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Shared Rural Network

Part of the debate – in the House of Commons at 4:20 pm on 28th October 2019.

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Photo of Nicky Morgan Nicky Morgan The Secretary of State for Digital, Culture, Media and Sport 4:20 pm, 28th October 2019

With your permission, Mr Speaker, I will make a statement to the House about connectivity and our recent announcement about the shared rural network. Last month, this Government announced £5 billion to accelerate the roll-out of the highest-speed internet across the country, including in our rural heartlands. The money is being targeted towards the hardest-to-reach areas of the UK, so that they will not have to wait for their homes and businesses to be connected to fast, reliable broadband. They will be given connections capable of download speeds of 1 gigabit per second to take advantage of everything that the next generation of new technology has to offer.

Connectivity on the go is equally important. Mobile phones are revolutionising our day-to-day lives and are crucial for businesses as they compete and grow. Half of adults—I reckon this will apply to pretty much every right hon. and hon. Member—say that they missed their mobile phone the most of all their devices, with one in three saying that they never use a computer to go online.

However, too many areas of the country are still waiting for high-quality mobile coverage. Today, only 66% of the UK landmass has geographic coverage from all four mobile network operators and 9%, largely in rural areas, has no coverage at all. I am therefore pleased to inform the House that last week the Government announced support for a shared rural network programme, subject to binding legal agreement being concluded. The proposal has been brought to Government by the four UK mobile network operators—EE, Vodafone, 3 and O2—and sets out their ambition to collectively increase 4G mobile coverage throughout the United Kingdom to 95% by 2025.

Under the proposal, areas that have coverage from only some providers—partial notspots—will be almost entirely eliminated, meaning that we will get good 4G signal anywhere, no matter our provider. It also promises to deliver greater coverage in the total notspots—the areas that currently have no mobile phone signal at all. The network will result in 95% of the UK getting coverage, including additional coverage to 16,000 km roads and 280,000 premises. The biggest improvements will be felt in Scotland, Wales and Northern Ireland.

The four operators will commit up to £530 million to get rid of the partial notspots, but we recognise the difficulty of building infrastructure in remote locations. The Government are therefore sharing the cost and are prepared to provide a further £500 million to eliminate total notspots. The Government’s investment will provide new digital infrastructure in areas that are not commercially viable for operators, to ensure that this new service provision continues for at least 20 years. It will also cover the cost of upgrades to the emergency services infrastructure, making it available to commercial operators.

The announcement is great news for consumers and a big step forward by the mobile network operators. It will be underpinned by legally binding commitments from each operator to reach more than 92% UK coverage by 2026. The mobile network operators will adopt new coverage obligations within their existing spectrum licence conditions to ensure that the outcomes will be delivered. If they cannot demonstrate that all reasonable efforts have been made to comply with the obligations, there are penalties for the operators, with a maximum fine of up to 10% of annual turnover. Although 2025 is the target date, many consumers will feel the benefit of the programme long before its conclusion. Annual coverage improvement targets will be published, and Ofcom will report regularly on the shared rural network’s progress in its “Connected Nations” publication.

The UK has a vibrant telecoms industry, and we are keen that the shared rural network proposal reflects that. The programme will be jointly delivered by all four mobile network operators, but it is expected that organisations from across the industry would have the opportunity to get involved in delivering the programme at various levels of the supply chain, building the required infrastructure in an open, fair and transparent way.

The mobile network operator proposal is conditional on Ofcom removing its proposed coverage commitments, which were included in the design of the original auction. I have written to Sharon White, the chief executive of Ofcom, setting out the Government’s support for the programme, subject to a binding legal agreement being concluded. It is for Ofcom to decide how it wishes to proceed with the auction. This morning, Ofcom opened its consultation on an alternative auction design, without coverage obligations.

I have also made it clear to the mobile network operators and to Ofcom that the Government retain the right to support the original Ofcom auction if a final and legally binding agreement on the shared rural network is not reached. I have considered the shared rural network proposal carefully, along with my right hon. Friend the Chancellor of the Exchequer, and I am satisfied that it improves on the coverage obligations set out in Ofcom’s proposed auction and should deliver good value for money. However, I have made it clear to the mobile network operators that, until a final agreement is reached, the Government’s support does not make a legally binding arrangement or contract and does not create any expectation that Government will act in that way.

In the coming months, the Department for Digital, Culture, Media and Sport, Ofcom and the mobile operators will work to finalise the legal agreement so that we can get on with the important job of improving mobile coverage. The operators share our ambition. I am confident that this proposal is the answer, and I expect to be in a position to update the House early next year.

This is a world-first deal that means that consumers will be able to rely on their own provider’s network to use their mobile phones wherever they are. It will make patchy coverage a thing of the past and mean that more people in rural areas can benefit from the speed and efficiency of coverage on the go. This Government are committed to giving rural areas across our United Kingdom the digital connectivity needed to flourish and to make the UK a world leader in 5G technologies. That is what this landmark investment will do. I commend this statement to the House.