The government must urgently review its Broadband Delivery UK (BDUK) project or rural communities and businesses will suffer, the Countryside Alliance has warned.

The alliance’s comments followed the publication of a hard-hitting report by a cross-party committee of MPs.

The Committee of Public Accounts report said the government had “mismanaged” the rollout of rural broadband and “left consumers with a raw deal despite a generous public subsidy”.

The £490m programme is designed to help get superfast broadband to rural areas but the government has already admitted it will not be completed until 2017 – two years behind target.

Committee chairwoman Margaret Hodge MP said: “The sole provider, BT, has been placed by the Department for Culture, Media and Sport in a quasi-monopolistic position which it is exploiting by restricting access to cost and roll-out information.

“All 26 contracts let by June 2013 had gone to BT and the remaining 18 are likely to follow suit.”

Countryside Alliance executive chairman Barney White-Spunner added: “The delay in rollout and concerns about the ability of the BDUK project to reach all the countryside, mean rural businesses are at real risk of missing out.”

The delay until 2017 will mean the government will miss its own target of putting all key public services online by 2014. A number of services are now online only – for example animal movement paperwork and HMRC – and are therefore unavailable for those without an internet service, Sir Barney said.

“The government needs to conduct a full scale review of BDUK,” added Sir Barney.

But BT rejected the committee report: “We are disturbed by the report, which we believe is simply wrong and fails to take on board a point-by-point correction we sent to the committee several weeks ago.

“We have been transparent from the start and willing to invest when others have not.

“It is therefore mystifying that we are being criticised for accepting onerous terms in exchange for public subsidy – terms which drove others away.

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Rural broadband campaign