26.09.13
Government failing on rural broadband programme – PAC
Failure to deliver “meaningful competition” could jeopardise the Government’s Rural Broadband programme, a new report from the Commons Public Accounts Committee (PAC) warns.
The programme aims to get superfast broadband into rural areas where commercial infrastructure providers currently have no plans to invest. The Department for Culture, Media and Sport is providing £490m funding to subsidise procurement of broadband services from BT until 2015. A further incentive of £250m will be provided after 2015.
But PAC said that awarding all 26 contracts to BT meant “the consumer is failing to get the benefits of healthy competition”. A lack of transparency over BT’s costs also posed “a serious risk to value for money”, and the MPs called for the Department to set out how local authorities will be adequately supported to check BT’s costs.
The further £250m should not be spent until the Government has developed an approach to secure “proper competition” and value for money, the committee recommended.
Publishing BT’s roll-out plans would also help other suppliers to identify how to reach the remaining 10% of the country.
Margaret Hodge MP, chair of the committee, said: “Details of speed and coverage in each local project are also being kept confidential, preventing other suppliers from developing schemes aimed at reaching the remaining 10% of premises and stopping communities and others from identifying alternative ways of providing superfast broadband.
She said the public were getting “a raw deal”.
The Department for Culture, Media and Sport said in a statement: “We put in place a fair commercial process and encouraged different suppliers to bid.
“We are disappointed that the PAC fails to recognise that thousands of rural premises who have never had a decent broadband supply are now getting one, something that is vital for farmers, rural businesses and all those who live outside major cities.”
And BT said in response: “We have been transparent from the start and willing to invest when others have not. It is therefore mystifying that we are being criticised for accepting onerous terms in exchange for public subsidy – terms which drove others away.”
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