Recommendations & Conclusions
16 items
2
Recommendation
Thirty-fifth Report - Improving Broadba…
Accepted
The Department has failed to make meaningful progress to tackle the barriers faced by operators in maximising gigabit connectivity by 2025. At the time we took evidence in early November, the Department expected that state aid rules would be a domestic matter from 2021 onwards and EU approval would no …
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The Department has failed to make meaningful progress to tackle the barriers faced by operators in maximising gigabit connectivity by 2025. At the time we took evidence in early November, the Department expected that state aid rules would be a domestic matter from 2021 onwards and EU approval would no longer be required. However, it had not assessed the potential impact were this not to happen in practice. It has yet to secure the legislative and policy changes that industry deems necessary to address major barriers to delivering gigabit infrastructure at pace. Responsibility for addressing many of these barriers, including changes to planning regulations, business rates treatment of fibre and requirements for new build properties, are spread across other parts of government and we got no assurance that they are being addressed urgently. Suppliers believe that legislation recently introduced to enable easier access to properties while welcome addresses only part of the problem. The Department is not clear about the potential for delay or for cost escalation if these barriers are not addressed before suppliers start work. It is also vague on the potential costs and delays from removing telecommunications equipment supplied by Huawei. Recommendation: The Department should identify which risks and barriers have the greatest potential to add delay and cost to the programme and provide a clear plan for how and when they will be addressed and the impact on time and schedule if they are not addressed.
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Government response AI summary
The government agrees and details actions already taken through its Barrier Busting Taskforce, including new legislation, consultations, and Department for Transport reforms for access and street works. It commits to publishing an update on this work shortly and continuing to address identified risks.
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HM Treasury
3
Recommendation
Thirty-fifth Report - Improving Broadba…
Accepted
The Department is not clear how, in a centralised procurement model, it will retain the people, skills and knowledge in local authorities that were critical to success in the superfast programme. The Department recognises that although it now intends to undertake procurement directly, it will still need the commitment and …
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The Department is not clear how, in a centralised procurement model, it will retain the people, skills and knowledge in local authorities that were critical to success in the superfast programme. The Department recognises that although it now intends to undertake procurement directly, it will still need the commitment and expertise accumulated previously within local authorities to support delivery 6 Improving Broadband under the gigabit programme. The Local Government Association has called for additional annual funding of £30 million for digital champions to co-ordinate delivery at a local level and to provide the additional capacity needed within highways and planning teams to support an accelerated pace of activity. The Department cannot give any reassurance that local authorities will get additional funding to retain their expert resources at a time when local government finances are under severe pressure from the pandemic. Recommendation: The Department should set out in its Treasury Minute response to this report, what steps it is taking to support the retention of knowledge, skills and delivery expertise in local authorities so that the change in approach does not cause delays to the future programme.
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Government response AI summary
The government agrees with the recommendation and commits to supporting local authorities through a Barrier Busting Task Force, close collaboration with the LGA, meetings with officials, and by assigning dedicated regional field team resources.
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HM Treasury
4
Recommendation
Thirty-fifth Report - Improving Broadba…
Accepted
he Department has been unable to show how it has learnt lessons from the superfast programme into the detailed design of the gigabit programme. The Department’s objectives for its superfast programme were unspecific and delivery of the 95% broadband coverage target by 2017 sat largely with suppliers rather than being …
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he Department has been unable to show how it has learnt lessons from the superfast programme into the detailed design of the gigabit programme. The Department’s objectives for its superfast programme were unspecific and delivery of the 95% broadband coverage target by 2017 sat largely with suppliers rather than being within the Department’s control. With full-fibre and gigabit coverage at 14%and 27% respectively on publication of the NAO’s report, which is behind other European countries, the Department is some way off its superfast programme objective to be “the best in Europe”. While the Department agrees that it needs to have clear objectives in place at the time of launching the subsidised element of its gigabit programme, we are not reassured that its new programme objectives will be any better. It is unacceptable that, once again, the Department has set a nationwide target for coverage (now revised from 100% to 85% by 2025), yet it has not published a realistic strategy for rolling it out, and has limited control over the levers necessary to achieve it. Indeed, the Department is relying on suppliers to deliver to 80% of UK premises without government subsidy. We are also concerned that the Department has not learned lessons about where to target areas for subsidy. The Department estimates that of the £1.9 billion public funding for the Superfast Programme, £0.9 billion is due to be repaid, which suggests that the subsidy was often not targeted at the areas in greatest need. It can take up to seven years before the amounts to be returned are calculated and repaid by suppliers. Recommendation: As the Department finalises its approach to its gigabit programme it should set out how it is incorporating the lessons learned from the superfast programme including: • Setting out clear programme specific objectives for the subsidised part of the future gigabit programme (the £5bn programme) • How it intends to improve its targeting to ensure it covers only those areas i
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Government response AI summary
