LEVELLING UP:
COMMUNICATION NETWORKS
The government’s latest National Infrastructure Strategy promises to revitalise the UK’s regions and town centres, and to help cities and communities live up to their full potential. Investment in physical and digital communication networks is accepted as the vital first step in this Levelling Up agenda. But, as Carter Jonas Partner Simon Mole and Head of Telecoms Paul Williams explain, delivering this ambition remains a challenge.
In November 2020, the government published its long-awaited National Infrastructure Strategy in response to the National Infrastructure Commission’s 2018 assessment of the nation’s infrastructure needs, to help redress longstanding inequalities between different parts of the UK.
The government’s so-called Levelling Up agenda to spread economic investment and growth out – to the regions of the UK and beyond the London and south eastern economic powerhouse - is a central plank in this infrastructure strategy.
"This is expected to not only shift focus away from London, but also to accelerate investment in public and private projects to create jobs and drive economic growth"
UK-wide gigabit broadband rollout:
ACCELERATING INVESTMENT IN THE UK’S
As the world recovers from the global Covid-19 pandemic, the government described this strategy as a moment of vital change from decades of under-investment in infrastructure, putting in place the “plan for a renaissance, backed by hundreds of billions of pounds of public and private investment."
It is a plan that was underpinned in the latest Budget, through announcement of the new £4.8bn Levelling Up Fund to invest in infrastructure to support town centre and high street regeneration, local transport projects, and cultural and heritage assets. This fund sits alongside £1bn plans to green light 45 New Towns Deals with local authorities across the UK, and to create a new UK Infrastructure Bank based in Leeds. This is expected to not only shift focus away from London, but also to accelerate investment in public and private projects to create jobs and drive economic growth.
The challenge of delivering this bold Levelling Up agenda is one key ambition addressed by the National Infrastructure Strategy. Its aim is to focus national and regional decisions on tackling past investment failings, and to help to kick start the UK’s post Covid-19 economy by building back fairer, faster and greener.
Investment in both the UK’s physical transport network and digital communications network sits at the heart of delivering this crucial agenda by increasing the performance, reach and efficiency of services. This will enable regions and cities to live up to their full potential and will revitalise towns and communities.
Without question, across both the public and private sector, there is great excitement and expectation when it comes to the prospect of delivering this ambition, and of the outcomes that are likely to flow as a result. Yet, alongside this enthusiasm, we are also seeing signs of frustration and disappointment over deliverability of this important ambition.
Why recent changes to the Electronic Communications Code could still see communities and businesses left behind
Paul Williams,
Head of Telecoms, Carter Jonas
The National Infrastructure Strategy has set out some ambitious targets for investment in the nation’s communications network. This includes the target of £5 billion to support the UK-wide gigabit broadband roll-out and to develop a Shared Rural Network (SRN) to extend 4G mobile coverage to 95% of the UK by 2025, as well as an injection of £250 million to ensure that our digital networks are resilient and secure.
This is great news, of course. However, the ambition sits against a less impressive backdrop which, in reality, saw the government’s 2020 spending review scale back the UK’s previous aim, under the Gigabit Broadband Programme, of every home having access to 1Gbps speeds – to simply a “minimum of 85%” coverage by 2025.
Similarly, the spending review suggests that only £1.2bn will be committed before the end of 2025, with the remainder of funds to be brought forward after this date, or through other initiatives.
That said, progress is now starting to be made on the SRN. As this £1bn public/private-funded scheme gets going, we are seeing operators start to make tentative steps to acquire sites which have to date been uneconomic to build and operate.
The ambition is certainly there across the public and private sector, and this new strategy is a great moment to reemphasise the need for investment in the UK’s communication network. It is also a moment to tackle and overcome the significant number of potential and actual blockages to progress, in particular since the changes to the Electronic Communications Code in 2017.
As a result, we have seen a huge amount of litigation between parties at the Upper Tribunal and all the way to Supreme Court, which has stalled the market. It appears that many operators, who have been quick to exercise their statutory Code powers under the new regime perhaps fearing potential problems, are now focused on reducing rents on existing sites, rather than pushing on with new site rollout, whether for 5G in urban areas, or as part of the SRN.
Primarily, these changes have disrupted the relationship between operators and landowners, principally due to the shift in valuation from a market value, to “value to landowner” approach.
In addition, we are seeing fixed-line and fibre providers now calling for multi-site agreements and a “portfolio” approach to fibre rollout, especially with local authorities and other government property. However, whilst these attempts to “simplify” arrangements may suit the fibre providers, they do not address many of the complexities and concerns around property disposal and longer-term development.
We can meet these very real threats to the effective delivery of the strategy’s ambition, provided government and the industry take joint responsibility for finding solutions. We must move beyond the culture of simply highlighting problems and allocating blame.
"We can meet these very real threats to the effective delivery of the strategy’s ambition, provided government and the industry take joint responsibility for finding solutions."
