Alun Cairns
Main Page: Alun Cairns (Conservative - Vale of Glamorgan)
Dr Phillip Lee (Bracknell) (Con)
In the spirit of the motion, I will be as superfast as possible. First, I must draw Members’ attention to my entry in the Register of Members’ Interests. I congratulate my hon. Friend the Member for Penrith and The Border (Rory Stewart) on securing this debate. I want to talk about the local position, concentrating on rural need and on superfast broadband need in particular. I then want to talk about the potential for satellite broadband to provide a solution for those remote homes and businesses that many hon. Members represent.
To be honest, I wonder what I am doing here today. I represent Bracknell, which is part of the Thames valley, where 10% of the world’s information technology businesses are based. It is part of the golden triangle of Newbury, Reading and Bracknell. We have Oracle, Microsoft, Hewlett Packard, Dell and Fujitsu Siemens. We have so many IT companies that I do not have time to list them all. And yet, until very recently, part of my constituency only six or seven miles away still had dial-up internet. I wonder why that is.
There are many Members here today, and I imagine that their mailbags are as full of complaints about this as mine is. A village in the west of my constituency, Finchampstead, is packed with people who work in the IT sector. I knock on their doors and ask for their support, and they say, “Yes, fair enough, but how come I cannot get fast broadband? I work for an IT company, yet I come home and I cannot get a decent internet link.” I have absolutely no answer for them. I have heard Opposition Members suggesting that we could not predict what was going to happen. Well, yes we could, and some of us did. The direction of travel was pretty obvious, not only for the internet but for mobile phone usage. We can argue that the capacity we need was not predicted, but we all knew that it was going to grow.
I have been convening meetings, and BT has kindly come in to see me. I am sure that all hon. Members have received BT’s briefing today on its fibre optic outlay. It assured me that it is going to hit various target dates for its fibre optic plans, but those dates have now been pushed back. My constituency is in Berkshire, not in some gloriously remote part of the countryside in Cumbria or the Yorkshire dales. I am in Berkshire, and I do not have a decent internet service. Indeed, in my own home in a semi-rural area in Berkshire, I cannot really get the internet—it is utterly pointless. I have inquired about the problem and tried to work out the solution, as I am not convinced that fibre optic will be there for people.
That is why I shall now move on to deal with satellite broadband. This may seem remarkable, but it is possible to get a decent broadband service throughout the country via satellite. Every constituent that Members represent can secure broadband access at a minimum of 2 megabits a second via satellite. I am told that speeds can reach upwards of 10 or 12 megabits; there is a significant cost, but it is possible. That seems to me to be an ideal solution. It is arguably cheaper and quicker, and it is undeniably greener because it uses less energy to provide the service for sending around the data. It is from the same sort of satellite, I might add, that the information for our BlackBerrys and mobile phones comes. It also relies on the space industry.
Alun Cairns (Vale of Glamorgan) (Con)
Would my hon. Friend acknowledge that satellite broadband is not as reliable as mobile broadband or fixed-line links?
Dr Lee
I accept that, although there has been an improvement, as I know from having had the privilege of seeing one of the new Ka-band satellites launched before Christmas. There is room for improvement in the efficiency and effectiveness of satellites, but the space industry has plenty of experience and evidence of those developments. By the end of this Parliament, about 300,000 links will be possible for broadband via satellite. That is quite a few, and I am sure that it covers quite a few of the homes and businesses that my hon. Friends represent. Broadband Delivery UK estimates that about 2 million businesses and homes do not have good enough broadband. I am one of them and so are many people living in the west of my constituency and elsewhere.
My final point about the space industry is that it is successful—a £7.5 billion industry annually, employing more than 80,000 people. The companies that provide the broadband service do so not only here, but sell their services abroad. They sell these services, some of them to 50 or 60 countries abroad, bringing income into this country. In the process of providing a broadband service that we all know is needed for this country, we will also be able to export, which is fantastic in itself.
