Local Government Funding: Rural Areas

Debate between Lord Herbert of South Downs and Graham Stuart

Monday 11th January 2016 Commons Chamber

[Graham Stuart]

My right hon. Friend makes a strong point.

Returning to my theme of why we should be at least cautiously optimistic about any review promise in future, the Government responded to our campaign in 2014 and promised to conduct research into the additional costs of delivering services in rural areas. They say that they cannot move to recognise it until the evidence is there, and we have long said, “Show me a single service that is cheaper to deliver per head in a sparse rural area than in a concentrated urban one, and we will be delighted to hear it.” I have not heard anything yet. Apparently the current inequities are defensible without any evidence, but any change, even on the most common-sense basis, requires vast amounts of it.

Anyway, the Government conducted the promised research.in 2014. They gathered data from councils at short notice, during the month of August. Strangely, there was a shortage of data, and—unsurprisingly—no real conclusions were reached and no appreciable change was delivered. We were told, “We are sorry, but there is nothing to justify any change.” I therefore caution colleagues not to expect jam tomorrow.

[Nick Herbert (Arundel and South Downs) (Con)]

Does my hon. Friend agree that the Government deserve real credit for announcing that they will adopt a national funding formula for schools to ensure that their funding will be delivered on an equitable basis in future, although the formula will be phased in? Should we not simply ask for the same arrangement in relation to wider funding? I am not suggesting any kind of gerrymandering of the system. I am merely suggesting the introduction of simple fairness that would recognise equality of need.

Rural Phone and Broadband Connectivity

Debate between Lord Herbert of South Downs and Graham Stuart

Tuesday 3rd February 2015 Commons Chamber

[Nick Herbert]

I am not sure whether that is the case, but we can look ahead at how we can inject more competition into the sector to ensure the competitive pressures needed to improve customer service. I would look again, as hon. Members have suggested, at BT’s relationship with Openreach and see whether there is a case for splitting them, injecting more competition there and potentially breaking up Openreach. We need more competition in this sector.

Secondly, we should not be fixated on the fibre-based solution, which will never be realistic in the hardest-to-reach rural areas. In those areas, wireless technology or access to 4G or faster mobile data signals will become the solution. I do not believe that satellite will be the solution. We therefore need to ensure that the kind of solutions being advanced in public-private partnership recognise that different solutions will be necessary in rural areas.

[Mr Graham Stuart]

Does my right hon. Friend, like me, welcome the £10 million fund that the Government have created to develop new technologies? Does he, like me, hope that the Government might be able to go further to make sure that small companies, such as those in my constituency, can be supported to develop the technology, show proof of concept and thus challenge BT and deliver for rural communities?

[Nick Herbert]

Indeed. Like my hon. Friend, I welcome the Government’s funding initiative in this area. I had intended to go on to say that. None of what I say is a criticism of the Government; they are merely suggestions as to how we can improve the situation further.

Thirdly, we need to ensure that the technologies adopted are future-proof. There is a danger that in seeking to meet the commitment to wholesale coverage by 2017 or superfast coverage for 95%, technologies are adopted that will not stand the test of time and will quickly be found to be insufficient.

Fourthly, I have a general observation to make about subsidy. Given that we all agree that access to broadband is an essential public service, there is a role for public subsidy in this area. That role should be to correct instances of market failure. We need to be careful to ensure that subsidy is not directed at companies or providers where the market would provide a service. With the current BDUK roll-out, there is a danger that public money is being used to close the gap in areas where it would have provided the service anyway, and the remaining 5% or 10% is not being covered. We must ensure that in future subsidy is directed to the hardest-to-reach areas and that the market is left to fill the gaps. That is a hard judgment to make, given that we are trying to ensure that the market operates properly.

In my constituency villages are being connected one by one. There is a tremendous improvement, which reflects the initiative of the Government and the county council. I welcome that, but I suspect that many of those villages would have been connected anyway to fibre. What is happening is that the rural areas are being left out. I remind the House that these rural areas comprise a great number of people and rural businesses who need to be connected. There is the danger of a growing digital divide, which might in turn become a further manifestation of something we need to avoid: a rural-urban divide. We see that in many other aspects of policy, and I think that we should strive to prevent it.

I mentioned that three and a half years ago I convened a summit to discuss how to improve the situation in West Sussex, and I believe that it bore fruit. I therefore suggest holding another similar event in West Sussex, not to criticise but to look forward and see how we can close the gap and ensure that we do not have a digital divide in rural West Sussex in future. I would be grateful if my right hon. Friend the Secretary of State considered attending the summit, partly because of the lessons I think there would be for other rural areas. The summit would have the active support of the South Downs National Park Authority, for instance, which is very interested in the issue. The Government have done a great deal to improve the situation. We must now ensure that we go further and close the digital divide.