The government agrees and outlines how it is incorporating lessons by committing funding to high-need areas, publishing a detailed targeting approach, and regularly reporting progress. It also cites independent evaluations and stakeholder consultations informing the UK Gigabit Programme design, including improvements like automated build plan …
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HM Treasury
5
Recommendation
Thirty-fifth Report - Improving Broadba…
Accepted
he Department is yet again failing to prioritise consumers in rural areas. The Department says that it intends to take an ‘outside-in’ approach to the roll-out of gigabit capable broadband, focussing on those areas that currently do not have access to superfast so that they do not remain left behind. …
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he Department is yet again failing to prioritise consumers in rural areas. The Department says that it intends to take an ‘outside-in’ approach to the roll-out of gigabit capable broadband, focussing on those areas that currently do not have access to superfast so that they do not remain left behind. But the most difficult- Improving Broadband 7 to-reach premises are not neatly grouped together, and the Department is not yet clear on how it will prioritise its interventions to ensure that they are served. The data available to help determine roll-out priorities is patchy and of variable quality. The Department acknowledges it is reliant on a good dataset but is not clear when it expects to have this in place. We had significant concerns that in the event of delays to the programme, the Department would look to deliver to as many premises as possible in a bid to meet its ambitious timetable. In this case, those people who currently lack superfast broadband would once more go to the back of the queue. Government’s announcements since our oral evidence session, reframing the target to 85% coverage by 2025 and not allocating three-quarters of the £5 billion allocation until after 2024–25, heighten these concerns. This suggests that many consumers, particularly those in rural and remote areas, will have to wait until well beyond 2025 for gigabit broadband speeds and may not even get superfast speeds before then. Recommendation: The Department should set out how it will establish which properties do not yet have superfast broadband, how reliable the data it will use to identify them is, and when they can expect to receive gigabit capable broadband.
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Government response AI summary
The government 'agrees' and states the recommendation is 'implemented', outlining how it uses Ofcom data and collects future build plans to identify premises and ensure data reliability. It detailed ongoing delivery through existing programmes and the Gigabit Broadband Voucher Scheme, with further procurements planned.
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HM Treasury
6
Recommendation
Thirty-fifth Report - Improving Broadba…
Accepted
The Department cannot provide certainty to consumers that they will have a choice of internet provider or be protected from overcharging should they become tied to the sole supplier in an area. The Department wants to encourage greater competition in the telecommunications infrastructure market, but in areas that need subsidy, …
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The Department cannot provide certainty to consumers that they will have a choice of internet provider or be protected from overcharging should they become tied to the sole supplier in an area. The Department wants to encourage greater competition in the telecommunications infrastructure market, but in areas that need subsidy, smaller alternative suppliers may gain dominant positions by default through lack of wider commercial interest. The Department believes that provisions for wholesale access in the gigabit programme contracts should ensure that all internet service providers have access to subsidised networks. However, such access may not be taken up if the most popular internet providers find it commercially unattractive to offer their services over a patchwork of different networks each serving a low number of premises. Some consumers, particularly in rural areas, may not be able to sign up with their service provider of choice and may end up paying more for their services. The Department claims price control provisions should ensure that providers cannot price beyond what is reasonably comparable in a given area, but it is not clear how it will define an area nor how price controls will work. Recommendation: In its Treasury Minute response to this report, the Department should set out how it plans to work with Ofcom, suppliers and industry bodies to ensure that all consumers will have a choice of service providers and are protected from overcharging, in particular where they become tied to a monopoly supplier. 8 Improving Broadband 1 Delivering the future programme
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Government response AI summary
The government agrees to implement annual wholesale access price benchmarking within contracts, evaluate Retail Service Provider quality in bids, and work with Ofcom and industry to increase network competition and facilitate standardisation to protect consumers from overcharging and ensure choice.
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HM Treasury
8
Conclusion
Thirty-fifth Report - Improving Broadba…
Accepted
The National Audit Office’s report called for the Department to present a detailed plan and schedule identifying how it will meet the timeline.16 But when we pressed for a broad timetable or indicative dates for the essential steps towards achieving the target, the Department stated that it was awaiting Ministerial …
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The National Audit Office’s report called for the Department to present a detailed plan and schedule identifying how it will meet the timeline.16 But when we pressed for a broad timetable or indicative dates for the essential steps towards achieving the target, the Department stated that it was awaiting Ministerial approvals. The Department repeatedly declined to provide any firm answers on when these approvals would be forthcoming or when it expected to determine the sequencing of events, beyond stating this would be “as quickly as possible.”17 We were unable to elicit any more detailed information about how long the Department estimates the contracting process to take, nor its view on the latest date by which it believes contracts would need to be in place for installation work to start.18
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Government response AI summary
The government agrees with the committee, confirming £1.2 billion for gigabit broadband rollout, and committing to announce first procurement locations, publish quarterly updates on the procurement pipeline, and submit a Programme Business Case for approval in Summer 2021.
