Related Articles
Delegates at the UK Labour Party’s annual conference have passed a key motion on public ownership, which technically commits the party to nationalise the “broadband-relevant parts of BT” (Openreach) and “deliver free full-fibre broadband to all by 2030.” It also adds a new “jobs guarantee” to protect workers. Easy to say, hard to do.
The somewhat radical policy position was previously put forward during the Jeremy Corbyn-era, as part of Labour’s Manifesto for the 2019 General Election (here). But that one also came alongside a related pledge to invest £20bn toward the deployment of full fibre.
NOTE: Readers should always take any political pledges, from any party, with a pinch of salt until there’s more solid detail.
Since then, Labour’s new leader, Sir Keir Starmer, has appeared to roll back on some of the more radical ideas from 2019 and that clearly didn’t sit well with party members. In response, The Communication Workers Union (CWU) and Unite proposed a new motion on public ownership that would effectively re-commit the party to the previous policy position.
The motion was passed at Labour’s annual 2021 conference with a show of hands, although the current leadership seems unlikely to formally adopt it.
The Motion on Public Ownership
Conference notes that the Covid-19 pandemic has led to a widely held desire for a new economic model that meets the needs of our communities and not just those of exploitative shareholders and external investors.
Timid tweaks to the current system will not fix the structural problems that the pandemic has both exposed and exacerbated. Deep and transformative change is required, and the case for extending democratic public ownership in the post-covid economy could not be clearer.
This is certainly the case in the postal and telecoms industries, where CWU members, as keyworkers, have made a huge contribution to their communities throughout the course of the pandemic.
The aim of the next Labour government must be to transform our economy by delivering an irreversible shift in wealth and power to working people. In order to achieve this. Conference:
— commits to bring Royal Mail back into public ownership, reuniting it with the Post Office and creating a publicly owned Post Bank run through the post office network;
— commits to bring the broadband-relevant parts of BT into public ownership, with a jobs guarantee for all workers in existing broadband infrastructure and retail broadband work, so as to deliver free full-fibre broadband to all by 2030;
— believes that we must continue to build quality public services that are democratic and give workers and their communities a greater voice as well as involving trade unions in both their establishment and delivery.
The original proposal in 2019 resulted in a huge backlash from the industry, since Labour seemed to be proposing to cancel an entire competitive sector of several hundred operators and their staff, including complex supply chains, and to re-build it around just two new entities – British Digital Infrastructure (they’d deploy the public network) and the British Broadband Service (they’d deliver free broadband like an ISP).
Naturally, promising a nation that their broadband access will become full fibre, and be “free“, is always going to be very popular, although such ideas tend to overlook the huge complexities and costs involved in the endeavour. Not to mention the potential for tax rises and any delays from the transition phase, which could trigger a fair few legal battles. Suddenly, getting to 2030 might take much longer.
In any case, we analysed all of this back in 2019 and don’t wish to repeat ourselves too much (see here). But one of the key issues with Labour’s proposal was that it didn’t seem to be necessary. A new breed of infrastructure competitors, such as CityFibre and many more (Summary of UK Full Fibre Builds), had already sprung up with significant rollout plans and were weakening BT and Virgin Media’s hold.
Today the market is awash with independent operators’ deploying Fibre-to-the-Premises (FTTP) infrastructure, which is in turn helping to make faster broadband services not only more widely available, but also better value (i.e. more Megabits for your £). The combined level of private investment for all this massively exceeds Labour’s proposed £20bn (BT alone are putting in £15bn and Virgin Media will put a few billion more toward it), but that would of course dry up if somebody took a grenade to the sector.
As Andrew Glover, UK ISPA Chair, said in 2019: “Labour’s plan exposes a fundamental misunderstanding of how broadband is delivered in the UK. Labour has identified some challenges relating to broadband infrastructure, but has wildly underestimated the costs involved. This proposal would also undermine the huge private investment and existing work already in motion to deliver nationwide access to gigabit broadband.”
All of this begged the question, why spend billions of public money when the private sector could do most of the work for you, without taxpayers footing the bill. Equally, many of the core improvements that Labour sought to deliver could still be achieved without destroying the sector – Point Topic already forecasts that 98% will get gigabit-capable broadband by 2030.
In addition, a future government could still potentially offer a “free” basic broadband service via a new regulated social tariff (details would be up to Ofcom / Gov to agree with industry), which could be offered to people who are unemployed or on low incomes (i.e. only those who actually need it). A little public subsidy may still be required, and it would need wide support from ISPs, but it could be done and without destroying the market.
Finally, both the new and old commitment made vague proposals to protect jobs, although it remains incredibly difficult to know how that could realistically be achieved (fewer staff would be needed to maintain a single network and ISP). One of the problems here is that investor flight would also start to occur long before the party’s policy could even begin to be implemented, leading to job losses and company collapses. Labour’s laser focus on BT in all this is another issue, since today’s market is much more diverse and complex than it was 10-15 years ago.
At the end of the day, it is possible to do what the unions and many Labour members appear to want, but nobody should be suggesting that doing so would suddenly produce a magic fix for rural broadband connectivity (full fibre will still take years to deploy), or that there wouldn’t be significant cost, delay and disruption involved in that transition. For some, such radical change would still be absolutely worth it, but you’d be hard-pressed to find anybody in the industry who agrees.
When we ran a snap poll on Labour’s 2019 proposal, some 10% of 611 UK respondents were undecided on support for it, while 25% supported the plan and 65% didn’t like it. But it should be noted that a higher proportion of our readership will have some familiarity with how the industry works and so may better understand the potential obstacles.
In the meantime, we’re still several years away from the next General Election (May 2024), and it remains to be seen whether the Party’s leadership will officially adopt the recent conference vote into a future manifesto pledge. Finally, we suspect there will be a few comments on this one – as is the norm for politically divisive issues, but please try to avoid being abusive toward others or trolling (we’ll remove any comments that step over that line). Keep it constructive.
Source link
