Examination of Witnesses

Product Security and Telecommunications Infrastructure Bill – in a Public Bill Committee at 2:00 pm on 15th March 2022.

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Catherine Colloms, Simon Holden, Mark Bartlett and Juliette Wallace gave evidence.

Photo of Caroline Nokes Caroline Nokes Chair, Women and Equalities Committee, Chair, Women and Equalities Committee 2:41 pm, 15th March 2022

Good afternoon. We will now hear oral evidence from Catherine Colloms, MD for corporate affairs at Openreach; Simon Holden, the group chief operating officer at CityFibre; Mark Bartlett, director of operations at Cellnex UK, appearing on behalf of Speed Up Britain; and Juliette Wallace, also of Speed Up Britain.

We have until 3.40 pm for this session. Will the witnesses introduce themselves briefly for the record, please, before I turn to the Minister? We will go left to right.

Simon Holden:

I am Simon Holden. I am the group chief operating officer of CityFibre.

Catherine Colloms:

I am Catherine Colloms. I am the corporate affairs director at Openreach.

Mark Bartlett:

My name is Mark Bartlett. I am the operations director at Cellnex UK, representing Speed Up Britain.

Juliette Wallace:

I am Juliette Wallace. I am the property director at MBNL, which is a joint venture between EE and Three. I also represent Speed Up Britain.

Photo of Julia Lopez Julia Lopez Parliamentary Secretary (Cabinet Office), Minister of State

Q Thank you for attending the session. I do not know whether you watched this morning’s session, but Protect and Connect and other witnesses put it that, since 2017 and the changes to the electronic communications code, roll-out has been even more difficult and slow, and that no progress has been made as a result. What is your response, as providers, to those concerns? Do you believe that the approach by operators has been too heavy-handed in the negotiations with landowners?

Mark Bartlett:

On behalf of Speed Up Britain, we very much believe that the changes proposed in the Bill are needed to speed up the roll-out of digital connectivity across the country. Therefore, we believe that changes are required.

In that sense, though, we need to look back to before 2017 to understand the policy behind the changes originally made, and to understand that those were made in order to achieve the outcomes that the Government were already trying to establish. Without the changes in the policy of 2017, this ambition will not be met. Speed Up Britain continues to support the policy ambitions as laid out in 2017, but the fact is that the law as put down at the time is not working and created loopholes, which have been exploited, and that has meant that we have been unable to proceed at the pace we wanted.

Catherine Colloms:

To give you a bit of context, Openreach is the national broadband network. We are in the process of upgrading the existing network, which is a hybrid copper-fibre network, to a new full-fibre network. The ambition is to build 25 million full-fibre homes and businesses by the end of 2026. That is a hugely ambitious target. It underpins the Government’s 85% manifesto commitment, but we have to get to a ramp of building 4 million premises a year.

We are currently building at 50,000 premises a week, so we are heading up towards the 3 million a year kind of ramp, but from pretty much a standing start in about 2017, as there was very limited full fibre in the UK at that stage. We had finished building the old network and had not transitioned through. It is a really serious challenge. If you think about the pace of build and what we are trying to achieve, being able to do things really rapidly and operationally simply becomes incredibly important.

For us, the two big pieces that the Bill can potentially help us with enormously and help supercharge that fibre build is around access, that is access to multi-dwelling units—the approximately 6.1 million blocks of flats in the UK—and access to rural parts of the UK. There are some urban as well, but if you think about how we build, we have a duct infrastructure but we also have a very extensive pole infrastructure. For most of our rural build—we have committed to building 6.2 million commercial rural, which goes beyond the Project Gigabit programme that the Government are talking about to the hardest-to-reach areas—we are going to have to do most of that over our existing pole network. At the moment, the Bill makes some changes that are helpful and which progress us forward by allowing us access to upgrade our current infrastructure on underground ducts. What it does not do is allow us to upgrade the infrastructure we have in place, either over the pole network or in those blocks of flats.

If you think about what we have in place today, we have our existing network, so we have the ubiquitous either copper or hybrid copper network that is there today in pretty much all of these premises, all across our poles. We are trying to upgrade that network to full fibre as rapidly as possible and to do so, it would be incredibly helpful if we were able to upgrade our existing infrastructure. The Bill at the moment allows us, as I said, to do that through underground ducts. It is not going to allow us to get into either MDUs to upgrade more rapidly—we estimate that something like 1.5 million MDUs could be at risk based on our experience of unresponsive landlords and our inability to get in—and it also does not allow us to automatically upgrade our property and the infrastructure that we have over the pole network.

