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Government Reviews State Aid Approach for Broadband Delivery UK

Monday, December 1st, 2014 (11:15 am) - Score 1,199
dcms superfast broadband britain

The Government’s Department for Culture, Media & Sport (DCMS) has appointed economic analysts Oxera to conduct an independent evaluation of how state aid (public funding) is being used in the national Broadband Delivery UK (BDUK) scheme, which currently aims to make fixed line superfast broadband (24Mbps+) speeds available to 95% of the population by 2017.

But critics of the scheme, especially those who may be angry at how most of the public investment (around £1.7bn so far) has gone towards BT, probably shouldn’t get their hopes up because the Government aren’t likely to stab themselves in the back and have already said that the review “will be used to support the re-notification of the current scheme for extended period State aid clearance when it expires on 30 June 2015“.

DCMS Statement

The evaluation will be used to verify whether the NBS has been to date implemented in full compliance with the Decision and the Broadband Guidelines; and to understand whether its National Broadband Scheme has met its primary objectives and assess the impact of the scheme on markets and competition, in line with the State aid Evaluation Methodology.

Should stakeholders wish to make representations about either of these two aspects to implementation they can do so by contacting Christopher Davis. He can be contacted by email at Christopher.Davis@oxera.com .

The evaluation will be open to responses from stakeholders until 10th December 2014 (i.e. not enough time for a serious review to take serious responses) and appears mostly designed to support the second round of BDUK funding (i.e. the £250m being spent to go from 90% to 95% coverage between approximately the end of 2015 and the end of 2017).

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15 Responses
  1. But used in combination with NAO, PAC, it may provide the opportunity for the state aid measure (SA.336671) to be modified so more cost transparency becomes possible.

    The issue is not competition but the lack of competition to Openreach. The latter is not surprising in rural areas, hence the need for transparency so the monies can be stretched as far as possible.

    The existing milestone payment system does not appear to permit ‘contingencies’ to be identified and re-spent. Clawback is only suited to recoveing the premium on take up, not the undelying inflation in the milestone payments identified by the NAO.

  2. Avatar Bob

    The Contracts should have been awarded to at least two companies so that you can compares costs and performance

    The fact that BT got awarded a 100% of the business tends to indicates there was something seriously wrong with the process

    • Avatar X66yh

      …….or alternatively that they were by far the best and the most outstanding quotation received by the government.
      You cannot force other companies to quote you know!
      The others could see a walking disaster when they see one and probably knew they were going to get the blame when it all went wrong so decided they really did have better corporate things to concentrate on.

  3. Avatar terri

    24mbps+ adsl2+ speeds which its all over hyped with ” superfast ” its a con same as the line rental .

    • ADSL2+ can theoretically deliver “up to” 24Mbps under lab conditions and in very close proximity but NOT “greater than 24Mbps” as specified through BDUK, so it is excluded.

      In the real-world even the best ADSL2+ lines are only truly able to achieve about 20Mbps (possibly a tiny bit more) due to practical limits and even that will be rare.

    • Avatar terri

      why do they try to say 24mbps is superfast as I have seen adsl2+ upto 24mb they say I think BT need to look and say to themselves is 24mb superfast because they selling a product what is not what it all seems. but nevermind they will learn when everyone gets rid of the green cabinet rubbish .

  4. Avatar Mocngog

    Are local authorities having independant assurances carried out to check that what BT state they have installed and to what standard is correct?
    I know that the Welsh Government have and they have made savings as well as ensuring that standards are met.

  5. Avatar GNewton

    “Are local authorities having independant assurances carried out to check that what BT state they have installed and to what standard is correct?”

    Not in Essex which is heavily hiding behind so-called commercial confidentiality clauses. There are known cases where they have spent up to £2400 per VDSL line, a collosial waste of money.

    • Avatar fastman2

      Gnewton — thins is what happens wuth LA proritises areas -assume you are referring to busines parks

  6. Avatar fttx

    BDUK was engineered to be only viable to BT.

    The PIA(Physical Infrastructure Access) was the first masterstroke.
    Having Fujitsu as the last remaining ‘competitor’ was the second.

  7. Avatar fttx


    SKY / Talk Talk / Fujitsu / Geo / Virgin / Vodafone / Google / BT ? many others all building and investing.

    If an OAN (open access network) with point to point optical was deployed like Fujitsu originally proposed it would be suitable for ALL operators – even carrying SKY and Virgin RF signals so no set top box swaps.

    But yeah… 20Mb on VDSL is ok for the foreseeable eh?

  8. Avatar dave

    get the govt to require bt openreach to make a 17Mbps FTTC broadband tier at low cost, then we’ll see some serious average speed increases in britain.

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