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Budget: 90% Next generation broadband coverage by 2017
Wednesday 24 March 2010 14:42:27 by Sebastien Lahtinen

In the budget today, the government has confirmed its previous plans to charge a 50 pence a month levy on all fixed phone lines which is expected to raise £1bn in the next seven years. This money will be used to fund rollout of next-generation broadband to the 'final third' of the UK, areas which wouldn't be able to receive super-fast broadband without government intervention.

On Monday, Gordon Brown delivered a speech in which he set out the government plans to deliver more services online. He said that to achieve this, universal access to next generation broadband was necessary by 2020. Benjamin Cohen of Channel 4 queried whether this actually meant 100% coverage, and we understand he clarified this as "every home". We therefore expected the budget to go further than the '90% 2017' promise. The government has also yet to clarify what they mean by 'next generation' or 'super-fast' broadband.

Campaign group Final Third First is calling on the government to fund broadband from general taxation instead of taxing phone lines:

"As with water, gas and electricity, broadband is now a public good and the essential fourth utility. The people have the right to demand ubiquitous connectivity that is effectively funded. The Government has made clear its determination to realise significant savings through reduced costs made possible through new digital communications technology. [..] If the fourth utility is not universal – to every person – the Government cannot realise the savings of its paperless dreams."

A spokesman for Final Third First

The HM Treasury website has been overloaded with downloads of the full budget document demonstrating the increasing use of technology by the government and its citizens. Trefor Davies, CTO of ISP Timico reported a 22% growth of traffic compared to yesterday during the Chancellor's speech which was broadcast on various websites, which was similar to the Ashes cricket tests last summer.


Posted by cyberdoyle over 7 years ago
I think the government should help the Final Third First to help the rural people. I don't think a phone tax is the right way to do it. Nor do I think the conservative idea of letting the market do it will work.
Until there is a level playing field for private investment in the infrastructure nobody is gonna help the rurals. The phone levy is too little too late. What we need is gov intervention to reduce/remove the VOA tax, and collaboration with councils and rural orgs. FTF is doing just that, and should be supported.
Posted by dch3dwj over 7 years ago
As I understand it the Conservative plan is not to just let the market deliver but also to use some of the TV license take to pay for roll out.

On the whole I agree with you though, my only worry is that the Government goes into hard in those areas where the market might deliver (as opposed to where it definatly won't) the teleco's will just freeze investment in those areas and wait for Gov' money. They might also hike their charges.
Posted by CARPETBURN over 7 years ago
God this makes me mad.......
quote"The government has also yet to clarify what they mean by 'next generation' or 'super-fast' broadband."

Nice of the (bleepers) to take our money and not even explain properly what its for.
Oh and first it was 100% then 99% now its 90% coverage... Bunch of nonsense.
Posted by dch3dwj over 7 years ago
The Government plans in Digital Britain, and all the costings, are for FTTC so it's safe to assume this is what they'll deliver.
Posted by themanstan over 7 years ago
Hehe... government plans... I like that, it should be the government's plan. But unfortunately you're right, there is no coherent single plan for delivery of NGA. Just lots of different plans, none of which is really being acted upon.
I'll harp on about the infrastructure of NGA access being merged (not nationalised) and a new Co. under the watchful eye of OFCOM delivering equal access to all ISPs. Investment in new infrastructure then being in non-competing areas. Imagine how much coverage there would be now if this was the case?
Posted by adslmax over 7 years ago
I am very very very ANGRY with this government! Exspecially I want to punch Gordon Brown face! Cos my poor 86 years old grandma can't afford to foot the bt line of 50p plus vat on her line rental, she cannot use any mobile phone (can't understand all the technology things nor computers. How selfish this government don't think of low income parents nor old ages pension peoples! They should tax the higher earning who earn over £100,000 a year to pay £1 plus VAT broadband tax on top of their income tax.
Posted by adslmax over 7 years ago
I am not going to vote for labour. Goodbye labour. Let's all of us vote for conservatives to get rid of this silly 50p tax plus vat on all fixed telephone lines in uk.
Posted by adslmax over 7 years ago
I am going to disconnected BT line for good! what the point pay 50p tax plus vat will be 59p in total.
Posted by GMAN99 over 7 years ago
Vote Tory and their 20% VAT? No thanks.
Posted by dpeilow over 7 years ago
Even the government seems to be guilty of confusing USC and NGA. From the Telegraph:

"…the Prime Minister said a single website would offer people the chance to “manage their pensions, tax credits or child benefits; pay their council tax; fix their doctors or hospital appointment and control their own treatment; apply for the schools of their choice and communicate with their children's teachers; or get a new passport or driving licence - all when and where they need it”.

