographical locations requiring to be linked, the price will vary. The Analysys Mason report recommends that Enet and the Department discuss price changes for dark fibre subduct and duct to ensure that customers do not find it more expensive, on average, to buy passive products that are comparable to managed service products.

When we put our pricing up on our website, as is the case with all operators that we aware of, it is maximum pricing you put up, and this has been the industry norm both in Ireland and abroad for many, many years. We published that pricing yesterday and I am going to explain to you the timing of that.

Regarding this specific point about the 50% reduction in prices yesterday, I would like to clarify this item. The Analysys Mason report was sent to us in June 2018. We had a number of discussions with the Department over June and July and a new pricing for the specific item of dark fibre of €2.60 per metre was agreed with the Department. It was also agreed that this price would be the maximum price per metre. In other words, depending on what people are buying off you that price could drop considerably. It could be down to €1 something or whatever. It depends. At that time we were asked to publish this price at the time of publication of the report by the DCCAE.

I would just like to say that in July, now, in fairness, you have to appreciate, Mr. Chairman, that I can only go on records-----

Mr. Peter McCarthy

-----and talking to more junior members of the team-----

Mr. Peter McCarthy

-----because there is no senior team here that was here last July-----

Mr. Peter McCarthy

-----so I am having to go from record.

Mr. Peter McCarthy

In a lot of the cases and a lot of the information I am going to give you today, I will have gone back and looked for correspondence, minutes and whatever I can find in the business in order to be able to give you the information. I do understand that it was envisaged that that report would be published within a matter of weeks or days of that meeting. We would have had a number of discussions with the Department from there, over the following months, where specific items of the recommendations were dealt with and we were closing them out. During that period, of closing them out, we would have consistently heard that the report was coming.

That is very helpful. Has Mr. McCarthy covered the point or is there more?

Mr. Peter McCarthy

Yes, I have. I can go into more detail but I think that-----

Perhaps, because it is so late, if he is free after, can he forward that document so we can read it in due course, as part of our further consideration. He can send it on to us rather than reading it now.

Mr. Peter McCarthy

No problem. Can I say one thing else on the Analysys Mason report, Mr. Chairman, if you are okay with it?

Mr. Peter McCarthy

Just to give a bit more information. Analysys Mason is a London-based consultancy. The DCCAE commissioned them to review whether Enet is operating the MANs in compliance with its obligations under the code of practice in the MANs concession agreements to provide open access to the MANs on an equality of treatment, non-discriminatory and transparent basis. This report represents the results of the review. It provides their opinion on the changes that should be made to the way Enet operates the MANs to: improve the transparency of pricing; ensure non-discrimination between ETNL and other Internet service providers; increase separation from ETNL; and encourage further take-up on the MANs.

Enet co-operated with Analysys Mason on their review. This involved site visits by their team to our Limerick headquarters, interviews with our staff and the sharing of records and data with them.

The independent report sets out four possible options regarding optimal structure of operation for the MANs. After thorough review, their chosen option recommends "improved processes, procedures and checks." For the avoidance of doubt, the report states, at 2.5.5 overall conclusion, "this report shows a range of areas in which enet should improve its adherence to the Code of Practice". This is stating that Enet is adhering to the code of practice, while suggesting improvements can be made in their opinion. The 13 recommendations are internal and procedural in nature, and are actually helpful to us as a business trying to continually perfect our delivery of service.

After nearly 15 years operating the assets, it is right and proper that the code of practice and our procedures be reviewed so as to ensure they are still relevant for current market conditions and fit-for-purpose going forward. The focus of the recommendations is on the improved processes, procedures and checks and relate to physical access, the cost of connection and pricing, and communication and take-up.

We have engaged with the DCCAE in addressing each individual recommendation, and these actions have been implemented or are being implemented in our business currently. We are always striving to be the best we can be. It is beneficial for the consultants from outside the business to come in and undertake a review, and give their views on what is good, what needs improvement and what needs to change. In keeping with best practice, we are working in partnership with Government to make the economic recovery sustainable in parts of the country previously left behind. Thank you, Mr. Chairman.

I shall not cut into Deputy Murphy's time. I wish to clarify the following in case people listening to the debate or the public do not know who or what we are talking about. The report was commissioned by the DCCAE, which is the Department of Communications, Climate Action and Environment. We will immediately write to the Department. Enet understood, having met its staff last July, that the report was going to be issued very soon thereafter.

Mr. Peter McCarthy

That was our understanding. Yes, Chairman.

We are writing to the Department to ask it to give us a good reason the report was not published last July if Enet and the Department had signed off on it. The point is that people would have got the price reductions last July rather than tomorrow or today.

Mr. Peter McCarthy

Just one point on that, Mr. Chairman. My understanding is we would have been working through the recommendations. So what they might not have been able to come out with at the time was to say Enet has everything done. We would have been working through. We would have been discussing some of the recommendations.

So the Department wanted some implementation before it published is what you are saying.

Mr. Peter McCarthy

I am not sure they are saying-----

Mr. Peter McCarthy

I am not actually saying anything.

We will ask the Department that.

Mr. Peter McCarthy

Yes. Thank you very much, Chairman.

They are good price reductions in so far as they go and it would have been better if they had been out last summer. That is all I am saying. That is a Department issue - the report - not Enet. I am sorry, Deputy Murphy, for the delay.

