Telecommunications Infrastructure (Leasehold Property) Bill (First sitting)

Seema Malhotra Excerpts

Committee stage & Committee Debate: 1st sitting: House of Commons
Tuesday 11th February 2020 Public Bill Committees

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

I beg to move amendment 9, in clause 1, page 1, line 17, at end insert—

“(c) the operator intends to provide an electronic telecommunications service that can deliver an average download speed of at least one gigabit per second.”

This amendment is intended to ensure that operators could apply for Part 4A order only if they intended to provide gigabit-capable broadband.

It is a great pleasure to serve under your chairmanship for the first time, Mr Davies. This is my first time on a Public Bill Committee for a number of years, so I hope that you will be, if not indulgent, at least understanding of any errors that I should make.

It is also a pleasure to serve on such an important Committee. We are often told by Government Ministers and by wide-eyed techno optimists that we are going through a digital revolution in this country. When hon. Members are uploading videos to TikTok, and centuries-old parliamentary regulations are accessible via an Android app, it is hard not to feel that we have entered a brave new world of connectivity.

That is the case not just in this place, of course; the internet is central to our lives and those of our constituents. Some 99% of adults under 45, and 81% of the adult population as a whole, use it regularly. Those are impressive figures, so let us hear some more: 98%, 97%, 8%. Those numbers represent the full-fibre coverage of, respectively, Japan, South Korea and the United Kingdom.

The previous Labour Government brought first-generation broadband to 50% of all households within 10 years. Over a similar timespan, Conservative Governments have managed to bring full-fibre broadband, the current generation of technology, to only 8% of households, while our economic competitors have been achieving full-fibre coverage. We are 35th out of 37 in the OECD rankings of broadband connectivity. When it comes to broadband, the only global race that the Government are running is a race to the bottom.

In the past 10 years we have witnessed a lost decade for telecoms infrastructure. The Government have repeatedly left our national infrastructure needs to the market, resulting in a deepening of our country’s regional divide, which was already the worst in western Europe. Regional studies show a 30% gap in internet usage between the south-east and the north-west. In London, 85% of the population are internet users compared with 64% in my city of Newcastle. It is welcome that the Government have finally woken up to this problem, but I am still none the wiser about what “levelling up” actually means in this case.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

My hon. Friend is making important points, particularly about the regional disparities and inequalities. Is she aware of any differences in who is using the internet? There might be differences in relation to children being able to study at home and people being able to work at home, which is critical for self-employment and for small businesses that might be starting up.

[Chi Onwurah]

My hon. Friend makes an excellent point, and her past experience in the IT sector leads her to understand and see the divides that exist—for example, people on lower incomes are less likely to use the internet and have access to broadband. There is also a real rural divide, with our rural telecoms infrastructure not enabling the kind of economic success stories of small businesses that she mentions. Unfortunately, the Bill does not address that. Indeed, many of the operators, such as TalkTalk, Mobile UK and Hyperoptic, have said that we need to upgrade our infrastructure, but the Bill does not address that.

In the last six months the Prime Minister has held three different positions on what kind of telecoms infrastructure we need: when he was standing to lead his party, he promised to deliver “full-fibre connectivity” to all households by 2025; the Government manifesto talked of “gigabit-capable connectivity” by 2025; and the Queen’s Speech dropped the 2025 reference altogether, promising instead to accelerate the roll-out. Will the Minister clarify exactly what the Government’s target is for broadband connectivity? Whatever the target is, and whatever the lofty ambitions are, I am afraid that the Bill will not achieve them.

The Bill is designed to enable people who live in flats and apartment blocks to receive gigabit-capable connections where their landlord repeatedly fails to respond to telecom operators’ requests for permission to install their infrastructure. The network builders say they face significant challenges in connecting people living in flats and apartment blocks when they do not receive a response from the building owner to requests for access. According to Openreach, 76% of multi-dwelling units miss out on initial efforts to deploy fibre because of challenges in gaining access.

