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Shropshire and Marches Campaign Gives up Hope of Better Broadband

Posted Wednesday, October 8th, 2014 (9:07 am) by Mark Jackson (Score 1,075)
shropshire bduk broadband rollout map

The Shropshire and Marches Campaign for Better Rural Broadband has announced its withdrawal from the local county broadband partnership, with concerns over attendance, confidentiality clauses, pre-set agendas and politics allegedly hampering their ability to propose and devise new ways of match funding with the Government’s £11.38m Broadband Delivery UK (BDUK) grant.

The Shropshire County Council (SCC) has been struggling to match-fund with the BDUK grant for some time (here), which if successful would enable the county to expand their on-going Connecting Shropshire project in England by aiming to make superfast broadband (24Mbps+) speeds available to at least 95% of the area by 2017.

The current target is for BT’s “fibre broadband” (FTTC/P) network to cover 93% of local premises by the end of Spring 2016 (note: unless otherwise stated, the 93% figure also includes sub-24Mbps speeds), which is fully funded but excludes Telford & Wrekin because that area has its own plan (here); although some of the same funding issues are known to affect both extension projects.

Patrick Cosgrove, Shropshire and Marches Campaign, told ISPreview.co.uk:

“After much thought, the Shropshire and Marches Campaign for Better Rural Broadband has concluded that there is little useful purpose in continuing with its membership of Connecting Shropshire’s Rural Broadband Group. To begin with there were high hopes that the collective thoughts of the members might help devise ways of identifying the matched funding for the £11.38m BDUK grant, and engage communities and other interest groups in imaginative ways of bringing faster broadband to rural communities.

We have been disappointed. Attendance at the group has been patchy, agendas pre-set, and conditions of confidentiality too inhibiting for our campaign to express its views freely. We fear that publicity from the present broadband project will increasingly be used for political purposes as the local and national elections draw closer, and we wish to dissociate ourselves with that.

We have had, and retain some sympathy for Shropshire Council as we feel it has been bullied and gagged or both, but in the absence of obvious matching money for the BDUK grant, the authority’s reluctance to consider borrowing for one of its stated top two priority projects is disheartening. Our decision has been aided by last week’s discovery that one green cabinet in Clun will be upgraded to Superfast while the other will not. It’s difficult to imagine any elected member or council officer freely choosing to deal with a discrete area of population this way which rather proves the point that BT is in the driving seat at the expense of rural households and businesses for whom the programme of broadband rollout was intended.

The campaign’s initial aims were that rural households and businesses with poor/no broadband would be prioritised, that there would be a universal commitment to far higher than the minimum 2 Mb guarantee, and that cross-boundary issues with other counties and Wales would be clarified. None of these has taken place. Meanwhile millions of pounds have been spent upgrading broadband for people who already had quite reasonable speeds, yet those likely to fall into the 2 Mb guarantee group have no idea when or how this will be delivered. Across the world businesses and government bodies are defaulting to digital by default for their ways of working. This is exacerbating the issue of rural disenfranchisement for Shropshire and the Marches which are in danger of becoming backwaters for economic and social decline.

Our worst fear is that the matching money will not be found and Shropshire Council will not after all have nearly £25m at its disposal for continuing rural broadband.

We will continue to campaign for faster broadband speeds in rural Shropshire and the Marches.”

Shropshire’s funding challenges are by no means unique and we’ve seen a number of similar extension projects choosing to draw down less funding from BDUK due, in no small part, to the difficulty of finding enough match-funding. This occurs at a time when many councils are being asked to make further cuts in order to help balance the country’s budget and reduce the national debt.

At one point Shropshire even considered abandoning the plan to extend their existing project with BT and instead considered an alternative proposal from Broadway Partners, which would leverage private investment to match with the additional BDUK funding and without costing the council directly (details). This would have resulted in a mix of wireless and FTTH broadband, although nothing appears to have come from that idea.

On the subject of the 2Mbps Universal Service Commitment (USC), the current and already funded project aims to make this available to 100% of the area by the same completion date as their 93% target. But the USC goal tends not to be supported by any firm plan and is instead normally linked directly to the superfast deployment. In that sense it’s worth nothing BTOpenreach’s new Street Cabinet based ADSL2+ service, which might soon be helping to provide part of the solution (here).

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25 Responses
  1. Phil Coates

    Interesting that Patrick Cosgroves understanding of the purpose of the BDUK programme is the same as mine, but completely different from the way it is being implemented ie. Fibre up towns and complete BT commercial roll out first and leave rural areas and not spots until last. Sad for those who will not benefit from the digital revolution but glad someone has accepted that the tail (BT) is wagging the dog (BDUK).

