Ultrafast Broadband: Devon and Somerset

Julia Lopez Excerpts

Tuesday 11th January 2022 Westminster Hall

[The Minister for Media, Data and Digital Infrastructure (Julia Lopez)]

It is a pleasure to serve under your chairmanship, Ms Rees. I thank my hon. Friend the Member for North Devon (Selaine Saxby) for securing this debate, and for her proactive engagement with my Department on behalf of her constituents and in her role as the chair of the all-party parliamentary group on broadband and digital communication. She does tremendous work and I commend her for that. I am always grateful for these opportunities to speak to hon. Members because we have a shared goal of delivering fast and reliable internet to everybody in the UK. I genuinely welcome problems and challenges being highlighted along the way so that I can seek to address them with officials.

As many hon. Members have said, the pandemic has really highlighted the importance of digital connectivity in how we live and work, which, as technology advances, will only become more profound. Several hon. Members have highlighted that there is a risk of a digital divide emerging, and I agree. The hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) talked about the movement of people into the region and, therefore, the additional importance of productivity gains coming from digital connectivity. My hon. Friend the Member for Somerton and Frome (David Warburton) highlighted the issue of economic competitiveness for the region, which I am very alive to. I enjoyed his beautiful analogy of the beacons on the mounds—I hope that we have moved some way beyond that in the last few hundred years, but I am happy to look into any concerns that that is not the case. Other hon. Members highlighted the importance of levelling up and the work that they are doing as a group of MPs to highlight connectivity issues.

My hon. Friend the Member for Newton Abbot (Anne Marie Morris) made some interesting comments about needing to prioritise those who are hardest to reach, and I wish to assure her that that is what the Government are doing. I will come to some of the issues relating to her region, but one of the first procurements we are looking into, which has already launched, is for Cumbria—which, as I hope hon. Members will appreciate, is one of the hardest-to-reach areas. Learning lessons from the Cumbria procurement will help us to manage the roll-out in other similarly difficult-to-reach regions.

I wish to assure all hon. Members that the Government are not leaving the knobbly bits until last, but trying to deal with them early in the process. As my hon. Friend the Member for Newton Abbot says, these people really matter. We want to make sure that everybody is connected, not least because this matter now affects people’s life chances in terms of education, the economy and so on.

I want to address some of the other interesting points raised by my hon. Friend the Member for Newton Abbot about innovation and how we need to look at all kinds of technologies, not just fixed fibre. It might interest hon. Members to know that I conducted the UK’s first ever call on Open RAN technology earlier today. Hon. Members will be aware of some of the challenges we have had in removing some of the kit from higher-risk vendors following the Telecommunications (Security) Act 2021, which has left us with questions on the resilience of the technology we use. We are trying to increase the range of supplies in our network, and we see Open RAN as one of the solutions.

I am keen to work closely with partners such as Vodafone and small and medium-sized enterprises to roll out that technology so that our networks are not only wide reaching but resilient. That ties in with some of the work that we are doing on the shared rural network. We hope those things will tally, because the Open RAN technology is being tested in some of those rural areas first. I hope that reassures my hon. Friend.

The roll-out of gigabit broadband and the work we are doing on 5G is for me, as Minister for Digital Infrastructure, as much about future-proofing our economy and society as it is about delivering faster internet speeds, as important as that is. We will achieve that primarily through Project Gigabit, with several billion pounds of investment to support nationwide gigabit-capable broadband. The commercial aspect to that gigabit roll-out is the key part of the programme. We want to support commercial activity to go as far as it possibly can, and only then use taxpayers’ money to intervene where it is necessary.

We want to use as much capacity from the market as possible, and maximise that pace of delivery. Our interventions include local, regional and cross-regional procurement. We are looking at Cumbria as one of the first of those. We are looking at gigabit vouchers, which have been pretty successful, and giga-hubs, where we invest in public buildings, such as schools, and gigabit delivery via the remaining projects under the superfast broadband programme.