The Bill provides a bespoke process for telecoms operators to gain access to MDUs in order to deploy, upgrade or maintain fixed-line broadband connections in cases where a tenant has requested an electronic communications service but the landlord has repeatedly failed to respond to an operator’s request for access. For a telecoms company to install equipment such as cables on public or private land, formal permission through an access agreement with the landowner/occupier is required. Under such an agreement, the landowner grants the communication provider a licence to install, access and maintain equipment on their land. The Bill takes into account the fact that landlords are not always responsive or eager to meet their tenants’ needs.

The measures in the Bill are welcome and the Opposition will not be voting against it. In the context of the lost decade, however, we are truly dismayed by the Bill’s limited scope. It proposes only minor measures to ease infrastructure build-out by giving operators more powers to access apartment blocks when tenants request service. The sector has welcomed the Bill but without any great enthusiasm, saying that the difference it will make will be marginal. The trade body for the tech industry, techUK, says it does not go far enough, stating that

“from new builds to street works”,

many issues

“have not been tackled by the Government’s Bill.”

We have tabled several amendments to improve the Bill, but before I speak to amendment 9, I will briefly mention additional flaws that the Opposition have not sought to fix through amendments. There is the matter of consistency with other regulations. The internet is now an essential utility for modern life and, as such, telecoms operators should possess the same powers as those who provide other utilities, but the Bill does not go far enough on that. We appreciate that the Government acknowledge the necessity of broadening the rights of telecoms providers, but they have not actually done so in the Bill. They have given no statutory rights of access to telecoms companies and placed no obligations on landlords to facilitate access.

Do the Government recognise that the internet is an essential utility, and do they believe that telecoms should be brought into line with other utilities, for which forced entry is permitted on the grounds of ensuring that there is no threat to life or safety? Obviously, that might not be the case with telecoms, but I want to understand the comparison that the Government make between the telecoms utility and other utilities.

The amendment is intended to ensure that operators can apply for a part 4A order only if they intend to supply gigabit-capable broadband. Of course, we need to understand what gigabit-capable broadband is, but I am sure that the Minister will relieve us of that uncertainty. As I said, we have suffered 10 wasted years under Conservative Governments of various types, a unifying theme of which has been a misunderstanding of technology interspersed with a misuse of it.

Given that the Prime Minister has expressed three different positions in six months, what is the aim of the Bill? Does it aim to provide gigabit broadband? On Second Reading the Minister said that the legislation will be a “hammer blow” to crack our woeful broadband nut. I can only assume therefore that the legislation does not serve simply to give operators opportunities to lock in my constituents to slow broadband. The Minister said that it must deliver gigabit-capable broadband, so I cannot imagine that he will have any objections to enshrining that in the legislation by supporting the amendment.

I also seek clarification on whether anything in the Bill confines it to fixed-line operators. Will the Minister confirm whether, under the terms set out in the Bill, it would be possible for a mobile operator to install a mobile base station, for example, for the purposes of delivering gigabit-capable broadband, either to one building or another? How does the Bill ensure, in the case of wireless or mobile broadband, that services are limited to a particular building only?

The amendment would make it clear that the Government are proceeding with their commitment to deliver on gigabit-capable broadband and that the Bill cannot be used to deliver slower broadband, so it will contribute to our broadband infrastructure.

--- Later in debate ---

[Seema Malhotra]

One issue that is not clear to me in the Bill or the explanatory notes is whether there is a time limit within which the operator might need to respond to a request from a tenant. There is more about the operator giving notices to the landlord—the grantor—but what about a deadline by which an operator might need to respond to a request from a tenant?

[Matt Warman]

There is no set deadline imposed on a private commercial organisation because individual operators are not all regulated in the same way. For instance, Openreach is regulated differently. It is a commercial decision for them, and the Government will do all that they can through processes such as this to try to encourage a speedy response. It is for Ofcom to regulate responses, as it does in the complaints procedure. As the legislation comes into force, Ofcom will consider whether response times to complaints might be thought of in the same way.

[Seema Malhotra]

Currently, in the way that the implementation of the Bill is envisaged, if an operator chooses not to respond or takes many months, is there anything in place to sanction or challenge that?