I welcome Mr. Peter McCarthy. I am sorry for the delay. I apologise in advance as I must leave after our exchange because I have somewhere to go.

Mr. Peter McCarthy

That is okay.

For the purpose of accuracy, the understanding was that Enet was going to lead the bid all along, and it has changed quite substantially. In actual fact, a number of subcontractors had been named as part of the consortium, which would be the case now, who would be engaged in the building out. The bid has changed very substantially, which was mentioned by others here today.

The leadership team in Enet changed in the latter part of last year. Obviously things happened in advance of that so it may not be possible for the CEO to answer.

In terms of the Enet national broadband plan, it had a technical proof of concept and the pilot scheme was launched in Ballyseedy, County Kerry. Does the CEO know the take-up figures? Was that business transferred to Granahan McCourt or did it remain with Enet?

Mr. Peter McCarthy

Can I just confer, if you do not mind, Deputy?

Does Mr. McCarthy want his colleagues to sit at the table? There is no issue with doing so.

Mr. Peter McCarthy

No, it is fine.

Proceed once you are happy.

Mr. Peter McCarthy

My understanding is that the take-up was 30% but there would have only been a relatively short period of selling at the initial stage of that. In other words, I do not think it is being actively sold today.

Has the scheme remained with Enet or did it stay with Granahan McCourt?

Mr. Peter McCarthy

It is with us.

Mr. Peter McCarthy

Yes.

I seek a clarification because we probably will need to deal with this when we have the Department back in. Who, in the Department, regulates Enet? Does Enet specifically deal with somebody in the Department?

Mr. Peter McCarthy

There is a team we deal with in the Department.

Who leads the team?

Mr. Peter McCarthy

It is led by Brendan Whelan.

In terms of MANs, the Analysys Mason report talked about having received several complaints. Some of those would have been submissions and some would have been complaints. One of the entities that we talked to this morning confirmed that it had made submissions. Some of those issues have been captured in the report. Predominantly, it would have been to do with pricing and transparency, and also the non-separation of the wholesale and retail business, which were very valid complaints. Obviously the complaints were picked up in this report because they were valid. We heard from a number of entities here today. Two and possibly three of them said that they would have bid had the MANs concessionary contract been openly tendered.

Enet had a contract with a clause that allowed it to continue. There was a report by the Department, but it is entirely appropriate for members to ask a question on what happened to the tender process. There was an expectation that the tender process would have occurred. We expressed our surprise and disappointment today that this did not happen.

Does Mr. McCarthy accept that he is operating in a commercial world and in that world, people bid for tenders all the time. Enet bid for the tender in 2004 and 2009 and some of the rules changed during that time. Does he accept that there was not a clear-cut relationship between the retail and wholesale entities, which has been picked up?

Mr. Peter McCarthy

Would the Deputy like me to start with the extension of the concessions?

Yes, if Mr. McCarthy could start with that and then address the pricing element. I will then come back to him on a third point.

Mr. Peter McCarthy

That is no problem. The first decade of the MANs programme saw significant investment and positive market impact from Enet and the company saw an opportunity to invest further in the asset to ensure that it remained at the heart of a rapidly changing telecoms landscape and to continue to deliver policy benefits for the State. When Enet approached the Department of Communications, Climate Action and Environment in July 2014, there was less than six years remaining on the phase 1 concession and given our investment plans and the fact that the payback period for infrastructural investment exceeded the remaining life in the concession, we felt it was more than appropriate to commence discussions with the Department.

May I stop Mr McCarthy for a moment?

Mr. Peter McCarthy

Yes.

I accept that when one considers making an investment, one has to look at whether one will get a return on it. If there had been a tender process, does Mr. McCarthy also accept that others would have had to make those kinds of decisions for exactly the same reason?

Mr. Peter McCarthy

When the Department approved the extension in March 2017, there was just three years remaining on the phase 1 concession. The Department of Communications, Climate Action and Environment commissioned an independent report on whether it should re-tender the MANs contract or extend the term of the existing contract, as allowed for in the original contract. We had a contract that started in 2004 and another in 2009. Both contracts had a provision for extension. It is not unusual for large infrastructure projects to have this extension provision and this contract had this extension provision in it.

The Norcontel report completed in June 2016 is unambiguous in its recommendations that the preferred option, based on the analysis, is to extend the current concession agreements. This report also makes a variety of other conclusions. The MANs had fulfilled the role for which they were conceived and designed. The MANs had been successfully operated and managed by the MSC appointed. The MANs continued to make a financial return to the State, as specified in the concession agreements. The role and position of the MSC in providing open and transparent access and connectivity is acknowledged and accepted by the service providers that avail of MANs service.

May I stop Mr. McCarthy at this point?

Mr. Peter McCarthy

Yes.

There was criticism of the lack of transparency in pricing and this has been picked up by the Analysys Mason report. There was one bill that did not differentiate, for example, between different components and whether there were discounts. We have heard from British Telecom, BT, this morning and we can only test this with companies that are purchasing from Enet whether the contract's terms were fully implemented. BT will revert to the committee with a note on the aspects it says were not fully implemented.

