Republican News · Thursday 12 December 2002

Just another day at the races?

The way government does business in Ireland

BY ROBBIE MacGABHANN

Secret meetings in executive boxes at the Curragh, intimate discussions while flying to soccer matches , liaisons in exclusive hotels and maybe a drink or two after the all-Ireland and of course another dubious meeting.

It is difficult being a government minister or a wealthy entrepreneur these days and the last week's findings of the Mortiaty Tribunal have lifted the lid in a spectacular way on how business is done at the highest level in Ireland and how ministers of the Dublin Government wielded their power and influence in the most questionable way.

The Moriarty Tribunal is back and examining the circumstances surrounding the granting of the second mobile phone licence to ESAT Digifone in 1995. Under scrutiny are the events that culminated with Denis O'Brien's consortium winning the licence and some years later netting him profits of £230 million while his financier Dermot Desmond pocketed £100 million. It seems that some punters can win big at the races.

So what has the Tribunal uncovered?

May 1995

17 May: Dan Egan, a Fine Gael party worker alleges he set up a meeting For Denis O'Brien with then minister for Tourism and Trade Enda Kenny and Richard Bruton, then minister for Enterprise Trade and Employment, in Government Buildings in Dublin. There are entries in Denis O'Brien's diary for this day with Kenny's and Bruton's names written in.

Egan has told the Tribunal that the late Jim Mitchell approached him and asked if he would act as a consultant to Denis O'Brien. Egan had set up the meeting to allow O'Brien explain his interest in the second mobile phone licence.

Enda Kenny has told the tribunal he has no recollection of this meeting. His diary for that day records an entry for Egan. Bruton's diary has an entry for O'Brien on 17 May.

O'Brien had also been advised by Egan to attend Fine Gael fundraising meetings where he would have the opportunity of meeting ministers in an informal setting. O'Brien had in March donated £1,000 to a Fine Gael fundraiser in Kilkenny. Dublin Central Fine Gael, the constituency organisation of Jim Mitchell, also received £2,000 from O'Brien's ESAT.

In late May, O'Brien and Lowry attended a Fine Gael fundraiser in Wicklow. O'Brien donated £5,000.

29 May: O'Brien donates £400 to Fine Gael Golf Classic in Meath.

June

O'Brien attends a Fine Gael constituency lunch and donates £1,000

9 June: Dublin Government civil servants meet to discuss confidential details of the mobile phone licence competition that would not be known by the competing groups.

19 June: O'Brien meets government officials to discuss licence.

20 June: A letter sent from a solicitor acting on behalf of ESAT has important information from the confidential 9 June meeting. Owen O'Connell, a solicitor from William Fry, who were acting for O'Brien, has not been able to explain where he got the confidential information.

Also in June 1995, Communicorp, O'Brien's company, makes its first approach to Dermot Desmond for funding but cannot agree terms. Communicorp gets a loan from another financier but is being charged 30% interest.

July

14 July: A crucial letter from the EU competition commissioner is sent to Michael Lowry. The letter contains information that could give bidders for the mobile licence an advantage in the competition.

24 July: The letter is faxed to an ESAT director

Also in July, Lowry claims that he was asked to come to a meeting with Tony O'Reilly in his executive box at the Curragh during a race meeting. Lowry alleges that the Independent News and Media chairperson claimed that he expected his consortium would win the phone licence competition. O'Reilly has said that Lowry's statement is untrue.

August

4 August: ESAT submit their bid for the phone licence.

10 August: Denis O'Brien flies to Glasgow with financier Dermot Desmond for a Celtic-Liverpool match. The two discussed the funding problems ESAT had with its bid.

11 August: O'Brien faxes new outline agreement for funding to Desmond.

16 August: Michael Lowry meets Tony Boyle, who was leading one of the consortia bidding for the mobile licence, in a Dublin hotel. There were no officials from Lowry's department present. Lowry was not supposed to have such meetings without a departmental official present. A Fine Gael fundraiser, Frank Conroy, had arranged the meeting.

Also in this month, O'Brien meets Fine Gael activist Mark FitzGerald in the Shelbourne Hotel and tells him that he had heard rumours that former Fianna Fáil Taoiseach Albert Reynolds was in line for a payoff from Motorola if they won the phone bid.

O'Brien also told FitzGerald that he wanted to raise his profile in Fine Gael and he subsequently gave £4,000 to a golf classic FitzGerald was organising in the K Club. O'Brien said he cannot remember the comments about Reynolds.

September

4 September: Anderson International, the consultants running the phone competition for Lowry's department, put ESAT at third place in the competition.

12 September: ESAT are still running third in phone competition after they make their oral submission for the phone licence. It is believed that ESAT misled Anderson and the Government as to the state of their financial backing.

15 September 1995: Lowry opens O'Reilly mine at Galmoy. O'Reilly claims that Lowry told him that "your fellows did not do too well yesterday". O'Reilly's Cellular Telephones consortium had made a presentation as part of their bid for the licence the previous day.

17 September: Lowry and O'Brien meet after the all-Ireland and go for a drink. Again Lowry has a meeting about the mobile phone bid without his officials and suggests that O'Brien get funding from Dermot Desmond.

29 September: Desmond signs a funding agreement with ESAT.

October

4 October: ESAT jump to first in the ranking for the mobile phone bid.

17 October: Lowry tells officials he wants to announce licence winners before the end of the month.

25 October ESAT announced as winners without receiving the final evaluation report from Anderson. Lowry announced the competition winners several weeks earlier than originally scheduled.

Happy endings

Other revelations about the Lowry years in office are still coming from the Tribunal, including his writing to the ESB in 1996 to tell them they would have to make their sites available to ESAT for phone masts.

When O'Brien sold ESAT in 1999 for £2 billion, netting him £230 million personally and Dermot Desmond £100 million, they probably had a quiet chuckle in the private jet, or executive box as the champagne flowed. O'Reilly lost out then, but his new consortium now owns Eircom.

So make your mind up. What do you think really happened?