    • Steve Jones

      It’s a gap funded model trying to maximise the coverage. That’s the way BDUK set the priorities. Given the political target was for maximum coverage > 24mbps, then it’s not surprising that roll-out will be to the areas where the largest number of premises can be covered for the least amount of subsidy.

      If BDUK had been setup to deliver functional broadband to those unable to get it as the first priority, then things might have been different. However, as it is, the priorities have been set on headline numbers (such as 95% at “superfast” speeds), so what has happened is perfectly consistent with stated political priorities.

    • @Steve – the pernicious use of confidentality agreements was not inevitable, the inflated milestone payments per premise passed was not inevitable, the refusal/delay to provide proper mapping is not inevitable, the non-publication of publicly funded surveys is not inevitable, the subsiding of cabs in business parks where duct is available for FTTP is not inevitable, overbuilding Virginmedia in places was not inevitable. Re-positioning FTTP FOD as a business product was not inevitable.
      But yes there is only so much money, but there is no transparency and thus no practical accountability for the monies available.

    • MikeW

      You don’t even have to look at priorities behind the scenes. Just look at the way the 3 BDUK phases are organised.

      Phase 1 has a target of reaching 90%, which amounts to connecting around 20%, for £500m

      Phase 2 has a target of reaching 95%, which amounts to connecting 5%, for £250m (ie twice as much per property)

      Phase 3 has only reached the stage of trialling “innovative” ideas for reaching the hardest places to reach.

      With central government setting 3 phases like that, you can see that phase 1 was intended to reach the easiest 20%, not the hardest.

    • gerarda

      Steve

      The BDUK model was predicated on the Governments belief that ADSL coverage was universal having swallowed BT’s spin on this. Therefore priority was given to superfast and not to notspots. The cost of this policy is now becoming apparent with a subsidy of £’000s per premise being handed to BT to add a few percentage points to the superfast coverage.

      To give credit to BT the whole BDUK exercse has been masterfully manipulated by them to their advantage.

  2. Steve Jones

    You conflate all sorts of things. For instance, what on earth has the repositioning of FoD got to do with BDUK? That was something that arose from the commercial trials where the installation costs of FoD were found to be very high.

    A certain amount of overbuilding of VM was inevitable in that there was bound to be some overlap. Such things were looked at in the OMR and had to conform with EU rules. In any event, don’t you think that if VM networks were being overbuilt with impunity, that VM themselves wouldn’t have lodged legal objections?

    As for cabs in business parks, then decisions on this reflect local political considerations. If a priority for a local authority is for roll-out to cover small and mid-sized businesses that cannot commercially justify a leased line, then what do you expect? If business parks were viable for fibre solutions, then surely some company would have spotted the commercial possibilities and done so and it would have shown up under the OMR. (Hyperoptic have, after all, been doing this sort of stuff).

    You’ve provided no evidence for inflated costs of actual roll outs. As it is, the total amount of money paid out by BDUK is relatively low at the moment. It’s currently sitting at about £81 per premises plus whatever the match funding figure is in each area. Where penetration is higher, some of that will come back in the form of “claw-back”. I’d expect that figure to reduce for a while as the roll-out gathers speed in the “easier” areas then start to climb as less cost-effective areas are tackled. Having worked on some very large projects myself, I know that there are always changes in plans, unexpected issues and some adaptation to changed circumstances and priorities. There will also be political (whether small or large p) interferences.

    As with any dealing between public and private bodies there will always be some aspects that are commercially sensitive. Try finding details on things like hospital or school builds. If you are expecting open books on things like the details of invoiced costs regarding (say) cabinets, then forget it. Those numbers are available to the auditors, but no private company is going to agree to the prices they pay for equipment being known by competitors (or what they pay as contract rates for street works and the like). Indeed, not only will the private companies not agree to it, they are almost certainly not allowed to do so due to the commercial terms they have with their suppliers. In my time, I was involved with some extremely large IT systems and, universally, we were contractually bound not to make public the prices we paid.

    As it is, I expect BDUK to over-deliver compared to its original coverage targets (although not on the original political, as opposed to contractual timescales).

    • @Steve – The £81 is the BDUK element, where for some reason BDUK do not provide the total subsidy. Add LA + EU monies and the average is closer to £200 per premise passed. North Yorks in there reporting confirm subsidies of c£40k+ per cabinet. This may or may not include some premium for USC.

      BT reported its commercial rollout to analsyts as c£1.3bn (from moistly planned not incremental capex – 50% capitalised labour) funding cicra 55k cabinets.

