BT and the Department for Culture, Media and Sport (DCMS) have hit back at criticisms published in a National Audit Office report.
The NAO report claimed that the Broadband Delivery for the UK (BDUK) process would be missing crucial funding from BT and would be 22 months late.
BT in particular has addressed the claim that it has only contributed 23 per cent, or £356 million, of the total funding for BDUK so far. BT says that it has in fact contributed more than £500 million to BDUK so far and, as we mentioned in our initial report, there are still more BDUK contracts to be signed.
Read Recombu Digital’s report on Fibre Broadband and BDUK and Rural BroadbandIt’s a given now that all those contracts will go to BT. This means more money will be contributed due to the obligation that BDUK contract winner has to come up with a portion of the cash themselves.
A BT spokesperson said:
“The BDUK programme is going to transform broadband speeds in rural areas benefiting small businesses and consumers alike. BT has already committed more than £500 million in capex [capital expenditure] and opex [operating expenditure] to the programme with more than a third of the contracts yet to be signed, including a very large one in Scotland. We believe we will contribute around 38 per cent of the total funds by the end of the programme, which is well above the 23 per cent claimed in the report.”
As well as this, BT has forked out £2.5 billion of its own money to connect two-thirds of the UK to superfast broadband by 2015.
DCMS recently announced that an extra £250 million will be spent on BDUK. This will be match funded by money from local councils, bringing the total extra spend up to £500 million.
Talking to Recombu Digital about deadlines and targets, DCMS says it expects 88 per cent of the UK to have access to superfast broadband by December 2015. While this isn’t quite the promised ‘90 per cent by 2015’ figure, it puts the NAO’s predictions into perspective.
A DCMS spokesperson said:
“Government is delivering a transformation in broadband and already 100,000 more homes and businesses are getting access to superfast broadband each week. Around 88 per cent of the country will have access to superfast broadband by December 2015, with an estimated 90 per cent getting superfast coverage by early 2016. An extra £250 million of investment means we will reach 95 per cent of premises by 2017 and we are now exploring with industry how to expand coverage further, using more innovative fixed, wireless and mobile broadband solutions, to reach at least 99 per cent of premises in the UK by 2018.”
The NAO expects that only nine of the 44 BDUK projects would be totally finished by March 2015.
Regarding the NAO’s criticisms of the lack of competition and the BDUK framework, the spokesperson told Recombu Digital:
“A framework was established to aid the procurement process for local authorities, and to ensure a degree of consistency and quality across the country. BDUK carried out extensive market engagement prior to and throughout the framework procurement process. Nine suppliers pre-qualified for the framework, three submitted final bids, two were appointed. Competitive tension was maintained throughout procurement of the framework, helping to ensure value for money. Suppliers withdrew from the process primarily for commercial reasons, or due to lack of technical or resource capacity.”
The NAO criticised the BDUK framework for being too complex and designed in a manner that only BT could thrive. Whether by accident or design, the end result is that BT is now the only bidder for the remaining third of BDUK contracts.
While the UK’s biggest ISP will be the sole recipient of £1.2 billion of public money, it’s also going to have to bring some money of its own to the table if it wants to continue to party.
Image credit: Flickr user steve p2008