Broadband (North of England)

Julian Sturdy Excerpts

Tuesday 8th April 2014 Westminster Hall

[Andrew Jones]

Yes, I strongly agree with that argument. I do not think that the scale or sector of a business, or the geography, really matter. The point about broadband is the ability to get access to customers all over the world. We need it, and quickly. The hon. Lady’s point is absolutely correct. For a rural business, dialling up on a slow landline that other family members might also use is incredibly slow going. Businesses without connectivity are being left behind, which is why good, reliable superfast broadband matters.

I want to share with the House one of the successful lessons of the North Yorkshire roll-out. North Yorkshire will shortly become the best connected county in the country, because our delivery vehicle was already in place as the Government launched their broadband strategy. That vehicle was a company started previously by North Yorkshire county council, called NYnet. NYnet has done extremely well, and deserves congratulations and praise from across the county. Being in a position to start promptly and knowing where some of the challenges would lie made a difference. North Yorkshire was the first county in the country to award its roll-out contract. The roll-out has been going at the rate of about 6,000 to 7,000 properties per month, which is a good rate. I checked the latest data and at the end of last week 102,402 properties had been enabled to receive superfast broadband of at least 25 megabits per second.

Just having the capacity, however, is not enough. People have to choose it. Take-up is running at 16.2 %, and rising sharply. Superfast North Yorkshire expects to reach 20% take-up by summer, and 30% by the middle of next year. That is significant as those rates of take-up also trigger clawback elements in the contract, so the roll-out provider—in this case, British Telecom—will have to pay money back to NYnet. It will be able to use that for reinvestment to roll out broadband to remaining properties, perhaps as match funding for Government schemes. The lesson from the roll-out is that the importance really lies in demand stimulation for both residential and business customers.

In North Yorkshire, significant business support and training have been on offer. There have been local conferences at Ripon racecourse and Fountains abbey, ably organised by my hon. Friend the Member for Skipton and Ripon (Julian Smith); my hon. Friend the Member for York Outer (Julian Sturdy) came to speak. We encouraged business and communities to get involved. There has been good business follow-up and more than 900 businesses have been helped.

I saw for myself how Superfast North Yorkshire has been operating when I attended the launch of the service in Boroughbridge in my constituency. I thought that it was good marketing, and I come from a marketing background. It was 6 December last year. We had a roadshow, involving the local school, the local mayor, local businesses, Father Christmas, of course, and some Christmas carols, Christmas punch and Christmas cake. It was a very Christmas-themed event. We also had a giant mouse, which I used for a ceremonial switching on of the service, and, to communicate that the service was available, a fibre-optic Christmas tree lit up to symbolise it. Basically, everything added up to show that something had happened—something new, fun and for everyone. I have been informed by the local community that the take-up in Boroughbridge has been high.

[Julian Sturdy (York Outer) (Con)]

I congratulate my hon. Friend on securing this important debate. He is absolutely right to praise the work of Superfast North Yorkshire and what it has done so far in the roll-out of superfast broadband across North Yorkshire and York. I am pleased to hear about the success in Boroughbridge, but does he not agree that the key stage to reach now is that next 10%? There are not-spot communities throughout my constituency and North Yorkshire, and Askham Bryan, Askham Richard, Hessay and Acaster Malbis, all in my patch, are part of the not-spot area. Is it not right to help those communities in the last 10% to bridge the digital divide, which means looking at how we can enhance new technologies to reach them? That is the key point—getting to those communities—and it will not always be done through fibre to the cabinet.

[Andrew Jones]

My hon. Friend is as wise as ever, and I strongly agree with him. I am about to deal with those points so, if he will forgive me, I will not address them now.

The question now is about looking ahead. I want to share a couple of points with my hon. Friend the Minister. We need to be vigilant so that one provider does not develop any kind of monopoly abuse—although we are not there yet, and I have seen no evidence of such abuse in my county. As a Conservative, I believe in the merits of competition to bring choice, value and innovation, and I know that the issue is already on the Minister’s radar.

I want to focus on the point made by my hon. Friend the Member for York Outer: how to give the opportunity of broadband to all homes, taking the figure from 90% to 100%. This year, my home county of North Yorkshire has roll-out phase 2 to take us to 93%. Phase 3 is planned for 2015, which will take us further. In that phase, the quest and challenge will probably move from being financial to being about decisions on the delivery method, which may have to change for the isolated homes and hamlets that are a feature of our rural areas. Satellite, wireless or other new technologies are likely to be used away from the cabling roll-out that we have seen thus far. That is urgent and important. I want people in the villages of Lower Dunsforth or Nidd in my constituency and those throughout the north who are missing out on the opportunities of broadband to be connected, so that they have opportunities to drive their businesses and to get all the benefits that broadband brings.