Can anyone tell me why you need NGA for that? Broadband, certainly - but not uber-fast fibre stuff.
Posted by seb (Favicon staff member) over 7 years ago
@adslmax - There are supposed to be some exemptions to the 50p/month tax inclusing social telephony (BT Basic service).. didn't see detail today on that but has been mentioned by lib dems and I think then labour too..
Posted by cyberdoyle over 7 years ago
can confirm that Seb, anyone on special tariffs ie poor and elderly won't be charged the levy.

dpeilow - fibre can deliver 2 meg far easier and cheaper than laying new copper to rural areas. currently in those areas the dial up means pages time out when trying to fill out online forms. NGA isn't about speed, its about the best infrastructure which works and is futureproof.
Posted by GMAN99 over 7 years ago
I've no problems with a 50p tax I mean my council tax sours each year and I get less for it each year. But things still don't seem clear to me, on one hand we will be taxed 50p a month so the gov can rollout super fast BB, on the other Ofcom are forcing BT to open up to let ISP's roll it out. So.... where does this 50p a month go if ISP's are paying for it themselves?
Posted by cyberdoyle over 7 years ago
the 50p is supposed to go to the areas that no ISP will touch. The final third. The ones who currently don't have any decent broadband. Even with access to ducts the cost of the valuation office windows tax and the costs openreach will charge for access will make the distances too great for private investors.
Posted by Somerset over 7 years ago
It would be useful to see a map showing the final third. No FTTC, no FTTP and more than 2km? from an exchange.

Surely a very scattered, hence difficult, picture.
Posted by cyberdoyle over 7 years ago
here you go Somerset
And many who can't get broadband won't have entered their areas. 90% of the uk land mass is the final third from the looks of it :(
Posted by GMAN99 over 7 years ago
No cyber that's slow spots not spots ISP's won't touch. Show the red spots only its not 90%, probably not even 9!
Posted by Aqualung over 7 years ago
IMO the 50p is the first step down the road towards a replacement for the TV licence, call it a communications licence. The Government already take a whooping amount of vat from our broadband bills they should use that !!!The more and better services promised would automatically lift that amount substantially.
Posted by dch3dwj over 7 years ago
@Seb - There are only 700,000 people on social telephony tariffs (TalkTalk estimate). The 'Digital Inclusion Task Force' reckons there are 4 million who are too poor to access broadband.

The levy is all a bit mad. Remember you'll also be expected to pay VAT on that 50p (no seriously, you will!)

Aqualung has hit the nail on the head. If there is a massive demand for NGA as the Gov' claims there wiil be the VAT return on all those £30 p.m. bills should more than cover the costs (circa £6 VAT per connection). So it pays for itself.
Posted by dch3dwj over 7 years ago
@GMAN - Unfortunatly I think we're in for 20% VAT whoever wins the next election. I've just watched three politicians arguing over an £8bn saving when the public deficit is currently at £178bn...

Fiddling while Rome burns.
Posted by chrysalis over 7 years ago
4 million too poor to get free broadband? as some providers it is effectively free. £1 an hour in my local net cafe's. Free in my local library. Free in schools.
Posted by Somerset over 7 years ago
CD - how much should be spent getting to the final 5%, like an isolated house in the country?

One slow spot on the map is closer to the exchange than me and my 4.4M. I suspect the home wiring.
Posted by cyberdoyle over 7 years ago
sometimes the distance from the exchange is deceiving cos the line may go round the houses and back, but yes home wiring sometimes is the problem. As for how much should be spent, well as much as it takes... the return on investment is for the country, the gov, the people, the kids. Reliable access to the internet is now vital for this country. If the NGA fund does the really difficult ones then the market will pick up the rest, cos the trunks will be in.
Posted by GMAN99 over 7 years ago
But I don't want my 50p to go on funding access to those out in the sticks, I want it to fund my own broadband development. I wouldn't expect you to pay for my services in my area?
Posted by Somerset over 7 years ago
GM - So your electricity should be cheaper if you live close to a power station?