As my hon. Friend the Member for Penrith and The Border said, this is a no-brainer. There will be a combination of solutions to provide broadband for everybody. It will include wireless and mobile, and fibre optic, but I suggest that for the difficult-to-reach places, space provides the solution. We are fantastic at space. We are already providing solutions for broadband in that way, so let us provide some more.
Ultimately, infrastructure matters. Reference has been made to the visionaries of the Victorian age who brought us trains. However, one mistake was made during that period. If my British social and economic history serves me well, we decided to go with Stephenson’s gauge for rail, instead of Brunel’s. Unfortunately, my hon. Friend the Member for South Northamptonshire (Andrea Leadsom) has now left the Chamber, but an analogy can be drawn here: Brunel had a wider gauge, so we could have gone faster with our trains. We are now struggling to provide even faster trains; if we had gone with Brunel, we would have had them. I suggest that we adopt exactly the same approach to broadband. Let us not have a narrow vision, but a broad one. Let us have a system that provides the very best broadband for all our constituents.
Alun Cairns (Vale of Glamorgan) (Con)
It is a pleasure to follow the hon. Member for Ceredigion (Mr Williams). I want to pay particular tribute to my hon. Friend the Member for Penrith and The Border (Rory Stewart) for the work he has done in preparing for the debate and encouraging Members to become fully involved. Many Members have highlighted the problems caused by the lack of broadband in their communities. I also think that there is an obligation on us to offer some solutions and encourage the Minister in his negotiations with the Treasury. I will move on to that later and how we can come up with some answers to the problems.
I am very pleased that broadband has been considered in the debate both as mobile broadband and as fixed-line broadband, because a short time ago fixed-line was the only way we considered it when discussing it. Ofcom recently reported that there had been a 2,200% increase in mobile data traffic in 2009, and I suspect that there has been a significant increase since then, with new technology being used both commercially and as a result of lifestyle changes.
There is great variance in the availability across the constituencies we have heard about today, particularly in rural areas but also in some urban areas. In my constituency, for example, much of Barry has the benefit of superfast broadband, which runs exceptionally well, but there are pockets within that urban environment that do not. However, some rural communities, such as Colwinston and Ystradowen, have almost no coverage at all. That is a tragedy for the people living in those communities and for the young people as they grow up.
Many points have already been made about sustainability, prosperity and the fact that home working and flexible working are a way of life for many people these days. Many people would like to make them a way of life but cannot do so because of the lack of broadband in their communities. There is also a social cost that we must recognise, as some Members have mentioned.
With regard to mobile broadband, 3G is the method that most of us would use. We need to recognise the differences between England and Wales in that respect. We do not have data for my constituency, but I can offer data on the differences between England and Wales. For example, there is 79% coverage in Wales for 3G, but 98% in England. For 2G, there is 89% coverage in Wales, but 99% coverage in England. Although people might assume that the technology has moved on, 2G is still exceptionally important, because last January Ofcom decided to lift the restrictions on the use of 3G services on the 2G network. That decision favours only two operators, and I think that the solution to many of these problems must be competition. Unless there is fair competition for all the operators, we will obviously not get the swift solutions that we would like. I hope that when the Minister responds he will say what he wants to do to correct that imbalance.
Much of the solution to the problem will be the 2012 auction. The 800 MHz spectrum will be important, because it will travel so much further, and the £530 million that the Minister and the Government are making available to try to close the “not spots” is welcome, but we need to recognise that there will be limits on what that £530 million can achieve. Bearing in mind the tight financial climate, I have no doubt that there were tough negotiations with the Treasury to secure that money in order to try to deliver a universal service obligation by 2015. I have no doubt also that the Treasury will have one eye—if not one eye and one hand—on the 2012 auction, so we need to support the Minister to ensure that in his discussions with the Treasury his hand is as strong as it can be.
I remember debating eight years ago the luxury of 256 kilobits, and if anyone had 512 kilobits that was absolutely extraordinary. The universal service of 2 megabits is welcome, but let us not forget that this is a fast-moving dynamic.