The purpose of teasing out the service is to ensure the delivery of a cost-effective product to homes and businesses. There has been a sizeable reduction in the cost. Enet did not need to wait for this report to be published to reduce prices but it the reduction happens to coincide with the publication of the Analysys Mason report and the Minister's announcement yesterday. While the report was published last March, Enet saw it in July or August.

It was ready last March and published yesterday.

Yes. Before the contracts were extended, there were criticisms from companies which were significant purchasers from Enet. That has been picked up and I hope it will be remedied now and in the foreseeable future. Mr. McCarthy stated that there was a satisfactory relationship between Enet and its customers. However, the customers were saying there were serious problems. Does he accept that?

Mr. Peter McCarthy

First and foremost, one has to remember that British Telecom is a major competitor of ours in the Irish market.

I understand that.

Mr. Peter McCarthy

We have two major competitors in this market, Eir, being pretty much the incumbent, is one and BT is the other. We have to look at things in that context and we cannot completely put that to one side. Maybe if I address the next section of the Deputy's question, which was on inter-company pricing. Enet is related to a sister company, Enet Telecommunications Networks Limited, ETNL.

Is that the retail side?

Mr. Peter McCarthy

No. I will explain it now. ETNL was separated from Enet in 2015. They are two distinct buckets on the Enet side of the house, namely, the MANs business which is Enet, and the wholesale business which is ETNL. There is a retail business which sits over to one side, which is AirSpeed Telecom. The MANs were built by the State. They were merely rings of fibre in rural areas, which were not connected either to buildings or backhaul networks. A ring of fibre was built in the centre of a town and one basically had ducts with one fibre cable in the ducts. That is all one had. It is a dead piece of infrastructure until one lights it up and connects it back through the backhaul network to some sort of termination point, probably in Dublin, where one will get international connectivity. Without backhaul, the MANs would have been a complete waste of money as local traffic would not have the ability to reach other destinations. Some €176 million of taxpayers' money would have been wasted. The State would not be in a position to receive nor would have been in receipt of the financial or policy benefits yielded to date. Analysys Mason stated in its report that without these backhaul connections, the MANs would be islands of connectivity with limited usefulness. Enet invested heavily in connecting the MANs to a national network, thereby making them utilisable and allowing regional broadband traffic to terminate in Dublin. The only party at that time that had that type of backhaul connectively outside of the incumbent Eircom was BT. By putting in this network, we increased the competition in reaching these areas. The investment to date has been in excess of €50 million on this infrastructure, outside of the MAN infrastructure. That investment of €50 million is on top of the €31 million. Therefore, the Enet group of companies has State owned assets as well as private owned assets. On this basis, Enet created a company ETNL to hold the non-MAN assets. This process acts to separate out the concession assets and the non-concession assets so that the State's assets remain easily identifiable at all times. The company has an inter-company pricing policy between the entities Enet and ETNL. This inter-company pricing is agreed with the Department of Communications, Climate Action and the Environment.

Not having been involved in any of the process prior to October 2018, I went through the records of the business and consulted a great many documents to see what happened in respect of the splitting of the entities, how the pricing worked and how the contracts were constructed.

I have found that the company has acted in good faith at all times when going to do anything in that it has gone to the Department first and said, "We are thinking of doing this, this is how it is going to look, this is how it will sit, this is the way the contracts will be constructed and this is how we propose to do our pricing". At all times, we have had that signed off by the Department in advance of making any specific moves, and that includes changing prices and anything else.

I have reviewed, in particular, documentation exchanges between the Department and Enet in respect of Enet seeking agreement to set up ETNL and how the relationship between ETNL and Enet would work, the transfer pricing proposals and draft agreements, including Enet acting as agent to customers in order that they have the simplicity of a single bill. In the case of AT&T, Verizon and some of the large operators, which are trying to connect multinational companies, customers do not want to be dealing with two entities and two bills. We are trying to provide a simple service and it is clearly documented because if it was not, we would end up with a grey area. We have gone to great lengths to try to ensure that does not happen.

Enet did not embark on the process, including the agreement on transfer pricing, without the consent and agreement of the Department. I am specifically referring to documents between the end of 2014 and the beginning of 2015, when ETNL was set up, which is important. I have seen a correspondence chain between the Department and ourselves on that.

It is clear there has been a sizeable reduction of almost 50% per metre, from which, I hope, the end user will benefit. Has that been factored into Enet's business model? The contract will have changed hands and, as Mr. McCarthy identified, there are investors, many of which are pension funds while others are from the IIF. Will the reduction make a significant difference to Enet's business model? Does it hope to sell more as a result of reducing the price? How will it play out?

Mr. Peter McCarthy

We need to talk about maximum pricing. As I alluded to earlier, the pricing that is put on the website as the published pricing is maximum pricing. The pricing is coming down, as it has been for a period of time, and the deals have been done accordingly. Prior to this, the maximum pricing was probably far out of kilter with what we were charging and what the market was willing to pay. Today, the maximum pricing is much closer to where it should be.

The maximum pricing will differ depending on the size of the customer.

Mr. Peter McCarthy

Yes, exactly.

What is Lactava Investment Holdings 1 and 2? It appears to have the same board composition as Enet.

Mr. Peter McCarthy

I do not have a clue because it does not form part of the Enet companies.

In that case, it is a part of the NBP bid company.

