MPs slam government for allowing BT rural broadband 'monopoly'

By Danny Palmer
01 Apr 2014 View Comments
A view of UK countryside

MPs have criticised the government for effectively handing BT a taxpayer-funded monopoly on rural broadband.

The claim, made by Rt Hon Margaret Hodge MP, chair the Public Accounts Committee, comes as the committee releases its 50th report examining the rural broadband programme - and it isn't the first time the PAC has criticised the rollout.

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BT has received all 44 contracts to deliver rural broadband, something Hodge said has completely squeezed out any potential competition in the area of providing super-fast internet.

"The government has failed to deliver meaningful competition in the procurement of its £1.2bn rural broadband programme, leaving BT effectively in a monopoly position," said Hodge, who also said the scheme has been damaged by a lack of transparency.

"Since our hearing in July last year, when 26 of the 44 contracts to deliver this were with BT, all remaining contracts have now also gone to BT. Despite our warnings last September, the Department for Culture, Media and Sport has allowed poor cost transparency and the lack of detailed broadband rollout plans to create conditions whereby alternative suppliers may be crowded out," she said.

"BT's monopoly position should have been a red flag for the department. But we see the lack of transparency on costs and BT's insistence on non-disclosure agreements as symptomatic of BT's exploiting its monopoly position to the detriment of the taxpayer, local authorities and those seeking to access high-speed broadband in rural areas," Hodge added.

However, communications minister Ed Vaizey has hit back against the claims, arguing that the rural broadband rollout is going smoothly and that competition and transparency are encouraged.

"Britain has the best super-fast broadband of all five leading European economies," he said.

"The government's nationwide broadband rollout is ahead of schedule; multiple robust safeguards are already in place to ensure value for money, and thousands of homes and businesses up and down the country are already getting the benefits.

"We continue to promote competition and have insisted on enhanced transparency from both local authorities and suppliers," he said.

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