To give you a bit of context, we have 1 billion metres of cable over poling at the moment. The vast majority of the rural network is served over poles, so for us it is really important to be able to deliver those 6.2 million commercial rural, but also potentially the Project Gigabit programme. We have been working in Scotland on the R100 programme—the “Reaching 100%” Scottish Government programme. We need one wayleave for every 16 premises, to give you the sense of scale. We are finding the ramp very challenging and because of the scale and pace that we are trying to build at, what we really need is ease of access, ease of upgrade and that is the opportunity we think with the Bill.

Simon Holden:

I think we are talking about two different sets of infrastructure here, which is worth explaining. We are talking about mobile and then we are talking about fixed-line fibre access. CityFibre is rolling out a fibre access network, mostly to consumers in the home. We are doing that across a footprint of 8 million households in the UK. The reason I wanted Catherine to go first is because we are utilising Openreach’s duct and pole infrastructure for three reasons. First, because it will allow us to go faster because we do not have to dig up the streets and lay ducts ourselves or put many more telegraph poles down. Secondly, because we are reusing and so can lower our cost, which means ultimately lower prices for the consumer. Thirdly, because it is just much more environmentally friendly if we can reuse those assets.

We are in favour of that, but at the moment we have this split between pre and post-2017 access. Our view at the time was that that made a lot of sense. Five years on from that now, it is a somewhat arbitrary split. So we think dealing with that is the right thing to do. In particular, the draft Bill’s proposals on ducts look fine to us. We would echo the point about poles. For us, poles are really important in rural, but also in Scotland. It turns out that in Scotland there are a lot of poles sitting in people’s backyards and just being able to access those to put our infrastructure on means that we can accelerate getting fibre access to all those homes. In our footprint, there are probably up to about 200,000 homes that we can access quickly if we can get that right, so we think that there is a real advantage to doing that.

For us rolling out fibre, there is a balance that you have to have here between access all the way through into the home, back to the public domain where, as a code operator, we can build in the public domain. I think we would say that our experience of getting landlords to come to the table is mixed and that the alternative dispute resolution mechanism proposed here is a good one to push that timetable down, so we can get to an answer.

I would also say, however, that when we get into the home, into a block of flats, the tenants really want the service. We have found that, once we have got the landlord and the landlord has given us the wayleave so we can connect into the front door of the block of flats, then wiring up inside is not particularly an issue. We are concerned a little with somehow grandfathering old wayleaves inside buildings, first because it does not seem balanced, but also because it will entrench the people who have those, which I would say is mostly Openreach.

In trying to promote competition and accelerate growth—to your question earlier, Minister, about whether growth has accelerated—the answer is that growth has clearly accelerated in rolling out fibre. That is absolutely happening. We have vibrant competition now, with billions of pounds being invested in this sector. Here is an opportunity to make it go faster, for us all to benefit with a frankly lower-cost solution.

We feel that what is on the table with that landlord dispute resolution mechanism is good. We do not feel that we need to go inside the building, frankly because once tenants have access to it, landlords are more than willing to give that connectivity, because they have happier tenants as a result. We have not found that that is a real impediment to us.

Photo of Julia Lopez Julia Lopez Parliamentary Secretary (Cabinet Office), Minister of State

Juliette, did you want to add anything? You do not have to.

Juliette Wallace:

I was not going to add any more to what Mark said on behalf of mobile.

Photo of Julia Lopez Julia Lopez Parliamentary Secretary (Cabinet Office), Minister of State

Q This morning, a rather unflattering depiction was created of the behaviour of operators towards landowners. “David and Goliath” was a term that was used: using financial might to bully landowners. Do you accept that characterisation of operators’ behaviour? It was also suggested that people might be disincentivised to have any infrastructure on their land, because of low rents, and that that will therefore slow roll-out to the detriment of everybody who shares our aim of better digital connectivity. It would be helpful to have your response to some of those assertions.

Mark Bartlett:

Speed Up Britain represents the MNOs: Cornerstone, MBNL, Cellnex, which is a towerco, and DMSL, WIG and the industry as a whole. I will put some facts, some numbers, on the table to help us understand what we are doing.

Since 2017, we have completed about 1,000 agreements, of which 85% have been consensual and reached without any recourse to any of the processes associated with the legislation. Over and above that, 14.5% approximately required some form of exchange of letters of notice, but then moved quickly to agreement, and only 0.5% of any of those discussions ended up in the tribunal. In my experience, those that ended up in the tribunal have been the industry—us—versus the industry, or land aggregators, to be blunt.

The facts speak for themselves. In the main, as an industry, we run over 30,000 towers, which are visited frequently in order to upgrade, to maintain and to support the connectivity of the country. We do not see a landowner community, a landlord community, our partners as such, in a wall of non-co-operation, but almost the opposite. We speak to our landlords very frequently, we interact with our landlords very frequently, and therefore I do not recognise the characterisation as stated this morning.

