30 Jun 2022

Political Notebook: Can it get any worse

PEOPLE must wonder can it get any worse.

PEOPLE must wonder can it get any worse.

The Moriarty report, published after 14 expensive years, has raised serious questions about the manner in which the second mobile phone licence was awarded to Denis O’Brien’s Esat Digifone.

Both Mr O’Brien and the Minister for Communications at the time, Michael Lowry, have vigorously contested the judge’s findings. The tribunal is a long read and only those who are intimately involved, or have to comment on it, are likely to go beyond the summary.

It is true that some of the conclusions would not survive the scrutiny of a court of law. But the tribunal was not a court of law. It was a tribunal where the judge, the highly regarded Mr Justice Michael Moriarty, sifted through mounds of evidence and reached conclusions after careful scrutiny and consideration.

People will make up their own minds on what they believe. However, to suggest, as has been done, that the judge would have stitched people up is absolute nonsense. What, possibly, could have been his motivation if the allegation is true?

He is regarded as honest and thorough, even if some mistakes were made at various stages of the long process that culminated in the publication of the report last week.

Much has been made about that fateful meeting between Michael Lowry and Denis O’Brien in a pub in Dublin on the evening of the All-Ireland final in 1995. The judge insists that the two men must have discussed strengthening the finances of the Esat consortium bidding for the licence.

Mr O’Brien and Mr Lowry say they discussed the match and Esat’s fixed-line business. There was no talk about the bid for the second mobile phone licence. The judge made his assessment on the basis of evidence made available to him. Yet the two men say they were the only ones who could know definitively what was discussed.

The bottom line is that the meeting should never have taken place, irrespective of what was discussed, given the sensitive position of the then Minister. Why did Mr Lowry decide to get involved, to some extent, and ask for information about granting of the licence on a number of occasions?

After all, this was a decision to be taken by civil servants, with outside advice, leading to the Minister going to his Cabinet colleagues with a recommendation. What about the remarkable money trail which suggested that Mr O’Brien, or those close to him, attempted to give large donations to Mr Lowry?

A disturbing aspect of the whole business was the manner in which the rich and powerful had seemingly easy access to Ministers. There is no evidence of any kind to suggest that there was a Cabinet conspiracy on the matter.

The then Taoiseach, John Bruton, and his Ministers, obviously acted in good faith in accepting Mr Lowry’s recommendation. Mr Bruton has said that he wants to read the 2,400-page report before commenting specifically on it. But he added: “One has to look back on this matter with great disappointment and regret.’’

Persona, which lost out to Mr O’Brien in the bid, got nowhere when it complained at the time to Mr Bruton and the then Democratic Left leader Proinsias De Rossa. Mr Bruton wrote at the time that “he was fully satisfied that the process conducted by the minister and independent consultants was absolutely fair, objective and non-discriminatory’’.

Mr Bruton pointed out at the weekend that the civil servants who assessed the bids had recommended Esat, as had an external consultant. Mr Bruton said he and the other Ministers understood that Mr Lowry was not involved in the process. The tribunal found that Mr Lowry had bypassed consideration by his Cabinet colleagues to deliver the result in favour of Esat.

It found that he misled the Coalition party leaders and sought to “overreach’’ Mr Bruton by claiming the government had no discretion in the decision. Mr Lowry firmly rejects this assertion.

It is imperative to remember that at the time Mr Lowry was a senior figure in the Fine Gael party, a close political associate of Mr Bruton’s and mentioned by some as a future party leader. He was a key player in putting together the Rainbow coalition and was a party fundraiser of note.

Why would Mr Bruton and others not have taken his word, particularly when civil servants and an outside consultant were involved? Fine Gael, mind you, delayed what appeared to be an inordinate amount of time in refusing to accept a 50,000 dollar donation from Mr O’Brien.

The Taoiseach, Enda Kenny, has said what had happened was “wrong’’ and he regretted the circuitous route which the donation had taken before it was sent back to Mr O’Brien.

Fine Gael reacted too slowly to the report. The party’s failure to put forward representatives on current affairs radio and television programmes in the immediate aftermath of the report’s publication was a mistake.

Sure, it was a long report. But there was a summary available. Also, the party was expecting this for a long time, knowing that there would be questions to be answered.

However, it was wrong for Fianna Fail to suggest that all Ministers sitting in the Cabinet at the time of the allocation of the licence had questions to answer.

Where, by the way, is the new politics promised by all parties since the general election? So far, we would be well advised to take all that kind of talk with a cellar of salt. So what of the aftermath of the report’s publication and this week’s Dail debate?

The report has been sent to the DPP and events will take their course. There are lessons to be learned from the 14-year process.

The time taken, and the huge cost involved, means that there must be some new process, perhaps by the way of an Oireachtas committee with the necessary powers, or a reformed Seanad, could do the job.

This is a pivotal week in Irish politics. Unfortunately, it is also likely to be a bleak week. The new Government is about to confront a fundamental economic challenge of funding the banks.

When the bank stress tests are revealed, they will give us an idea of the amount required for the fifth bank bailout since the 2008 guarantee.

The predicted figures make for grim reading. A further injection of up to 23 billion euro is anticipated. The banking hole seems to be getting bigger and bigger.

There is little talk now about “burning bondholders’’, an emotive and unfortunate term in any event. Will losses be imposed on bondholders as was pledged by the two parties now in government when they spoke from the Opposition benches?

Ireland is in receivership, as Minister Ruairi Quinn has chillingly but accurately observed. That dreadful word “default’’ now stalks the body politic.

The Minister for Finance, Michael Noonan, has made it clear that Ireland’s debt could become unsustainable. He has pointed out that there are other variations apart from the level of capitalisation required for the banks.

The level of growth one built into the economic model and the level actually achieved will be a significant factor.

Mr Noonan said: “Therefore, no matter how wise one is, it is not possible to say the debt will be unsustainable next week, next month, next year, or in three years’ time.’’

Then there is our 12.5 per cent corporate tax rate which remains, according to Mr Noonan, a “red line’’ issue. In a week in which the Dail debates the Moriarty report, it all makes for a grim scenario.

The Government, despite its big majority, has received a tentative endorsement from voters, given that hammering Fianna Fail was the first item on the agenda for a significant section of the electorate.

The coming weeks will test the Coalition’s mettle.

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