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Threat to Broadband Upgrades as UK Gov Extends Lane Rental Scheme UPDATE

Monday, February 19th, 2018 (12:21 pm) - Score 2,050

The UK Government has approved the extension of a controversial new “lane rental” power, which will allow local authorities across England and Wales to charge utility companies by the hour for civil engineering work that causes significant disruption (traffic congestion etc.).

At present the Lane Rental Scheme has only been trialled in London (TfL) and Kent. This allows both to impose a charge of up to £2,500 for each day their roads are occupied by the works. The charge was set at a level that reflected the costs of congestion caused by the works, and that would encourage works promoters to: “reduce the length of time taken to carry out the works; improve planning, coordination and working methods; carry out more works outside of peak times; complete works to the required standard first time.”

Last year an impact assessment of the scheme stated that there are around 2.5 million road works carried out in England each year causing significant disruption and delay to road users, with delays caused by works estimated to cost more than £4 billion a year. In addition, delays increase the likelihood of an accident and lead to greater carbon emissions and pollution.

The charges are intended to be focused on the busiest streets at the busiest times (e.g. encouraging work to take place at night etc.).

Government Statement

New schemes will be permitted. It will be for local authorities to ask for the Secretary of State’s approval for schemes, based on bidding guidance that will be issued by the DfT. The guidance will include advice on how to assess the cost benefit analysis of schemes, and this in turn will be based on performance data from the existing schemes in London and in Kent.

Around 30 local authorities responded to the consultation saying that they would like to set up schemes within the next 5 years. This marries with the mid-range assumption used in the consultation version. It should be noted that there will continue to be some uncertainly around how many authorities will implement schemes.

Schemes will be set up on the basis of current legislation. We asked in the consultation if changes should be made, for example, whether charges should be hourly and about the use of surplus lane rental charges. These amendments were, however, not supported by respondents so no further legislation is needed to implement this option. Charges will therefore continue to be set at a maximum of £2,500 per day.

Authorities will, as now, be able to set a charging structure following consultation. Kent County Council for example include a range, based on congestion from £300 to £2000. Any surplus revenue must be used on ways ‘to reduce the disruption and other adverse effects caused by the street works’, as set out in legislation. This will ensure that any surplus revenue raised will be spend on reducing congestion caused by the works.

On the surface this makes sense, although it comes at a time when the Government are also trying to deliver significant infrastructure upgrades and that includes support for the rollout of both “superfast broadband” (24Mbps+) and new “ultrafast broadband” (100Mbps+) capable ISP networks. In particularly they’ve been very keen to encourage the deployment of Gigabit capable “full fibre” (FTTH/P) networks.

The problem is that building all of this requires a significant investment and risk, which can easily be disrupted if local authorities suddenly decide to clamp down on Utility Companies by imposing extra charges on related street weeks. All sorts of unexpected complications can hit civil engineering teams (e.g. blocked cable ducts) and imposing huge fines is unlikely to help (some areas might become unviable to reach or ISPs could raise prices to compensate etc.).

Last year a stakeholder group representing utility companies estimated that implementation of lane rental across England and Wales could increase annual costs of street works by £327m. They also estimate that it would “deter over £2.2 billion of investment” in infrastructure.

Bob Gallienne, CEO of Street Works UK, said:

“It is disappointing that the Government has decided to extend lane rental without any clear evidence that it reduces congestion. We support initiatives to reduce congestion but we believe this approach is a blunt instrument that will make it harder for utilities companies to deliver vital infrastructure that powers the economy. The government’s own analysis of the existing lane rental schemes concludes that there is no causal link between lane rental schemes and reduced congestion.

Utilities companies are delivering the infrastructure that the UK needs to drive up productivity, create economic growth and deliver on government’s priorities such as broadband and new homes. While we do not believe Lane Rental is the best solution, we will continue to work closely with the Government to ensure their proposals are implemented in a manner that reduces complexity, recognises the need for consistency and is only used in targeted and limited situations.

Local authorities already have the powers to manage and co-ordinate street works, but are currently not using these effectively. Data shows that utilities are performing to a significantly higher standard than highways. It is therefore essential that these proposals apply equally to both utilities and local authorities.”

