Broadband (South Northamptonshire)

Lord Vaizey of Didcot Excerpts

Wednesday 26th February 2014 Westminster Hall

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

I am pleased to be speaking under your chairmanship, Mr Williams. I congratulate my hon. Friend the Member for South Northamptonshire (Andrea Leadsom) on securing this important debate. She is an assiduous champion of her constituents and their interests, and it does not surprise me that she seeks to draw my attention to the importance of broadband to her constituents.

Before responding to the specific issues that my hon. Friend raised, I will give a brief overview of the broadband project as it is developing. Having commissioned research, the Government know that investment in broadband pays enormous dividends in economic growth. A recent study that we commissioned showed that over the next decade every pound invested in broadband will deliver a £20 return investment. That sounds an unusually high return, but it is realistic because broadband is a general-purpose technology, which has an increasingly critical role in the day-to-day running of businesses large and small.

The bulk of that economic impact will come from improvements in business productivity and will safeguard employment in areas that might otherwise be at a disadvantage. There will be a time saving for people who will no longer have to commute, and opportunities for people to participate in the work force. The gross value added attributable to our current programme is about £6.3 billion a year by 2024, with about 20,000 jobs attributable to the programme. I have been told that increased teleworking will save around 10 million hours of leisure time every year, as well as reducing commuting costs.

We invested some £500 million in our original programme to bring superfast broadband to areas where it was not commercially viable, and that money was matched by local authorities. The total sum was around £1.2 billion. As my hon. Friend said, the Government gave Northamptonshire some £4 million, which was matched by the county council and topped up by the telecoms provider BT.

The programme in Northamptonshire, before we announced our superfast extension programme, was designed to achieve 89.2% fibre coverage, which meant that 87.4% of all premises in Northamptonshire county council’s area would receive speeds of 24 megabits and above. Some 228,000 premises in the Northamptonshire county council area will be covered by BT commercially and almost 50,000 premises—48,600-odd to be exact—will be covered by the intervention of the Government and the county council. As my hon. Friend pointed out, 18,500 premises in her constituency will benefit from the programme.

I am pleased to say that, according to my understanding, the programme in Northamptonshire is now two months ahead of schedule. It may or may not have escaped your notice, Mr Williams, that the Government were criticised some months back for the programme’s being delayed. In fact, the more one sees the programme getting under way, the more one sees that it is now beginning to exceed its targets. In my hon. Friend’s constituency, we have so far reached 3,300 premises through the scheme and we should have covered another 2,000 premises by the end of March.

The programme is very successful, not only in Northamptonshire, including South Northamptonshire, but across the country. We are covering more than 10,000 premises a week. We hope to get to a milestone of half a million premises reached some time towards the approach of summer. We hope then to be covering some 40,000 premises a week.

Let me echo the tribute paid by my hon. Friend to her county council—Northamptonshire county council. From the very beginning of the project, we wanted to partner with local councils and Northamptonshire county council has stood tall as an exemplar of a county council to partner with. Not only has it match-funded the Government money, but it has proved effective in ensuring that planning barriers were removed and in co-ordinating all the different elements that need to go into a smooth roll-out of superfast broadband. It does not surprise me at all that the programme is already ahead of schedule; a lot of the credit for that has to go to the county council.

My hon. Friend also mentioned the Tove valley community broadband project in the south of Northamptonshire. I echo her comments. That is a hugely successful project, as she said, with more than 50% of the households in its target area having signed up for the superfast service, making the project financially viable. I am pleased to say that Broadband Delivery UK and the Department for Environment, Food and Rural Affairs have, in principle, approved £118,000 for the project through the rural community broadband fund. It is good to see how the local communities have worked so closely to put together the project, which will bring superfast broadband to Tove valley.

I am delighted with the excellent progress that we have seen in Northamptonshire and I look forward to the continued success of the county roll-out, which will see a further 18,000 premises passed. I am pleased that we were able to find the additional money—£3.64 million —to go to Northamptonshire as part of the superfast extension programme.

Nothing is ever perfect and I take on board my hon. Friend’s points about some of the issues that she is having to deal with in her constituency. I have to say that I have found BT to be a very good partner in terms of broadband delivery roll-out, but I hear what her constituents in Grange Park say, which is that perhaps, in her words, they are being held to ransom by BT, as BT is the only supplier.

However, it is probably worth pointing out that BT often finds itself as the only supplier in areas where other commercial suppliers simply will not compete because it is not necessarily commercially viable. She will not find Virgin Media there because it may not be commercially viable for it to compete in Grange Park. Although one finds a plethora of commercial suppliers competing for the business market, the residential market is less competitive, because, to put it bluntly, it can be less profitable.

My understanding is that in Grange Park, some 650 premises already have superfast broadband as part of BT’s commercial roll-out. A further 193 premises will get it in 2014 as part of BT’s commercial roll-out, and 77 premises in Grange Park will get it as a result of the rural broadband initiative. That still leaves some 700 to 900 premises looking for a solution, so my hon. Friend is absolutely right to raise the issue, and to do so in this Chamber. I promise her now, in this forum, that I will get back to BT, BDUK, and the county council, and work with her to see whether we can make progress on a solution.

I was also pleased to hear my hon. Friend mention mobile coverage. She rightly expected me to solve a number of problems for her in the Chamber this afternoon, so let me see whether I can oblige. I am delighted that we are now seeing the roll-out of 4G—fourth-generation technology for mobile phones. It was a fraught process to get to a position in which we were ready to auction the spectrum, but the spectrum auction went very well and we are now seeing the roll-out of 4G nationwide. That roll-out itself is set to conclude some two years ahead of schedule; the licences require 98% coverage for one licensee by the end of 2017, and my understanding is that all four main operators plan to reach that figure by the end of 2015.

I have to say to my hon. Friend that, according to my understanding, from discussions with the operators when they give indications for specific areas or constituencies of the country, we will see a significant uplift in terms of mobile coverage. Not only will 4G coverage extend mobile coverage significantly, but the roll-out of 4G will also see, as a knock-on effect and knock-on benefit, a significant increase in coverage of 3G.

Mobile coverage, alongside fixed broadband coverage, is an issue of significant concern to the Government. We are actively looking at that to consider ways in which to improve it, because what sums up the whole debate, and why it is so appropriate for my hon. Friend to have secured it, is the recognition over the past few years that good, superfast, digital communication, whether mobile or fixed, is becoming an essential aspect for almost every business and an essential part of our leisure life as well. That is why I am so pleased that the fixed broadband project is going well.

I am pleased that we are delivering in my hon. Friend’s constituency. Nothing is ever perfect and she is right to point out where there are gaps in coverage. I repeat my pledge to work with her, the county council, BT and BDUK to deal with the issues that she has raised.