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HM Treasury
11
Conclusion
Thirty-fifth Report - Improving Broadba…
Accepted
We asked about progress towards resolving the barriers which industry has repeatedly said need to be addressed if it is to progress the commercial roll-out to reach 80% of UK premises by 2025. The Department said that it is working on this, but Openreach told us that the legislation introduced …
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We asked about progress towards resolving the barriers which industry has repeatedly said need to be addressed if it is to progress the commercial roll-out to reach 80% of UK premises by 2025. The Department said that it is working on this, but Openreach told us that the legislation introduced by the Department so far on access to property is insufficient to “meaningfully tackle the numerous barriers;” for example they told us that it does not address landlords that seek excessive costs.26 Given its responsibility for broadband policy, we pressed the Department on how vigorously it was pursuing the removal of barriers where responsibility rests with another part of government, including changes to planning regulations and the business rate treatment of fibre.27 The Department stated that it was working with the Department for Transport on streetworks, and the Ministry of Housing, Communities and Local Government on planning, but declined to offer any view or reassurance that the matters are being urgently pursued.28
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Government response AI summary
The government details existing legislative and policy actions taken by its Barrier Busting Taskforce, including new legislation for property access, consultations on new build broadband, and reforms to street works processes. It commits to publishing an update on its barrier busting work shortly and continuing …
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HM Treasury
12
Conclusion
Thirty-fifth Report - Improving Broadba…
Accepted
The National Audit Office report stated that the requirement to remove equipment supplied by high risk vendors from telecoms networks puts the schedule at risk.29 The Department conceded that this might cause a delay to the future programme and that it was consulting with industry on precise implications, but was …
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The National Audit Office report stated that the requirement to remove equipment supplied by high risk vendors from telecoms networks puts the schedule at risk.29 The Department conceded that this might cause a delay to the future programme and that it was consulting with industry on precise implications, but was not able to provide any indication of the possible length of that delay or impact on the roll-out.30 20 Qq 52–53, 93–96 21 Spending Review 2020, paras 3.5 & 6.86; table 6.22 22 Q 59 23 C&AG’s report para 2.8 24 Q 29 25 Qq 30–34 26 Qq 69–70; IBB0005 - Openreach, para 7 27 Qq 68, 71 28 Qq 59, 71–74 29 C&AG’s Report, para 2.11 30 Qq 98–107 Improving Broadband 11 Retaining skills and knowledge in local authorities
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Government response AI summary
The government is conducting a technical consultation with network operators on the use of Huawei equipment, which is nearing completion, and the Secretary of State will announce the outcome in due course to address the impact on the programme schedule.
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HM Treasury
13
Conclusion
Thirty-fifth Report - Improving Broadba…
Accepted
The National Audit Office report sets out how the Department intends to adopt a centralised procurement for its gigabit programme, even though it considered the partnership approach that it used under the Superfast Programme to have been very successful. The report said that the knowledge and experience of local bodies …
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The National Audit Office report sets out how the Department intends to adopt a centralised procurement for its gigabit programme, even though it considered the partnership approach that it used under the Superfast Programme to have been very successful. The report said that the knowledge and experience of local bodies had been critical to supporting delivery and overcoming obstacles during the superfast programme.31 The Department told us that although it intended to undertake the procurement directly under the future programme, it needs the continued involvement and expertise of Local Authorities and it is important to retain their skills and records of where and by whom broadband infrastructure has been installed with a public subsidy by participating in the Superfast Programme as outlined in paragraph 3.3 of the NAO report.32
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Government response AI summary
The government agrees with the committee and commits to actions by Spring 2021 to ensure continued local authority involvement despite centralised procurement. This includes advice from the Barrier Busting Task Force, working with the Local Government Association to define roles for the UK Gigabit programme, …
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HM Treasury
15
Conclusion
Thirty-fifth Report - Improving Broadba…
Accepted
The National Audit Office’s report said that it had been difficult to assess the Superfast Programme’s performance because it lacked programme-specific measures against which to judge success. It explained that the Department’s coverage targets, for example, to reach 95% of UK premises with superfast broadband infrastructure by 2017, were not …
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The National Audit Office’s report said that it had been difficult to assess the Superfast Programme’s performance because it lacked programme-specific measures against which to judge success. It explained that the Department’s coverage targets, for example, to reach 95% of UK premises with superfast broadband infrastructure by 2017, were not specific to the publicly-funded element within the Department’s control and could only be achieved in conjunction with industry-funded roll out.37 We reminded the Department of its target for the UK to be “the best in Europe” and pointed out that the 14% full-fibre coverage and 27% gigabit coverage reported by the National Audit Office put us below the European average.38 The Department said that latest coverage rates for full-fibre and gigabit-capable had increased and were now 17% and 30% respectively.39
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Government response AI summary
The government agrees with the committee's observation, commits to regularly publishing progress against the UK Gigabit Programme's milestones to improve performance assessment, and details other actions taken to address areas of greatest need, learn from evaluations, and improve program design and clawback mechanisms.
