Telecommunications Infrastructure (Relief from Non-Domestic Rates) Bill

Baroness Pinnock Excerpts

Report stage (Hansard): House of Lords
Tuesday 28th November 2017 Lords Chamber

Moved by

[Baroness Pinnock]

1: Clause 1, page 2, line 36, at end insert —
“(c) require that a certain proportion of the relief granted to providers under this Act must apply to hereditaments in deprived or isolated areas of England and Wales.”

[Baroness Pinnock (LD)]

My Lords, I now bring us from space back down to earth with the telecoms Bill. I draw the House’s attention to my interest as a councillor in Kirklees and as a vice-president of the Local Government Association.

As I said at earlier stages of the Bill, this is a constructive way of providing an incentive to IT providers to lay more fibre, with the intention of enabling more properties—both households and businesses—to access superfast broadband. My concern throughout the passage of the Bill has been that a scarce resource—public money—is being used indiscriminately. Any company that lays fibre, be it a billion-pound company or a smaller provider, can benefit. Any fibre that is laid will qualify, regardless of the wider public interest.

The benefit of fibre to the cabinet in the street is dependent on the distance from that cabinet to the property. At 300 metres away, the benefit will be negligible—although the Government’s current, but unjustifiable, measure is 1 kilometre. Broadband speeds are also dependent on the connectivity from the cabinet to the property; a copper connection further degenerates the broadband speed available. By the way, I am pleased to see that action is being taken elsewhere to ensure that adverts for broadband speeds will show realistic speeds attainable in properties, particularly households.

The concerns I just described are the reasons for the amendment. Its purpose is to make sure that the Government make the most effective possible use of scarce public resources. I listened most carefully to the Minister’s response in Committee to the practical difficulties in my amendment. It would now add this to the list of potential regulations under proposed new subsection (10) of Section 44 of the Local Government Finance Act 1988. It would require that at least some part of the resources is allocated to improve connectivity in areas of deprivation and isolation. I beg to move.

[The Parliamentary Under-Secretary of State, Department for Digital, Culture, Media and Sport (Lord Ashton of Hyde) (Con)]

My Lords, the noble Baroness, Lady Pinnock, raised connectivity in remote areas. I thank her for her remarks. It is an issue that we explored at Second Reading and in Grand Committee, and one that I absolutely agreed is of utmost importance, as I do now.

The amendment seeks to ensure that deprived or isolated areas receive “a certain proportion” of the relief. However, it is not clear what exactly that would entail as the term “a certain proportion” is not defined. By its very nature, all areas would get “a certain proportion” of the relief depending on how much and where fibre is deployed and lit from 1 April 2017. If the noble Baroness intends for “deprived or isolated areas”—again, those are not defined—to receive a higher proportion of the relief than others, the amendment would not have that effect.

The Government cannot therefore agree to the amendment as it is technically deficient and does not fully engage with how the telecoms networks are deployed and the approach taken to upgrade our networks with more fibre. I do not want to dwell on the technical deficiencies because even if they were resolved the amendment would still not be in keeping with the Bill’s very simple aim—to promote fibre connectivity wherever it takes place.

As my right honourable friend the Minister for Digital said in the other place, we need to think of the fibre network like a growing tree—he is a romantic soul. We already have a strong trunk, which links our great cities and connects Britain to the world, but we must now grow the boughs and branches. We must grow out this fibre not just in the trunk or the boughs, but in a multitude of branches that serve people’s houses, businesses, and all the public services of the land. The point is, we need to support fibre everywhere and if the relief is not available to support the growth of those branches then they may not grow at all, such is the difficult balance of the business case for more fibre. Therefore, if we seek to ensure that particular areas benefit more than others it is possible we will undermine that business case and deprived or isolated areas may not benefit at all. I do not believe this was the noble Baroness’s intention.

We do agree that it is vital to see improved connectivity in remote and indeed rural areas. People need at least acceptable broadband at home and at work; it is essential for modern life. That is why the Government have consulted on the design of a broadband universal service obligation, which would provide a digital safety net by giving everyone, no matter where they live, the legal right to request a connection to broadband speeds of at least 10 megabits per second. But we are not satisfied with just acceptable levels of access: we want to ensure that businesses and households throughout the country have access to faster broadband—superfast and better. By the end of this year, 19 out of 20 premises will have access to superfast broadband. We are taking steps to ensure that the figure rises even further in the next two years so that 97% of households and businesses have superfast access.

Some £30 million of the £200 million funding under the England Rural Development Programme has been made available through Defra. This is targeted at supporting rural businesses and growth, for broadband services in these areas at speeds of 30 megabits per second or faster where this is not currently available or planned, and to ensure that all areas can and do have the broadband speeds they will need for the future.

The Government are delivering a series of measures to support the rollout of fibre broadband in addition to the measure we are debating today. We launched the £190 million challenge fund as part of the Autumn Budget for local bodies to bid into as part of the local full fibre networks programme. As it was being developed during this year, we received a great deal of interest in that programme from local bodies in all parts of the UK, not least in rural and remote areas. The projects delivered under this programme will, we expect, encourage further commercial development of future-proofed fibre networks right across the country. This follows our announcement last year of more than £1 billion to support digital infrastructure.

Also part of that substantial sum is the digital infrastructure investment fund. That involves £400 million of government financing now being administered by fund managers and will attract significant private investment which will be available for alternative providers to use for fibre networks. This work will have impacts right across the country and enable operators to make the commercial case for wider deployment. In summary, therefore, the Government acknowledge that all areas of the country need decent broadband. That includes urban and rural areas which do not have it. I have outlined the measures the Government are taking to achieve this, but the Bill has one simple aim: to incentivise new fibre optic cable wherever it is laid, because we need it everywhere. I therefore hope that the noble Baroness will feel able to withdraw her amendment.

[Baroness Pinnock]

My Lords, I notice that the Minister, in his detailed response, made the assertion that we would have what he described as “decent broadband” throughout the country. I have to say that I query the definition of “decent broadband” that is provided by the Government. A speed of 10 megabits per second is not really acceptable in the current way that business and households operate. The Government’s measure of “decent broadband” being within one kilometre of where the fibre is laid to the street cabinet certainly does not provide broadband speeds at the property, given that 300 metres away it has degenerated to such an extent that the improvement is negligible.

What concerns me, and I have pressed it throughout the passage of the Bill, is that all public bodies—understandably, and supported by me—are moving to digital by design. For instance, if you are unemployed and in receipt of employment and support allowance you are required to make job applications online. If you are not in a facility with good broadband speeds, that is really difficult.

[Lord Ashton of Hyde]

Let me make one thing clear: the universal service obligation, which we have said will come in 2020, will be at 10 megabits per second which although I know is not acceptable to a lot of people, will allow things such as job applications to be done: you can even download and watch a film at 10 megabits per second. The universal service obligation, which is a safety net, will be available to everyone.

--- Later in debate ---

[Baroness Pinnock]

I thank the Minister for his intervention but if he has ever tried to watch a film at 10 megabits per second he will discover that you get gaps while you are watching it because the download speed is variable.

I am concerned about people who live in isolated areas and those in more deprived communities who will not be able to afford full fibre to their household and the consequent monthly payments. I have been making this case throughout the passage of the Bill, because we need to consider broadband access as an essential utility and at the moment I do not think that the Government are seeing it in that light. Nevertheless, I understand the technical arguments that have been made and I accept the Minister’s statement that the Government appreciate the importance of all households having access to broadband Therefore, I beg leave to withdraw the amendment.

Amendment 1 withdrawn.