Mr. Peter McCarthy

They do not form part of the structure of which I am chief executive today. They are not part of the existing company structure, as far as I am aware.

I thank Mr. McCarthy for appearing before the committee. It has been a long day and he has added some clarity to the matter. I was nearly convinced at the end of the previous meeting that we would not need any fibre broadband and that broadband could all be provided through bits of boxes and parts of buildings.

Mr. McCarthy mentioned that Eir is the incumbent and that BT is the major competitor. BT seemed to have an issue with the Norcontel report but, as he clearly outlined, it is only natural that it would, given that is Enet's chief competitor and it wants the business.

On the report about the 50% reduction I received earlier, I wish to clarify that, having met the Department in July 2018, following the publication of the Analysys Mason report, Enet's understanding at the time was that the announcement would be made a few weeks later. Am I correct that the committee intends to write to the Department in respect of the delay?

Yes, that is exactly what I was saying. We will write specifically to ascertain why there was a delay last summer.

The 50% reduction is the price as of this morning. If there is a retrospective saving, will there be any claw-back for the taxpayer, or will the price of €5.20 per m. be paid in full?

Mr. Peter McCarthy

As I said, they are the maximum prices. When a maximum price is set, what one is saying is that it will be any more than that.

There is an economy of scale, however.

Mr. Peter McCarthy

In general terms, it is going to be a lot less.

I knew nothing about broadband until this week. From what I have read, my understanding is that the basic intention of the NBP is to install a network around the country that, hopefully, will provide consistent speeds. They might not reach 100% but it is hoped that there will be coverage of 95% for customers in, for example, Ballymaloe or counties Galway or Leitrim. Unless I have missed something during the meeting, there is no better method for delivering that than high-speed fibre-optic cable, which is Enet's business. While masts, fixed wireless, roaming or nomadic wireless have a place, and perhaps they will fill the residual void, my understanding is that, according to the evidence, the best product to deliver infrastructure for the people is the fixed-line cable. Am I correct that nothing that beats fibre-optic cable?

Mr. Peter McCarthy

The interesting aspect of the matter is that the two are intertwined. There is no question that wireless has a part to play but in most cases, when rolling out wireless, it is being rolled out with fibre connected to it. Great speeds will be attained by running fibre to the masts. Over the past year, we have rolled out a lot of fibre. Wherever people roll out rural broadband, we connect their infrastructure to fibre.

In that case, there is a mast-----

Mr. Peter McCarthy

Yes.

One of the companies - it might have been Imagine - stated that the cable extended 13 km to the mast. Enet brings the cable to the mast and, in effect, the broadband companies ping off the mast.

Mr. Peter McCarthy

Yes, exactly. The MANs are rural and, therefore, it is easy to connect to the MANs and then connect to our backhaul or somebody else's backhaul.

Enet is essentially the spine of the process and everybody else radiates from it.

Mr. Peter McCarthy

Because we are so deep into rural Ireland, we are playing a major part in that at the moment.

Questions were being asked about the existing infrastructure and Bord Gáis networks. Mr. McCarthy referred to Enet having use of that. Will he elaborate on that? It was not discussed earlier and from what I heard, I had the impression that the networks were almost redundant. He indicated that Enet has capacity in that regard.

Mr. Peter McCarthy

This is an incestuous business in that every carrier in the country somehow connects into every other carrier for different reasons. One is all the time trying to build the reach of one's network, much of which is done by me buying a piece from BT, Colt, Eir or whatever it might be. Eir does not sell very much but the other operators do.

We are always trying to build our infrastructural reach. We deal quite a lot with international carriers and they want reach. They want to be able to get to the business communities. We are very lucky with the MANS in that we are providing unique infrastructure to areas of Ireland. There is much infrastructure in Dublin but outside of the city the sort of infrastructure we have is unique. There is also ESBT, which is the telecoms network of the ESB. That is mainly a backhaul network. We use pieces of that for connectivity. It would be the same for Aurora. It will buy bits from us and we buy bits from it. We are always trying to strategically build our network. We are all intertwined. We have BT as a customer and we also provide some services to BT. In fact, up until approximately 2014, we had nearly all of our backhaul with BT and then we moved it to CIE. Up until that point, however, BT would have had a lot of business from us.

I thank Mr. McCarthy. This morning we heard about the second phase of the tendering and I want to make sure I understand that. Many of the questions this morning related to the extension. I heard Mr. McCarthy explaining it to Deputy Catherine Murphy. From July 2014, there was less than six years to run on the first phase. Is that correct? As a business then, Enet was wondering what it would do in six years. Is that what Mr. McCarthy was saying?

Mr. Peter McCarthy

No. It is more about investment. If I went to our board today and stated that I wanted to build a new MANS, that I wanted to build new infrastructure, the first thing the board will examine is if it will pay back within seven years. If is not going to pay back within seven years-----

Mr. Peter McCarthy

-----I will not get that extra money for deployment. That is a critical factor and it is no different with any other telecoms company in the country. They are looking at this all of the time. As a company gets closer to its renewal situation, that starts to become an issue.

Of course it does.

Mr. Peter McCarthy

Is it a good idea to invest all of that cash and take the risk-----

Mr. McCarthy obviously has a sum that works out how to make a MANS equitable.

