Dismantling An ‘Independent’ Review

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From top: Peter Smyth; Fianna Fáil TD Timmy Dooley, People Before Profit TD Bríd Smith, Green Party TD Eamon Ryan, Senator Michael McDowell and Sinn Féin TD Brian Stanley

Peter Smyth, who reviewed communications between the former Minister for Communications Denis Naughten and businessman David McCourt of Granahan McCourt, took questions from members of an Oireachtas committee.

The purpose of the procurement process auditor’s review was to see if the communications between Mr Naughten and Mr McCourt tainted the NBP procurement process.

At the outset of yesterday’s meeting, Mr Smyth stated:

“I am satisfied that the process itself is safe…I do believe the process is untainted by the meetings between the former minister and Mr McCourt.”

But as questions were put to Mr Smyth by several TDs and Senators – including Fianna Fáil TD Timmy Dooley, People Before Profit TD Bríd Smith, Sinn Féin TD Brian Stanley, Green Party TD Eamon Ryan and Senator Michael McDowell – Mr Smyth faltered.

It emerged that Mr Smyth did not hold any face-to-face meetings with any of the people with whom he discussed these meetings.

Instead, he conducted his review, over four weeks, via phone calls, texts and emails.

The people with whom Mr Smyth spoke to did not give him sworn statements.

He explained his process doesn’t require him to ask people to make sworn statements.

In his review, Mr Smyth said he could only take Mr Naughten and Mr McCourt’s word for what was discussed at two one-on-one meetings and one phone call – communications for which there are no minutes, notes or no third party to verify what was or wasn’t discussed.

Mr Smyth also told the committee that, as a process auditor who has carried out many process examinations during his career, he’s never made a finding against any process.

Fianna Fáil TD Timmy Dooley first raised the department’s own communications protocol for the procurement process or “rules of engagement” and asked if the rules were broken.

Specifically, he asked about the rule that says direct or indirect “canvassing” by a bidder is prohibited.

He pointed out that if a bidder was found to have been canvassing the department, the bidder would be immediately disqualified from the process.

Mr Smyth said:

I formed the view that the meetings don’t amount to canvassing.”

Mr Dooley raised the dinner meeting in Clare, on September 16, 2017, between Mr Naughten and Mr McCourt, which was also attended by Minister for State Pat Breen, who set up the meeting, at Mr McCourt’s home in Clare.

At this point, in September 2017,  there were two other bidders seeking the contract for the NBP.

In his review, Mr Smyth found that this meeting took place outside the procurement process.

Mr Dooley said to Mr Smyth:

“The average punter on the street cannot accept, absolutely, think that, you and everybody else believe in fairytales if you think that, at no time, during that kind of encounter that there was no discussion whatsoever about the NBP.”

If the NBP was discussed, at that particular point… would you accept that that would have given considerable rise to concern while there were two other bidders in the race?

Mr Smyth said he would accept that.

Mr Dooley also raised the meeting between the two men in New York, on July 16, 2018, which was set up by Mr McCourt, where they did discuss the NBP procurement process when no member of the NBP process was present.

Mr Dooley asked Mr Smyth if he regarded that as a “breach” of the department’s own rules of engagement or communication rules.

Mr Smyth said:

Yes, I consider that to be a breach of the rules in a strict sense.”

But he added:

“Do I consider it to be canvassing? No.” 

Asked how he would define canvassing, Mr Smyth said:

“I don’t have a specific definition of canvassing…”

Mr Dooley said he couldn’t see the communications as anything other than canvassing – regardless of the outcome or impact of the canvassing – and said he feels that Mr Smyth’s report is “less than complete” on canvassing.

Mr Smyth responded:

“You’re asking me to speculate on what might have been discussed or might not have been discussed at a meeting…

I’ve avoided speculating and I’ve avoided trying to form opinions and tried to work to facts…on that basis, I don’t have any facts or information which would lead me to a conclusion that there was canvassing.”

“…I’ve no evidence that something happened, I’ve no evidence of the minister trying to engage in the process in favour of Granahan McCourt. So that leads me to the conclusion that there wasn’t canvassing.”

Mr Dooley put it to Ms Smyth:

“By you not being able to say canvassing took place, neither can you say that it didn’t.”

People Before Profite TD Bríd Smith reminded Mr Smyth about the Siteserv connection to the NBP procurement process.

In September last, it emerged Denis O’Brien’s Actavo, formerly known as Siteserv, had joined the Granahan McCourt consortium.

The 2012 sale of Siteserv by IBRC, formerly Anglo Irish Bank, to a Denis O’Brien-owned company is currently the subject of a Commission of Investigation which started in 2015.

