Question

To ask the hon. Member for Battersea, representing the Church Commissioners, what assessment the Commissioners have made of the potential impact of the implementation of the Product Security and Telecommunications Infrastructure Act 2022 on revenue to churches.

In February 2018 the Church of England signed an Accord with HM Government to develop guidance for dioceses, parishes and Chancellors to enable digital connectivity. This was in response to concerns about the social consequences of uneven deployment of digital connectivity, particularly in rural areas. The Accord can be viewed online, here: https://assets.publishing.service.gov.uk/media/5a86eb9540f0b62305b9559c/2018_02_18_Church_of_England_-_HMG_Accord.docx__1_.pdf

Following its obligations under the Accord, and acknowledging the difficulty for Code Operators in dealing separately with many thousands of self-governing parishes, the Church of England’s commercial arm then signed Memoranda of Understanding (MoUs) with all four Mobile Network Operators

These MoUs provide a single point of contact for the Operators, a company called NET CS, a managed process to navigate permissions under church and planning laws for heritage buildings, and a template licence for use by parishes

The Electronic Communications Code, as amended by this Act, requires valuing a property rent at market value, but importantly this must now exclude any value related to it being for the “use of an electronic communications network”. This means that comparable evidence of telecom and Church rental agreements established before the Code was introduced can no longer be used to determine a rent, so that Church rental yields are likely to suffer materially.

In most cases this change to the valuation basis (in the case of churches, a relatively small space in a tower) means that for new agreements, or on renewal of agreements coming to term after perhaps 20 years, the revenue for landlords – churches, local and other public authorities, as well as private landowners - is much lower than it used to be before the changes to the Code, sometimes as much as 85% less

However, the consensual agreement with Operators under the Church of England MoUs is providing much better revenue for parishes than market value under the Electronic Communications Code, so long as parishes elect to use these MoU consensual agreements. This revenue is a useful addition for hard-pressed parochial church councils which are trustees of parishes charged with the costs of maintaining centuries-old listed heritage buildings.