BT Criticised For Inflated Rural Broadband Costs

BT has been heavily criticised for “vastly overestimating” its rural broadband costs by more than £90 million.

A report by the National Audit Office revealed that the actual price of equipping rural areas with high-speed Internet came to 25 per cent or £92 million less than BT’s figure.

Read more: BT announces G.fast trials, aims to bring blistering broadband speeds to UK

MPs have now suggested that the telecoms firms should use the leftover money to extend its broadband reach into even more remote parts of the UK. The Public Accounts Committee (PAC) has also questioned how BT came to such an inflated figure in the first place.

“Although it’s reassuring that the cost to the public purse could end up being £92m less than what BT had originally forecast in its bid, I worry that this does not stack up with what BT told my committee in 2013,” Margaret Hodge, chair of the PAC, told the BBC.

“It is very concerning that it looks like BT could have abused its dominant position in the market by vastly overestimating forecast costs in the first place when it put in its original bid, and we also have broader concerns about whether the deal represents value for money.”

However, BT claims that suggestions it deliberately intended to overcharge consumers are wide of the mark and would have been detrimental to the company itself.

“The suggestion we inflated those costs is bizarre as by doing so we would have hindered our chances of winning the work,” said a company spokesman.

Read more: BT hits rock bottom on customer satisfaction

The company explained that its initial estimate was based on how much it believed rural deployment would cost, but that the savings would now be reinvested. BT plans to provide broadband speeds of up to 500Mbps to homes across the country via a new form of technology called G.fast.