Mr. Peter McCarthy

In fairness to the Department, it did not rush out and make a decision. This was a discussion that went on for three years and involved Norcontel being brought in. It was a careful evaluation process. First and foremost, as I said, we had a provision in the contract that said the MANs could be extended-----

The 2004 and 2009 contracts had provisions for extensions.

Mr. Peter McCarthy

Both of those contracts had that.

Mr. McCarthy already said that.

Mr. Peter McCarthy

Once we had that we met procurement rules. It really was down to the Department to decide if that was the right to do. When the Secretary General was before this committee in December he said that irrespective of any pressure that may have been put on, and there was none in this case, the only objective was to ensure that whatever deal emerged from the decision on extending or retendering was to the benefit of the State and nobody else.

That is fairly clearcut, is it not?

Mr. Peter McCarthy

Absolutely. As part of the extension, the Department negotiated changes to the contract. As the incoming CEO, I can see that is biting and is benefiting the State and not us. The renegotiated terms were definitely advantageous to the State.

That all seems to make sense now. We could have done with the representatives from Enet being in first this morning. It might have been handier if we did everything in reverse order. Would the witnesses like to add anything further? We are at the end and perhaps there are things we have not asked about that might help our discussions.

Mr. Peter McCarthy

I want to say one or two things. We genuinely welcomed the publication of the Analysys Mason report. My team is a new one and we are very keen to get off on the right footing here. We want transparency and we want to work with the officials to make sure we are not back here in 12 months trying to work our way through this again. It is our plan to take this forward in a transparent and professionally-operated business. This is a public-private partnership and we are not a regulated body. This is about us working with the Department to deliver the best the value from this process. It is a win-win situation.

As I mentioned earlier, the State already received €31 million in assets and €8.8 million in revenue. Foreign direct investment outside of Dublin is been facilitated by our partnership. This means jobs in underdeveloped regions, taxes being paid by new companies and their employees and more affordable housing. People will not have to leave Dublin to work. This is good for everybody and this is what Enet and the Department are delivering together. There has been a certain amount of trial and error but we have addressed and are addressing any defects we can identify. That is the nature of every business and this is a success story for Enet and for the State.

We have to remember we are in a very competitive situation. While we do not operate a regulatory department or have people who are constantly watching what everybody else is doing and putting stuff out, we are operating in a competitive space. We are doing the best we can and we are totally focused on our business and driving it out, building our customer base and doing that with professionalism and integrity. That is what I wanted to say.

I thank Mr. McCarthy.

I have a few questions. Mr. McCarthy referred to some comments made by the Secretary General of the Department. He was here before Christmas and I remember that very well. He cited the Norcontel report. We will take that up again with the Department and not Mr. McCarthy. I want to get the facts on the record by asking Mr. McCarthy some questions. He mentioned the competitive situation. Where is the competition with MANs? ENET is the sole monopoly operator of that network. Perhaps Mr. McCarthy is referring to competition to get the best price for customers. I do not know. Mr. McCarthy, however, mentioned the competitive situation twice. There is a contract for ten years so where is the competition?

Mr. Peter McCarthy

I am sorry, but within the Enet business, in the ETNL situation, where we are wholesaling business ourselves, BT is our primary rival, or one of the main rivals in that area.

We are more concerned with the MANs and the public business with the State rather than private business. In that regard, there is no competition.

Mr. Peter McCarthy

Eir would be the primary competitor there. I did see the opening statement of the CEO of Eir this morning. This is important. When we are out in the MANs, we are the only alternative to Eir. If the MANs was not there then Eir would be in a completely monopolistic situation. It would also have been very difficult if Eir ever had bid to acquire the MANs because it would have given it a 100% monopoly.

Eir did not even bid for the MANs because it was an operator at the time.

Mr. Peter McCarthy

I think Eir has always operated, or for many years, as a separate-----

I do not think it sought the MANs.

Mr. David Eyre

I think MANs was put in place so that there would be infrastructural competition. The raison d'être for the MANs was to have two separate networks in these towns.

That is fine. The point made today by Eir was that under the European procurement rules an operator could not provide the service supplied by the Enet. It had to be independent. It was stated that Enet met that condition at the time. Now that it has a sister company in the same business, however, Eir questioned whether that condition was still being met. Does Mr. McCarthy understand the question?

Mr. Peter McCarthy

I do Mr. Chairman. I will go back to the point I made at the start and that is the differentiation between a wholesaler and a retailer. ETNL is a wholesaler, Enet is the operator of the concessionaire and AirSpeed is a retailer. They are quite different.

That is fine. They are well separated.

Mr. Peter McCarthy

I am glad to have the opportunity to clarify that. Paragraph 75 (e) of the State aid approval decision of the European Commission addressed to Ireland in respect of the State aid to be provided to Enet under the concession agreements for the Metropolitan Area Networks, phases two and three, states that the State retains ownership of the infrastructure and attributes its management to an independent MSE which cannot act as a retail service provider. Enet is the MSE and neither Enet nor ETNL act as a retail service provider.

The sister company of Enet, however, does act in that capacity.

Mr. Peter McCarthy

Yes, but it is a separate company.

I suppose that is where public confusion arises. Mr. McCarthy can understand that. I ask Mr. McCarthy to send that document to the committee because it will be important in our deliberations.

Mr. Peter McCarthy

That is no problem, I would be delighted to do that.

