NAO to investigate government rural broadband programme

A host of suppliers previously decided not to enter the framework after claiming all the chips were stacked in BT's favour

The National Audit Office (NAO) is to investigate the government's rural broadband programme, after the procurement arrangements were criticised for providing BT with a cash cow.

The Department for Culture, Media and Sport is spending £530 million to subsidise investment in broadband infrastructure in rural areas of the UK. "Its primary objective is for the UK to have the best superfast broadband network in Europe by 2015", said the NAO, repeating the government's stated aim for the programme.

The NAO goes on: "The Department's rural broadband programme aims for 90 percent of premises in each area of the UK to have access to superfast internet speeds of above 24mbps, and for all premises to have broadband speeds of at least 2mbps."

BT has won all the rural broadband deals so far, which have been procured by local authorities with the help of the government cash, often in the form of matching funding.

The procurement framework saw only BT and Fujitsu able to enter the bidding stage on contracts, but after BT won the first big clutch of deals Fujitsu pulled out saying that it couldn't compete. A host of suppliers previously decided not to enter the framework after claiming all the chips were stacked in BT's favour.

BT is already building a national fibre broadband network, and it is using the rural broadband programme to connect communities with fibre which may not have necessarily got it without some sort of subsidy.

The NAO said: "This report examines how well the Department has designed the rural broadband programme and the extent to which its safeguards assure value for money. It also considers whether the 2015 targets for rural broadband provision are likely to be met."

The NAO findings are expected to be published at the end of the summer.

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