All suppliers have the opportunity to bid for procurements at all levels, and to get involved, working with communities to use gigabit vouchers in areas where no other delivery is currently planned. In the spirit of the cross-party working in which we all wish to engage, and the fact that this is a collective endeavour, I encourage all hon. Members to highlight the voucher programme to constituents who might not be aware of it, and to encourage suppliers to get involved in those critical procurements.

At a local level, communities from across the UK have seen massive increases in gigabit broadband coverage, spurred by commercial investment. Through listening to industry and working closely with Ofcom, we have made a made a number of policy and regulatory changes to stimulate the market, including Ofcom creating a new pro-investment, pro-competition regulatory system for telecoms in the UK that was introduced early last year. Our 130% super-deduction on qualifying plant and machinery investment means that we expect more homes to receive coverage by 2025 without a Government subsidy, which is critical if we are going to make best use of taxpayer cash.

We have also changed the law to make it easier to connect premises in blocks of flats. We are piloting innovative approaches to street works, which we think can speed up build by between 10% and 40%. We are also working with industry to set up a gigabit take-up advisory group to review how to increase consumer demand for gigabit, and incentivise further investment from the private sector in gigabit roll-out. Although many homes are able to get connected to gigabit, they do not always do so. We need to make households aware of the importance of gigabit connectivity.

[Luke Pollard]

On connecting buildings, does the Minister have a view on the progress made on allowing new operators—such as CityFibre, which is rolling out the fibre network in Plymouth—to use historic wayleaves, so that they do not have to negotiate afresh with landowners where there is an historic wayleave that would allow access and speed up the roll-out, especially in buildings where there is a lower speed but an established connection?

[Julia Lopez]

I assure the hon. Member that we have just introduced legislation that we hope will deal with some of those issues. We are in close contact with some of the operators, asking what they need to speed up the roll-out. Factors such as wayleaves, as he highlighted, are among them. I encourage him to support the legislation on Second Reading.

There has been an unfair amount of gloom about the progress we are making in this area. Although I welcome the Opposition’s commitment to cross-party work on this, I push away some of the more partisan points made by the hon. Member for Ogmore (Chris Elmore). As a result of the measures we have taken, the UK has seen more than £30 billion of private sector investment committed, and one of the fastest gigabit broadband roll-outs on the continent. Today, more than 65% of premises can now access gigabit-capable networks, which is up from one in 10 in November 2019. I hope the hon. Member will acknowledge the good progress we are making.

On concerns raised by my hon. Friend the Member for North Devon about rural areas missing out again, I emphasise that it is not just towns and cities that have seen increases in coverage. Since 2018, we have provided gigabit coverage to more than 600,000 rural premises, which has made a huge difference to the work and home lives of local people. In Devon and Somerset, 66,000 further premises now have gigabit-capable coverage being delivered, as part of our superfast broadband programme, which is managed by Connecting Devon and Somerset. On the broader picture, some of the tricky areas are among our first procurements.

My hon. Friend the Member for North Devon stated that the south-west had 92% superfast capability and that her constituency had 87%. I am pleased to report increases in both, with the latest thinkbroadband statistics estimating a figure of 94% in both Devon and Somerset and nearly 92% in my hon. Friend’s constituency. That regional statistic will also increase to more than 96% once the current contracted delivery is completed. Even though those improvements are coming, I recognise it can be a long wait for many and that is a frustration for all of us, and some premises will still not be included in those plans.

BDUK is working in partnership with local bodies on the ground. We are working to make sure those relationships are functioning well, and we have a good amount of shared data on where coverage is happening. Nevertheless, most hon. Members are aware that delivery in Devon and Somerset has been slower than we would have liked because of the challenges faced by Connecting Devon and Somerset, which is the joint team resourced by a number of hon. Members’ councils. I do not think those challenges are typical, notwithstanding that other rural areas also share issues regarding the complexity of some builds.

I do not wish to go over old ground, but the previous contracts collapsed and that followed procurement by CDS in 2015, which failed to complete owing to an inability to agree terms with the supplier, which in that case was BT. Subsequent to the previous contracts being terminated in 2019, CDS will have had to undertake a new open market review and public review with suppliers to confirm which premises are not within any commercial plans and therefore require subsidy. That has been a lengthy process and it is important to minimise that risk of overbuild of other commercial networks, which has also been regularly highlighted by my hon. Friend and which was also a requirement under previous EU state aid rules. CDS then had to follow that with a compliant public sector procurement process, meaning that the new delivery contracts were agreed only at the end of 2020.