CD - if NGA does the difficult ones etc. What trunks? To where?
Posted by GMAN99 over 7 years ago
No I'm not saying it should be cheaper no, we are not talking electricity. My electricity is no cheaper than theirs out in the sticks. Despite what has been said broadband isn't a utility. Ok so what if the sewer systems in cities needed vital upgrades and a tax went on water bills to pay for it, and those out in the sticks also had to pay even though they didn't need any upgrades, fair? They'd be fuming
Posted by docki over 7 years ago
No I agree, A phone line is but broadband is not. It's an always on but no always available non guaranteed service with no SLA and should never ever be "expected" and when people tell me their speed or service is " not acceptable" i really want to tell them the above. People have no idea..

That's the beauty of being on cable. As soon as the government do this my phone line will be terminated.. by me.. for once I can stop them from shafting me.. win
Posted by TaRkADaHl over 7 years ago
Somerset... bad example... last time I checked electricity does not degrade like an ADSL signal down a twisted copper pair.

Personally, broadband is not a utility, it is a luxury, without electricity and running water 99.8% people would struggle to live nowadays, without broadband, 0.02% would struggle to live (mobility impaired and so on...)
Posted by mishminx over 7 years ago
Those who make the most use of Government services are those least likely to use a computer. In addition to being those least likely to afford a computer let alone broadband. So whilst bank accounts for all ties in. Where are all the computers coming from? Where is the funding for training, broadband provisioning and so on. A steaming crock and labour have filled it!
Posted by cyberdoyle over 7 years ago
somerset, the trunks of the network, to cabinets in the rural towns and villages. My nearest pop is the city, so the cost to get there means nobody will invest in our area. Get us a pop and it becomes doable.
The reason for doing this is to build NGA, by giving people a stable scaleable broadband connection that will grow with their needs.Because it can grow, it will grow, and will stimulate roll out in the cities. So the whole country gets IT. Just like your food and water comes from the fields, so NGA will too.
Posted by dlaff over 7 years ago
i think if he wants fast broadband then he needs to stop isps using upto he must make them say what speed you will get and make them stick to it its no good saying you will get 100mbps when it drops when alot of people online so might go down to 256
Posted by Raspyyeti over 7 years ago
This is how the money should be used.
Amsterdam has 450,000 fiber connections with 80 percent of the costs were labor costs, while 10 percent were fiber
Posted by Somerset over 7 years ago
CD - what's the problem with a connection to your local exchange which will have a fibre connection to 'the city'.

What do you consider to be current needs?

'Get us a POP', what, for free?
Posted by GMAN99 over 7 years ago
So this tax will last 7yrs or that's how much they will make in 7yrs and we'll continue to be taxed after that?
Posted by AndrueC over 7 years ago
@GMAN99. Not necessarily. Window tax didn't last forever :)
Posted by Somerset over 7 years ago
AC - income tax is only temporary!
Posted by herdwick over 7 years ago
interesting that none of mains water, gas and electricity are available to every person in the country, especially gas (not that I would want it).
Posted by deira over 7 years ago
Does this mean a levy on all fixed lines - including, for example, those used only for burglar alarms?
Posted by stanmor over 7 years ago
A serious question - why is 'super-fast' (presumably 40Mb?) broadband deemed to be essential in isolated areas at all? If you want over say 16Mb, surely the main use is to download video/play fast games (hardly a social necessity) or to run an interactive business If you need something that fast you shouldn't expect miracles in an isolated farm, paid for by a 'phone tax'. Why not just aim for a reasonable speed in all populated areas rather than mega in isolated crofts?
Posted by Gamerwillz over 7 years ago
That's a great news indeed, but I wish BT or other UK telecommunication firms started the fibre deployment back in 2000, then we would have got a fibre covered Britain by now.

Looking forward to downloading movies in seconds, and playing Modern Warfare 2 online on PS3 with full green pings!
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