What year is that document from?

Mr. Peter McCarthy

That document goes back to 2004 or 2005.

I ask Mr. McCarthy to give us the provenance. We are putting these questions now because otherwise we will have to come back to them later.

It has twice been stated that the original contract provided for an extension.

Mr. Peter McCarthy

Correct.

The contract did not have to provide for that, but the Department chose to go that route. It could have retendered. If Enet had invested in the latter years of the contract and the contract was not renewed, I presume it would have included a mechanism of compensation for unrecovered investment.

Mr. Peter McCarthy

I am not clear on that.

I gather from Mr. McCarthy that, when Enet entered into the last few years of its contract, it put it to the Department that it wanted to continue investing.

Mr. Peter McCarthy

Yes.

From Enet's point of view, that would only have been viable if it had been able to recover the investment over a seven year period. That is one of the reasons Enet would have sought an extension.

Mr. Peter McCarthy

Yes.

Was there a corresponding opposite agreement to the effect that, if Enet continued investing but did not recover its investment because it did not get an extension, it would not then be out of pocket?

Mr. Peter McCarthy

If I tried to answer that question, I would be doing so without knowing the facts.

We will allow Mr. McCarthy to check. He gets my meaning. I presume the contract was a two-way street.

Mr. Peter McCarthy

My understanding is that what was on the balance sheet would end up going to the Department.

Back to the State.

Mr. Peter McCarthy

Yes. We will check the details and send them to the clerk.

If investment was incurred in the latter years of the contract and, because Enet did not receive an extension, that investment transferred back to the State, where would Enet's non-recovery accrue? A normal business would want to get a return on investment, but Mr. McCarthy is saying that it went to the State.

Mr. Peter McCarthy

It is important to point out that it would not stop us from connecting anyone.

I am talking about further investment.

Mr. Peter McCarthy

Every time we connect someone to the MANs, we could have to do a dig. A MAN is a ring. If BT or another company came along and stated that it wanted to connect Joe Bloggs or such and such a company in a town, it could mean us having to dig 500 m to that premises to connect it. That type of direct connection to a MAN is always an investment and stays with the MAN. It is an ongoing investment of possibly millions of euro per year.

When Mr. McCarthy stated that, in the event of the contract not being renewed, he wanted Enet to get a return on the investment it had made latterly, to what investment was he referring? That seems to be the pitch he was making.

Mr. Peter McCarthy

Yes. I am not sure of the specific investments at the time. I have not dug out the details.

Mr. McCarthy made that statement-----

Mr. Peter McCarthy

I understand that.

-----but has now said that, if Enet made an investment, it was really the State's investment because it would revert to the State.

Mr. Peter McCarthy

I will give the Chairman an idea of some of our investments. We have built MANs where there was none at all.

Was Government approval for that required?

Mr. Peter McCarthy

No. One would apply normal-----

Enet has a big presence in Portlaoise, but if it decided to go to Mountmellick in my area, that would be its call.

Mr. Peter McCarthy

That is our call.

Enet can make that decision.

Mr. Peter McCarthy

We can if there is a business case, but so can anyone. Any operator can do that.

People can provide MANs-----

Mr. Peter McCarthy

Yes, but they are State subsidised. Anything we do is through our investment.

We are getting that. Mr. McCarthy stated that all MANs were connected to Dublin.

Mr. Peter McCarthy

Yes.

Is that through ESB pylons? Bord Gáis, Waterways Ireland and Iarnród Éireann have been mentioned.

Mr. Peter McCarthy

Our primary backhaul is with CIÉ.

Mr. Peter McCarthy

Yes. As our customer base grows, the MANs become busier - data usage by our customers is going through the roof - and we bring more of the mobile operators and Imagines of this world onto the network, our capacity on the MANs requires much more IT development and spend. We must upgrade regularly, which is expensive. This is not just about fibre in buildings, since it is the IT systems that make all of this work. A massive amount of money goes into those systems continuously to expand the networks.

Enet has a contract with the Department that looked unusual to us. All of the companies represented - I am sure Enet's retail company is included in this - are governed by the regulator.

Mr. Peter McCarthy

No, we are not. There is only-----

No. I am coming to the reason it sounded unusual to us.

Mr. Peter McCarthy

I beg the Chairman's pardon and apologise for interrupting him.

The MANs are a major piece of the telecoms infrastructure, yet the regulator of the telecoms industry seems to govern everything except for them. We will raise this matter with the Department, but does Mr. McCarthy have a view on it? Eir has made it clear to us that, as part of the national broadband plan, the price that the company that wins the contract will pay for use of Eir's physical network for running fibre services will be set by the regulator. Is that correct? I am not blaming Enet but it appears that, in the case of the MANs, the regulator has no role in setting Enet's prices. That is why it has maximum, discounted and reduced prices. That the MANs are not under the Commission for Communications Regulation, ComReg, when almost everything else is is a matter that we will raise with the Department. It is just a straight agreement. Am I right? That is the impression we were given today.

Mr. Peter McCarthy

I am glad to have a chance to clarify this. Most of our competitors' services and our services are unregulated. The most regulated-----

Most of-----

Mr. Peter McCarthy

A company must have significant market power, SMP, to be regulated. As far as I am aware, our competitor, BT, only has one or two minor services that are regulated. Its products that compare to ours are, like ours, unregulated. That is an important piece of information.

