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Free UK broadband floated, through telco nationalisation and tech tax

The bold plan, which aims to boost productivity and reduce the digital divide, has received mixed reactions.

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Ahead of next month’s General Election in the UK, the Labour Party has pledged to connect every home and business with free full-fibre broadband by 2030, if it wins.

 

The main opposition party would nationalise part of BT to deliver the policy as well as introducing a tax on tech giants to help pay for it.

 

This builds on Labour’s existing proposals to nationalise energy utilities, water companies, postal services and railways in a drive to transform the public sector.

 

Labour said the plan would “bring communities together in an inclusive and connected society” and boost 5G connectivity. The proposed roll-out would begin with communities that have the worst broadband access, including rural and remote communities and some inner-city areas, followed by towns and smaller centres, and finally, areas that are currently well-served by high-speed broadband.

 

Labour said the plan would “bring communities together in an inclusive and connected society” and boost 5G connectivity.

 

The Conservative Party, which is now in government, has called it a "fantasy plan" that would cost taxpayers billions, while the Liberal Democrats dismissed it as "another unaffordable item on the wish list".

 

UK Prime Minister Boris Johnson previously called on the telecom sector to deliver 100 per cent roll-out of fibre-optic broadband to properties across the UK “in five years at the outside". The National Infrastructure Commission has estimated that building and maintaining a full-fibre network across the UK would cost £33.4 billion over 30 years.

 

Tech tax

 

Labour proposes to integrate BT’s broadband infrastructure arm, Openreach, into a new public entity, British Broadband. The roll-out would be paid for through Labour’s Green Transformation Fund, with the costs of maintaining the network paid by a tax on multinationals, including tech giants like Google and Facebook.


BT chief executive Philip Jansen told BBC News he was happy to work with whoever wins the election to ensure digital connectivity but said the process for implementing Labour’s plan would not be "straightforward". Elsewhere, he said it could cost up to £100 billion, adding that the impact of any changes on BT pensioners, employees and shareholders would need to be carefully considered.

 

Tech trade association TechUK said nationalisation would be a “disaster” for the telecom sector.

 

TechUK CEO, Julian David, commented: "Renationalisation would immediately halt the investment being driven not just by BT but the growing number of new and innovative companies that compete with BT. Full fibre and 5G are the underpinning technologies of our future digital economy and society.”


“The telecoms sector has delivered increased coverage, capacity and quality whilst household spend on telecoms services has remained flat,” he added.

 

The governments of countries such as Australia, Brazil, Luxembourg, New Zealand, Singapore and South Africa have created state-owned operators to drive broadband deployment.

 

Connectivity lag

 

Labour says its plan could result in 300 million fewer commuting trips, three billion fewer kilometres travelled by car, and 360,000 tonnes fewer carbon dioxide emissions per year. Estimates from the Centre for Economics and Business Research suggest a full-fibre network could boost productivity by £59 billion by 2025, bring half a million people back into the workforce and boost rural economies, with an estimated 270,000 people more able to move to rural areas.

 

According to Ofcom, around 8 per cent of premises in the UK are connected to full-fibre broadband, well behind other countries such as Japan and South Korea with 97 per cent and 98 per cent coverage respectively.

 

Research from the Fibre to the Home Council Europe finds that the UK has a 1.3 per cent fibre-to-the-home (FTTH) penetration rate, behind counties such as Latvia (50 per cent), Lithuania (46 per cent), Spain (44 per cent) and Sweden (43 per cent).

 

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