Catherine Colloms:

I am happy to talk from a fixed perspective. Generally, we have pretty good relationships with a large number of our landowners. Fibre and the copper and duct infrastructure we have is not a revenue generator for most landlords. You will have heard Charles Trotman this morning, from the CLA. We have agreements and rate cards, which were negotiated with the CLA and the NFU. We work closely in particular with those kinds of rural players to ensure that we have those in place. They are very effective and seem to work very well.

Just to give some kind of context for fixed, we do not tend to have these kinds of disputes, to the extent that you are not going to make a ton of money, frankly, by having a few poles on your land. A pole rental is between £10 and £20 a year, so even if you had a couple hundred poles, which would be unusual, that would mean only a couple of grand. If you think about ducting and cabling going through, that is anything from 19p to 49p a metre, so it is not a revenue generator per se. For us, the conversation with landowners is predominantly about access.

To Simon’s point, we find that we do have quite a lot of issues when it comes to MDU access, especially given the scale at which we are trying to build. We obviously have a machine of people who sit behind to try to negotiate, wherever possible, consensual agreements or wayleaves, but we would genuinely need an army of people to try to get stuff done.

For example, some of you will know that a couple of years ago we fully fibred Salisbury, which became one of the first full-fibre cities in the UK. We tried experimenting to test the limits of access and find out what would or would not be a problem with the roll-out. After two or three years of really concerted effort, including with John Glen, the local MP, being super-supportive and with loads of local PR, we could still get into only about 79% of MDUs, because of non-responsive and non-communicative landlords. If we were to scale the MDU team that we had for dealing with the amount of time it would have taken to tackle those unresponsive landlords, we would effectively be scaling from a team of about 17 to over 300.

As Simon says, the ADR processes are helpful predominantly when there are larger landowners, such as housing associations or local authorities. They are less helpful when it comes to the hundreds of thousands of wayleaves that we need in order to get into all the individual MDUs. That is why we think that the ability to upgrade the existing infrastructure, and therefore to give tenants the connectivity they deserve, is still the right mechanism to try to ensure that we can get the upgrade as quickly as possible.

Juliette Wallace:

We do recognise, as the operator side of the industry, that in the very early days of the code—early 2018, for instance—the interpretation that we were trying to explore may have been a little too over-enthusiastic, shall we say. A lot of time has passed and we have learnt from that. I think that a lot of the examples that are provided to try to support the allegation of a David and Goliath approach are from very early in 2018, and they do not exist today. I think that we have moved on a lot, but we cannot be stuck with all the allegations of the past as well.

I do not agree that the David and Goliath approach is correct. As Mark said, to the extent that it is, what we are finding with the tribunal element of the approach is that it is actually industry arguing with industry; it is not small farmers, necessarily, who are behind that negativity. It is not David and Goliath; it is Goliath and Goliath.

Photo of Julia Lopez Julia Lopez Parliamentary Secretary (Cabinet Office), Minister of State

Q Catherine, you set out some ambitions on roll-out. Were those ambitions based on the presumption that this legislation will go through, or were they based on the status quo? What would be the impact on the ambitions of your members and your company if the legislation did not go through? What would be the impact on rural connectivity, in particular?

Catherine Colloms:

The current target of 25 million full-fibre premises by 2026 did bake in some assumptions about access, particularly in relation to the upgrade rights in clauses 59 and 60, through MDU and through poles. On the impact of not having it, I think there is a kind of overarching impact. If you think of the challenges of the build and the scale of what we are trying to do, the harder it is to build and the slower it is, the less we can do. We are having to re-phase and re-look at the build that we are currently targeting, as a result of potentially not getting some of the elements in the legislation.

If I take the MDU point in particular, we have re-phased some of our MDU work to the back end of the 2026 target, the reason being that at the moment we just feel we are not going to get the access. As I said, our experience is that up to 1.5 million of those total 6.1 million MDU premises will be at risk. We are seeing that in a day-to-day aspect as we build, so we have re-phased 300,000. That will go to the end of the build, which means it does not count towards the 2025 manifesto target. It will still be planned within our build, but I think what will happen is we will just have to build different bits.

When we are building this rapidly, we cannot afford to sit and wait—wait to negotiate a wayleave, wait for an unresponsive landlord to come back, wait for an ADR process. Even though we have some of these mechanisms in place, we frankly do not use them, because there is not the time and we do not have the scalability to be able to wait for all these landlords, so while we are trying to build at such pace and scale, we effectively move on. What will happen in the short term is that we will still aim for our big 25 million target, but you will get a different mix, and we are already seeing that you will have less MDU in the mix. Obviously, the concern with that is that MDU is often urban and is often local housing or in more deprived areas, so there is a risk of creating a new digital divide—in particular, if you happen to live in a block of flats versus not—because of the access issues.

