UK government under fire for rural broadband blunders

Posted on 8 Jul 2013 at 14:13, by Robert Jaques

The UK government has come under fire for a series of blunders which have led to broadband services for remote areas being delayed by up to two years.

The project, which is supposed to make superfast broadband available to 90 per cent of premises in each area of the UK, is now expected to be delivered nearly two years later than initially planned, according to the National Audit Office (NAO).

Only nine out of 44 local projects are expected to reach their original target of providing 90 per cent superfast coverage by May 2015. The delay is partly because gaining approval under EU State aid rules took six months longer than expected. In June 2013, the government revised its target, and now aims to secure delivery of the rural broadband programme by December 2016, as well as 95 per cent superfast coverage by 2017.

According to the NAO, measures designed to make the broadband rollout less risky have backfired, resulting in diminished competition. "The design of the competitive framework had the advantages of ensuring affordability and transferring risk but, together with State aid conditions and other commercial factors, led to potential suppliers withdrawing from the bidding process. BT was left as the only active participant in the framework and is likely to win all 44 local projects."

"In addition, the Department has secured only limited transparency over the costs in BTs bids. It does not have strong assurance that costs, take-up assumptions and the extent of contingency contained in BTs bids are reasonable."

The rural broadband project is moving forward late and without the benefit of strong competition to protect public value. For this we will have to rely on the Departments active use of the controls it has negotiated and strong supervision by Ofcom, added Amyas Morse, head of the National Audit Office."

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