As the Guardian reports this morning:
Plans to roll out superfast broadband in rural areas are in chaos because government mismanagement has given BT a near-monopoly in the market, a report has found.
The report, by the Commons public accounts committee, came as Labour questioned why Ian Livingston, the head of BT when the contracts were signed, was made a peer and a trade minister in June.
In its report, the MPs said the Department for Culture, Media and Sport allowed BT to profit from £1.2bn of taxpayers' assets after no other companies won a single contract to increase broadband coverage across Britain.
BT has been quick to exploit its position by refusing to reveal costs to civil servants or coverage to local councils, the MPs said. This information would be crucial in guaranteeing that BT's bids are reasonably priced and fair for the public.
As a result, the committee has taken the unusual step of calling for the department to halt payments of a further £250m until ministers and civil servants introduce competition and value for money.
And they're right to do so. The state will not now pay for disabled people to have the room they need to live. But it will pay for BT's monopoly profits, for which they will not account.
There is something very wrong when we have a society where this is possible.
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Please tell us which company you want to install broadband in the regions.
A nationalised one
Peter, did you listen to the R4 program about this last night? There were people who run much smaller telecom companies who are trying to get these contracts who were aghast at the amounts BT are charging to install Broadband.
But this useless government has handed BT a de facto monopoly and so BT is simply ripping the taxpayer off. So much for the virtues of competition and the market. The right wing in this country don’t want the state doing anything, but apparently private sector monopolies instead are just fine.
“as Labour questioned why Ian Livingston, the head of BT when the contracts were signed, was made a peer and a trade minister in June.” How far is this from corruption?
Richard. Once again here is a tale of what happens when public money is used to fill the void caused by the acute failures and lack of investment by the private sector, struggling within the rigged perameters of the market. South Yorkshire Digital Network was once hailed as a pioneering model for other regions to follow; but because private operators cannot see a big private profit in using the network, even though it has filled a vital need, the network is being wound down. http://www.bbc.co.uk/news/uk-england-south-yorkshire-23713493
Another example of the revolving door between politics and business except unlike in the 1980s, when Norman Tebbit who privatised BT was made a Director, the head of BT was made a peer and a minister. If this had happened in a third world country you would have western governments lecturing them about corruption.
Exactly David, as has long been chronicled by the Eye.
Hardly any point in anyone else bothering really.
BT have the fibre-optic installation routine sorted.
When they have installed it other companies will rent the lines and provide the service.
Pretty much like it is at the moment with copper lines…
In any case, Fujitsu was the only other company bidding, and it pulled out.
http://www.theregister.co.uk/2013/03/18/fujitsu_exits_bduk_race/
bad value for the tax -payer -quelle surprise. I wish the corporate world would decide whether it wants socialism for the rich or proper capitalism where people go bust if they do a bad job! It is happy for state money on its terms but not when it helps people in need.
” It is happy for state money on its terms but not when it helps people in need”
Exactly.
State benefits for corporate UK = OK
State benefits for population UK = NO-K