The UK Public Accounts Committee (PAC) has criticised the government for leaving BT in a monopoly position after failing to encourage competition in the procurement of its £1.2bn rural broadband.
According to the watchdog’s report, BT had been awarded all the contracts to extend faster internet connections to areas that are not considered commercially viable.
In July 2013, PAC raised concerns over BT being awarded 26 of the 44 contracts to deliver the intended schemes.
PAC chair Rt Hon Margaret Hodge MP said: "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."
"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."
The DCMS has been called on to gather, study and publish data on costs related to deployments from the existing BDUK programme, in efforts to notify pottential suppliers about the next round of funding.
"And before that next round of funding is released, the department should work with local authorities to ensure there is real competition and value for money," the report added.
In response to the PAC report, a BT spokesperson told the Telegraph that the criticism of BT was ‘inaccurate and unjustified’.
"It is frustrating that the committee continues to try and pick holes in the programme rather than recognise the wider value and benefits it is delivering," the spokesperson added.
"BT was the only company willing to accept the challenging terms on offer and make a significant investment in rural areas.
"This was at a time when others walked away when they realised easy pickings weren’t to be had.
"Claims that BT is a ‘monopoly’ are simply inaccurate given more than 100 ISPs are offering fibre across BT’s open network."
