Watchdog slams culture unit over rural broadband

BRITAIN’S public spending watchdog has launched a scathing critique of the government’s rural broadband scheme, saying the process has been blighted by a dearth of competition.

The National Audit Office (NAO)’s review of the process for assigning state-funded broadband contracts also predicts that only nine out of 44 projects will be delivered on time.

The Department for Culture, Media and Sport (DCMS) encouraged firms to apply for a slice of a £530m pot to build superfast networks in rural areas, but BT has been left as the only contender for all 44 projects after other companies pulled out.

“Competition has been limited,” the NAO will say today. “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.”

The rural broadband project is designed to bring superfast internet to areas where providers like BT consider it economically unviable to do so alone. The scheme is a key pillar of the government’s growth strategy, but the programme – estimated to cost £1.2bn of public money in total – has been marred by delays. Last week, Miller scrapped a target of bringing superfast internet to 90 per cent of the population by 2015, moving the goalposts to 95 per cent by 2017.

“The rural broadband project is moving forward late and without the benefit of strong competition to protect public value,” said NSA head Amyas Morse. He said that DCMS had ensured safeguards to protect public money, but that these will have to be rigorously applied.

“We have noted the NAO report and welcome its confirmation that processes we have put in place to ensure value for money are strong and robust,” the DCMS said. “We agree that effective enforcement of the contracts is important and are working with local authorities to ensure this.”