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BDUK Dispute Leaves Cumbria Villages Waiting for Faster Broadband

Thursday, July 5th, 2018 (12:01 am) - Score 2,005

A dispute between Openreach (BT), the Government’s Broadband Delivery UK programme and the local authority’s Connecting Cumbria project appears to be stalling a plan that could otherwise see fixed line “superfast broadband” (24Mbps+) ISP services extended to a number of previously excluded villages.

At present the local state aid supported Connecting Cumbria (CC) project is working with Openreach to roll-out “superfast broadband” (24Mbps+) services to reach 95% of premises in the county by the end of 2018 (contract 2), most of which are being delivered by the expansion of FTTC and a few FTTP services. So far around 93% of local homes and businesses have already been covered.

However, the latest situation stems from a decision last year, which resulted in 146 postcodes being reclassified to be eligible for State Aid (here). Previously the postcodes had been de-scoped from CC due to a conflict over the existing commercial coverage of Solway’s fixed wireless broadband ISP network. Despite this Openreach later hinted that some of the postcodes, such as those for Hayton, could be upgraded within the existing budget.

Fast forward to March 2018 and the UK Minister of State for the Ministry of Justice, Rory Stewart (MP for Penrith and The Border), is said by residents to have assured them that Hayton and other areas were indeed on the list to be considered for the next phase of improvements. Both Hayton Parish Council and Connecting Cumbria have previously supported this push.

Unfortunately doubts have now been cast over this after Rory revealed to one of his constituents that the Government’s Broadband Delivery UK programme, which oversees CC, had recently rejected a related request. The message has now been passed to ISPreview.co.uk and is pasted below.

Rory Stewart MP said:

“Back in March I was told that BT had included Hayton in the proposal submitted to Cumbria County Council for the next phase, and that Connecting Cumbria would give full support to BT’s evaluation, subject to value for money assurance with BDUK, and then planning. However, a situation has arisen which is preventing this from happening.

Without going into the technical and protracted details, the position is that a change request was raised with BT in April 2017 to utilise cost efficiencies from Contract 1 for further superfast fibre deployment in Cumbria, but BDUK rejected this, and Hayton is one of a number of areas caught up in the disagreement.

Ultimately, BDUK and BT are arguing over technical points to the detriment to the people of Cumbria, and I have written to the Minister to ask what could be done to further encourage them to agree a way forward. Connecting Cumbria are also meeting with BDUK on Monday to see if they have made any progress in their discussions with BT.

It is immensely frustrating but everyone is working on a solution, and I will continue to press them hard. Thank you again for taking the time to write.”

In case anybody has forgotten, the BDUK contracts include a clause that requires the supplier (e.g. BT) to return public funding both as a result of efficiency savings (e.g. if something didn’t cost as much to roll-out as first forecast) and for rising levels of service take-up in upgraded areas (aka – clawback / gainshare). This can then be reinvested in order to further boost local coverage.

Across the UK some £210m+ is currently set to be returned (Jan 2018 figure) as a result of efficiency savings, with clawback potentially adding up to another £536m on top of that. Both figures are likely to rise further as take-up improves and contracts complete, with the funding expected to then be reinvested in order to help push superfast broadband to cover 98% of the UK by around 2020.

A Spokesperson for Openreach told ISPreview.co.uk:

“We’re keen to upgrade these areas, and we’re working very closely with the council and BDUK to resolve the situation so that we reach as many properties as possible with the funding available.”

Our Connecting Cumbria partnership has been a huge success so far, making faster broadband available to more than 126,000 homes and businesses across the region.”

Sadly BDUK (i.e. the Department for Digital, Culture, Media & Sport) were unable to clarify their reasons for the rejection of the aforementioned proposal, although they did confirm that meetings would be taking place with Rory Stewart MP to discuss all aspects of the superfast programme. We also received a similar response from Connecting Cumbria.

A Spokesperson for DCMS told ISPreview.co.uk:

“Superfast connectivity in Cumbria has gone from 0.6% to nearly 93% in six years and we’re committed to working with local bodies and suppliers to continue this progress.”

A Spokesperson for Connecting Cumbria added:

“Currently Connecting Cumbria is working with BDUK to do everything possible to support the ongoing delivery of superfast connectivity in Cumbria. To this end officers from Cumbria County Council will join Raj Kalia in a meeting with Rory Stewart MP to discuss all aspects of the superfast programme.”

Changing BDUK contracts mid-flight can be complicated and strictly speaking local authorities are supposed to wait until the end before they can harness funding returned via savings or clawback (many of the contracts run for 7 years from around 2012/13), although there is some room for tweaks as we’ve seen when BT offered the early return of some clawback linked funding for reinvestment (here).

Clearly extracting cost efficiencies in the Cumbria contract is proving to be more problematic and for now the reason remains unclear. In our experience BDUK tends to have a fairly good reason for rejecting such requests, although on this occasion they’ve not said what that is.

Tony Nuttall, Hayton Resident, told ISPreview.co.uk:

“It’s very disappointing that political in-fighting between BT and BDUK is preventing people in Cumbria from getting access to a usable broadband service. They’re the very people who should be working hard to help us. I’ve been fighting for improvements for a decade to support my clock repair business, and while I’ve had no end of promises over the years nothing has actually been done.

I’m more or less resigned to retiring before my business can benefit from the tens of millions that have been spent in the county. It’s time for the Minister to step in and get this long-delayed project moving again.”

Sadly residents in the affected communities look set to remain under a cloud of uncertainty until the problem is resolved.

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Mark Jackson
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 Twitter, , Facebook and Linkedin.
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21 Responses
  1. Avatar Meadmodj says:

    “BDUK were unable to clarify their reasons for the rejection” why can’t they be open especially after such a delay. Whether its technology, money, state aid, competition, further tendering or just plain politics they should state their reasons for the rejection.

