Below is a statement given by Fergus Ewing to the Scottish Parliament on how the Scottish Government will invest £600 million to deliver superfast broadband to every home and business in Scotland.
The announcement in last week’s budget that the Scottish Government is committing £600 million to the first phase of the Reaching 100% superfast broadband programme is fantastic news for Scotland.
I was keen to share the detail of that announcement with Parliament and to reflect on its significance for Scotland’s economy.
Over the past few weeks, there has been a great deal of conjecture – and quite frankly misinformation – about how Scotland is performing in terms of broadband delivery.
This statement is an opportunity to set out the facts. And here is the key one:
By the end of 2021, Scotland will be the only part of the UK where every single home and business can access superfast broadband.
The £600 million announced last week is the biggest public investment ever made in a UK broadband project; and launches the first universal superfast programme in the UK.
To put that fully into context, it is over double the amount of public funding committed to our current Digital Scotland Superfast Broadband project (£280 million) and more than three times bigger than the £190 million fibre fund that the Chancellor announced for the whole of the UK in his recent budget.
And it is a programme entirely unique to Scotland. That is a choice the Scottish Government has made – superfast broadband for all.
Why is this so crucial to Scotland and why do we need to do it now?
It’s simple really. If we want a Scotland that:
· delivers inclusive economic growth;
· helps businesses in our rural and urban communities to innovate and grow;
· prepares our children for the workplaces of the future;
· creates a digitally skilled workforce fit for the digital century; and
· reforms our public services through digital innovation
…then we need a future-proofed digital infrastructure.
This new procurement will help deliver that and I will talk more about it in a moment.
But, first, it is worth reflecting on the truly spectacular progress that has been made in recent years.
Our investment, along with that of our partners, in the Digital Scotland Superfast Broadband programme has genuinely transformed the availability of broadband across the country.
Commercial investment alone would have delivered coverage to just 66% of premises – largely in urban Scotland.
Coverage in the Highlands and Islands would have been just 21% and there was no planned commercial coverage at all in Orkney, Shetland or the Western Isles.
Recognising the unique challenges posed by Scotland’s geography, we concluded that a distinct approach was needed.
Rather than taking forward 32 small-scale procurements at local authority level, we took the joint decision with our local government partners to aggregate planned public investment into two larger regional projects in Scotland.
This created a scale that has dwarfed any other project in the UK, extending broadband access to over 800,000 premises across Scotland so far, with further deployment to follow throughout 2018.
The success of this approach is demonstrated by the coverage figures. Ofcom figures continue to show that Scotland has made the fastest progress of any of the UK nations in extending superfast access. And we are well on track to meeting our 95% fibre coverage target by the end of this year.
This programme has had a massive impact. But it has not reached everyone.
We could have chosen to stop there, as the UK Government has done. We could have taken the decision that their Universal Service Obligation – set at just 10Mbps – was sufficient for our rural communities.
But we didn’t. We chose a different path. We concluded that the economic damage which would be caused by consigning large parts of rural Scotland to the broadband slow-lane – and, by extension, the economic slow-lane – was unacceptable.
That is why, even with broadband reserved to Westminster, we have launched the Reaching 100% programme.
And it is why, even though the UK Government was only willing to commit £21 million to R100, the Scottish Government has stepped up to ensure a £600 million investment in a vital piece of Scotland’s national infrastructure.
The procurement that was launched last week will build on the success of the DSSB programme. But it will be different in some key respects.
Unlike the DSSB programme, we plan to make the delivery of new backhaul in particular rural locations a requirement.
That will help create a truly national fibre network; ensuring that all parts of Scotland are within reach of accessible fibre.
Allowing for currently planned commercial coverage, there are around 245,000 homes and businesses in Scotland who cannot access superfast broadband.
This initial investment will deliver superfast access to a significant proportion of those; but we do not expect it to deliver 100% coverage on its own.
So there will be further phases, through which we will ensure that superfast broadband reaches each and every premise. We expect this to involve a wide range of superfast technologies, supported by a national voucher scheme, available to individuals and to communities.
But the initial phase is the key one. Extending a future-proofed, accessible fibre network into remote rural areas will provide the essential platform for delivering superfast broadband for all.
We are purposely targeting the funds where they are needed most – in rural Scotland. So this first phase won’t focus on cities.
My firm belief is that coverage gaps in urban areas should be filled by commercial suppliers. I am greatly encouraged by emerging plans from the likes of BT, Virgin Media, CityFibre and Vodafone – amongst others – which suggests that this is beginning to happen.
The procurement will be split across three regional lots, designed to maximise competition. This is vital – to drive both value and innovation.
I am confident that the scale of our investment, and of our ambition, will attract interest from a wide range of telecoms suppliers across the UK and Europe.
This is a huge public investment and it is vital that we get the right deal for Scotland. So the procurement will take some time – approximately one year. It is being run as a competitive dialogue and these generally take between 12-18 months to complete.
We are confident that we will have suppliers in place – and ready to start building – by early 2019
Crucially, broadband activity will continue on the ground between now and then. Alongside extensive commercial activity, the DSSB programme will continue to deliver throughout the coming year, with new investment that has been generated by early take-up on the new fibre network.
This so-called Gainshare funding plans for new deployment in every local authority area across Scotland during 2018, avoiding any significant gap between DSSB ending and R100 starting.
So much has been achieved over the past 3 years. The latest Ofcom figures show that superfast coverage in Scotland has increased by 26 percentage points since 2014, compared to 16 for the UK as a whole.
We now want to finish the job.
The £600 million investment that we will make is fantastic news for Scotland’s rural economy and a real statement of the Scottish Government’s intent to make Scotland a truly world class digital nation.
This investment will transform the economic prospects of rural Scotland. The fibre network we help build will be the backbone for delivery of our 100% commitment and, beyond that, for the future development of Scotland’s digital economy.
It will underpin a wide range of connectivity services long into the future – 4G and superfast broadband today; 5G and ultrafast broadband tomorrow.
And it will help drive innovation and growth right across the economy – supporting new business models and industries, while ensuring that Scotland is competitive in the next digital age.
We can be a world-leader in this digital century – one that is inclusive; innovative; outward-looking; driving technological and digital innovation and making Scotland the most attractive place in the UK to invest.
Working alongside Highlands and Islands Enterprise, and our local government partners, we have already developed an enviable delivery track record through the DSSB programme – one that has largely bridged the coverage gap between Scotland and the rest of the UK over the past 3 years.
We will now build on that success and, through the R100 programme, help deliver a future-proofed, national fibre network that will place rural Scotland among the best connected places anywhere in Europe, and underpin future economic growth.
Fergus Ewing MSP is Cabinet Secretary for Cabinet Secretary for the Rural Economy and Connectivity.