On rural land, we have this ambition to get to 6.2 million. Effectively, the way that we plan and build the network is we will pick an exchange, and we will survey that area and have a plan to build, but if we cannot get the wayleave, we will not build to the village that is beyond the wayleave. We will still get to our target, but you will get more pockets left behind in different places as we build, because instead of being able to build to 80% or 85% of an exchange area, one landlord might potentially be blocking the access that gets you to the village that is over there. If you cannot cross the land, the expense of having to circumvent it and go all the way around it means that that village build is prohibitive.

Photo of Caroline Nokes Caroline Nokes Chair, Women and Equalities Committee, Chair, Women and Equalities Committee

Can I ask witnesses to please keep their answers shorter? I have had a number of Back-Bench Members already indicate that they want to come in.

Catherine Colloms:

Sorry. I think it just changes the mix, effectively.

Simon Holden:

I might just add that if Openreach is the Goliath and CityFibre is the David—certainly in rural—we would like to go into rural. This would be really helpful for us in order to make sure we can move at speed and at a sensible cost, and take advantage of the opportunities the Government are providing to accelerate growth there, so we would be in favour of that.

Juliette Wallace:

On the mobile side, you asked about rural connectivity. Predominantly, that is going to come from new sites, and the code is actually working quite well with new sites—new land build-out. Our biggest challenges come from renewing the agreements that have expired on existing sites. That is where we need the changes in the code that this Bill addresses, and also the amendments to how the Bill is drafted so that it actually addresses the Government’s ambitions that came out as a response to the consultation.

Photo of Chris Elmore Chris Elmore Opposition Whip (Commons), Shadow Minister (Digital, Culture, Media and Sport)

Q I have two very quick questions, because I am conscious of time and Back-Bench colleagues. On the flats and the issues around the digital divide, you mentioned the overall figure—1.4 million, I think it was. It would be good to understand where those places are and how that is impacting on connectivity, poverty, and access to education and services. There is almost an assumption that broadband roll-out is an issue in rural areas, which clearly is not the case if you are talking about mass flat construction. If an amendment regarding access were put forward and accepted, either in the Commons or the Lords, would that be about still trying to engage with the landlords to say that you are gaining access, rather than saying, “Look, we’ve got the powers. We are now going to start simply entering through this separate law”?

This is for Mr Bartlett. Forgive me if I am misquoting you, but I think you said 1,000 contracts have been negotiated since 2017. I am assuming those are all new sites, or are some of them renewals as well?

Mark Bartlett:

indicated assent.

Photo of Chris Elmore Chris Elmore Opposition Whip (Commons), Shadow Minister (Digital, Culture, Media and Sport)

Q To flip it on its head, how many people, companies, organisations or groups have tried to withdraw from contracts dating back more than a decade before 2017? This is purely for the record; it is not a trick question. It is all good and well saying that it is 1,000 since 2017, but how many have tried to walk away or are still arguing that the use of their land, building or whatever should not continue?

Simon Holden:

We, CityFibre, are in cities. Probably 10% to 15% of our build is in multi-dwelling units. We are typically in underserved areas around the UK, and I would say that we have a disproportionate share of things like social housing that sit under our built portfolio. No. 1, we think that it is really important to be able to access those properties. I would say that big social housing landlords are embracing that, but it is patchy and we would value having the ability to accelerate negotiations as we are having them and have a really clear process where we can make sure that we get everyone to the table, with a fair resolution at the end of it.

Once you get access to the building, I think it is up to the building landlord and the tenants, obviously, as to how you are going to do the in-building wiring. As I said before, we found that once you have got hold of the landlord and you have agreed it, that does not tend to be a particular problem. What we are concerned about is that if you extend this back to historic wayleaves, all you are doing is effectively entrenching the people who have already got those, which most of the time is Openreach. We would think that that is not helpful for competition. That would be our observation, but in terms of accessing those properties, it is super key to us for our business model to be successful and, of course, for society to benefit from getting the best digital infrastructure to as many households as possible.

Catherine Colloms:

As Simon says, most multi-dwelling units tend to be in towns and cities, so looking at the constituencies represented around this table, I can tell you, Chris, that you only have 3%. Hornchurch, in the Minister’s constituency, has 13%, and I think Hastings has 24%. They are very concentrated, classically, in urban areas, as Simon says, and often in potential areas of deprivation or areas which are less socially inclusive.

In terms of the access point, you are right. The idea of automatic upgrade would give us the right to do that. You still have to have a relationship with the landlord. That is still always the intent, but it comes down to the obligation. At the moment, there is no obligation for the landlord to do anything. New build legislation obligates them to put in a full-fibre connection, and there is a slightly different conversation you can then have that allows you to proceed with the wayleaves.