      BDUK +LA state aid of £1.2bn+ to fund no more than 30k fibre paths and cabs.

      Confidentiality where needed must be respected, but the NAO and PAC concerns go unanswered. This is state aid paying for BT assets, more transparency is needed, not just to drive efficiency, but to protect BT shareholders from possible idiocy.

    • TheFacts

      Why do you expect full transparency on this, please name some other government contracts that release the full details? Do you really want to know which ducts are blocked?

    • @Steve affordable FOD was and is a BDUK requirement – see requirment docs on Hampshire CC site and the need for BT to support communities to extend publicly funded assets.

      @The Facts – This is state aid – see EU doc SS33671. Many councils insist and get open book accounting.

    • Steve Jones

      @NGA

      Firstly I was aware that the £81 was BDUK. The actual “match” funding varies from area to area. It would be interesting to see it all put together, but as far as I’m aware, the EU money applies on in some areas. Unfortunately nobody seems to have brought the figures together on what has been spent to date.

      Inevitably some areas will cost more, especially when fibre has to be run long distances to the more remote cabinets (and exchanges). There will be more blocked (or full) ducts. Power is likely to be more expensive to lay on than in urban locations. Extrapolating expenditure on low cost areas into high cost ones is simplistic.

      Also, reference to a requirement (from one council) for “affordable” FoD doesn’t mean it magically happens. All sorts of unrealistic things get put into requirements documents. I know, I’ve dealt with dozens of requirement documents and invitations to tender. Those sort of things get thrashed out in tender documents and not all requirements get met, especially where they are uneconomic. I’m not aware that FoD was ever promised to any BDUK projects as a low-cost solution for (other than extremely well heeled) domestic customers. It is, of course, available for commercial use, where it might be justified. In that respect, it might be considered “affordable”, but the question is where’s the definition of what that means?

      Incidentally, I think you mean EU document SA.33671 as you don’t find it under SS33671. As far as “open book accounting” goes, then there’s a big difference between “open book accounting” in the sense of the customer being able to audit the costs and expenditure (which BDUK can do) and those same figures being publicly available. Given the legal nature of contracts that government suppliers have with their own, often foreign, suppliers then I simply can’t see it happen. What local projects should be able to do is provide summaries of expenditure and deliverables. That’s their responsibility, not their subcontractors.

    • Steve Jones

      nb. a bit of evidence that the BDUK local projects are using “open book accounting” principles, at least in good part. Here are a couple of ITT documents (Rutland and Lancashire) that refer to principles of Open Book Accounting in the procurement. Indeed, it looks like the principle of open book accounting features in most of these BDUK documents.

      http://www.rutland.gov.uk/pdf/Redacted%20Local%20Broadband%20Plan%20final.pdf

      http://www.westlancsdc.gov.uk/media/85214/Lancashire-Local-Broadband-Plan.pdf

      However, to emphasise again, Open Book Accounting does not mean the figures are all going to be openly published. It means the customer (the local BDUK project) has access to audit them. Of course it’s an immensely time-consuming exercise and requires expertise (I think the BDUK & NAO are providing some central resources).

    • @Steve, if you seek out table 11 p33 of the NAO report you will see a propotions table unlocked by the noting that 36% of the cost is the cabinet with an average identified cost of £28.9k – excluding tie cables. You need to remove BT operationsl costs and then the self verified capital contribution and you will find an average total subsidy of £46k – which includes an unquantified USC. The latter could be met in theory by a sales referral deal for satellite, so no extra cost needs to be incurred. This lines up with the milestone payments being reported by LA’s.
      If you treat the numbers as a plausibility exercise, then you will note many features including about £350m of future proofing for things like FTTP but which is not specified which makes your point on FOD look odd.

  3. Patrick Cosgrove

    To add to NGA’s list: and for all we know the lack of information about how the 2 Mb guarantee will be met has been entirely deliberate in order to help justify not prioritising those in greatest need.

    • TheFacts

      Please explain how you would roll out to those in greatest need first. This implies working back from 100% coverage.

  4. Patrick Cosgrove

    Dear The facts – probably quite a few solutions that those far more technical than I am can describe, but here’s three from a layman.
    1. Beam backhaul into key spots and then push about by fixed wireless.
    2. As above, but FTTP or FFTC along telegraph poles.
    3. Bring backhaul into rural notspots along telegraph poles, then as 1 and 2 above.
    More suggestions welcomed.

    • TheFacts

      Given the relatively short timescales of the projects it makes sense to do them in the best financial and engineering way. Let’s see where we are in 12 months time.