The same processes will also be required for contracts taken forward under our new gigabit programme, but rather than local authorities, BDUK will be in the lead for that process. BDUK brings together central resources and expertise and we hope that will mean we get a more consistent national approach to delivery while still working with councils to deal with local implementation issues. BDUK is currently part of the Department, but it will be spun out as a separate executive agency this year. That will give it greater autonomy and greater scrutiny from a new board. That is going to be an important step in focusing and giving greater priority to ensure a good gigabit roll-out from now on.

My hon. Friend talked to BDUK officials just yesterday. Other hon. Members have spoken about making the west country a priority area for connectivity and that connectivity-related issues are not just nice-to-have things to address. I assure them that I have had my own discussions with BDUK to see what more we can do for the region, because I appreciate that hon. Members have particular frustrations that need to be addressed. I want to work together to do that. We have officials in the room, so I wonder whether we can look at the GigaHubs programme as well to see if there is anything more we can do.

I also wish to address the point made by the hon. Member for Ogmore about Wales and his constituency. It is going to be important that we work closely with the devolved Administrations. I am meeting Kate Forbes MSP this week, and I will be holding similar meetings with counterparts in the Welsh Administration and will be happy to look into his constituency. The hon. Gentleman raised points about the Product Security and Telecommunications Infrastructure Bill, which includes measures on the electronic communications code that regulates agreements between landowners and telecoms operators. We are looking to try and deal with some of the problems that came after the 2017 changes, trying to move to a position where we can have more arbitration rather than litigation and getting better relationships between landowners and mobile network operators so roll-outs can happen much faster. I hope the hon. Gentleman will support that legislation.

Returning to Project Gigabit, we only want to intervene when it is necessary. The same applies to delivery under the superfast broadband programme by CDS. That is why the open market review and the public review process I referred to earlier has to be followed, even though it can take a significant amount of time. As I say, I appreciate the frustrations. CDS has followed that process and is now only intervening in premises confirmed as eligible for public subsidy. However, we recognise that commercial plans will be changing and to maximise that value for local bodies, we should take reasonable steps to make way for new commercial investments.

That is easier said than done and CDS will be mindful of the risks to some premises of descoping to make way for a commercial build if that then leaves other neighbouring premises without viable coverage. Those are tricky issues that I know my hon. Friend the Member for North Devon will appreciate. I simply encourage all local bodies to be open and transparent in their dealings with commercial suppliers and to make way for new commercial builds if they can, and BDUK will continue to reinforce that point to local bodies.

Conversely, although I welcome new commercial build plans, I urge commercial providers to target investment at areas that are currently not in scope for any other coverage. BDUK is also making this point with suppliers. That will help increase the number of premises that have gigabit access from at least one operator, rather than having fewer premises with multiple providers.

Several hon. Members talked about the voucher scheme, which is one of the mechanisms that we have to incentivise and encourage suppliers to provide coverage to areas not covered by any other plans. I encourage all commercial suppliers to use that scheme as much as possible, and I encourage everybody in this Chamber to highlight the scheme to their constituents. The voucher scheme can be hard work for communities, and it runs the risk of delivering a patchwork of coverage. However, it is a relatively quick means of supporting delivery in particular communities and has been used successfully by many suppliers, including some of the largest, to provide gigabit coverage in communities across the country.

Many areas of Devon and Somerset are making good use of the voucher scheme. I am pleased to say that 5,466 premises in Devon and Somerset have gained a gigabit connection because of it, and a further 2,645 premises are awaiting connection. That is a combined total of over £12 million of investment. In the North Devon constituency, 299 premises have gained their gigabit connection as a result of that scheme, and another 208 premises are awaiting connection. That is nearly £1 million of investment by the voucher scheme in the constituency of my hon. Friend the Member for North Devon.

