National Broadband Plan

Thursday, 27 June 2024

Questions (121)

Catherine Murphy

Question:

121. Deputy Catherine Murphy asked the Minister for the Environment, Climate and Communications if the loans charged by investors to National Broadband Ireland and their associated companies were obliged under the contract to go to market for services and procure services are in line with best practices competitive bids for products and services; if his Department allowed or facilitated the investors taking above market interest rates for loans to NBI/its associated companies; and if this is allowed under the contract. [27765/24]

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Written answers

Minister for the Environment, Climate and Communications (Deputy Eamon Ryan)

The Department has not facilitated investors taking above market interest rates for loans to NBI/its associated companies.

Public subsidy is being invested in the National Broadband Plan (NBP) in accordance with the commercial stimulus model, which sizes the level of subsidy payments required to enable investors to provide the high-speed broadband services required under the contract and achieve a commercial return on their investment.

The investors are providing equity funding to the project through the purchase of shares and the provision of shareholder loans to NBII (National Broadband Ireland Infrastructure). Utilising both these instruments is a standard form of “equity” investment in infrastructure projects. The interest earned on shareholder loans forms a part of the overall commercial returns to the investors. The financial evaluation of the final tender submission benchmarked the overall commercial return sought and concluded that it was within the benchmarks observed.