Witness was surprised Esat Digifone won licence

Moriarty Tribunal: A former programme manager in the Rainbow Coalition said he expressed surprise when he heard that Esat Digifone had won the 1995 mobile phone licence competition.

Mr Greg Sparks, a founding partner with the accountancy firm Farrell Grant Sparks, said he had heard rumours that Mr Denis O'Brien's side of the Esat Digifone consortium was financially weak.

He also told Ms Jacqueline O'Brien, for the tribunal, that he had heard rumours that financier Mr Dermot Desmond had become a shareholder in the consortium.

Mr Sparks was programme manager for the then tánaiste, Mr Dick Spring. He had taken leave from his job to work with Mr Spring in the Labour/Fianna Fáil coalition and in the Rainbow Coalition that followed it.

The tribunal heard that after the party leaders approved the announcement by the then minister for transport, energy and communications, Mr Michael Lowry, that Esat Digifone had won the competition, Mr Spring told Mr Sparks of the result.

He expressed surprise because of the rumour he had heard concerning Esat Digifone's financial position. He also mentioned the rumour he had heard concerning the involvement of Mr Desmond as shareholder, and queried if Mr Desmond's involvement had been considered in the light of the Glackin Report into the controversy surrounding the Johnston Mooney & O'Brien site in Ballsbridge, Dublin.

"The involvement of Dermot Desmond could have created a political problem. What I did not want was the tánaiste, when the thing was announced and if Mr Desmond's involvement was confirmed, to be door-stepped by the media as to that question.

"There was a political consequence, and I had to alert the tánaiste to that in case he was door-stepped."

Mr Eoghan Fitzsimons SC, for Norwegian firm Telenor, asked Mr Sparks who told him that Mr Desmond was a shareholder. Mr Sparks said he did not recall. Telenor was a shareholder in Esat Digifone at the time.

Asked why he had not told Mr Spring immediately when he heard the rumour concerning Mr Desmond, Mr Sparks said he did not know that the decision on the licence was being made, and was not prepared for looking at the issuing of the licence.

The party leaders approved the announcement of the competition result on October 25th, 1995. When Mr Spring informed him of the outcome, Mr Sparks, as well as expressing surprise, said in his opinion access to the licence would allow whoever held it make "super profits".

He understood at the time that Esat Digifone was not financially strong. He acknowledged that with the licence the consortium would have no difficulty in getting funding, but he thought its current financial strength would have been relevant.

There had been a clear recommendation from the consultants and civil servants who had assessed the bids for the licence, and the government had accepted that recommendation.

Mr Sparks said he had a breakfast meeting in the summer of 1995 with representatives of the Persona consortium, which was bidding for the licence. Motorola was part of the Persona consortium, and there were two executives from Motorola present.

As well as hearing information about the consortium's bid, he also heard that Motorola was considering a large investment in Ireland. He said no new information was conveyed to him at the meeting, and he described it as "innocuous".

The tribunal will resume after Easter with a new witness.