Consulting bill for Ireland’s National Broadband Plan tops €40 million

The consulting bill for Ireland’s National Broadband Plan has hit a new milestone: topping the €40 million mark since the project kicked off in 2016. The news has raised eyebrows, with the scheme still being behind schedule.

As an important contributor to Ireland's economy and education, internet infrastructure is a key asset to the country’s development, as well as the success of its businesses. Over the last six years, this has seen the Irish Government look to roll out high-speed broadband across the country.

In late 2019, it was anticipated that high-speed connections would become a reality for 1.1 million people in the coming year, with work due to begin at the start of 2020. The National Broadband Plan aimed to ensure that all of rural Ireland get the same access to opportunities offered by high-speed broadband as urban areas.

Upon signing the contract for the plan, the Irish Government also published a list of approximately 300 community centres, schools, library hubs and local GAA halls in every county, all of which were supposed be duly connected to high speed broadband, to enable communities to quickly get free public access to high speed broadband.

Two years later, a tumultuous roll out means many of these promises are some distance from reality. Ireland’s State has paid €132.3 million to date to National Broadband Ireland (NBI), the body charged with delivery of the National Broadband Plan, but it is still projected as being “at least six months behind schedule”, according to reports in the Irish Examiner. Of 115,000 premises targeted to be made ready for connection in 2021, for example, only 27,000 are prepared for high-speed connectivity.

When asked for the reasons behind the delay, Secretary General of the Department of Communications Mark Griffin told Ireland’s Public Accounts Committee that uncertainty resulting from Brexit and the pandemic in particular has had a heavy toll on NBI’s plans. In particular, one of NBI’s main contractors, Kelly Group from the UK, “postponed” setting up an Irish operation. As a result, a company expected to perform roughly one-third of the initial plan in 2021 did not commence work.

Griffin also explained that the pandemic had caused “a whole swathe of problems” which further led to the plan falling behind, including supply chain and logistical delays, delays in recruiting staff, travel restrictions and a lack of accommodation for cross-island contractors. For example, another of NBI’s main subcontractors at one point saw 40% of staff earmarked for the project either absent having contracted coronavirus, or having had close contacts with a positive case.

Pandemic delays

Griffin said that one of NBI’s main subcontractors had at one point 40% of its staff dedicated to the project absent either with Covid, or as close contacts of a positive case. In light of this, Griffin explained a ‘remedial plan’ had been put in place once it became apparent original 2021 targets could not be matched – and the Public Accounts Committee heard that that plan’s main milestones had been achieved to date.

It was also stated that the NBI is now working toward a revised estimate for 130,000 connections by the end of 2022. Against an overall target for the €3 billion plan of 544,000 properties connected, this is understood as the “minimum” to be achieved by that date, while some 50 people within the Department of Communications itself are currently dedicated to the plan, as it looks to push to meet its contracted conclusion of 2027.

As it stands, no penalties for missed milestones are due to come into play before February of next year. However, while there is still some leniency in the political process toward the hamstrung roll out, pressure from the public is mounting – particularly in light of spending figures which have come to light regarding lucrative consulting deals which predate the pandemic.

To date, the Irish Examiner reports that the Government has spent more than €42 million on consultants for the National Broadband Plan. Of this, around €24.4 million went to paying for “procurement advisory services” to award contracts for the roll out. Meanwhile, the remaining €18 million was incurred by buying “contract management advisory” services, according to the Department of the Environment, Climate and Communications.

Consulting spending

The largest beneficiary of these payments was Big Four professional services firm KPMG, receiving €14.8 million between 2016 and November 2021, after providing services relating to “financial and procurement and specialist personnel”. This was followed by technology consultancy Analysys Mason, which raked in €11.5 million across the six years of the plan to date.

Elsewhere, law firm Mason, Hayes and Curran was the highest-paid entity in terms of legal services with €8.5 million. Meanwhile, another Big Four firm – EY – pocketed €6.2 million for “commercial and financial” services despite not playing any part in the procurement process. This made it the best-paid firm in the last two years.

In light of this, the roll out of the National Broadband Plan has come in for much criticism. On top of the slow pace of delivery, the amount of public funds now diverted to private companies for that delivery means that the Government is now facing the inevitable questions of whether it is getting value for money.

Griffin defended the Government’s spending on consultants in a note to the Public Accounts Committee, reported by the Irish Examiner. It stated that “robust oversight and governance” would be “critical to ensuring that the project is delivered on time and within budget,” while noting the various management consultant contracts in place were due to expire next year.