    • @The Facts Why wait? It has been over 2 years already. Framwork and its milestone payments system was signed one month before the Olympics.
      Let’s say 30,000 premises passed a week where a £100 per premise is paid as contingency/take up risk/usc/, that’s £3m a week – £150m a year of free cash flow. That’s £150m (illustrative) a year not being used to plan a deeper rollout, with new apprentices, denying rural users services where the money has been paid. Any invoice you can squeeze in and get paid, creates a new ineffciency reduces any clawback.
      As a shareholder the short term gain while cunning is disatrous given the new regulation the abuse invites – full PIA and greater separation. You also fear for the management culture of secracy and deceit where your ability to mis-lead about costs and investment levels is the basis of your annual assessment.

    • TheFacts

      My reply is about the order of the implementation. Typically building out from the core network.

  5. Phil Coates

    Patrick Cosgroves comments say it all ‘The campaign’s initial aims were that rural households and businesses with poor/no broadband would be prioritised, that there would be a universal commitment to far higher than the minimum 2 Mb guarantee, and that cross-boundary issues with other counties and Wales would be clarified. None of these has taken place. Meanwhile millions of pounds have been spent upgrading broadband for people who already had quite reasonable speeds, yet those likely to fall into the 2 Mb guarantee group have no idea when or how this will be delivered.’

    As population density decreases moving into rural areas and if the money had been used to build out to these areas, ‘fill in’ on the way back would be in BTs commercial interests and they would have a very complete fibre network.

    Most of us on the non-receiving end of the BDUK project in rural areas have seen overbuilding of VM networks, completion of BT commercial rollouts and the upgrading of speeds in areas which were already well provisioned with ADSL – exactly as Cosgrove says. As he has actively been involved in their project I tend to feel he has a decent grasp of what could and could not be done if it were not for the issues of politics and commercial ‘confidentiality’ raised by the incumbent – BT.

    • Patrick Cosgrove

      Phil – that’s a good point about increasing population density. So far we’ve been more concerned about keeping the existing people and stopping outmigration of families and small firms. I’ll use that in future if I may.

  6. Phil Coates

    @Steve
    BDUK does not help the matter when it persistently uses the word ‘Rural’ and phrases such as ‘investing £530 million to stimulate commercial investment and bring high speed broadband to rural communities reaching 90% of UK homes and businesses’.

    Most punters don’t get the subtle wordplay – they see ‘rural’ and think countryside/farms etc but then the 90% bit comes along. 90% of rural homes and businesses? 90% of all homes and businesses? 90% of rural homes and businesses who don’t have adequate access now?

    Of course its a gap funded model but by handing it over to County Councils who are largely clueless and with only one operator left in the hunt, the priorities have become those of BT rather than the taxpayer.

    • Steve Jones

      Read Kube Networks blog (in two parts) on the top 4 BDUK myths. Myth 1 sets out this misconception that this was primarily a rural project (as defined by the politicians).

      A further point (myth 2), is that many of the areas covered by BDUK would have, eventually, been included in the commercial rollout, presumable as requirements (and hence increased penetration) made them viable. In effect, the BDUK money served to accelerate that time frame of roll-out to those areas. So the answer comes back the same – the reason that the roll-out is prioritised the way it is comes down to the priorities set by the government at the time. (Note, that there is a claw-back mechanism to recover subsidy from areas where it was excessive).

      http://mykubenetworks.co.uk/2014/02/bduk-top-4-myths-revealed-12/

      Whilst Kubenetworks are involved with BDUK, it’s not as part of the infrastructure delivery, so I think their summary of the myths is a very reasonable summary,

  7. Phil Coates

    Patrick

    No problem – I honestly thought that was the intention of BDUK in the first place – how wrong can you be!

    I am in Staffordshire, next to a main road, with 0Mbps available and ‘too expensive’ for round one of BDUK whilst a nearby town beginning with ‘Ru’ has had the BT commercial rollout finished by BDUK. It is lucky enough to have had blanket Virgin Media coverage already and so now people have the choice of 2 ‘Superfast’ providers whilst people like myself have none.

    Satellite BB at £75 per month is no joke and although I can afford it, many cannot.

  8. Phil Coates

    Steve
    I agree completely. The point I am making is that the average punter, especially those in rural areas, is not a network specialist. The Government launches a BB programme littered with references to ‘rural’ and generates the expectation that not spots will finally be sorted. There is natural unhappiness when it turns out the money is being spent in towns which appear to need it least.

  9. TheFacts

    Looks like Cab2 is enabled and a new one is going in by the exchange for the eo lines in December.

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