The former senior adviser to the rainbow coalition, Mr Seán Donlon, is to tell the Moriarty tribunal tomorrow about two occasions when he was told that Sir Anthony O'Reilly was unhappy about not winning the State's second mobile phone licence.
Sir Anthony, chairman of Eircom and of Independent News & Media (IN&M), is to give evidence to the tribunal on Wednesday. He had an interest in one of the failed bids for the licence.
Mr Donlon, a former secretary general of the Department of Foreign Affairs, is to tell the tribunal that it was made clear to him by executives of IN&M in 1996 that the government would receive hostile coverage in its newspapers if certain commercial matters connected with Sir Anthony were not addressed.
At the time the Independent group had an interest in a licence for the distribution of television channels using the MMDS system. However, unauthorised operators were using TV deflectors to provide the same service, mainly in Co Cork. The Government did not want to close them down because it had become a political issue.
Mr Donlon has prepared a statement of intended evidence for the tribunal which has been seen by The Irish Times. In it he said he had no direct contact with Sir Anthony during the licence competition. However, at an America Ireland Fund function in UCD in June 1997, Sir Anthony conveyed his unhappiness to Mr Donlon about how the government was treating his interests, he said.
He was told by the then Taoiseach, Mr John Bruton, in 1996, that Sir Anthony was unhappy about not winning the licence. He was also told in 1996 by senior executives of IN&M that Sir Anthony was unhappy about not winning.
He was also told by then US ambassador Ms Jean Kennedy Smith in 1995 that American interests she knew of were confident they would win because they were involved with Sir Anthony in their bid. This was before the result was announced.
Mr Donlon said he was told in late July 1996 by Mr Bruton that he [Mr Bruton] expected a meeting in the near future with Sir Anthony. Mr Donlon was asked to prepare a briefing for Mr Bruton.
He was generally aware that Sir Anthony was unhappy about the TV deflector issue and had believed the government was not implementing the law. He was given a briefing about the matter so he could brief Mr Bruton.
After Mr Bruton met Sir Anthony in a house in Glendore, Co Cork, Mr Bruton sent a fax to Mr Donlon summarising what had arisen. He did not have a copy of the fax but believed TV deflectors was the main issue raised. Other matters were Sir Anthony's disappointment about the phone licence competition, road access to a mine in the midlands, and the level of grant aid for a Heinz factory in Co Louth. Sir Anthony is a former chairman and managing director of Heinz.
Mr Bruton has already given evidence to the tribunal about the Glendore meeting.
Mr Donlon said he subsequently had a relaxed meeting with representatives of IN&M in its offices in Hatch Street, Dublin. He met Mr Liam Healy, Mr B. Hopkins and Mr Mike Burns. He had known Mr Healy for a number of years. Most of the lunch was spent talking about the alleged failure of the government to implement the terms of the Cork TV MMDS licence. However, dissatisfaction was also ex- pressed about the government's general attitude to Sir Anthony's interests, including the failure in the licence competition. This was, however, said "en passant".
"Despite the relaxed mood I was left in no doubt about Independent Newspapers' hostility to the government parties if outstanding issues were not resolved to their satisfaction." Mr Donlon said his only involvement in the competition was when he was asked by Ms Kennedy Smith if the decision on a winner was a government decision. He said this may have occurred in late August or early September 1995. He checked and then told the ambassador the decision was one for the government. The query from the ambassador arose when he was discussing other matters with her.
He had no foreknowledge of when the competition outcome would be announced.
