Tuesday, 21 May 2019

Questions (530)

Timmy Dooley


530. Deputy Timmy Dooley asked the Minister for Communications, Climate Action and Environment the timeline for the development of each cost-benefit analysis of the national broadband plan; the timeline of the errors identified in a cost-benefit analysis conducted by a company (details supplied) which were subsequently corrected; when this was communicated to the Department of Public Expenditure and Reform; and if he will make a statement on the matter. [21714/19]

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Written answers (Question to Communications)

In relation to the National Broadband Plan my Department commissioned a comprehensive Cost Benefit Analysis (CBA) in line with the Public Spending Code (PSC). A CBA Benefits report and a detailed benefits calculation annex was published in 2015 by my Department as part of the approval to launch the procurement process. All updates to the 2015 CBA were shared with officials in the Department of Public Expenditure and Reform (DPER) and the final CBA has been published by my Department this May. The CBA has been developed and updated over the last four years. It was only through detailed engagement with the market through the 800 hours of dialogue with all bidders and through receiving the final tender submission by Granahan McCourt, that it was possible to finalise the published CBA which remains positive, even in the pessimistic scenario.

There was also significant engagement between my Department and its advisers and the Irish Government Economic and Evaluation Service (IGEES) on behalf of DPER on the CBA. The development of the CBA has incorporated feedback from IGEES and DPER officials. The development of the CBA has incorporated and addressed feedback from IGEES and DPER officials to ensure compliance with the PSC.

During the course of engagement with IGEES and DPER officials an issue was raised by IGEES which was based on new guidance from that unit and had not been considered as part of the 2015 CBA. When this feedback was incorporated it resulted in a reduction to the net benefits in the CBA. An issue was identified in February 2019 relating to incorrect costs being included in the CBA. This error had not been in the 2015 CBA but instead was included in later CBA iterations. Correction of this error resulted in a reduction in costs, with the number in the CBA now reflecting the Final Tender. These corrections to benefits and costs are reflected in the final CBA and resulted in an overall positive CBA, published earlier this month.

There are challenges in applying the PSC to a bespoke project such as the NBP however, all of the benefits included in the CBA are consistent with the PSC Guidelines and generally accepted approached to CBAs of this nature.

PwC have provided all necessary assurances to my Department that both the CBA published in 2015 and the final CBA provided to the DPER and published in 2019 are accurate for all known costs and benefits allowed for under the PSC and are fully compliant with the PSC.