Rural Broadband Scheme Did Not Make the Most of Public Money

The Canadian federal government didn’t get the most bang for its buck when it doled out money from its $500-million fund for rural and remote broadband access, Canada’s auditor general concluded in an audit, the Financial Post reported.

The Connect to Innovate fund, which was launched in 2016, aimed to target rural locations where there was no broadband available.

Nearly 3.7 million Canadians don’t have access to internet speeds greater than five megabits per second, limiting their ability to participate in the digital economy. As such, competition for the funding was fierce. The program received 892 applications requesting a total of $4.4 billion, demand that easily outstripped available funds and heightened the need for efficient spending, the Financial Post article said.

Innovation, Science and Economic Development Canada (ISED) did not implement the program in a way that ensured the maximum expansion for the public money spent, the Office of the Auditor General of Canada, Michael Ferguson said in an audit.

The auditor general’s report comes as the Canadian Radio-television and Telecommunications Commission begins to accept applications for a separate $750-million fund for rural and remote broadband. Rural internet advocates say it’s critical for this funding to be deployed more efficiently, according to the Financial Post.

The auditor’s findings may impact the proposed spending and new recommendations could be sought out.

Some experts have advocated for a regional approach to funding, so people who know the terrain evaluate projects. This also allows for more granular look at which properties have internet access instead of writing off an entire area because one house has access.

There have also been criticisms against the mapping system used by the government since it excludes projects from funding if a single property in a 25 square kilometre hexagon has internet speeds above the five Mbps threshold.

This will hopefully get rectified in the future as the auditor has recommended ISED and the CRTC publish a more detailed connectivity map that respects confidentiality of internet service providers’ data.

The report said ISED didn’t ask applicants to demonstrate their projects wouldn’t be possible without public funding, according to the report. Nor was it transparent in the selection criteria.

The Auditor recommended the department consider a reverse auction process, where the government would propose a project and award it to the internet service provider that can deliver for the lowest government subsidy. It also suggested the department publicly outline how it evaluates projects so internet providers know what it’s looking for before filing applications.