Mark Bartlett:

To answer your question, first of all the current legislation is not working. At least over a half of all sites are stuck, so the landlord says that they are not renewing or getting new ones. Of those that are under renewal, there are absolute rights in the current legislation for landlords, if they wish to do so, to redevelop at the end of the lease and we have to leave. My estate would be measured in tens a year where it is their right and we move on.

In the current legislation there are also absolute rights for the operators to maintain that equipment if there is no redevelopment need. That is, obviously, very positive, because when we lose a site or a rooftop, whatever the infrastructure might be, that is serving hundreds of people in the community. Therefore, quite naturally, both the investment that we have made and the utility to the public need to be maintained, unless, as I said, the landowner has a genuine need to make that redevelopment, and that is enshrined in legislation, both today and in that passed pre-2017.

Photo of Shailesh Vara Shailesh Vara Conservative, North West Cambridgeshire

Mr Bartlett, you said that, as far as the agreements are concerned, some 85% are consensual. I would welcome it if you could expand on that, because there is a disproportionate element in terms of bargaining strength. Of the 85%, I am minded to say that there are some small landowners who probably are not happy but feel that they do not want to incur legal costs, that they are up against a David and Goliath scenario, and that they have no option, so they sign up reluctantly but are seen in your statistics as being consensual. Is it not right, then, to put on the record that that 85% is not everybody saying, “Sure, no problem. I have something here; I will just sign it—there you are”? I suspect that a lot of people have concerns about signing, but the cost of legal advice and so on is prohibitive. The way you have portrayed it makes it black and white and very simplistic when, in reality, it is anything butQ .

Mark Bartlett:

I think that would be human. I have never met anybody who wants to take a reduction in the amount of money that they are paid by anyone—that is not something that people work on. However, the policy was put in place to reduce the costs to the industry to allow investment in 5G, which is happening right now for the good of the country.

On the valuation point, it is a fact and a process that if we do not behave properly and that ends up in a tribunal, we would be penalised by the tribunal for the amount of money we have paid, and the judgment would fundamentally go against us, so there is a protection for the landlord there. Secondly, normally—in almost 100% of cases, in fact—we always offer more than the valuation criteria say we should. That results, normally, in a payment of several thousands of pounds, not several tens or several hundreds of pounds.

It is my experience that the majority of people understand that the law has changed and that, like when things change in how you pay your bills, things have fundamentally moved on. So long as we, as an industry, are fair and do not attempt to be over-enthusiastic, as Juliette put it, 85% of people do sign up and say, “Okay, I get it. I am still happy with those several thousands of pounds, and I am willing to make an agreement of that sort.” That is not everyone; 15% of people do not feel that, and we have a further conversation with them, and we come to an agreement with the vast majority of them as well.

I would also point out that this is often characterised as an individual change of an agreement—x to y. We often pay incentive payments to achieve an agreement as well. I would like to put that on the record. It is not just about a reduction in rents. I would also point out that, on average, it is a 63% reduction in rent, not the high 90%-type reduction, that has perhaps been characterised, by the industry.

Photo of Shailesh Vara Shailesh Vara Conservative, North West Cambridgeshire

Sixty-three per cent. is still a significant sum for a small farmer who is counting every penny in his budget. The Committee can understand your reasoning in terms of policy and so on, but as far as the individual is concerned, I maintain—we will have to agree to disagree—that the 85% figure is somewhat misleading if taken in its individual context. I have made my point. Thank you.

Photo of Kevin Brennan Kevin Brennan Labour, Cardiff West

Q Just to get the record accurate, Ms Colloms, you mentioned earlier the Government’s 85% manifesto target. That was not the target was it?

Catherine Colloms:

That is the current target.

Photo of Kevin Brennan Kevin Brennan Labour, Cardiff West

The manifesto target was for full gigabit by 2025, but that was dropped to 85% in November 2020, wasn’t it?

Catherine Colloms:

I think you are right.

Photo of Kevin Brennan Kevin Brennan Labour, Cardiff West

Q Ms Wallace, you said earlier that your companies were “over-enthusiastic” in the early years after 2017. I suspect that it is not really enthusiasm that you are referring to, but being over-assertive or aggressive with landowners, perhaps—that is probably what they would say. If that were the case after 2017, why would landowners not believe that the same would happen after 2022?

