SINCE the second mobile phone licence was awarded last November, there have been intermittent complaints from the losing bidders and from Opposition parties. The losing bidders for the licence have concentrated their efforts on trying to press the Government to disclose the basis for its decision and have recruited the US embassy in their support. The Government has been loath to go along, arguing that the details submitted by the consortiums were confidential and were assessed by independent consultants.
Yesterday's debate in the Dail Public Accounts Committee appears to have finally brought the affair to a head.
Allegations were made at the committee by the Fianna Fail TD, Mr Sean Doherty, and Mr Des O'Malley of the Progressive Democrats, about the way the tender process was carried out. Mr O'Malley also questioned whether the successful bidder had adequate funds to now proceed with its plans.
Privately, some of the losing bidders have been questioning the process for some time, although none has sought a judicial review by the High Court as was open for them to do. And the chairman of Esat Digifone, Mr Denis O'Brien, last night angrily rejected the "allegations or innuendoes" made at the committee about the financing of the contract and the decision making process.
"The money which is required to be paid on signing the licence is in place and has been for some time," he said. Mr O'Brien refused to comment in detail on Esat Digifone's finances, but strongly criticised statements by Mr O'Malley that the licence had been obtained by someone who did not have the money.
The latest controversy has also spurred the Minister for Communications, Mr Lowry, to call a press conference today at which the senior civil servants responsible for the decision to award the licence to Esat Digifone - a consortium including Esat, Telenor of Norway and Mr Dermot Desmond's International Underwriting and Investments Company will be present.
Sources close to the Minister insist that they will have no difficulty answering any questions about the awarding of the licence, which they say was done of the basis of advice from Andersen Management International consultants.
One area of controversy has been the price paid for the licence. Following EU intervention, the Government put a cap of £15 million on the price. One of the main reasons for doing this, sources say, is that the EU was insisting that Telecom Eireann, the existing mobile operator, would have to pay a proportion of the fee paid by the new operator in order to allow fair competition.
With Esat Digifone paying £15 million, Telecom is being levied £10 million, but a higher charge to the new mobile provider would have meant that Telecom would have to pay a much higher levy.
Mr Doherty told the Public Accounts Committee yesterday that he was "concerned" that the licence contract was capped at £15 million when it was worth "very vast sums of money". There were protests at "the very highest level" from the US embassy and a major US chief executive indicated his intention to pull out of Ireland because of what Mr Doherty called "dodgy decisions".
IDA Ireland said last night that it was not aware of any US company revising its investment programme for Ireland as result of the outcome of the mobile phone licence competition.
The US embassy has so far called on the Department to meet the losing bidders and explain why they lost, but letters from the embassy in the public domain make no reference to the price paid for the licence.
Mr Doherty called for an investigation by the Comptroller and Auditor General, Mr John Purcell, into the decision to award the contract. Mr Purcell told the committee that no financial transaction had taken place as yet and it was not in the comptroller's rem it, as such, until such a transaction had taken place. The contract is expected to be signed within the next few days.
A Government backbencher, Mr Michael Finucane of Fine Gael, accused the opposition parties of "political shenanigans and opportunism" over the issue.
Mr O'Brien pointed out last night that the decision to cap the licence fee at £15 million had nothing to do with Esat but followed discussions between the Department of Communications and the EU. "No member of the board, management or staff of Esat Digifone made any representations to Brussels or elsewhere, in relation to the licence fee," he said.
He added that none of the six applicants made any comment at the time about the level of the fee being too low or that they would be willing to pay £100 million. Mr O'Brien said that Mr Doherty's suggestion that it was a "dodgy decision" was "an insult to the many Irish staff who worked on the bid for Esat, not to speak of the experts who assessed all of the bids".
The chairman of the project team which evaluated the bids is Mr Martin Brennan, a principal officer in the Department of Communications. The team included senior civil servants from Communications and the Department of Finance, as well as consultants from Andersen Management International.
Mr Brennan has responsibility for telecommunications and radio division - development. A Department source stressed yesterday that the decision by the project team to award the licence to ESAT Digifone was unanimous.
