Broadband (East Yorkshire and North Lincolnshire)

Graham Stuart Excerpts

Monday 10th September 2012 Commons Chamber

[Andrew Percy]

Not quite. I am going to talk about east Yorkshire now; it is a disadvantage of representing two counties. [Interruption.] With almost perfect timing, my hon. Friend the Member for Beverley and Holderness joins the debate just as I move on to east riding.

We have a specific issue in a large part of east Yorkshire. Kingston Communications, the telephone service provider in Hull and the surrounding area up to Beverley, is a separate company that was developed by the local council. There is no BT provision in that area. KC’s internet service, Karoo, has a mixed reputation, but it is delivering broadband speeds of 100 megabits in parts of Hull. KC is, however, excluded from the national procurement framework. Will the Minister take into account the unique nature of the area, given that it has that historical network which specifically excludes BT? KC cables are installed not only in the area from Hull to Beverley but across the whole of east Yorkshire, and they could be tapped into as part of the roll-out.

The delivery of the East Riding’s broadband plan will be particularly difficult, because it is the most rural unitary authority in England. It has particular geographical problems and a lot of small, remote communities.

[Mr Graham Stuart (Beverley and Holderness) (Con)]

My hon. Friend will also know just how many small businesses there are in the East Riding of Yorkshire. It is not some rural backwater. There is a huge amount of entrepreneurial activity there, and it is increasingly reliant on access to the internet. That is why I congratulate him on securing this important debate tonight.

[Andrew Percy]

My hon. Friend is absolutely right. He is a passionate advocate of better broadband connectivity in his constituency, and I know that he takes a close interest in this issue.

If the funding gap for the East Riding broadband plan is greater than 50%, will Ministers look again at its funding allocation? We welcome the Government’s temporary announcement on broadband infrastructure planning, which we hope will speed up the roll-out. We also hope that safeguards will be put in place to accommodate reasonable objections, particularly in conservation areas. Will the Minister give a guarantee that the projects in east Yorkshire and north Lincolnshire are on course to be completed in 2015?

I am using the opportunity of this longer Adjournment debate to raise all these points, Mr Deputy Speaker, and I hope that it meets with your approval that I am taking more time than usual. There are two counties involved and the case for each of the broadband delivery plans is compelling. I hope that the Minister will be able to respond to my questions on wireless, on North Lincolnshire’s position on the list, on whether there will be a funding gap in the East Riding, and on whether we can look into the KC issue.

[Mr Stuart]

I should like to put on record that my right hon. Friends the Members for East Yorkshire (Mr Knight) and for Haltemprice and Howden (Mr Davis) and I all fully support my hon. Friend in his efforts to make the case for improved broadband infrastructure in east Yorkshire.

[Andrew Percy]

I thank my hon. Friend for that intervention. I should tell him, kindly soul that I am, that I mentioned those colleagues earlier in the debate. We are all on the same page on this issue.

My final point is on the same topic but goes off on a slight tangent. It relates to 4G. We know that 4G technology is going to play a part in the nation’s broadband solution, and it is particularly important for people on the go. For many, that is equally as important as their broadband at home. It is always good to cite a report in Parliament, and I should like to mention one produced by Capital Economics, which found that the deployment of 4G broadband could create or protect 125,000 jobs nationally and lead to £5.5 billion-worth of direct investment over the next three years, adding 0.5% to the UK’s gross domestic product.

We had a conversation recently with Everything Everywhere, which I believe is Orange and T-Mobile, and it has been given permission to roll out 4G on some of its spectrum—tomorrow, I believe. It is important that the 4G spectrum auction, which has already seen significant delays—I want to press the Minister on this point—happens as soon as possible, so that consumers can benefit from more competition in the market and have good access to superfast broadband not only at home, but when they are on the go, too. On those points, I conclude and look forward to hearing the Minister’s response and his assurances.

--- Later in debate ---

[Martin Vickers]

Thank you, Mr Deputy Speaker, for drawing me back closer to the important issue of broadband.

[Mr Graham Stuart]

Will my hon. Friend give way?

[Martin Vickers]

Gladly.

[Mr Stuart]

I am grateful, and I am sure that he was making the point that the admirable and excellent reduction in bridge tolls, the improvement of the A164, the Beverley southern by-pass and the vast investment in infrastructure—

[Mr Deputy Speaker]

Order. I can assure the hon. Gentleman that that is not part of the debate. Members certainly do not need to reply to the point or bring it into the debate again. I am being very generous and I am trying to help. I am sure that no one wants to test the Chair’s patience at this stage.

--- Later in debate ---

[Mr Vaizey]

It is very important for us to debate the provision of broadband services in the constituency of Brigg and Goole. My hon. Friend mentioned six issues on which he would like to hear from me about progress. The first was wireless provision. The second was whether the bid from his part of the world could be moved up the ladder. The third was the role of Kingston Communications in broadband delivery. The fourth was the question of what steps might be taken if a funding gap arises. The fifth was a request for a guarantee that broadband roll-out will be finished by 2015. The sixth was an update on 4G spectrum. In responding to those six points, I have an opportunity to update my hon. Friend and the House on the progress that has been made in achieving the Government’s objective of stimulating more private sector investment in locations where the commercial investment case is weak.