[Matt Warman]

The answer is that at the moment that is one of the problems. The Bill introduces the process by which we might look at whether the responsiveness to requests is something that Ofcom might look at. However, the hon. Lady is right to ask. We want to see a speedy roll-out, and the response from operators is an important part of a speedy roll-out. We are very much on the same page. We would not want to see operators ignoring the requests of potential customers, and I hope that neither would the operators, because in many cases they have a potential commercial opportunity.

Let me address the two specific questions asked by the hon. Member for Newcastle upon Tyne Central. As discussed on Second Reading, we see broadband as an important utility but, as she acknowledged in that debate, it is not the same as other utilities. It is obvious that as time goes on more and more essential services will depend on connectivity. As that situation evolves, we will need to keep it under review. However, she is accurate when she says that the threat posed by a lack of water is different from that posed by a lack of broadband. We should treat them differently; it is horses for courses.

--- Later in debate ---

[Matt Warman]

I genuinely sympathise with what the hon. Lady is seeking to do, but her amendment also constrains a Bill that benefits from taking the approach that it does. Technically what she proposes would amend only one part, but amendment 9 would not amend the circumstances under which the part 4A order can be made because they are set out in paragraph 27B. There is a logical inconsistency in what she proposes, but the principle is very much the same as what the Government are seeking.

The hon. Lady would also inadvertently be delaying the roll-out of a service that would be a significant improvement even if it were not gigabit capable, and she undermines the principle of aspects of technology neutrality. Our intention has always been for the whole code to be technology-neutral. There would be no direct benefit from her amendment, although we very much share her ambitions. We want the Bill to benefit tenants whatever the service they request and, with that in mind, although the Government sympathise with her ambitions—

[Seema Malhotra]

I would like some clarification on a couple of points. What might the minimum speed be and would it be out of scope for a part 4A order to be used to upgrade broadband from copper networks to fibre, for example, if broadband were not fast enough for whatever reason? Do these plans sit alongside, or are they separate from, plans to implement the universal service obligation for a decent service broadband speed of 10 megabits per second, which is clearly much less than 1,000 megabits per second?

--- Later in debate ---

[Chi Onwurah]

These amendments seek to improve the legislation to enable others to make requests. As I understand it—I hope the Minister will clarify this— only freeholders and leaseholders can use the legislation as it stands.

Mr Chairman, I will not try your patience by expounding at length on the dire state of both home ownership and leasehold, or “fleecehold”, as many of my constituents call it. Home ownership rates among young people are a third lower than in the noughties, and for far too many, the leasehold system is broken. There are now 4.5 million households in the private rented sector, a jump of 63% in a decade, and we also know that tenants can easily find themselves in precarious and insecure circumstances through no fault of their own, or even with nowhere to live via a section 21 notice. All of this makes tenants dependent on the whim, or the pleasure, of their landlord. The upshot is that a large proportion of our population is condemned to renting for life, but with few rights and less certainty. We in this Committee can do something about that, at least when it comes to broadband.

Amendment 7 is intended to expand the definition of persons who can request an operator to provide an electronic telecommunications service to include rental tenants and other legal occupants who may not own the lease to the property they occupy. As the Bill stands—the Minister will correct me if I am wrong, I hope—only the freeholder or the leaseholder can make that request, so what of the poor tenant who is desperate for gigabit broadband to enable them to work from home or grow their business? What if their landlord is difficult to reach or indifferent to their predicament? Should the person actually living in the building not have some rights here?

Furthermore—while we are considering who can make these requests—why are businesses left in the cold, particularly those in business parks, where there has often been great unmet demand for broadband? I hope the Minister will provide clarity as to whether business tenants and traders based in properties can use this legislation to upgrade their infrastructure and grow their business.

Amendment 4 is more of a probing amendment, designed to understand whether the Government know what they are doing when it comes to broadband deployment. Before I entered Parliament, I spent a significant number of years rolling out broadband networks in the UK, France, the US, Nigeria, Singapore and Australia, so I know that building out a telecom network requires a plan; it would be nice if the Government understood that keeping networks secure requires a plan, too, but we will come on to that later. In any case, building out a telecom network requires a plan with a business case, predicted revenues, and—well, I am sure the Minister gets the picture.