Ms Smith asked Mr Smyth if, at any stage, he thought an investigation was warranted “into the fact that one of the bidders that came late into process was actually under investigation himself for the sale of Siteserv?”

She went on to ask if it’s OK for bidders to change like that.

Mr Smyth said he couldn’t comment on an ongoing process and said Ms Smith was asking him a question outside the remit of his report.

Ms Smith went on to ask Mr Smyth if he interviewed the junior minister Pat Breen about the meeting in Clare and Mr Smyth made a slip when he said:

I spoke to Minister Breen because he’s my third party in terms of what was discussed at the dinner with Mr O’Brien, or Mr Naughten and Mr McCourt.”

Green Party TD Eamon Ryan, who was Minister for Communications from 2007 and 2011, raised the meetings where there were no officials with the minister – on March 27, 2018 when Mr Naughten had dinner with David McCourt in the Merrion Hotel, Dublin, and during the aforementioned dinner in Clare in September 2017.

Mr Ryan said that when he was minister his officials would have been “hyper sensitive” to such meetings – because of the Moriarty Tribunal, which found the then Fine Gael Minister for Communications Michael Lowry assisted businessman Denis O’Brien’s consortium Esat Digiphone acquire the country’s second mobile phone licence during that procurement process in the mid-1990s.

Mr Ryan said:

I don’t think they [officials] would have allowed me gone into dinner with a bidder on my own. That would have set off all sorts, so many alarms bells off that it would have been red, red, red alert. Do you get that sense from the department that they recognise that those sort of informal meetings – that’s not protecting their minister when that happens…they would be very uncomfortable with that happening.”

Mr Smyth said he didn’t ask Mr Naughten’s department officials if they were concerned about the minister’s meetings with Mr McCourt.

Senator Michael McDowell asked Mr Smyth if he sought written statements from the “actors” involved and Mr Smyth said he didn’t.

Mr Smyth said in relation to meetings where there were formal minutes or notes, he “didn’t feel it was appropriate to go and start interrogating people as to what else was discussed at that meeting” and therefore didn’t ask them directly what was discussed – therefore he took the minutes at face value.

For example, although it’s known the NBP was discussed at the meeting in New York – and this was minuted – Mr Smyth said he didn’t ask those involved anything further about that discussion.

In relation to the un-minuted meetings, he still didn’t seek written statements and, instead, spoke to the people involved on the phone.

He said, of the Clare un-minuted meeting, rural Ireland and broadband was discussed, but the National Broadband Plan wasn’t discussed – verified by Mr Breen.

Mr Smyth reiterated that he didn’t ask Mr Naughten and Mr McCourt for a written account of what was discussed at the meetings but that he was copied into a memo which Mr McCourt, unprompted, sent to the Department of Communication.

They then had this exchange:

Michael McDowell: “Did he [McCourt] supply that to Minister Naughten?”

Peter Smyth: “I don’t believe so. It was addressed to the Assistant Secretary of the Department.”

McDowell: “Did you speak to them on the telephone, you said?”

Smyth: “Correct.”

McDowell: “How often did you speak to each of them on the phone in relation to these matters?”

Smyth: “So, I had eight calls and 14 text messages, plus two emails with Denis Naughten, and I had eight calls and 15 text messages and two emails with David McCourt.”

McDowell: “And you also had the benefit of a written statement…”

Smyth: “From Mr McCourt.”

McDowell: “And tell me, who arranged these phone calls? Was it you?”

Smyth: “In the first instance, with Denis Naughten, I contacted Denis Naughten’s office in Roscommon, they gave me his mobile number, I sent him a message asking him to give me a call to discuss the process and then all these exchanges were between me and him. There were a number of cases where I rang Denis and I got through to his office and he rang me back.”

McDowell: “I see, and were you aware who was with them when he was speaking to you on the phone?”

Smyth: “No.”

McDowell: “You see the advantage, do you not agree, the advantage of asking for a written statement separately from each of these gentlemen would be that they would commit themselves to a version before you started asking one of them on the phone for information in a situation where the phone call could be discussed with the other?

Smyth: “I don’t think there’s any advantage because if they wanted to fabricate evidence, they could fabricate evidence.”

McDowell: “Yes but it would be very simple if you asked both of them to come before you Mr Smyth to say ‘have you been speaking to each other since I last spoke to you?‘”

Smyth: “The process I was running was to be completed in three weeks, and it was completed in four weeks.”

Mr McDowell asked Mr Smyth if he did anything to “test” the truth of what he was being told in regards to the meetings which weren’t minuted and which couldn’t be verified by any third party.

Mr Smyth replied: “So can you give me an example of what you would expect me to have tested?