Superfast North Yorkshire has told me that it expects to hit 100% by 2017, which would be extremely positive, so I want to say two things to the Minister. First, and perhaps most importantly, is simply that we should press on, and quickly. Those doing the roll-out must be held accountable for the speed of progress. It is not great that some counties seem to be only just starting the sprint when North Yorkshire is approaching the finish line. That is a competitive advantage for North Yorkshire—not something I worry about normally, but from the perspective of UK plc, we need everyone to be there. Whatever the blockages, constraints or capacity problems might be, they need to be removed.

Secondly, will the Minister work with colleagues to promote business training? I have read that the benefits of the UK’s becoming a world-leading digital economy are measured in tens of billions of pounds, but only half of small and medium-sized enterprises have a website. That presents a huge opportunity, but training will be required for people to take up or even recognise it, because I have also read that many companies do not think that it is relevant to their business.

Finally, I thank the Department for Culture, Media and Sport team for putting North Yorkshire at the heart of the first phase of the roll-out. As a team of North Yorkshire MPs, we pitched for our county’s inclusion in the roll-out. It was one of the first things we did as a team after arriving in Parliament, and we were delighted to be successful. The reason why we were included was our ability to have a delivery vehicle, in the form of NYnet. That proved to be a wise decision, as we are now leading the country in this area.

The North Yorkshire team grasped the opportunity and many lives in our county are better for it. Broadband roll-out is a key part of dealing with the north-south economic divide that I mentioned at the start of my speech. We are still fighting the battle for more infrastructure in the north as a whole, and I think we are winning that battle, but for broadband it has been well and truly won.

--- Later in debate ---

[Helen Goodman]

I have two criticisms: one is of the way in which broadband has been rolled out; the other is of the behaviour of the Department for Environment, Food and Rural Affairs and Her Majesty’s Revenue and Customs, because they are now demanding that people deal with them solely online. That is a new development under this Government. The Government are encouraging them—in fact, instructing them—to deal solely with the citizen online. In the first-tier tribunal, for example, the tribunal judge ruled that the requirement to submit VAT returns online and the failure to take into account a person’s ability to comply on grounds of computer literacy, age, or the remoteness of location was a breach of the European convention on human rights. We need to see a change in the Government’s attitude on that.

There is an overall problem and it is twofold. The Government prioritised speed over access. When we left office, we had laid out a plan for securing universal broadband roll-out by 2012. The Government abandoned it and set out twin objectives in 2011. They were the provision of a superfast broadband network to 90% of the population by 2015 and the ability of every household to receive at least 2 megabytes download speed by 2015. Both those targets will be missed by the Government and the target is now to reach 95% of the population by 2017.

What the Government did was invest a large amount of money, for example, in the super-connected cities programme, instead of prioritising the roll-out to the rural areas. The super-connected cities programme produced a legal challenge. What the Government did was highly controversial.

[Julian Sturdy]

Does the hon. Lady not agree that the UK has the highest uptake of superfast broadband across the whole of the EU? Superfast North Yorkshire is a prime example of a beacon of success, showing how to deliver superfast broadband across the north and in rural areas. The issue with rural areas, of course, is their rurality, which makes it hard to bridge that last bit. That is why we need the investment in new technologies, which is what the Government are doing.

[Helen Goodman]

I am sorry to tell the hon. Gentleman that the Government have put a large amount of money into the super-connected cities programme—it ran into a rural challenge in Europe—instead of putting money into and prioritising rural areas such as his constituency and mine. I wish that what he is saying was true, but it is not. Will the Minister tell us in his winding-up speech what the spend in the super-connected cities programme is? It had a mammoth underspend a year ago and we have not had an update from him on the precise profile of what is going on with that programme, which I think is an extremely important point.

Twice the Government have been criticised by the Public Accounts Committee for their roll-out of broadband. All hon. Members and all Departments should take seriously criticisms that come from that Committee. Last July, it pointed out that the broadband delivery programme will be 22 months late and that the programme, because of the way in which the contracts have been set up and the geographical areas have been designed, was not promoting market competition.

As the hon. Member for Lancaster and Fleetwood (Eric Ollerenshaw) pointed out, British Telecom now has even greater dominance in this area than it had previously. It is expected to win all 44 contracts being put out to tender by local authorities. The Public Accounts Committee also cast doubt on the transparency of the costs in BT’s bids and said that because there was a lack of transparency in the process and in the bids, it was impossible to tell whether we have achieved value for money. That is before we move on to the questions that have been raised not only by the hon. Gentleman, but by other hon. Members in the House about the behaviour in specific small locations.

This is not a success story; it is a story of promise and disappointment. The Minister admits that contracts are now being signed with late delivery dates. He has moved the goalposts on several occasions.