As the Bill stands, the operators can plan to pass a building, but they cannot plan on getting any revenue from that building, because they cannot make the request to access the buildings that they pass. If the landlords do not respond, the operators cannot use this legislation unless and until a leaseholder or freeholder makes the request.

[Seema Malhotra]

My hon. Friend is making an important point, on which I would like to support her. The situation has been very different on the ground, and from the experience I have had with leaseholders in blocks, it is sometimes very difficult to get individuals to come forward. When they talk privately with each other, they say that they do want something to happen, and they want an operator to take the lead. In order to provide some flexibility to achieve the outcome we want to see, does she agree that it would be worth considering the right of operators to make the requests?

--- Later in debate ---

[Matt Warman]

I once again admire the hon. Lady’s ability to get national security matters into the discussion, as she herself to some extent implied, although her doing so was a lot less gymnastic than her peroration on leasehold. Although today is the first opportunity that we have had to talk about telecommunications since the announcement, there will be a far broader important debate on national security and high-risk vendors. That legislation will, of course, overarch many pieces of legislation, including this Bill.

We have listened carefully to the broad debate, both on high-risk vendors and on the amendment. I know that Members are interested in this matter, following the Government’s decision. In that decision, it was made clear that there will be new controls across the board on high-risk vendors, who will be excluded from all safety-related and safety-critical networks in critical national infrastructure, excluded from the security-critical core network functions, limited to a minority presence of up to 35% in the other parts of the network, and subjected to tight restrictions, including exclusions from sensitive geographic locations.

The Government made the decision on high-risk vendors after considering all the necessary information and analysis from the NCSC, industry and our international partners. It was an evidence-based decision, taken on a comprehensive security assessment, and noting the realities of the telecoms market. Members will be given a full opportunity to contribute to the important debate on high-risk vendors when the relevant legislation is brought before Parliament. However, as I think the hon. Member for Newcastle upon Tyne Central knows, to do so for this piece of legislation risks introducing a degree of incoherence in what is an important debate. We will do it in a coherent, sensible way in due course, and I hope that Members are reassured that the Government remain committed to working with Parliament as a whole to protect our future telecoms network, important though this Committee is.

[Seema Malhotra]

This is indeed a very important area. I slightly disagree with the Minister on whether referring to high-risk vendors is to extend the debate on today’s legislation. However, in terms of the implementation of the legislation, and operators and leaseholders going through the process, assuming that those operators obtain permission from the granters, will it be Ofcom that works to ensure that they abide by today’s legislation and the future high-risk vendor legislation?

[Matt Warman]

The hon. Member asks me to pre-empt what will be an important piece of legislation. What I can say is that we will ensure that nothing in today’s legislation could be used to circumvent that broader and more important piece of legislation, because obviously we have to ensure that 35% means 35% in whatever context.

I hope that Members understand that this is a hugely important issue. The Government are intent on doing things in a coherent and sensible way, so that we deal with matters of national security in the appropriate place rather than in a patchwork of measures with bespoke things in such places as this legislation. I therefore hope that the hon. Member for Newcastle upon Tyne Central will withdraw her amendment.

--- Later in debate ---

[Matt Warman]

The important point is that there has to be a formal response “in writing”. By definition, in responding a landlord ceases to be unresponsive. This legislation aims to deal with unresponsive landlords.

[Seema Malhotra]

It would be an interesting exercise to go through all the different ways in which one could respond, but we would then be here for the afternoon session. The purpose of the Bill is to speed up the process for residents to secure superfast broadband. New paragraph 27B(4)(a) reads

“agrees or refuses, in writing, to confer or otherwise be bound by the code”

and so on. A response will surely be either an agreement or a refusal, or a point of clarification. The “otherwise acknowledges” could be as simple as an email saying, “I have received your notice.” For the purpose of speeding things up rather than providing new ways in which blocks could be put in place, it is important that the Minister provides further explanation of what is intended to be covered by “otherwise acknowledges” and how it helps, given the clarity of 27B(4)(a).