It is useful, as a clear impression was given. Eir is under the regulator because it is so big.

Mr. Peter McCarthy

Yes. Given that BT is a business of scale, parts of it are regulated as well. In terms of the MANs and any of our services, though, BT's comparative products are, like ours, not regulated.

We got the impression that everything was regulated bar the MANs.

Mr. Peter McCarthy

I am glad to have the chance to clarify that.

Might I clarify that again? It is 5.50 p.m. Where else would we be on Valentine's Day, Chair?

We came back in the afternoon. In truth, we have only been here for just over an hour.

Mr. Peter McCarthy

We are okay for time. We have no problem in that regard.

We will conclude soon.

"SMP" means significant market what?

Mr. Peter McCarthy

Power.

Enet is regulated in that respect. BT has SMP in some cases and, hence, is regulated. Am I right?

Mr. Peter McCarthy

In respect of just some elements.

Mr. David Eyre

Products that are not relevant to the products that we provide.

Some of its parts and the equivalents in the witnesses' company are not regulated. They are basically-----

BT's apples and Enet's apples are-----

Mr. Peter McCarthy

Exactly the same.

Perfect. I thank the witnesses.

They can see why I am putting these questions. We do not want to walk out of here with one side of the story.

Mr. Peter McCarthy

Yes.

It is probable that the other company was precisely correct in what it said, but we got an impression from the big pitch it made about its being regulated. That is because it is so big, though, and we understand it is a dominant player.

Does the Department have a separate service-level agreement with Enet or does it just have a contract?

Mr. Peter McCarthy

It is a concession contract.

It governs the arrangements. How often must Enet submit its financial statements, including returns, dividends and investments, to the Department so that its viability as an operator can be checked? The Secretary General told us that there was almost a requirement that a certain percentage of Enet's turnover had to go into investment each year. I am sure the witnesses have read it, but I have not looked back over the transcript.

Mr. Peter McCarthy

We have-----

There is a requirement of a certain level of investment.

Mr. Peter McCarthy

There is. We must produce a three-year plan, which was produced and handed over in November, I believe. That is a requirement. I am not certain, but I believe that we also have a requirement to produce accounts for that particular company.

Mr. McCarthy might provide clarification for us.

Mr. Peter McCarthy

I will. There are a number of reports as well, including a KPI report. We have regular, formal and minuted meetings. Those are the requirements.

Mr. McCarthy might set out the reporting structure.

Mr. Peter McCarthy

We can send a note on that to the clerk.

I have a further question on the broadband plan, but something was mentioned about MANs in rural areas. Well, Enet calls them "rural areas", but it is not out the country. It is in towns, by and large the provincial ones.

For people who want broadband outside of the MANs and a provider is supplying broadband in a rural area close to a town on the MANs, it has been stated that there is an option to connect to Enet as the source for that service.

Mr. Peter McCarthy

Yes, that is correct. We manage what is called the "middle mile".

Please explain that again for people. We have heard about the "last mile". This is important for understanding the system.

Mr. Peter McCarthy

I am delighted to explain. I actually have a carefully scripted explanation on that, if I may have one moment.

I understand that-----

Mr. Peter McCarthy

It is a couple of paragraphs and no more.

Mr. McCarthy can send that document to us.

Mr. Peter McCarthy

That is not a problem. I am happy to help.

Those Members not here will then get the benefit of reading it next week.

Mr. Peter McCarthy

I am delighted to do that.

I can guess what the "middle mile" is. We also know about the last bit and where Enet is with that, but it would be helpful if Mr. McCarthy would send us the explanation of the "middle mile". The last topic I want to raise with Mr. McCarthy is the national broadband plan. This might not take very long. The national broadband plan was a principal part of Mr. McCarthy's opening statement and Enet is a subcontractor to the bidder, National Broadband Ireland, NBI. Mr. McCarthy has stated that Granahan McCourt is the main shareholder. The Ireland Strategic Investment Fund, ISIF, a State company, also has a significant stake.

Mr. Peter McCarthy

The ISIF.

That is correct. The ISIF has a substantial investment in the Irish Infrastructure Fund, IIF, as well, the company which now owns Enet. Is that correct?

Mr. Peter McCarthy

That is correct.

That is fine. If this contract is secured by Enet, then the State has a stake. Is that correct?

Mr. Peter McCarthy

No. If National Broadband Ireland, NBI, which is the bidding consortium, or anybody, wins this contract then Enet is potentially a subcontractor. At the moment, Enet will be a subcontractor if the national broadband plan, as it currently is, was to go into the preferred bidder stage and move forward. Enet would be bringing the benefit of the MANs and all of that infrastructure into play. From that perspective, IIF, and consequently ISIF, would benefit.

I note the wording used by Mr. McCarthy. He stated Enet is a "key subcontractor" but not the only contractor.

Mr. Peter McCarthy

That is correct.

Enet, therefore, is not the only subcontractor. I just wanted to clear up that issue. The last aspect of this matter concerns the national broadband plan. It started in 2015 with 850,000 houses. Today, we heard Eir has already taken 300,000 houses out of that original figure because it can do it commercially. The company has also stated that it is now replacing some of its old network with fibre and that will take another 80,000 houses out of the remaining 540,000. The total left will then be 460,000 houses. Mr. McCarthy may not be able to answer my next question. He can make a comment if he wishes or, if not, we can refer this back to the Department.