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HM Treasury
16
Conclusion
Thirty-fifth Report - Improving Broadba…
Accepted
The Department told us that it wanted to have very clear objectives and to be clear about the benefits for the subsidised part of its gigabit programme but could offer no further detail on how it intends to design and conduct the evaluation of that programme.40 The 31 C&AG’s Report, …
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The Department told us that it wanted to have very clear objectives and to be clear about the benefits for the subsidised part of its gigabit programme but could offer no further detail on how it intends to design and conduct the evaluation of that programme.40 The 31 C&AG’s Report, paras 3.11–12 32 Qq 126, 146–147 33 IBB0003 - Local Government Association 34 Qq 127–132 35 C&AG’s Report, para 3.12 36 Qq 133–136 37 C&AG’s Report, para 13 38 Q 81 39 Q 81 40 Qq 153, 156 12 Improving Broadband Department has, once again, set nationwide coverage targets for its gigabit programme; originally 100% and now 85%,41 and the Department is once again relying on industry to deliver most of it; in this case to 80% of UK premises.42 As yet, it has published no targets specific to its £5 billion subsidy programme such as the number of premises it aims to cover by when. The Department acknowledged that it was better to have control over all the levers but said that it had demonstrated its ability to have influence over the market when it achieved the nationwide target for superfast broadband.43 The Department told us that relying on commercial roll-out does not necessarily mean that they cannot achieve these kinds of targets.44
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Government response AI summary
The government agrees with the committee’s point and commits to publishing progress against the UK Gigabit Programme’s milestones regularly, using lessons from previous evaluations to inform the new programme's design.
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HM Treasury
17
Conclusion
Thirty-fifth Report - Improving Broadba…
Accepted
The National Audit Office report noted that the Department estimates £0.9 billion of funding will be returned by suppliers where capital expenditure was lower than expected or actual take-up of superfast broadband is higher than expected.45 The Department told us that because some of this represents future profits measured over …
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The National Audit Office report noted that the Department estimates £0.9 billion of funding will be returned by suppliers where capital expenditure was lower than expected or actual take-up of superfast broadband is higher than expected.45 The Department told us that because some of this represents future profits measured over a 7 year period from contract completion, it has not yet all been received and it will monitor returns to Local Authorities and central government over that time.46 While £0.9 billion of money to be returned represents a significant proportion of the overall public subsidy of £1.9 billion provided under the superfast programme, the Department said it believed it had targeted premises as well as it could with the data available.47 41 National Infrastructure Strategy 2020, p. 31 42 Qq 16–17, 36, 153 43 Qq 156 44 Qq 36, 156 45 C&AG’s Report, para 1.12 46 Qq 16, 28 47 Qq 14–15, 17 Improving Broadband 13 2 Protecting consumers Consumers in rural areas
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Government response AI summary
The government acknowledges the observations about returned funding by detailing improvements to the Superfast Broadband Programme, including centralising supplier build plans, extending the clawback period to 15 years, and incorporating a one-off recovery to bring forward future clawback value.
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HM Treasury
18
Conclusion
Thirty-fifth Report - Improving Broadba…
Accepted
The Future Telecoms Infrastructure Review sets out government’s intention to take an ‘outside-in’ approach to rolling out gigabit-capable broadband, where areas that are currently unable to access superfast speeds are prioritised so they are not left further behind.48 The Department told us that it still aimed to focus on areas …
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The Future Telecoms Infrastructure Review sets out government’s intention to take an ‘outside-in’ approach to rolling out gigabit-capable broadband, where areas that are currently unable to access superfast speeds are prioritised so they are not left further behind.48 The Department told us that it still aimed to focus on areas without access to superfast broadband so that those areas do not remain left behind.49 However, it said that the harder-to-reach areas are not necessarily grouped together and it could not tell us how it intended to establish a sequence for reaching them in the subsidised element of its gigabit programme.50 The National Audit Office’s report suggested that the data needed to support an ‘outside-in’ approach was patchy and of variable quality.51 The Department outlined the steps that it planned to take over the coming weeks and months to build a robust and reliable dataset on which to base planning assumptions but declined to tell us when it expected to have this.52
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Government response AI summary
The government details its plan to implement an 'outside-in' approach by collecting and updating robust data from Ofcom and operators, conducting public reviews for each project, and has published the first review for Cumbria.