However the Government has at least told Local Highway Authorities that new schemes would only be approved if key conditions are met, which includes requiring LHAs to operate a “best in class” permit scheme where “fees are proportionate and the offering of discounts for joint works, full compliance with permitting regulations and guidance and schemes fully supported the delivery of national infrastructure projects like HS2 and full fibre networks roll-out.”

Caveats of Government Approval

Government approval would be given on condition that LHAs:

─ Operate a permit scheme in line with ‘best in class’, for example, where permit fees are proportionate and the offering of discounts for joint works, full compliance with permitting regulations and guidance and schemes fully supported the delivery of national infrastructure projects like HS2 and full fibre networks roll-out.

─ Schemes applied to a LHA’s works in the same way as in Kent and London. Schemes are voluntary so there would be no ‘new burdens’ for Government.

─ Lane rental charges are used to provide incentives to work outside of peak times, they were waived for joint works, caps were put in place for major works to install and to replace apparatus so that these works were not unfairly penalised and delayed.

─ Schemes cover no more than 5% of the local network, are trialled for a period of time before ‘going live’ and reviewed annually to ensure charges remained proportionate and were applied to the most congested roads.

The suggestion is that LHAs would probably have to make an exception for certain work (e.g. full fibre network deployments), although the Government’s position on this is still quite vague. We suspect that some local authorities may simply choose to charge lower fees for such works rather than a total exemption, which would still be an extra cost and one that could create problems.

Ultimately the approach may depend upon how much common sense each LHA and the Government chooses to apply for any given region. We will be keeping a close eye on this to monitor how it impacts broadband related civil engineering work / upgrades.

Government Response

UPDATE 20th Feb 2018

Gigaclear has offered a network operator’s perspective.

Brett Shepherd, COO of Gigaclear, told ISPreview.co.uk:

“While we welcome measures that look to reduce congestion, we remain concerned that Lane Rental will provide a further barrier to rolling out fibre-to-the-home (FTTH) technology across the country. It will increase the cost of improving connectivity to rural areas that are crying out for high quality broadband. This, in turn, is likely to impact the amount of properties that will receive this service.

Next steps are to understand the Department for Transport’s (DfT) condition that any new schemes must ‘fully support the delivery of national infrastructure projects, including full fibre roll out’. To address the above concerns, DfT must ensure that Lane Rental does not deter investment, otherwise this decision will be contrary to the government’s ambition for widespread fibre-to-the-home.

As the leading supplier of full fibre broadband to rural locations, we are already innovating with techniques which reduce build time and increase efficiencies. Schemes like this introduce complexities and in my opinion, add further hurdles, which will only slow down the implementation of a full fibre Britain.”

Leave a Comment
21 Responses
  1. Virgin says:

    Get rid of conservative government for the better for the whole of UK. Tory must go. I want general election spring 2018.

    1. JustAnotherFileServer says:

      Replace it with what though? Labour always puts the country into a debt crisis, so they are no good. Libs have never done anything or shown any promise of doing anything. UKIP are in a mess and should have formed a new party after the brexit referendum.

      Any sensible suggestions?

    2. timeless says:

      you read too many newspapers and watch too much TV, firstly the last Labour government wasnt exactly True Labour, more like Tory lite. however there are still allot of untruths flying about, the main one being “out of control borrowing”, take a look at actual figures and compare this governments to the last governments borrowing and l know youll find that our current government has borrowed more in 7 years than Labour did in 13, however if you really want to gauge Tory borrowing then put all Labour governments together over the past 100yrs and the Tories have still borrowed more, which is very telling if you ask me.

      Either way, Corbyn is very different compared to other politicians.. and given his voting records and how he treats ppl l respect him more than other politicians, whether he would make a good PM is up for debate, but thats a given for any person who hasnt held the seat before, but if there is one thing l dont do its watch TV and read news papers, official figures and unbiased opinions etc are how l vote.

    3. JustAnotherFileServer says:

      I will let you read this and see if you understand it: https://fullfact.org/economy/labour-and-conservative-records-national-debt/

  2. Virgin says:

    It’s not labour party that was in debt. Don’t talk load of rubbish. Tory borrowing more than the labour party.

    1. JustAnotherFileServer says:

      Please don’t make me fall off my chair in laughter. Both Tony Blair and Gordon Brown spent money that this country did not have and if you want to dispute those facts then you are very delusional.