[Matt Warman]

I come back to my central point, which is that the Bill addresses the problem of landlords who do not respond. Ultimately, it does not confer a right to install equipment against the will of a landlord. Once a landlord engages with the process, they are not considered unresponsive and are not covered by the Bill. Obviously, a landlord has the right to prevent access—either through prevarication or by withholding permission—in almost all circumstances, whether for telecommunications infrastructure or for anything else.

I completely understand what the hon. Member for Newcastle upon Tyne Central is seeking to do, but ultimately the things that she wants defined are already defined on the face of the Bill, and they will clearly not benefit from being separately defined again. It is important that we are consistent with the electronic communications code and, although I sympathise with the hon. Lady’s desire to see broadband rolled out wherever it can be, I ask her to withdraw the amendment.

[Chi Onwurah]

I thank the Minister for his response. He said that the Bill does not confer a right to install equipment against a landlord’s will, and I am concerned that that effectively means that tenants do not have a right to superfast or gigabit-capable broadband, which I would argue is an increasingly important part of modern life. We joked earlier about the difference between access to water and access to broadband, but for many people broadband is an absolutely essential part of their working and social lives, and a forward-looking Government would ensure that citizens have a right to gigabit-capable broadband. Although the universal service obligation confers some rights, it does not deal with recalcitrant or unwilling landlords.

[Seema Malhotra]

Does my hon. Friend agree that there could be a compromise or third way on this? The terms of new paragraph 27B(4)(b)—

“otherwise acknowledges the request notice in writing”—

are superfluous if a landlord is seeking to push action further down the road. If that is an incentive for landlords to engage less positively with those seeking to build networks, would the Minister at least consider reviewing—if not deleting—sub-paragraph (4)(b)? If responses from landlords fall considerably under that option, rather than agreeing or refusing with the reasons that one would expect in a positive dialogue, will the Minister consider whether that option should stay in the Bill?

[Matt Warman]

rose—

--- Later in debate ---

[Chi Onwurah]

It is a pleasure to respond positively, and not just in spirit but in practice, to the Minister’s amendments. They respond to concerns that we raised on Second Reading and those raised by others about increasing resources. The number of judges available to consider those requests and cases leaves much to be desired. Hopefully the Government’s amendments will make the limited scope of the Bill more effective, so we are happy to accept them.

New clause 1 responds to that by acknowledging that our judiciary is under severe strain at every stage. The new clause is designed with accountability and transparency in mind, so that we can see the impact of the new legislation on the resources available. The legislation sets out new legal functions. As with all good legislation, we must ensure that the new mechanisms are robust and well-resourced to ensure that the legislation does what it is meant to do, and does not fail when it makes contact with reality.

The new clause would require a report on resources to deal with proceedings arising under part 4A of the code be prepared and published within six months of the Act receiving Royal Assent. It aims to ensure that we see the impact on our judiciary. Although the information may be available, I am sure that the Minister is aware that nothing concentrates minds as much as laying a report before Parliament for scrutiny by right hon. and hon. Members. That gives an opportunity to see how the legislation works in practice. I am sure the Minister is proud of the legislation and the impact it will have, so he must welcome the opportunity to speak to that in the House.

We do not have an impact assessment for this legislation. It is a short Bill, but that does not mean that its impact may not be important. When I spoke to operators, they estimated that it might cost around £30,000 to take a request through the tribunal. That is their estimate—I have not seen any Government figures to confirm whether they consider that to be high or low, but that would have been a welcome part of an impact assessment. The sum of £30,000 for a tribunal to access an apartment block with 10 apartments means an additional cost to the operator of £3,000 per customer. That has an impact on the business case for that investment in the first place.

[Seema Malhotra]

I am not seeking to incur the Minister’s displeasure by bringing in wider issues on leaseholding, but when landlords may be taken to court for any matter, they potentially charge their fees back to their leaseholders. Perhaps we should make sure that there is some protection.

[Chi Onwurah]

My hon. Friend makes an excellent point. Without raising all the concerns surrounding leasehold, it is well known that freeholders may charge the leaseholders for the costs they incur when seeking legal judgments. In addition to the £30,000 that the operator would put on to the cost of the service deployment, therefore, the leaseholders and ultimately the tenants may also find themselves facing the costs incurred by the freeholder going to tribunal.