Juliette Wallace:

When the new code came into effect, it set out how sites should be valued for the use of mobile infrastructure. Previously, there was no mention of how sites should be valued. Pre-2017, we had an industry that had been built up over the previous 20 years or so and that had got somewhat out of hand. Rather than paying a fair price to install infrastructure on land, a fair price being one that recognises what else the landowner could rent the land for—

Photo of Kevin Brennan Kevin Brennan Labour, Cardiff West

Q Can I stop you there? I do understand that—I served on the 2017 Bill Committee; obviously, I know about it—but my question is, why would your companies not do exactly the same again? You implied that they did not act very well after 2017 by using the term “over-enthusiastic”. Why would they act any better now?

Juliette Wallace:

We have learned from the past. My comment about being over-enthusiastic related to the suggestion of David and Goliath with respect to the valuations. The valuations that were proposed very early, in 2018, were much lower than we are going out with now. As this Bill does not intend, currently, to adapt the valuation methodology, there should be no reason to think that the valuations that are currently being offered will change.

Photo of Kevin Brennan Kevin Brennan Labour, Cardiff West

Q Okay. Finally, Mr Bartlett, you mentioned a figure just now in answer to Mr Vara—was it 64%?

Mark Bartlett:

It was 63%.

Photo of Kevin Brennan Kevin Brennan Labour, Cardiff West

That is the average. Could you tell us some of the figures for those who were worst affected? If 63% is the average, what were some of the biggest drops in income for people affected?

Mark Bartlett:

At this point I obviously do not know—

Photo of Kevin Brennan Kevin Brennan Labour, Cardiff West

Would anybody have suffered a 90% reduction?

Mark Bartlett:

I was about to say that at this point I can only talk about Cellnex UK, because obviously I am not aware of the commercial agreements of any other members of Speed Up Britain. I can be clear that there have, in a handful of cases, been—we have been open about this—90%-plus reductions in rent. But in the main, that normally means the rent itself was over-rented at the point of agreement—that is, we were paying drastically too much. On average, 63% is in line with the Cellnex UK achievement. We have to understand that we have an ongoing relationship with our landlords above and beyond a renewal. There is no interest in the industry for us to behave in a way that alienates our landlords.

Photo of Kevin Brennan Kevin Brennan Labour, Cardiff West

Q Ms Wallace, do you have any figures in relation to that?

Juliette Wallace:

I was going to pretty much echo the Cellnex example. We have a handful that are towards 90%—in that sort of area. We also have some sites where the rent has gone up as a result of the new code.

Photo of Kevin Brennan Kevin Brennan Labour, Cardiff West

But the average has been a reduction.

Juliette Wallace:

The average is a reduction, but it is creating a fair environment that says, “We will reimburse you for the land that we’re utilising.” As I say, we have a lot of sites where there has been no reduction and we have a small number where the rent actually increased.

Photo of Kevin Brennan Kevin Brennan Labour, Cardiff West

Thanks. I think everyone understood there was going to be a reduction, but I cannot remember those sorts of figures ever being mentioned at the time of the 2017 Bill.

Photo of Sally-Ann Hart Sally-Ann Hart Conservative, Hastings and Rye

Q This question is for Catherine Colloms and Simon Holden to start with. My constituency, Hastings and Rye, has urban and rural areas—we have small Rye—and pre-existing 2017 infrastructure. You have both explained the consequences of the cost if you cannot use existing duct and pole infrastructure. What activities, exactly, would be required to upgrade existing infrastructure, and what reassurance can you give landlords or people who own gardens containing a telegraph pole or that sort of thing?

Catherine Colloms:

Effectively—let me take a multi-dwelling unit and then I will take a pole—we need to put a new fibre cable over some of these pieces of infrastructure. I actually have my kit behind me, which I can show you in a second. With an MDU, there is often fibre outside a premises; we will build to the curtilage. What we have inside an MDU is the existing cable—the existing hybrid fibre—that is going up inside the risers. You basically cannot see it. It then kind of pops on to a room. We would reinstall the new part of the full-fibre kit in the classic plant room downstairs, so that it is all with the maintenance bits. We then need a new small cable—this one is basically it; it is called InvisiLight—which we would run up through the risers. This is what you would see, or not see, running through corridors or along the wall. When you put this on a wall, you cannot find it because it is absolutely tiny. This cable has all the fibres running through it.

Photo of Sally-Ann Hart Sally-Ann Hart Conservative, Hastings and Rye

The visual impact is going to be minimal.

Catherine Colloms:

It is minimal. You often need a very small box that just sits on the top of someone’s door and you effectively put this cable inside someone’s flat to a new box. That is for an MDU.

For a pole network, it is similar in the sense that you need slightly more than this amount, because we will probably have some more cables in it. Over the existing pole infrastructure, you will have a new cable that basically has fibres in it. As you can see, this cable is absolutely tiny compared with copper, and it will serve hundreds of premises, as opposed to the copper, which needs to be a different size. You would effectively need a cable that is slightly larger than the one that I have here—because it would be protected—that runs across the existing infrastructure. You sometimes need some termination points, so there might be a few pieces of black plastic, which is effectively where you put various bits of the access network.