    2. Mark Jackson says:

      Enough with the party politics. Please all avoid trolling / insults and stick to debating the issue, thanks.

  3. Salek says:

    The government should really encourage Fibre roll-out by offering a period of say 5 years where companies such as Open Reach have no fees to pay in such instances, it will certainly help a fibre roll-out gather pace, instead greedy councils will want their cut for a service where they will ultimately benefit,

  4. Ethel Prunehat says:

    If those who dig up roads just get a free pass then they don’t have any incentive to minimise the disruption caused to road users.
    Anything that encourages prompt reinstatement of the carriageway, off-peak works or total avoidance of disruption is to be welcomed.

    1. asrab uddin says:

      i am not implying because its charge free – they can do anything they want, still will need to apply for permit for any job and keep disruptions to minimum, where there is clear violations of the schedule of course a fine should be imposed,

  5. Optimist says:

    Another nail in the coffin of landline technology. The future is wireless.

    1. Steve Jones says:

      Wireless technologies also rely on landlines. There simply isn’t enough bandwidth to do the backhaul via wireless, and they aren’t making any more. Further, higher speed wireless links require ever smaller cells and more masts due to the need to keep down congestion and because the higher frequencies required don’t propagate far, especially if there’s anything in the way. What will those micro-cells require? Yes, optical fibre landlines.

      The simple fact is that the capacity over fibre links is essentially infinite. The same is not true over wireless. Wireless makes sense locally and for mobility and, maybe, for some more remote locations. It’s not going to replace landlines and hasn’t done so anywhere in the World.

    2. Ethel Prunehat says:

      To put my pedantic hat on – ie, my only hat – they are “making” more wireless bandwidth in the sense that the cost of DSP techniques and hardware for previously “exotic” wireless bands is falling continually, so more bands become viable over time.
      I wouldn’t have believed you if you told me 15 years ago that I could use 60G wireless in my house, for example.
      Of course, demand for bandwidth increases just as fast or faster, so maybe my point is moot!

    3. Steve Jones says:

      I would argue they aren’t making any more bandwidth. It’s just we’ve found ways of exploiting it, but there are theoretical limits on what can be achieved for any given power output and cell size. Those more exotic frequencies don’t travel so far. It just goes back to my original point – to exploit ever faster wireless requires more fibre optics to more locations.

    4. Optimist says:

      Steve Jones typed thus:

      “Wireless technologies also rely on landlines… What will those micro-cells require? Yes, optical fibre landlines.”

      Yes, the backhaul will require landlines, but each can serve thousands of customers. The connection to the end customer, however, can be wireless.

      My local council did this a few years ago when they built a new office. To avoid having to dig up the carpark to install the cable run, their phones & internet connect wirelessly with a WISP a half a mile or so away on an industrial estate.

    5. Steve Jones says:


      A point-to-point wireless system such as the council presumably used is another matter entirely, although even there the bandwidth is limited. Also, I made the point that as speeds get faster, you have to have many more and smaller micro-cells and what might have served thousands will then serve hundreds or even tens of people. That means fibre has to go deeper and spread further. The idea that wireless will supplant land based communications rather than complement it is a fiction. Far and away the largest wireless bandwidth usage is WiFi, and that requires many millions of nodes, perhaps tens of millions.

  6. Michael says:

    This is stupid. Eventually is going to affect infrastructure rollout. Utility companies and Mobile Network Operators don’t cause that much inconvenient. I’d rather live with some congestion for a few days/weeks if it means our way of communicating/Broadband networks can improve. This is just a way to get money or of them when they spend enough on providing networks & building them as it is.

  7. Asrab says:

    on this note – i wonder if the highway agency have to pay a fee to the council when they are doing roadworks ??

    the M60 has had smart motorway upgrade for over three years

    1. Steve Jones says:

      The lane rental scheme only covers roads under the control of local highway authorities. By definition, roads which are under the control of the Highway Agency are not under the control of the local highway authorities.

      So the answer is no.

    2. Ethel Prunehat says:

      If Highways England are responsible for it then the local authority isn’t. HE answers to the transport secretary.

  8. UltrafastDream says:

    What great news! Perhaps they can turn their attention to Rural Broadband Rollout instead where ‘Lane Rental charges’ won’t apply!

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