Ceisteanna—Questions. Oral Answers. - Telecom Éireann Discussions. – Dáil Éireann (27th Dáil) – Wednesday, 30 Mar 1994

Ceisteanna—Questions. Oral Answers. - Telecom Éireann Discussions.

Eamon Gilmore

Question:

9 Mr. Gilmore asked the Minister for Transport, Energy and Communications when Cable and Wireless first approached the Government to express their interest in Telecom Éireann; if Telecom Éireann has given any report to him of its discussions with Cable and Wireless or any other telecommunications company; if his attention has been drawn to evidence given by the chief executive of Telecom Éireann to the Joint Committee on Commercial State-Sponsored Bodies on 25 May 1993, in which he stated that Cable and Wireless had been introduced to the company by the Government; his views on whether this is a correct account; and if he will make a statement on the matter.

Proinsias De Rossa

Question:

12 Proinsias De Rossa asked the Minister for Transport, Energy and Communications in regard to his statement during the Adjournment Debate on 3 March 1994, if he will list each of the overseas telecommunications companies which have expressed a potential interest in linkages with Telecom Éireann; if he will give the details of each approach and the nature of the linkage proposed; and if he will give the Government's response on each occasion.

Richard Bruton

Question:

30 Mr. R. Bruton asked the Minister for Transport, Energy and Communications whether he has sought information from Telecom Éireann on proposals to purchase share holdings in Telecom Éireann or to enter into joint ventures with the company; whether there are broad policy guidelines issued by him which will guide consideration by the board of such issues; and if he will make a statement on the matter.

Mr. Cowen

I propose to take Questions Nos. 9, 12 and 30 together.

Preliminary contacts between Cable and Wireless and the Government go back for some time but developed into exploratory discussions without commitment between the company and Telecom Éireann 12 months ago. In a press statement dated 24 May 1993, I stated that an approach was made to the Department by Cable and Wireless with a view to exploring the possibility of links with Telecom Éireann, that I had asked Telecom Éireann for their views and that preliminary discussions, without commitment, were entered into between Telecom Éireann and Cable and Wireless. This accords with the statement attributed to the chief executive to the Joint Committee on Commercial State-Sponsored Bodies.

The Telecom Éireann Corporate Plan 1994-1999 indicates that in addition to these discussions, Telecom Éireann have had preliminary discussions with several other potential formal allies. In its informal day-to-day contacts with players in the telecommunications market, my Department is also generally aware of a degree of interest in possible alliances with Telecom Éireann. However, the only formal proposal made to either Telecom Éireann or to me is the one recently made by Cable and Wireless. My attitude to this proposal and other possible similar proposals is as I stated on 3 March on the Adjournment of the Dáil.

Mr. Gilmore

I am pleased that the Minister has finally acknowledged that the initial contact from Cable and Wireless was made to the Government who then introduced Cable and Wireless to Telecom Éireann. Will the Minister withdraw the statement he made in the House on 1 July 1993 in which he denied that Cable and Wireless had approached him or his Department and apologise for misleading the House on that occasion?

Mr. Cowen

Deputy Gilmore is one of the greatest exponents of conspiracy theories we have seen in this House for a long time.

Mr. Gilmore

It is fact. It is on the record.

An Ceann Comhairle

Deputy Gilmore has asked a question. Be good enough to hear the Minister's reply.

Mr. Cowen

I assure Deputy Gilmore and every Member of this House in relation to the future of Telecom Éireann that the full range of options will be considered by the board and they will advise me of the position. I am not interested in informal contacts, in meeting or not meeting somebody or in something which arose in a conversation. That is for the Trotskyite conspiracy theorists, it is not for me.

Mr. Gilmore

The Minister has denied it for the past 12 months.

An Ceann Comhairle

Deputy Gilmore ought to desist from interrupting.

Mr. Cowen

The facts are as follows. A formal proposal came to my Department in March, of which I did not have notice. When it arrived I immediately gave a directive to Telecom Éireann in which I said: "This is the first formal proposal we have received. Please seek out a full range of options and report to me as shareholder and advise me from your perspective what is in the strategic interests of this company". We will take our decisions based on that information and other expertise from consultancies which we may seek at that stage. Those are the facts and everything else is superfluous.

Mr. Gilmore

We now know, and the Minister acknowledges, that Cable and Wireless had been in discussion with Telecom Éireann for 12 months.

Mr. Cowen

I said that last May.

Mr. Gilmore

I am sure the Minister is also aware that Telecom Éireann had been considering other options in relation to strategic alliances. Why did the Minister wait until Cable and Wireless put a formal proposal on the table before asking Telecom Éireann to evaluate the various options? Why did he not ask Telecom Éireann to carry out that evaluation 12 months ago when he knew that these discussions were underway between Telecom and various companies?

Mr. Cowen

I refer the Deputy to my statement of 24 May 1993. The discussions were exploratory and preliminary in nature. There were no formal proposals put to me. I am not interested in expressions of interest; I am interested in formal proposals. I have taken a practical and pragmatic approach to this issue. I refer the Deputy to my statement to the other House in early March 1994. The bottom line is that this country must have efficient, wide-ranging and competitive telecommunications services as the crucial element in economic development and job creation, both directly and indirectly. Both Culliton and Moriarty point to that fact.

The Government will consider the full range of options that will emanate from the directive I gave to the company last week, which was the first indication of any formal interest whatever and which I outlined in detail in Dáil Éireann. I am determined to ensure that we make a conscious strategic decision after appropriate analysis and consideration. We cannot afford the consequences of policy drift in this area, neither should we look exclusively at the first offer that is made. The procedures I have outlined and put in place are a pragmatic and realistic approach to ensure, in a changing world, that the interests of Telecom Éireann, its staff, customers and the public — as owners of the company — are best served by the solutions which will emerge. That is the agenda; there is no other agenda.

Mr. Gilmore

The Minister has allowed a certain amount of policy drift to occur during the past 12 months. Practical and pragmatic may be the terms the Minister uses to describe his position but I put it to him that his considerations are political. The Minister has teed up a privatisation of part of Telecom Éireann and postponed it for six months, until after the European elections on 9 June 1994, to avoid political embarrassment for him and his parties in Government.

Dáil Éireann debate - Wednesday, 30 Mar 1994