Catherine Colloms:

On the telegraph pole, but not every pole. It will be only on a few of the access poles, but we try to minimise the impact and keep it as small as we can.

Simon Holden:

We are using exactly the same process and procedures, and the ducts and poles that are available, so my answer is the same.

Photo of Sally-Ann Hart Sally-Ann Hart Conservative, Hastings and Rye

Q Why do you think the Bill does not cover infrastructure that was there before 2017?

Catherine Colloms:

At the moment, the way that clauses 59 and 60 are drafted, they talk about “no adverse impact” as opposed to minimal adverse visual impact. The existing code under which we are currently operating talks about “minimal adverse impact”, which is why we have been able to put infrastructure in as we are doing today. That has not been transposed in the Bill. We are suggesting that if we could change the definition to “minimal adverse impact” as opposed to “no adverse impact”—with, for example, the MDU having something like this cable—that would allow us the ability to go in and upgrade with minimal adverse impact where we currently have the infrastructure.

Photo of Sally-Ann Hart Sally-Ann Hart Conservative, Hastings and Rye

Q Thank you. I have one more question for you, if I may. In Hastings and Rye, with rural and urban areas, and levels of deprivation, we do not want digital exclusion. Are there any other changes to the Bill that will get full fibre out more quickly to those people who really need it?

Catherine Colloms:

For me, it is the critical clauses 59 and 60. If we could extend the measure to multi-dwelling units, that solves your urban problem, but, critically, if we can extend it over the pole network, that is what will make the difference in rural areas. As I was explaining to the Minister, it is not necessarily that the target changes, because we will still try to do everything we can to meet the target, but the danger of not being able to upgrade existing infrastructure over poles is that you end up with pockets that are excluded as you upgrade. We are effectively trying to avoid getting all these pockets of digital divide in MDUs and cities, but also the little pockets as we are upgrading through rural areas at the same time.

Simon Holden:

I would add one administrative point. The way that the Bill is drafted at the moment means that the main operator, which would typically be Openreach, has to notify the private landowner. The fact of the matter is that if we wanted to use it, we could equally notify the private landowner. What I do not want to do is either to burden Openreach with lots of my administration, or for that to become a bottleneck to the speed of my roll-out. We would propose that if it is the main operator or the new operator that has utilised that infrastructure, it could give the noticing. By the way, we are giving noticing to local authorities for works all over the place; we have a process for doing that. That would actually accelerate things from our perspective and not create an inadvertent administrative bottleneck from a process perspective. We can provide you wording on that.

Photo of Sally-Ann Hart Sally-Ann Hart Conservative, Hastings and Rye

Q Thank you. I have one question for Mr Bartlett. We heard this morning from a colleague who is not here this afternoon that one possible reason for the increase in costs that perhaps Cellnex, for example, has met is that between the landowner and the operator, middlemen became involved. What are your thoughts on that?

Mark Bartlett:

First of all, towercos have been around in the industry since the start. The BBC became National Grid became Crown wireless became Arqiva became Cellnex, and so on. This is not a 2017 phenomenon. Secondly, Cellnex itself has invested billions of pounds in the UK over the last couple of years and invests hundreds of millions of pounds a year, whether that is in connecting the Brighton main line or providing DAS, small cells, tower upgrades or new towers. To describe a huge enabler of connectivity across the UK as a middleman is, I think, a step too far. Fundamentally, we are an industry that is bringing connectivity to the whole of the UK; we are part of it, and we believe that these changes are needed to deliver it.

Photo of Rebecca Long-Bailey Rebecca Long-Bailey Labour, Salford and Eccles

The Bill will give the right to share and upgrade pre-2017 infrastructure. In relation to mobile coverage, to what extent will this dramatically improve the roll-out? The range of 5G, as I understand it, is very limited—is it 500 metres? Perhaps you could confirm that. Beyond that, it would be very helpful for us to understand to what extent telecoms providers are currently collaborating with one another to locate the best sites to situate new masts and to upgrade existing masts, to minimise the impact that communities will face. As we heard from various people this morning, many communities feel very powerless in this whole process, and it would be helpful to reassure them that they are being considered and there is a wider agenda that is being addressed by such companiesQ .

Mark Bartlett:

That is a good question. First of all, do we collaborate as an industry to use shared infrastructure? We are required to do so under planning laws. In fact, towercos’ reason for being is to create efficiencies and share infrastructure, to the benefit of the community. We are, through the planning process, not allowed to stick one tower next to another. Those sorts of things protect the community, but also make sure that we exploit the infrastructure that we have today to maximum effect.