Ian Lucas
Absolutely. The Minister is always very polite in his answers to parliamentary questions, but he is also very good at drafting uninformative replies, something that I worked very hard to achieve when I was a Minister. I was not quite as good at it as he is.
The provision of universal broadband services is also very important to the public sector. Online services are a massive opportunity for government at all levels to provide better services more quickly and more efficiently. However, the Government can move in that direction only if they provide those services to everyone across the country. For example, I understand that the Government intend to move to the compulsory online registration of new companies. As the former responsible Minister, I understand the reasons—costs and efficiency—for this decision, but one can justify such a move only if there is universal broadband provision across the UK. A company with no access to the internet cannot be required by the Government to use it.
If we are to have universal broadband by 2015, what will it cost? Through parliamentary questions, I have established—I did get some information—that the cost of providing universal fibre-to-the-premises provision would be £29 billion, and that more realistically universal fibre-to-the-cabinet provision would cost £5 billion. We agree that there is a market failure and that the Government have sought to address it by setting aside the £530 million by 2015 mentioned several times today. However, we all accept that that is not enough, so we must look to the private sector for the necessary investment to bridge that investment gap.
On definitions, the Government are not just committing themselves to universal broadband; they are committing themselves to the best high-speed broadband in Europe by 2015. It will be helpful if the Minister tells us today what speed he regards as high speed for these purposes. If we are to work together for the benefit of our constituents to achieve that target, we must know what it means.
We know that insufficient public money is available to achieve the Government’s goals by 2015, so let us consider the position for private investment. How is that going? Here, I regret to say, there is a problem that was referred to by a couple of Government Members, including the hon. Member for Newton Abbot (Anne Marie Morris). On 1 April the Minister received correspondence—no coincidence perhaps—in which senior executives of leading communications companies, including Fujitsu, Virgin Media, TalkTalk, Geo and Vtesse Networks, wrote that “urgent intervention” was needed to require BT to revise the pricing for the use of its infrastructure. The companies also stated that without such intervention the Broadband Delivery UK process risked a lack of vigorous competition, and as a result would fail to deliver the investment, quality, speed of roll-out, innovation and value for money that the industry was capable of delivering, and which taxpayers deserved. That is a major problem for the necessary private investment.
The communications network under Labour was extremely competitive. For example, in the past three years, competition has seen the cost of mobile broadband fall from £50 per gigabyte to less than £10 per gigabyte.
Alun Cairns
If the network was so competitive under the former Administration, why are we ranked only 26th in the world for average broadband speed?
Ian Lucas
The previous Government made massive advances in the provision of broadband services and internet services over a very long period. I am proud of our record. Had the Government stuck to the same targets, we would have achieved much more progress than has been achieved to date. I now hear from providers, and the Minister has been told in correspondence from them that without urgent intervention there will be a lack of vigorous competition in the marketplace, so what action is he taking in response to these representations?
I wish to raise one more concern with the Minister. It is now clear that responsibility for the delivery of broadband services in particular geographical areas in England is to be the responsibility of local authorities, which might create a patchwork of provision across England. Different local authorities will attach different priorities to the advancement of the network. We heard from the hon. Member for Lancaster and Fleetwood (Eric Ollerenshaw) about the issues affecting Lancashire. I was pleased to hear that the tendering process in the North Yorkshire pilot area seems to have begun, even though the pilots were announced as long ago as last October. There are particular issues when it comes to the provision of services and tender documents by local authorities. What steps will the Minister take to ensure that each local authority makes the progress needed to achieve the targets he has outlined?
I was interested to hear that Somerset and Devon are working together on their pilot project in the south-west. One of the drivers for that is the superior provision in Cornwall, which has been assisted by European funding that is unavailable in Devon. Hon. Members from Wales may be interested to know that the provision of broadband in Wales and Scotland has de facto—if not de jure—been assigned to the Welsh Assembly Government and the Scottish Government respectively. Responsibility for delivering services in Wales and Scotland will essentially be dealt with at the Assembly or Scottish Parliament level. A patchwork is already developing across the UK. It is important not to lose sight of the need for a national network. We do not need a lot of small “railways” running in individual areas without their being linked together. Although having small, big society projects set up networks is appealing, there is a danger of the networks not working effectively together. There are tensions between the small and larger projects. It is important that we maintain a competitive network.
