Batt O'Keeffe
Question:5 Mr. B. O'Keeffe asked the Minister for Transport, Energy and Communications if he intends to privatise Cablelink. [9551/97]
Ceisteanna — Questions. - Plans for Cablelink.
Seamus Brennan
Question:20 Mr. S. Brennan asked the Minister for Transport, Energy and Communications if he expects Telecom Eireann to come under pressure to sell Cablelink; and the contacts, if any, he has had with the EU Commission on the matter. [10948/97]
I propose to take Questions Nos. 5 and 20 together.
I have no plans to privatise Cablelink. Any decision to disposed of Telecom Éireann's interest in Cablelink would require the approval of all the shareholders in Telecom Éireann, these being the Minister for Finance, the Strategic partners, PTT Telecom and Telia and me.
No such decision has been taken. Government policy for Cablelink requires that its network be developed as a platform for a range of communications services, which would be open to a variety of competitive service providers. A plan for upgrading the network is currently being prepared by Cablelink.
During consultations in the second half of 1996 between officials from my Department and the EU Commission concerning the liberalisation timetable and clearance of the strategic alliance, the future of Cablelink was discussed. The outcome of these consultations was the approval of the alliance, with commitments, in line with stated Government policy, that Cablelink would be developed and upgraded to a state of the art multi-media platform at the same rate which would apply if the company were owned by a third party and that the network would be subject to open and non-discriminatory access obligations.
In addition, during the consultation phase before the adoption of Commission Directive 95/51/EC of 18 October 1995, the Commission indicated it intended to make an assessment in member states of the impact of the joint provision of cable and telecommunications services by a single operator, with a view to reaching conclusions on the matter by end 1997. This is recorded in the Recitals to that Directive.
The Commission has now engaged consultants to assist in analysing the issue and officials of my Department met the consultants recently: the meeting was a fact-finding one. As the exercise is currently ongoing, any discussion regarding the possible conclusions is entirely speculative.
Has the Department carried out an evaluation of what Cablelink would fetch on the open market? When the Minister said he had no plans to privatise Cablelink, does that mean he has no plans prior to an election? Is he concerned about the number of job losses likely to occur in Cablelink were it to be sold off? What would be the total cost of investment in Cablelink to upgrade it to a state of the art multi-media platform? Given the liberalisation policy, does he believe he may be forced in future to privatise this company?
I have no plans to privatise Cablelink——
We are so lucky to have such a sensible Minister.
—— therefore, the rest of the Deputy's questions are hypothetical. I regret I am not in a position now nor would I be in a position in the near future to reply to the Deputy's question as to how much investment would be required to bring Cablelink to the point of being a state of the art communications platform.
I thought the Minister said in his reply this was being looked at——
It is being looked at.
—— and he says he has no idea of the cost.
The objective has been set. We have not yet fully described the means of arriving at that. If the Deputy will be patient, in the fullness of time I will be able to tell him what is involved.
The Minister may have no plans to sell Cablelink but most certainly the EU has plans to force him to sell Cablelink. Is that the position? While the Minister may have no plans, does he have a view, a Government policy or an opinion as to whether it should be privatised?
Yes, I do not think it should be privatised and the Government takes the same view. It is for that reason the Government has taken the view also that Cablelink should be developed to the point where it becomes a state of the art communications platform to which access should be available freely and on a non-discriminatory basis. In September 1995 Telecom Éireann received a request from the European Commission for information about the company's plans for developing the cable network including, presumably, its operations through Cablelink. The company has responded to that request and so far as I know there has been no comeback from the Commission.
Is the Minister aware the British Government recently received a sum of £200 million to issue a licence to a company operating in Northern Ireland which wished to have the licence to cable Northern Ireland or as much of it as it could? There is no cabling in Northern Ireland. It has to put in the entire network, the entire infrastructure, but still considers it worthwhile to pay £200 million to do that. In the circumstances will the Minister agree Cablelink is worth a great deal of money if it is now sold? It is particularly important that it should be sold given that it is controlled by Telecom which is deliberately not developing it in order that competition with Telecom can be avoided? Will he bear in mind we have had three reductions in telephone charges by Telecom in the past year or two, all of which were on the international side where they are subject to competition. There has been no reduction on local or internal trunk calls, where there is no competition, and there will be none for as long as Telecom Éireann is allowed retain its present privileged position of controlling its only possible competitor.
Deputy O'Malley seems to be good at reading reports about what is happening in other countries but not quite so good at reading reports about what is happening here. It is simply not true that there have been no reductions in Telecom's internal charges. Since that is the subject of a further question I look forward to elucidating these matters for the Deputy when we get to that question. It is interesting that somebody thinks it is worthwhile to bid £200 million to cable Northern Ireland. If the Deputy's suspicion is true then it seems to me we have in the ownership of Telecom Éireann and, therefore, of the State shareholder and the alliance shareholder a valuable asset. For that reason it is a matter of even greater importance to this House that the Government and Telecom and the strategic partners in Telecom should have taken a decision that Cablelink should be developed and upgraded to be a state of the art multi-media platform. What the Deputy is saying indicates we have a valuable asset. It is interesting to note there is a wide divergence of views on this strategic matter between the two putative partners in Opposition.
The Minister is engaging in an economic somersault. I have heard him speak many times on the need for competition. It is interesting that his partners in Government have influenced his thinking given that he tells the House it is his opinion the company should remain with Telecom Éireann. I put it to the Minister this company is already part privatised.
Does the Deputy want to privatise the rest of it?
On the one hand the Minister thinks it is not a good idea to sell it, yet he is the Minister who put his name to the sale of 20 per cent of Cablelink to the Swedes and the Dutch. He has already sold it and he now tells the House it should not be sold.
The Deputy has to dig deep to find things to complain about.
They are on the surface.
I admire his ingenuity. It is a pity he does not put it to more constructive use. Competition can bring many benefits. That is why the Government issued a second mobile telephone licence and why I expect to announce at the end of this year a competition for a third mobile telephone licence. The Government has also provided that, as and when Cablelink is developed to a multi-media platform, there will be open and non-discriminatory access for third parties to the Cablelink network to ensure competition in the provision of services.