Secondly, in terms of sharing upgrade rights, obviously we have existing towers. At the point at which we need to upgrade for 5G, often we need to put more equipment on those towers, so it is important that we are able to do that without having to negotiate higher costs under the old regime, and that we are able to do that very quickly. To Catherine’s point, where we do not get agreement to upgrade a tower, it simply means—the local community around that tower is much further than 500 metres; depending on which technology you use, it might be 500 metres, but I will not go into that, and one big tower serves many hundreds of people—that that tower does not get upgraded and the money is spent on a different tower in a different community.

The power of the individual to affect the outcomes of the community is very high in the process that we have today, especially where the legislation does not work. To be frank, that is why the changes are required. It is not necessarily to overcome some battle with a land agent. We are simply attempting to create this connectivity solution across the UK as fast as we possibly can, and having the simplicity—while remaining fair to the landlord—of legislation that works and an operational process that works is going to enable that.

Is there anything else you want to add, Juliette? If I may, I will refer to Juliette on the technical—

Juliette Wallace:

I do not think there is anything particular to add, other than to say that the shared rural network absolutely relies on the ability both to roll out new sites to new areas that are total notspots at the moment and to roll out sharing and upgrade capability on existing sites. If we do not get the changes in this Bill, we are going to be seriously reduced in our ability to effectively roll out, share and upgrade those existing sites. There are some sites where currently we have no mechanic to be able to renew those agreements. As Mark said, the power of the individual to frustrate the roll-out of new technology or increase technology to a geographical area is huge currently.

Photo of Rebecca Long-Bailey Rebecca Long-Bailey Labour, Salford and Eccles

Q To what extent are mobile providers sharing their proposed network coverage maps with local authorities, so that local authorities could try to match them with other providers, for example, where such collaboration has not been taking place?

Mark Bartlett:

With respect, I am unable to answer that question as part of Speed Up Britain, because that is often commercially sensitive, but we can write to you. Mobile UK is part of Speed Up Britain, and they are the best people to ask. I will ask them to write to you directly to give you that clarity.

Photo of Rebecca Long-Bailey Rebecca Long-Bailey Labour, Salford and Eccles

Q I have one final question on the poles issue. I am genuinely inquisitive about this. Is it the case that an area could potentially have a full-fibre broadband network under the road, as it were, but also have a pole network adding competition? If that is the case, are we at risk of creating rural deserts where there are fewer consumers and so less commercial incentive to do that, and overpopulated areas that have many options but a lot of infrastructure in their street scene? That is a question for Simon and Catherine.

Simon Holden:

We architect what we call polygons, which basically go around our cities, and our objective is basically to cover every premise in the city polygon that we build. That is a commercial decision that we have made. We think that super-high-density fibre networks are the best way to cover a population and offer the best marketing opportunity to end customers. By the way, they allow you to do the densest 5G networks overlay on those.

In our architecture—which does not follow the Openreach architecture; it is our own—we use a series of ducts and poles in rings going around, and then run off coming from that. We plan, in our builds on our city polygons, not to have notspots. Sometimes we cannot go down a private road, because we need a wayleave and there is a process to go through to get that, but our policy is to try to cover as much as we possibly can. Typically, we cover 85% to 90% in what we call the first pass of the build, and then we start going back to do infill around that. At least where we are building today, we do not have that as a problem.

In rural areas, I think that will be affected by the BDUK process and the roll-out—we would like to participate in that—but our expectation is that we would be building and connecting from our cities all the way out to the deep rural areas, picking up the small towns and villages on the way. In those commuter towns, we would look to cover all those premises; if we are there building, we would rather just build it once and cover everyone. That is the best commercial opportunity that we see.

I do not think that we see what you are describing as a problem that we would be planning in to avoid; it would only be because we could not get particular wayleaves or particular access, a little bit as Catherine described, that we would end up trying to go around that. That is why this legislation will help us.

Catherine Colloms:

If you think about the existing architecture—obviously, we have the existing architecture; we are still building new, but we are trying to reuse wherever we can, because that is cheaper and avoids digging up all your constituencies as we go—it is true to say that there is a greater proportion of underground ducting in urban areas, which this legislation, as drafted, would allow us to upgrade more easily than over the pole network or in multi-dwelling units. We have a much denser proportion of poles in suburban and rural areas, so at the moment, as the Bill is drafted, it is harder to upgrade rural areas than it might be to use the existing underground infrastructure, which is predominantly in urban areas, as you say.

Photo of Caroline Nokes Caroline Nokes Chair, Women and Equalities Committee, Chair, Women and Equalities Committee

If there are no further questions from Members, on behalf of the Committee I thank the witnesses for their evidence. I hope I have not hurried you along too much.