Mr McDowell said: “One is to get both of them separately to give you an account and not afford them the opportunity to confer with each other.”

Mr Smyth said he believes, according to the timing of his phone calls with the two men, they wouldn’t have had time to confer with each other.

Sinn Féin TD Brian Stanley asked Mr Smyth if he agreed with him that, because of the un-minuted meetings and no third party to verify what was discussed at the two one-on-one meetings and one phonecall, if the State could be left open to a legal challenge down the line.

Mr Smyth said:

“You’re asking me for a legal opinion. I won’t give you a legal opinion. It’s one of the things, as a process auditor, I’m just precluded from doing. It’s actually, if you read the rules about a process auditor, it’s one of the things that’s specifically precluded so I won’t give you a legal view…”

Good times.

Previously: Faulty Leakage

Mr Smyth In The House

Watch back in full here

 

 

13 thoughts on “Dismantling An ‘Independent’ Review

  1. Eoin

    Freudian!

    “I spoke to Minister Breen because he’s my third party in terms of what was discussed at the dinner with Mr O’Brien, or Mr Naughten and Mr McCourt.”

    That’s quite a “slip”, Bodger.

    Why would the “independent auditor” refer to a dinner involving “Mr O’Brien”, that is, presumably, Denis O’Brien who bought Siteserv in controversial circumstances and who has now been swapped in to this hugely lucrative state contract?

    Reply
  2. Eoin

    “He said, of the Clare un-minuted meeting, rural Ireland and broadband was discussed, but the National Broadband Plan wasn’t discussed – verified by Mr Breen.”

    This was a dinner at the private home of the sole remaining bidder (who at that time wasn’t sole but one of three bidders).

    Be interesting to know if Mr Breen took advantage of the, em, facilities while he was at the dinner. Maybe it’s just me, but I like to wash my hands before eating especially if I have just shaken the hands of my hosts. Depending on how long the dinner lasted and how much liquid was consumed, I’d probably need to take a pee at some point. So, the question is, was Mr Breen by Mr Naughten’s side 100% of the time. Maybe, Mr Naughten needed the facilities and Mr McCourt the host showed him the way. Was there seriously not 5 minutes that evening when the Minister and David McCourt were alone without the third wheel, Pat Breen present?

    Reply
  3. Joxer

    My company has just gone through a process audit. As part of one process its required that a written sign off is provided by the client before the next step of the process can commence. We had to provide evidence of that sign off to the auditors – if we cannot provide that evidence we fail the audit

    Either this Smyth fella is a sham and doesn’t know his arris from his elbow or he is covering something up

    Reply
  4. Otis Blue

    Smyth is quoted in the piece as saying he couldn’t comment about an ongoing process. So the point of the review is?

    Fairytale of New York or Banana Republic.

    Take your pick

    Reply
  5. Otis Blue

    “It is difficult to get a man to understand something when his salary depends upon his not understanding it.”

    Uptown Sinclair’s famous quote seems apt in all of this.

    Reply
  6. Liam Deliverance

    What a shambles, like many other shambles before it. To me this a corrupt process with different parties trying to manipulate the outcome in their favour. The number one priority should have been putting the most suitable and cost effective infrastructure in place to progress the NBP. Instead 7/8 years of work is useless and we will be another 5/6 years before NBP Mark II is realized. This has ramifications for jobs, housing options for those wishing to locate outside of the cities, business’s and their plans, FDI, taxation projections and many more. Many questions come to mind:

    What is the cost to the taxpayer for the NBP process to date?

    What will be the cost for the new NBP plan if the current one is shelved?

    What is the cost to the economy for the failure to deliver this 4 years ago?

    What is the cost to the economy while we wait for the new plan to be delivered?

    What is the estimated time to deliver the plan now?

    How can we know the next plan won’t also be corrupted?

    Who chose Peter Smyth to paper over the cracks and fumigate the stink from this?

    How much was Peter Smyth paid to preside over this farce inquiry into another farce?

    How many heads are going to roll because of this?

    When, for the love of Jesus, will they make it a sackable offence and loss of pension for those who act in this way or are we doomed to repeat the same mistakes over and over again and allow corrupt practices run this country in to the ground?

    Reply
  7. Otis Blue

    Why persist with universal broadband provision, as intended by the NBP, when many simply don’t want it or won’t pay for it? Eerie echoes of the whole water meter debacle.

    The 300,000 odd homes cherrypicked by Eir, which left the remaining 540,000 homes in the NBP a questionable proposition, has, I understand, a take up rate of less than 20%.

    Let’s see some decent financial modeling and cost benefit analysis before we spunk billions on this. Surely the Dept of Public Expenditure and Reform would demand no less?

    Reply

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