Labour to provide free full-fibre broadband to everyone if it wins the next election
The Labour Party has committed to providing free full-fibre broadband for all businesses and homes if it wins the next election and will nationalise a part of telecoms provider BT in doing so.
The roll out will begin with areas suffering from the worst broadband access, including rural and remote communities as well as some inner city areas.
This will be followed by towns and smaller centres, and then by areas that are currently well-served by superfast or ultrafast broadband.
Labour said it would nationalise Openreach – the digital network arm of the country’s biggest broadband and mobile phone provider – as well as parts of BT Technology, BT Enterprise and BT Consumer.
The proposal sent BT shares down as much as 3.7 per cent, wiping nearly half a billion pounds off its market capitalisation.
Labour said the plan will be paid for through its Green Transformation fund and taxing tech giants such as Amazon, Facebook and Google.
“It’s time to make the very fastest full-fibre broadband free to everybody, in every home in every corner of the country,” Labour leader Jeremy Corbyn will say in a speech, according to an extract released by the party.
“By creating British Broadband as a public service, we will lead the world in using public investment to transform our country, reduce people’s monthly bills, boost our economy and improve people’s quality of life.”
Labour has also previously pledged to nationalise power networks, Royal Mail, rail and water companies, but shadow chancellor of the exchequer John McDonnell has said the party would not nationalise the whole of BT. He also added that this announcement represents the limit of the party’s nationalisation plans.
The cost of nationalising parts of BT would be set by parliament and paid for by swapping bonds for shares.
“These are very, very ambitious ideas and the Conservative Party have their own ambitious idea for full-fibre for everyone by 2025 and how we do it is not straightforward,” said BT chief executive Philip Jansen.
“It needs funding, it is very big numbers, so we are talking £30bn-40bn ... and if you are giving it away over an eight-year time frame it is another £30bn or £40bn. You are not short of £100bn.”
Prime Minister Boris Johnson has promised to roll out full-fibre broadband to all homes by 2025 if his Conservatives, who are leading in the opinion polls, win the election.
Speaking to Conservative Party activists today, Johnson described Labour's plan as a “crazed Communist scheme” adding “we are funding a huge programme of investment in our roads, in telecoms, gigabyte broadband”.
The Lib Dems called Labour's announcement “another unaffordable item on the wish list”.
Julian David, the CEO of technology association TechUK said: “These proposals would be a disaster for the telecoms sector and the customers that it serves.
“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 majority of the estimated £30bn cost for Full Fibre is being borne by the private sector.
“Renationalisation would put this cost back onto the taxpayer, no doubt after years of legal wrangling, wasting precious time when we can least afford it. These proposals would be a huge set back for the UK’s digital economy which is a huge driver for growth.”
Sign up to the E&T News e-mail to get great stories like this delivered to your inbox every day.