Let me make it clear that we do not underestimate the importance of superfast broadband in stimulating economic growth and in providing a core service for many businesses and consumers throughout the country. That is why one of the first steps we took on coming to office was to set aside some £530 million to support public intervention. It is important to stress the fact that that money has been provided to support the roll-out of superfast broadband where the market will not deliver.

The market will deliver to about two thirds of the country, mainly the urban areas. That will be done by BT and Virgin Media in competition with each other, and I am delighted to be able to say that both of those companies are investing many hundreds of millions of pounds in rolling out superfast broadband. Virgin Media has doubled the speeds it offers to consumers to about 100 megabits and BT has advanced the roll-out of its commercial broadband programme by a year.

Everybody knows, however, that some public support is needed to get broadband to some areas, particularly rural areas where the cost of laying fibre exceeds the potential market return. The £530 million sum I mentioned has been supplemented by a £150 million urban broadband fund, as well as a further £150 million for mobile infrastructure projects, and because of the way we have set out the programme, there will be additional money from local councils. There will be between £1 billion and £1.5 billion of public money going into broadband roll-out. That is a very significant amount of public expenditure in infrastructure.

The newspapers are full of talk about stimulation for growth and investment in “shovel-ready projects”. This is a shovel-ready project that will be going ahead in the next weeks and months and over the next two years. It will not only provide jobs, as many people will be employed to lay this fibre, but stimulate the economy by providing a broadband infrastructure.

I would like to acknowledge the significant contribution made by local authorities, which have stepped up to the challenge magnificently both in identifying local funds to match the Government contribution and in leading project procurement and implementation. North Lincolnshire and North East Lincolnshire councils have put together proposals for a joint project, and East Riding of Yorkshire council has developed plans for a project in east Yorkshire. Indeed, we have been able to approve all local broadband plans, with the exception of one, Sandwell, which I hope will be ready for approval in the very near future.

Broadband Delivery UK state aid broadband notification has taken longer to be approved by the European Commission than was anticipated. We had hoped it would be approved earlier in the year, but we believe we are now in the final stage of discussions with the Commission on the detail, and we hope it will be signed off shortly. Once we have that approval, the BDUK team in the Department for Culture, Media and Sport will be able to give state aid approval for all projects that are compatible with the notification, allowing for a much more rapid turnaround than if the Commission had to deal with each one separately. I recognise that there has been some impact on the project pipeline, but we will work as hard as we can to meet our 2015 deadline for having the best superfast broadband in Europe.

We have used this time to our advantage. We have prepared projects for procurement under the BDUK framework. The framework contract was agreed by DCMS with BT and Fujitsu at the end of June. It allows projects to undertake accelerated procurement with standard terms and conditions. Five projects are already in procurement using the framework, and we have agreed with the bidders that further projects will enter procurement at a rate of about one per week from October onwards. We expect procurement to be complete by next summer. I would like to recognise the willingness shown by the suppliers to accommodate our shared desire to increase the pace of procurement.

I want to say a few words about broadband in north Lincolnshire. There may be concerns about the pipeline of projects, and my hon. Friend mentioned his concern about where his project resides in the list. The situation is straightforward: projects are listed in line with the order in which local broadband plans were approved. Projects that were able to move more quickly at the early stage have therefore appeared earlier in the list. While there may be other ways of defining the list, our experience has been that the order in which the projects come forward does broadly match their readiness to go ahead. However, if projects are not ready when their procurement slot is reached, we will promote another project up the list. I do not want to encourage my hon. Friend therefore to sabotage other broadband projects, but it is important that he be aware that, in effect, the list reflects when projects are ready for procurement; but the list can change, and it is therefore important that he and the project team keep in touch with BDUK.

BDUK is working to progress projects to preparation at the earliest opportunity, and I understand that north Lincolnshire should be entering the BDUK assurance process in early November and will be able to launch its open market review in that month. That will be a significant milestone for the project.

My hon. Friend also mentioned his concern about funding gaps. Again, I do not want to give him or others who have spoken in the debate false hope, but obviously our door is always open to hear concerns and requests. However, we do need clear evidence of a gap in funding before considering a request for further funding. We certainly expect good evidence to be made available of any shortfall, and we will consider a good case if one is put forward. I stress to my hon. Friend, however, that there needs to be clear evidence of a funding gap.

My hon. Friend also mentioned the position of Kingston Communications. The use of suppliers not listed on the framework is a matter for the project teams. We have of course encouraged projects to use the framework because it saves time and procurement process costs. We expect all the remaining procurements to be undertaken using the framework. We recognise that other suppliers, such as Kingston Communications, may have an interest in this programme. However, it must be for the project team, working with BDUK, to decide whether the benefits of opening the procurement more widely would offset the benefits of effectively departing from the framework contract. That is an important point to make.

[Mr Graham Stuart]

Just to nail this absolutely, can the project team decide to do that? They do not have to go through the framework, so they could, if appropriate, work with a company such as Kingston Communications.

[Mr Vaizey]

It is possible for them to do that, but as I say, they have to work with BDUK to decide whether that is the right way forward. It is for BDUK to sign off a procurement process that goes outside the framework. The decision has to be in conjunction with BDUK; it cannot simply be unilateral. BDUK is willing to sit down and discuss with the project team whether that is the appropriate way forward, but I must stress that it has to be done with BDUK.