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UK Government Told to Spend £5.5bn from HS2 on Ultrafast Broadband

Tuesday, Jun 18th, 2013 (3:09 pm) - Score 1,508

The New Economics Foundation, an independent think tank that aims to inspire “real economic well-being“, has advised the government to scrap its £33bn High Speed Two (HS2) railway link and instead invest £5.5 billion from the effort into rolling out “ultra fast to-the-door” broadband coverage across the United Kingdom.

The controversial HS2 scheme aims to build a new high-speed rail link between the midlands and northern England, which could possibly be extended even further in the future. It’s a huge undertaking and wouldn’t be completely finished until 2032, although the first trains could be speeding along the tracks between Birmingham and London by 2026.

But many have questioned the economic viability of HS2 and whether or not it’s the right use for such a huge amount of money. The new NEF report is no exception and suggests that the money could be better spent on projects that might be quicker to deploy, cost less and still beat HS2’s objectives.

One of the proposed ideas, which other reports have also suggested, is for £5.5bn to instead be put towards investing in a new generation of urban-focused fibre optic broadband (FTTH) connectivity for both business and home users.

But this would only go towards delivering Free-to-use video-conferencing hubs for SMEs and NGOs and better broadband services in London, Glasgow, Edinburgh, Leeds, Manchester, Liverpool, Sheffield, Nottingham, Birmingham, Cardiff and Bristol.

Future-proofed infrastructure (Report Extract)

The need for increased digital connectivity will only increase in the coming decades. Meanwhile, current broadband investment plans do little to alleviate the data pinch-points created by soon-to-be outdated Internet connections. So to pave the way for future-proofed Internet connectivity for all, our HS2 investment alternative includes £4.5 billion of capital to create a coherent up-front funding mechanism for the provision of a to-the-door fibre-optic broadband infrastructure.

The cost of providing fibre-optic connectivity to every house in the UK has been estimated to be at least £15 billion, however. So while our alternative investment package would clearly not contain the full amount necessary to reach every UK home, it could connect most homes in the core cities.

The report makes a fair point (broadband boosts the economy and better connectivity could reduce the need to travel) but it should be said that the government’s own £150 million Urban Broadband Fund (“super-connected cities“), which focused on many of the same areas, had to scrap its infrastructure investment in-favour of a controversial voucher scheme after the EU threatened extensive delays due to competition concerns (here).

So clearly just throwing a few extra billion at several cities might, in practice, not be the best approach. Similarly the critics of such investment strategies have often questioned why dense urban areas should be given such funding in the first place, especially when the economic case for private investment should be a lot easier to achieve than in rural locations.

NEF’s Alternative Ideas for HS2 Funding

• £10 billion on upgrading our exiting North-South mainlines – to improve speed and capacity of inter-regional travel while avoiding the need for an ecologically disastrous new line.

• £10 billion to overhaul regional rail around the country – because improving shorter, commuter links between and within non-London cities would give a much bigger lift to existing employment centres than a sole focus on long-distance travel.

• £6 billion on improving buss and light rail (e.g. tram) networks around the UK – and introducing smart ticketing systems (like London’s Oyster card) to make low-carbon public transport and simpler, more everyday option for travellers.

• £2 billion on better biking and walking infrastructure – to improve wellbeing and help make regional cities places that people want to live and businesses want to locate

• £5.5 billion on rolling out ultra fast ‘to-the-door’ broadband coverage across the UK – boosting business and reducing the demand for unnecessary business travel.

By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on X (Twitter), Mastodon, Facebook and .
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