    1. Avatar Joe says:

      Depending on the nature of the dispute it could be covered by confidentiality clauses or public statements could open up either side to legal claims.

    2. Avatar Meadmodj says:

      Short term perhaps but if it specifically does not meet an element of their UK Next Generation Network
      Infrastructure Deployment Plan I can’t see any reason for them not clearly stating it as the discussion point. OR will naturally pitch for the funds to be reinvested in their network rather than it go elsewhere. OR appear “keen” indicating infrastructure availability and upfront work but if BDUK determine that the funds cannot be used then the local communities (and Solway) will be left in the dark until a further tendered BDUK/USO phase and any OR plans more than likely mothballed until then.

    3. Avatar NGA for all says:

      If you can re-tender for say c3k premises, this should not preclude change requests for in-fill and extensions.
      Re-tendering only makes sense if there is sufficient clusters to build a contiguous and viable network.
      BT’s capital contributions for FTTC should be really clear given FTTC has some regulation. BT Capital Contribution for FTTP in-fill could be set at PSTN investment rates for cost recovery purposes until someone has a better idea. Again Ofcom should be nudging this in the background.
      Old BT Group folk are still involved so it is likely they will play it out in the same manner that led to the costly separation of Openreach.

  2. Avatar FullFibre says:

    Wireless, like hybrid fibre/copper should only be seen as a temporary solution. IMO.

    1. Avatar Meadmodj says:

      Is the issue still Solway? I thought it had been resolved.

    2. Mark Jackson Mark Jackson says:

      No, the Solway postcodes were resolved last year, it’s now just about how those areas can be upgraded.

  3. Avatar NGA for all says:

    Room for Tweaks! I recollect a coverage ambition of 99% in Cumbria based on the budget available.

    Is the £536m + £210m plus whatever sums arise from the 20 contracts that are in dispute?

    1. Mark Jackson Mark Jackson says:

      It clearly says “Across the UK” at the start of that sentence, so those figures are UK wide from all BDUK contracts so far.

    2. Avatar NGA for all says:

      Sorry, if we add the £536m + £210m + sums outstanding in the 20 disputed contracts, plus the contracts yet to fulfilled, plus the sums to be contracted the UK could yet receive the 12% FTTP in-fill envisaged for the rural intervention area. 12% comes from crude estimates on the distance limitations of the cabinet.
      I hope the opportunity is not lost.

    3. Mark Jackson Mark Jackson says:

      On that 99% figure, I think it’s always important to draw a clear line between flaky political aspirations and the definitions of service speed vs coverage in a contract.

      I can’t recall seeing the 99% figure referenced in a Cumbria/BT contract for “superfast broadband” speeds of 24Mbps+, so if it was stated in the past then it was either just pre-contract political gas or one of those “fibre broadband” terminology confusions (i.e. including speeds below 24Mbps as well as above).

    4. Avatar NGA for all says:

      Perhaps, but then we conveniently ignore the absolute need for in-fill in rural. We also ignore the lack of any reporting on the respective contributions in a subsidised gap funding model. Investing and planning to go as far as possible was not flaky, it is central to the representations made by DCMS and BT in their evidence to PAC in 2013.
      Costs were always to be averaged across the intervention area, this is how the budgets were built. The iterative approach is a fallout from the gaming of costs, capital and a corresponding failure to invest in the resource needed.
      For BT Shareholders and rural customers, BT have still billed less than £1.2bn in six years and there is no record of BT’s capital contribution apart from flaky inputs to the CMS Select Committee in 2016 which Matt Hancock has to subsequently withdraw via WPQ47312.
      For Cumbria/BDUK – are they to stop at 95%, take the money back and rely on the B-USO? This could arise in an environment where the lack of transparency prevents even ISPreview enquiries being answered. Perhaps this is not a priority for Openreach.

    5. Mark Jackson Mark Jackson says:

      Oh noes not this again. Please let’s try to keep focused on the article topic above and not extrapolate questionable wider accounting assumptions or theory to the moon.

    6. Avatar NGA for all says:

      Mark, the gaming and accounting practices are impacting on all the projects, including Cumbria. If your concerned about assumptions then list them. On-going scrutiny will continue to contribute to achieving more FTTP coverage in rural.

    7. Avatar TheFacts says:

      @NGA – scrutiny by who?

  4. Avatar Guy Cashmore says:

    Well done Cumbria for getting to 93%, similarly rural West Devon got to 80% and appears to be going no further..

  5. Avatar Loulutch says:

    Id love to see Virgin Media do anything like what it do, they wouldn’t dare, they just let BT Get blamed for agreeing to expensive contracts that they fail to complete without problems

    1. Avatar NGA for all says:

      Virginmedia have no existing rural network to overlay with Fibre. You cannot blame Virgninmedia if BT Group execs thinking they know better than the Engineers, even denying them work by gaming the costs and capital. The gangs doing the work can be saluted. Those losing the trust of public officials need to be tackled. Their behaviour has contributed directly to the further separation of BT.

  6. Avatar Csaba Udvarhelyi says:

    Internet should be free as a basic right of ours. We cannot exist without it nowadays

  7. Avatar Barry Forde says:

    Perhaps Hayton should consider a community/B4RN build? We are live at Warwick-on-Eden (on our trunk from Manchester to Edinburgh) and putting in backhaul from there to reach the Allen Valleys which is about to start its build. Hayton is on that backhaul route. Good luck with existing plans but if they go pear shaped there could be an alternative!

  8. Avatar Anne Whyment says:

    All talk and no action meanwhile we are left with snail speed broadband

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