We have deliberately designed Project Gigabit to ensure that coverage is delivered in every area of the country, and not to leave those harder areas until last. We think that that will add to the gigabit coverage currently being delivered through superfast contracts. We want to reach as far as possible beyond 85% gigabit coverage by 2025, and every area of the country will be under contract by that stage. However, it is not the case that rural areas will be left with no coverage once that has been completed. The latest stats from thinkbroadband show that North Devon currently has 32% full-fibre coverage. That is ahead of the UK average of 30%, so when it comes to gigabit there is a good story to tell, and a good start has already been made.

[Selaine Saxby]

I thank the Minister for her clarifications this afternoon. We have already talked about the low take-up of gigabit in some areas. Is she able to clarify whether that is because some of my constituency is served by small providers who are not wholesalers, which is not the same as having Openreach or CityFibre and is therefore further reducing take-up?

[Julia Lopez]

I am afraid that I do not know enough about the commercial relationships and situations in my hon. Friend’s constituency to be able to provide a detailed answer; I will have to go to BDUK and get further details.

Many people are satisfied with their superfast speeds, and question why we need gigabit. Gigabit is actually about future-proofing homes and businesses across the country. Constituents across the country should understand that, although technology is advancing quickly, it is going to be taking even greater strides in future. We may see the delivery of more healthcare requiring fast speeds and new types of factories requiring really great connectivity. We need to ensure that we are thinking not just about speed, but about capacity, resilience and connectivity. We need to ensure that, when more applications and technologies require this kind of digital infrastructure, it is there, ready and waiting to be used.

In March 2020, the Government announced that they had agreed a £1 billion deal with mobile network operators to deliver the shared rural network—this relates to my hon. Friend’s concerns about notspots. The deal will see operators collectively increase mobile phone coverage across the UK to 95% by the end of that programme. That is underpinned by legally binding coverage commitments. In the south-west, 4G coverage from all four operators will increase to 87% from the current 75%, and from one operator from 97% to 99%, thanks to the shared rural network.

I was interested in the comments of the hon. Member for Plymouth, Sutton and Devonport on the trainline piece of work. I believe that that may be happening in other parts of the country, but I am happy to look into this particular project for him and see whether there are any conversations that the Department for Digital, Culture, Media and Sport needs to have with the Department for Transport. I recognise that the current roll-out will still leave some premises in the region with sub-superfast speeds, and in any case we now want to increase access from superfast to gigabit.

In our quarterly Project Gigabit delivery updates, which I hope hon. Members have received, we set out a target timetable for our regional supply procurements. For Devon and Somerset, we are targeting a procurement start in February to April 2023, with contract commencement early in 2024. This procurement is currently set up to include 159,600 premises, but the number could change depending on the market’s build plans.

The timetable for procurement was drawn up after extensive consultation with industry and local bodies and reflects the need for coverage from current contracts to be clear. Unfortunately, that is where hon. Members are seeing some of the challenges that their region had previously under superfast have an impact on how quickly we can get going with the gigabit stuff, which I regret.

It also increases the chances that the suppliers in the current programme will be able to bid for projects and continue building once their current deployment ends. We must be cognisant of the fact that only a certain number of people have the expertise to deliver some of this work. If those companies are engaged in superfast work, they may not have the capacity to bid for some of those gigabit contracts, which is regrettable.

All the procurements will, of course, be open to every interested supplier and I hope for good levels of competition. Our approach keeps open the potential for using smaller local supply procurements and the larger regional and cross-regional procurements that I think we want the likes of Openreach to be bidding for. We will seek to use each of those options as effectively as possible.

While we all welcome a large single supplier volunteering to complete coverage in Devon and Somerset commercially, we will need to see what results from the competitive procurement process. We should all welcome competition. It is positive that many more broadband network providers are now able to deliver significant levels of coverage, compared with the position in the past when only one national operator was undertaking a new roll-out. That is where our efforts to get a really good commercial market going are reaping dividends.

I am confident we will be successful in ensuring coverage through these procurements. I very much look forward to working with my hon. Friend and others in this Chamber, all Members from Devon and Somerset and all other interested parties, so that we can get the connectivity that is not only important to speed and life chances now, but ever more so into the future.