BT: Rural Areas Will Suffer Broadband Delays Unless Government Removes Barriers

The chief executive of BT, Philip Jansen, has warned that people in rural areas will face further delays in receiving full-fibre broadband unless the government removes the financial barriers hindering the process.

Rural residents are at risk of becoming “second-class” citizens when it comes to digital services, as millions of homes are still commercially unattractive for operators to reach.

Jansen said that BT could spend an extra £1bn on connecting roughly 3m homes if the government were to waive the business rates incurred from building the new networks.

The BT boss said that there is now an “urgency” for the government to act if they are serious about meeting their target of connecting 85% of homes with superfast broadband by 2025.

“The biggest contribution the government can make are on cumulo rates, essentially business rates charged on the new networks once they are built; it risks significantly slowing our progress,” Jansen said.

“Exemption on these rates would be worth about £1bn to BT alone, equivalent to [getting full-fibre broadband to] about 3m premises. Without it we may need to rethink the pace and shape of our fibre build and those living in rural areas may need to wait longer.”

The Public Accounts Committee (PAC) criticised the government earlier this month saying that it would miss the 2025 target due to a series of failures relating to the rollout.

“Look at the PAC report, the government has said a lot but we would like to see extra money to build in really rural areas quickly,” said Jansen.

“We want to go as fast as we possibly can and build as much [in] rural [areas] as we possibly can, the government can help us on cumulo and not tax us on the build.”

Jansen also called on Ofcom to encourage investment in the rollout by introducing fair regulatory relief measures. This includes allowing BT to make a fair return on its £12bn investment, which the operator claims will take two decades to pay off.

“We are not looking for some super-normal return, just a fair return,” said Jansen.

“BT is ready, willing and able to build like fury and fibre up the UK but we need Ofcom to come good on creating a climate that encourages investment and the government to show some urgency in removing barriers. There has been plenty of time for talking now we need to turbo charge the move to the next generation of connectivity.”