UK Government SUSPENDS Broadband Connection Voucher Scheme

The Government’s Connection Voucher scheme has been suspended to new applications as funding dries up. The vouchers gifted grants worth up to £3,000 to help smaller businesses in 50 UK cities get a superfast broadband (30Mbps+) service installed.

Originally the scheme, which was initially supported by around £100m from the wider Urban Broadband Fund (“Super-Connected Cities“), was supposed to end in March 2015. Instead it was given another £40m boost and extended to cover more cities until March 2016.

At the same time applications for the vouchers were made easier to approve (businesses only needed a single quote instead of several etc.), expanded to reach firms outside of the city centres and all of this was supported by a much more coherent advertising campaign. Suffice to say that uptake of the vouchers improved markedly.

Last month it was revealed that 40,941 businesses have now benefited from the vouchers (up sharply from around 15,000 in Q1 2015), which made it no surprise when ISPs last week began to inform us that only £33m of the £40m extension remained available. At around the same time we were also told that new applications for London and Birmingham were no longer being taken.

Yesterday the situation changed again, with ISPs informing us that the Government’s Department for Culture, Media and Sport (DCMS) has now suspended all new applications for vouchers across the entire scheme. Apparently nearly all of the £40m is now gone, although some funding has been left to cover applications that are still being processed.

DCMS Statement

“The Connection Voucher Scheme is currently suspended. The funds available to the Scheme are close to being fully committed and we have suspended the scheme. Whilst the Scheme is suspended, cities will not accept applications.”

At this stage it is not clear whether the Government will extend the scheme again via a new funding boost or move on to other things. Despite its apparent success the scheme has been no stranger to criticism, with many feeling as if the money could have been better spent on bringing faster connectivity to rural areas. Others have also complained that it did little to improve the overall availability of super-fast broadband infrastructure.

It’s worth remembering that the voucher scheme only came about because of concerns over EU state aid rules (here). The related funding had originally been earmarked to help deploy new “ultrafast” (80-100Mbps+) broadband networks across a smaller number of major UK cities, but fears of network overbuilding triggered legal challenges by BT and Virgin Media (here) and that combined with the EU concerns to result in a watered down voucher scheme (“Plan B” as it was called).

Otherwise London, which is the biggest city in the scheme and has been involved since the start, has so far shown the strongest uptake (11,664 vouchers consumed) and they’re followed by the other major population centres of Manchester (4,163), Leeds + Bradford (4,016) and Birmingham (2,494).