I am sorry that I have not been able to deal with the numerous contributions made today. However, I am sure that the Minister has heard the strength of feeling from Government and Opposition Members, and that he will use the video in his negotiations with the Treasury, because there will come a time when some of the bids being made now will be turned down, and that is when government starts to get difficult. Saying yes is easy; saying no is always more challenging.
Mr Vaizey
If the hon. Lady will wait for one second, I want to use this opportunity—[Laughter.] I want to echo my hon. Friend the Member for Penrith and The Border—it is quite clear that most hon. Members want to be like him—by thanking my own officials, Mark Swarbrick and Simon Towler, who have done an astonishing amount of work on this issue. Such is their dedication that they even took the photographs for the superfast broadband document that we published in December.
The hon. Member for Newcastle upon Tyne Central (Chi Onwurah) will be interested to hear that I want to pay tribute not only to the work of Broadband Delivery UK, which was set up by the previous Government and comprises an excellent team of dedicated officials from the private and public sectors, but to the telecoms regulator, Ofcom. I know that we will be discussing the auction in a matter of moments. Ofcom is very ably led by Ed Richards, who also has a fine team. I have embarrassed the hon. Lady on many occasions, but the fact that she could say, “I’m from Ofcom” was a stamp of great quality, and she now brings adornment to the House. Anyway, I seem to have persuaded her not to intervene on me.
On the 25-megabit target, our target of having the best superfast broadband in Europe is of course dependent on a range of measures, including choice, coverage, speed and take-up. Competition is also very important. It is all very well for an hon. Member to mention that Uzbekistan has better coverage than the UK—that sounds like a bit of a slight to Uzbekistan, although I am sure that that was unintended—but it is worth remembering that Uzbekistan has a population of 5 million people, and effectively one mobile broadband provider. If we want to encourage competition, which will encourage choice, innovation and low cost, we will also have to acknowledge that the Government cannot direct and demand how broadband is rolled out.
The hon. Member for Wrexham pointed out that we expect two thirds of the country to be covered by private sector investment, with BT and Virgin clearly in the lead, along with some small network operators. As so many hon. Members were keen to praise far-flung places all over the world for their broadband, let me be the champion of British business and British broadband providers. Every three months, BT puts down a fibre network equivalent to that of Singapore. BT, a British company, is rolling out broadband at twice the pace of Deutsche Telekom, twice the pace of AT&T and twice the pace of Verizon. That is something that we should be very proud of. BT recently announced that it expects to offer an 80 megabit service next year, while Virgin already offers a 100 megabit service. I do not want to sound too patriotic because we also welcome the intervention of Fujitsu, which has plans to bring fibre connections to 5 million rural homes.
The key to this debate is supporting those areas where the market will not deliver. We have already announced four pilot areas, including the one represented by my hon. Friend the Member for Penrith and The Border—it was more than life was worth not to have his constituency as one of the pilot areas, although it was, of course, I emphasise, an independent decision—along with North Yorkshire, Herefordshire and the highlands and islands. [Interruption.] Well, we all know about the discussion of Herefordshire and Wales that took place in the House a few months ago.
We will announce the next wave of pilots next week. As the hon. Member for Wrexham pointed out, this is indeed where government gets difficult, because we will have to say no to a few. Let me offer a crumb of comfort to those who may get bad news next week. From now on, we shall be working on a first-come, first-served basis. We will not announce a third and fourth wave; any local authority whose bid is not accepted can sit down with Broadband Delivery UK, work through the bid to find out where the gaps are and then come forward again when it is ready. It will be a rolling process. We also recently announced the creation of a rural community broadband fund, which is expected to be worth up to an additional £20 million—above and beyond the £530 million we have made available.
