Digital Economy Bill

Lord Inglewood Excerpts

1st reading (Hansard): House of Lords & Committee: 1st sitting (Hansard): House of Lords
Tuesday 31st January 2017 Lords Chamber

[Lord Arbuthnot of Edrom (Con)]

My Lords, one issue that has not been raised in this debate so far is the effect on small businesses in rural areas of the poverty of mobile telephone networks. That, combined with slow or poor, and sometimes non-existent, broadband speeds, puts rural businesses at a disadvantage. So I have a great deal of sympathy with the amendments that have been spoken to, and I hope that the Minister will show similar sympathy.

[Lord Inglewood (Con)]

My Lords, I join those who have spoken in support of these amendments. Like some other noble Lords, some weeks I come up from the country to your Lordships’ House. The shortcomings of the infrastructure in rural Cumbria, where I live, is far too frequently a topic of conversation.

As a number of noble Lords have said, connectivity is the crucial aspect here, because it is now part of the essential infrastructure of contemporary life. It is important that we look at this issue from the perspective of what people need, but the reality is that what we need today may not be what we need tomorrow. We have to try to bridge the gap between the digital haves and the digital have-nots, and we achieve that by looking at the issue in the way that I have just described. Therefore, I am not approaching this matter from a kind of nerdy, technical perspective. What matters is the result as much as the means by which you get there.

Over the years, there has been a lot of debate about whether a universal service obligation should be in our law and be statutorily enforceable. I had the good fortune to chair the Communications Committee, and a number of years ago, when we conducted an inquiry into broadband, we debated this issue at length. On that occasion we reached the conclusion that what mattered was the rollout and that it was quite conceivable that a USO would get in the way. With the benefit of hindsight, that was probably a mistake, and therefore it is interesting to see the provisions for such a legal obligation coming into our legislation.

However, at the end of the day I come back to where I started with all this, and it is why I will be interested to hear what the Minister has to say. It is not the detail but the result that matters here. We have got to move into a world where the digital divide is bridged. This is particularly important for areas in the country, and I speak from that perspective, but it is also true for a number of urban areas. We seriously deny people access to a whole range of commercial, and other, aspects of contemporary life if there is not adequate connectivity. As a number of your Lordships have said, we live in a country that is adopting a different approach to industry. It is crucial to appreciate that the key to increasing wealth creation in areas outside the south-east of England—which I think everyone agrees is desirable—is improving connectivity. That is the way, as noble Lords have said, to improve the potential of SMEs outside the south-east.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord Ashton of Hyde) (Con)]

My Lords, I am glad that we are at last able to start this very important Committee. I should immediately declare an interest, which is that I suffer at my home in the country from extremely bad broadband, although we are lucky enough to be able to use microwave technology to do something about this. In addition, last night when I tried to ring my wife from central London on my mobile telephone to complain how overworked I was, I was unable to get a signal. So, I can absolutely sympathise with my noble friends Lord Arbuthnot and Lord Inglewood; I recognise the problems, particularly for rural areas and SMEs, and the Government agree with quite a lot of what has been said in terms of aspirations. I think we will differ when we come to decide how the USO should be used to fulfil those aspirations, and exactly what its role is.

The Government have a clear digital agenda, and our ambition is for world-class digital connectivity. We are determined to ensure that the UK has the digital infrastructure that our businesses and citizens need both now and in the future. The Green Paper published on 23 January makes digital infrastructure a central pillar of the Government’s proposed industrial strategy and identifies good digital infrastructure as a driver of growth.

We support the spirit of Amendment 1, requiring that the universal service order should define a gigabit-speed broadband universal service obligation—or USO—delivered via full fibre to the premises. We differ in that we do not think that the broadband USO is the right tool to use at this stage in the development of the UK’s digital infrastructure market. To pick up on the point of the noble Lord, Lord Aberdare, the rationale for a USO is to prevent social and economic exclusion. It does this by ensuring that where the market does not deliver, a minimum set of communication services are made available, on request, to everyone, no matter where they live or work. In doing so, it takes account of the prevailing technologies enjoyed by the majority of people: the USO follows the market, it does not drive market change. The UK’s fibre market is at an early stage of development—currently only 2% of UK premises have full-fibre connection—so I do not think we have reached the stage where there is a case for introducing a gigabit-speed USO. It is not a prevailing technology used by the majority and it is not needed to prevent social and economic exclusion.

We do, however, agree that more extensive fibre connectivity is crucially important to the UK’s future digital growth. We are planning now for the networks that are going to be needed to ensure continued economic growth and development across the UK in both urban and rural areas. In the Autumn Statement we announced more than £1 billion to support digital infrastructure, targeted at supporting the rollout of full-fibre connections and future 5G communications. The Government are consulting on how we might further encourage full-fibre rollout.

Amendment 2, in the name of the noble Lord, Lord Fox, proposes a superfast broadband specification for the USO. This specification is, as the noble Lord said, in line with scenario 3 of Ofcom’s USO technical advice, which the Government commissioned to help inform the design of the USO. All the scenarios set out in Ofcom’s report are being given careful consideration. Once that work has been completed there will be a public consultation on the design of the USO and the specifications that will be included in the universal service order, including the minimum speed.