This has too often seen operators, for example, being quick to blame landowners and their representatives for slowing delivery and rollout. We now have an opportunity to work together to boost collective understanding of the impact of telecommunications rights and installations across different landowners and asset types. Whilst a “one size fits all” approach may be convenient and cost effective for operators, it doesn’t address the genuine concerns and anxieties felt by property owners who see burden, not benefit associated with telecoms installations.
Carter Jonas has a key role to play at the heart of this vital engagement between the government, landowners and operators, and we have continued to reiterate the impact on landowners seeking to develop property when faced with significant legal costs, proceedings and uncertainty where telecoms equipment is installed.
Government has responded to lobbying from the operator-backed organisation “Speed Up Britain” by announcing a consultation on further changes to the Code. But there is a risk that this could result in even greater powers and rights for both mobile and fibre providers, potentially further raising tensions with landowners.
We have also been working with 'Department for Digital, Culture, Media & Sport (DCMS) on initiatives such as template agreements, better collaboration, and revisions to the Ofcom Code of Practice – initiatives that both operators and landowners are committed to improving, irrespective of what any changes that flow from the consultation.
It is slow, but this commitment to change by all is starting to bear fruit. An understanding of the operators’ objectives and property owners’ concerns allows the parties to be brought together to reach sustainable agreements on terms that work better for both sides.
Only through such change in culture, moving away from conflict towards a world where all parties jointly own and solve problems, through a mutual trust and respect damaged by three years of polarisation, will we be truly able to accelerate delivery of the nation’s much needed communications network.
Transport to connect the regions and nations of the UK:
SIMON MOLE,
PARTNER,
Carter Jonas
Failure to empower local voices is slowing investment to create a united, global Britain
We now have a great opportunity and the necessary political support to accelerate progress on parallel ambitions for a so-called Integrated Rail Plan and to deliver, as the Strategy explains, “transformational improvements in the Midlands and the North.”
Much of the National Infrastructure Strategy’s ambition to upgrade the UK’s mass transit backbone is largely based around an unprecedented, long term capital investment in the HS2 programme that is expected to deliver the nation essential and long-awaited improvements in North-South connectivity.
There is no question that this massive, £100bn plus programme of work will see a transformation in the UK rail network capacity by the time it is fully completed in 2040. The challenge for the UK is to spread mass transit investment and benefits more widely and reduce the current over-reliance on this single mega-project to drive the government’s ambition to Level Up the economy.
Similarly, we must press forward to meet the government’s target to boost regional connectivity by restoring many of the branch lines and rail services lost through the Beeching cuts of the 1960s. Currently, much of this delivery still relies on the passion and goodwill of railway enthusiasts and charities to each promote their own ‘heritage line.’ This is the moment to create the central strategy and joined up thinking needed to pull these vital plans together.
"This is the moment to create the central strategy and joined up thinking needed to pull these vital plans together."
Having established the National Infrastructure Strategy and highlighted the need for investment in the UK’s transport connectivity, it is a great moment to also ask what role the National Infrastructure Commission might have in monitoring the delivery of this ambition going forward. Having set the framework for the government strategy in its Needs Assessment Report, should it, for example, now play a stronger role to ensure delivery?
It is clear that, for all the great ambition set out in the Strategy, the industry would still benefit from more realistic and reliable delivery timetables and greater clarity over which bodies and approval authorities have been given the powers they need to actually drive and deliver these vital projects.
A great example of this is the continued slow progress in delivering a much-needed rail transformation in the North. Despite much enthusiasm and support from central government, Transport for the North still lacks the right planning and land assembly powers, and remains somewhat reliant on Network Rail to provide schemes such as Northern Powerhouse Rail and the Trans Pennine Upgrade.
More support and funding to the Planning Inspectorate would also help to encourage swifter faster consenting through the existing Development Consent Order process, along with providing Mayors and cities with the devolved powers needed to actually deliver locally.
Regional or local schemes such as the Sheffield bus rapid transit project should also be prepared and assessed locally, allowing West Yorkshire Combined Authority to promote the scheme with assessment and consenting responsibility handed to the Sheffield City Region Mayor. The current consenting regime will instead see the project adjudicated by the Department for Transport.
Businesses like Carter Jonas have a major role to play in accelerating this change to devolve decision making and help to develop regional thinking and responsibility. Our wide regional coverage gives us the ability to help promote major infrastructure schemes on a regional level and offer a complete service to scheme promoters.
We know that centralised thinking around transport has to change. Government must understand that to truly impact regional communities through its strategic objectives for greater national transport connectivity, it must also think small and local rather than solely focusing on the big-ticket programmes.
That means committing to investment in local and regionally important schemes – including smaller, community-focused active travel projects – and harnessing the power of devolution to boost regional control and accelerate local investment deals. It means working hard to move away from years of centralised investment plans to finally take regionally critical decisions beyond Westminster.
"it must also think small and local rather than solely focusing on the big-ticket programmes."