This plan is now for 20% of the 2.4 million premises in Ireland. We have had that figure and, between business and domestic, I think it is correct. The national broadband plan was to cover probably the last 30% or 40% of premises when it started but it is now for the last 20%. The commercial sector is now dealing with a big chunk of the original 30% or 40%. Eir made it clear today that if its board approved further investment it could possibly work on a commercial basis to reduce that figure further.

This committee will be concerned that the contract the Minister may approve - and I am not speculating on whether he will - will be for circumstances that are very different to the situation pertaining when negotiations commenced. The numbers covered the by national broadband plan could be dramatically reduced. As time passes, we are hearing that some of the premises currently included in the plan will be removed. There is no doubt we need the national broadband plan in rural areas but the numbers covered by and scale of this plan seem to be diminishing all of the time. Is that Mr. McCarthy's understanding? How is Enet, as a subcontractor, affected by this situation?

Mr. Peter McCarthy

I will give a personal view.

I will pose that question to the Department.

Mr. Peter McCarthy

This is a very general high-level view and it goes back to what I stated about the market we are in. It is highly competitive sector. All of the competitors were here today and they all have a different slant and that is what it is.

They were all very shy.

Mr. Peter McCarthy

The only way to get the real numbers involved would be to do a census. That is all I have to say. It is back to the Department after that.

Regarding the alleged residual number of premises, I think we might subtract another 30,000. Eir stated there were 330,000 premises, so the imaginary figure is now 460,000. Those will also be hardest places to get to, the most difficult to connect and, I imagine, the places with the least penetration. I imagine they are the most complex premises to deal with. Everybody is going to take the low-hanging fruit first.

Contract negotiations are proceeding on the potential benefit for whichever company gets the contract and the State aid. As the process continues, some premises are being removed from the being covered in the plan. I do not like using the word "cherry picking" but as we go along companies are taking the most commercial or the best prospects from what was initially envisaged in the original plan. What is left is not the low-hanging fruit.

It is not low-hanging fruit.

It is at the stage where the costs are going to be higher, as well as the State aid, the smaller the numbers involved get. That is something the Department will have to configure and not Enet.

Mr. Peter McCarthy

Exactly.

One of the witnesses made a good point on the MANs and the private fibre networks as well as the mobile network. It was stated that "all existing and planned commercial investment should be taken into consideration prior to any State intervention into a commercial market". We might advise the Minister to find out what exactly is in any contract before he signs it. There might be fewer premises included by the time whatever company gets the contract actually gets around to doing the job. We will have to raise that with the Department. What is in the contract is a moveable feast at the moment.

It always will be.

That is correct.

It changes every day.

If we turn back the clock two years, there were 850,000 houses involved. The numbers have almost halved now. That is an observation and not a conclusion. We have now completed our-----

Mr. Peter McCarthy

I would like to add one small thing to what I have said.

Yes, please do.

Mr. Peter McCarthy

We came in today in good faith and we have answered questions not just on the national broadband plan but on Analysys Mason, extensions and everything else. It was good to hear what was said today to understand, finally, the identity of the complainant. There is a very unusual process under way here. It is the bit I do not understand. The Analysys Mason report was driven by complaints, in one sense.

That is okay.

Mr. Peter McCarthy

To address something like those complaints within a business, and ensure the business is equipped to make sure something similar does not happen again - if something did happen - or that there is continuous improvement, the first thing to do is to go back, examine the complaint and try to understand it. I still do not feel that has been possible. One of the complainants has gone public today. I still believe, however, that if a complaint is valid, it should be in the public domain. I do not understand why it is not. I do not understand why, if there is a legitimate complaint, it is confidential. It makes no sense to me.

That complaint was stated here today and we asked for a copy of that correspondence. Mr. McCarthy will be aware of that. We will also contact the Department separately. I do know if it has been requested already under freedom of information legislation. I doubt it.

Mr. Peter McCarthy

If I had sent a letter to the Chair or the Department, I would have thought that aspect was up to me to undertake.

There was at least public acknowledgement today as to the identity of the complainant.

Mr. Peter McCarthy

I appreciate that.

It was stated earlier and I will not repeat the name. It is on the record.

Mr. Peter McCarthy

I thank the Chair and the committee.

I thank all of the witnesses for coming and I apologise that the meeting has continued so late into the day. It was a long day and I thank the witnesses for bearing with us. Is it agreed that the clerk requests any follow-up documentation and carries out any agreed actions arising from the meeting? Agreed. We will now adjourn. If confirmed, we will be meeting representatives of the Department of Public Expenditure and Reform on the issue of oversight of capital projects at our next session or, that is not possible, we will be meeting with representatives from the Kildare and Wicklow Education and Training Board on the financial statements in the special report of the Comptroller and Auditor General. We have to check availability. It will be one or the other of those groups. In the afternoon of that session, we will be meeting witnesses from the Irish Council for Social Housing and the approved housing bodies interim regulatory committee in connection with their Vote and our discussion on housing.

The joint committee adjourned at 5.59 p.m. until 9 a.m. on Thursday, 21 February 2019.