Following the broadband money

KMPG’s £2.1m for BDUK broadband procurement work

with 8 comments

The department of culture media and sport has paid the accountancy and consulting firm KPMG £2.15m for designing and running a broadband procurement framework that has resulted in just two suppliers, BT and Fujitsu, competing for some £830m in state funding.

In addition, the European Commission’s DG Competition, which must approve funds issued under the programme designed by KMPG, has still to approve it, more than six months after it was finalised.

Pinsent Mason, the law firm that signed it off, got £711,000.

The details, which are published as part of the DCMS transparency initiative, show that KMPG received £1,179,629.94 for ‘Temporary staff: interim managers’ between 12 July and 7 December last year, and a further £968,334.78 for ‘management consultants’ between 12 January and 27 March this year.

The person leading the project, whose identity is not disclosed in the DCMS documents, was on the senior civil servants’ pay scale of SCS1, which starts at £58,200, and goes up to £117.800.

KPMG was brought in via a pre-existing Treasury procurement framework. Civil service insiders were reportedly shocked by the temporary staff’s lack of experience in procuring telecommunications products and services, although they had experience in other large public sector procurements.

The framework they produced was highly controversial because it set eligibility thresholds too high for all but the largest suppliers. This was despite government desires at the time for at least some work to go to small and medium enterprises, and for communities to play an active role in the procurements. In the end nine firms were invited, and seven pulled out, leaving only BT and Fujitsu.

The on-going delay in getting the framework approved by Brussels has prompted several county councils to go their own way.

BDUK money may start flowing now that DCMS has appointed BT and Fujitsu, but leading telecoms lawyer Mike Conradi of DLA Piper, warns that any money actually disbursed may invite legal action from existing community network operators under state aid rules.

Written by Br0kenTeleph0n3

2012/07/04 at 08:01

8 Responses

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  1. What’s the £318m for the Isle of Man Comms Commission?


    2012/07/04 at 13:15

  2. Glad that North Yorkshire (as one of the pilot projects) have sought, and been granted, state aid clearance for the BDUK project here and are not in limbo like many other county councils awaiting approval of the framework agreement by the EU.


    2012/07/04 at 13:45

  3. The latest developments in the BDUK saga give me no confidence that we will ever see decent broadband in our village (20 miles from Cambridge). The government seems to have presided over yet another cock up. If one believes the conspiracy theorists then BT actually “leant on” Fujitsu to pull out of the tendering process. It is farcical. In rural areas BT has a monopoly, and even if we formed a community broadband company, we would still have to go cap in hand to BT for connectivity to the outside world. I really don’t see any reason why the incumbent monopoly should trouser public moneys when the answer is simply. The government should just enact a law enforcing a universal commitment to provision of a specific speed broadband. Except this government won’t as they are so much in thrall to the bankers and commerce!


    Chris Newby-Robson

    2012/07/12 at 06:33

    • Are you saying the government should enact a law saying a company should supply a specific product to any property in the UK at a specific cost, regardless of the actual cost to the company?


      2012/07/12 at 08:51

      • In the case of BT, yes. If BT opened up their infrastructure to all comers and acted as a true common carrier then it might be different. However BT’s aggressive commercial practices make them a fat juicy target in my opinion. Out of the main cities they have a monopoly, and have no viable competition, yet they are asking for public taxpayers money to extend th eir monopoly. I think it is outrageous!


        Chris Newby-Robson

        2012/07/12 at 09:12

  4. Public sector project results in large income for consultants. Pope a catholic. Bears defecate in woods, etc……..

    yarwell (@yarwell)

    2012/07/12 at 09:27

  5. […] neither telecommunications nor local (as opposed to central) government procurement simply because they could be hired quickly (but not cheaply) under an existing framework contract?The consequent idiosyncratic, imploding and increasingly controversial process was probably […]

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