I am conscious of time and I am anxious to talk about mobile voice and mobile broadband. I understand the issue. In rural Oxfordshire, in the village close to Wantage where I live, I have to stand in the middle of the road to get mobile coverage. When I was candidate before the 2005 election, simply getting my constituents connected to the internet was a high priority for me. I pay tribute to the work of community broadband groups, which many hon. Members have mentioned, as their ability to galvanise enthusiasm and put forward solutions is important, encouraging other operators to take an interest and see that provision of rural broadband can be profitable.
Broadband Delivery UK is taking a technologically neutral approach to solutions; mobile broadband is a potential solution for hard-to-reach areas. We want to see partnerships between fixed, mobile, wireless and satellite operators to compete for the available funds. I emphasise that there is no one-size-fits-all solution. A couple of my hon. Friends mentioned the benefits of satellite technology. I am lucky enough to have the National Space Centre in my constituency, so I would be more than happy to see a satellite solution. We have to be realistic, however, about what satellites can deliver. They will be a complementary technology, but they certainly do not provide a one-size-fits-all solution.
The key issue—and, I think, the key reason why my hon. Friend the Member for Penrith and The Border called this debate—is the auction that is about to take place for the 800 MHz and 2.6 GHz spectrum, and the coverage obligations put forward in Ofcom’s initial outline of how the auction will take place. I remind hon. Members that this is being consulted on; it is not fixed in stone. This debate will be important not just for the Treasury to watch, but for Ofcom, which will give serious consideration to any representations, along with appropriate evidence, on whether to increase the coverage obligation attached to the 800 MHz licence. It is important that robust evidence is made available.
Let me make it absolutely clear to hon. Members that the auctioning of spectrum is not a money-raising exercise. In fact, under European rules, it is not appropriate to auction spectrum simply to raise the maximum revenue possible. Ofcom has to take into account a whole range of different factors, including the investment capacity of operators. It must also undertake a cost-benefit analysis of whether the coverage obligations are inappropriately expensive.
It is important that Ofcom’s consultation is seen to be open, transparent and robust. One thing that I have learned in government is that the constituency of mobile and telecoms operators with which I deal comprises not only some of the most fantastic British companies, but some of the most litigious. If my hon. Friend the Member for Penrith and The Border could have done any additional work in marshalling his forces for this evening’s debate, it would have involved conveying to the chief executive of each company, in no uncertain terms, his and his colleagues’ view that we must get on with the auction, and that any attempt to disrupt it through litigation could set back the auction and therefore the roll-out of spectrum.
I have deliberately avoided being partisan in my speech, but I must express disappointment about the interventionist approach that I consider the last Government to have taken in regard to the spectrum auction. I believe that if they had simply left it to Ofcom, we would have reached the end of the process before the present Government had even come to office.
We should bear in mind the changes that are taking place in the UK mobile market and in technology. I had the privilege of visiting Alcatel-Lucent recently to observe the technology that it is developing in Swindon. It is good to see inward investment taking place there. Technologies such as femtocells—which, essentially, provide small base stations in the home or office—will radically improve indoor coverage, and will give users better coverage.
The hon. Member for Wrexham made a valid point in his critique of the Government’s policy in regard to local authority bids. I think that local authorities are best placed to lead the bids, but it is important to remember that Broadband Delivery UK sits behind the bidding process,. It is able to advise local authorities on procurement, and assesses bids partly on the basis of the capacity of a local authority to deliver in terms of its personnel and expertise. The more such bids are made and the more individual local authorities engage in procurement exercises, the more other local authorities will have an opportunity to learn from the process.
Let me end by reminding the House that Rome was not built in a day. We must bear in mind the capacity of the private operators and companies that will deliver superfast broadband. I believe that we have adequate sums to support it, but I take the concerns expressed by Members on both sides of the House very seriously. We are working as hard as we can, given the constraints within which we operate, to deliver good superfast broadband to as many people as possible by 2015.