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HM Treasury
19
Conclusion
Thirty-fifth Report - Improving Broadba…
Accepted
The National Audit Office’s report describes how the Superfast Programme was able to leave the very hardest to reach premises until last when, in a bid to meet its timeline, the Department prioritised maximising the number of premises reached over providing for those in greatest need.53 We asked for assurance …
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The National Audit Office’s report describes how the Superfast Programme was able to leave the very hardest to reach premises until last when, in a bid to meet its timeline, the Department prioritised maximising the number of premises reached over providing for those in greatest need.53 We asked for assurance that, should the programme timetable start to slip, the people with the poorest broadband would not be sacrificed and put to the back of the queue once more. The Department told us it was committed to an ‘outside-in’ approach and that its priority was to ensure that those who do not have access to superfast broadband will receive decent broadband.54 The National Audit Office’s report referred to the final 1% of premises as “prohibitively expensive” and the Department explained that it was assessing the value for money of alternative technologies for delivering the fastest speeds possible to these premises.55
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Government response AI summary
The government reaffirms its commitment to an 'outside-in' approach by detailing plans for targeting premises without superfast broadband through new procurements, comprehensive data collection, and formal public reviews for each project.
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HM Treasury
21
Conclusion
Thirty-fifth Report - Improving Broadba…
Accepted
The National Audit Office was concerned that greater competition in the broadband infrastructure market would not necessarily lead to a greater choice of internet providers for consumers. In its report, it explained that in areas that needed subsidy, smaller alternative infrastructure providers could gain dominant positions. Its report also set …
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The National Audit Office was concerned that greater competition in the broadband infrastructure market would not necessarily lead to a greater choice of internet providers for consumers. In its report, it explained that in areas that needed subsidy, smaller alternative infrastructure providers could gain dominant positions. Its report also set out a risk that more popular internet providers may not find it commercially attractive to 48 Department for Digital, Culture, Media & Sport, Future Telecoms Infrastructure Review, July 2018. Available at https://www.gov.uk/government/publications/future-telecoms-infrastructure-review 49 Q 27 50 Qq 26–27, 38–39 51 C&AG’s Report, paras 3.2–3.6 52 Q 40 53 C&AG’s Report, para 3.17 54 Qq 35, 159 55 Q 155 14 Improving Broadband offer their services over many different networks and that consumers, particularly in rural areas, could be left with limited choice.56 The Department told us that it was aware of the risk but said that the contracts for its Superfast Programme enabled wholesale access to a range of internet providers.57 It explained that work was underway outside of government to create a platform to make it easier for internet providers to supply their services over alternative networks but provided no information about when this would be ready.58
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Government response AI summary
The government agrees with the committee's concern and commits to specific actions by Spring 2021, including annual wholesale access price benchmarking in contracts, evaluating retail service provider quality in bids, working with Ofcom to increase network competition, and facilitating industry efforts to standardise and aggregate …
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HM Treasury
22
Conclusion
Thirty-fifth Report - Improving Broadba…
Accepted
We asked the Department how it intended to protect consumers in areas with a single dominant supplier from being charged a lot more without proper competition. The Department told us that its contracts had price control provisions to ensure that internet providers cannot charge beyond what is reasonably comparable in …
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We asked the Department how it intended to protect consumers in areas with a single dominant supplier from being charged a lot more without proper competition. The Department told us that its contracts had price control provisions to ensure that internet providers cannot charge beyond what is reasonably comparable in that areas.59 The Department did agree that local monopolies were not a good thing but did not explain how price controls will work and told us that it had not yet decided how to define an area.60 56 C&AG’s Report, paras 3.18–3.20 57 Qq 19, 50 58 Qq 50–51 59 Q46 60 Qq 47–49 Improving Broadband 15
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Government response AI summary
The government provides details on how it will protect consumers, including annual wholesale access price benchmarking within contracts, evaluating Retail Service Provider quality in bids, and working with Ofcom and industry to increase competition and facilitate network standardisation to ensure choice and fair pricing.
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HM Treasury