MP says broadband deal won’t work
David Warburton, Conservative candidate for Somerton & Frome and MP since 2015, has hit back at the Corbyn broadband plan. Of course it is an industry Mr Warburton has some experience of.
The deal may sound attractive but David Warburton reckons it will end up costing the taxpayer around £100bn. And in his view, that will be on top of thousands of job losses in the telecoms sector and at the financial cost of the failure of small businesses that have grown up supplying the market.
His full statement on the Labour Broadband plan follows:
The UK enjoys one of the most highly invested and successful telecoms sectors on earth, and it was an industry I was fortunate enough to be closely involved in, long before politics raised its head. Telecoms provides tens of thousands of jobs, supporting innumerable other businesses in its vast supply chain – all coughing up very significant tax revenues to the public sector. As the joint open letter published by the telecoms industry following Labour’s announcement of free state-owned broadband says, such plans would fundamentally jeopardise the future of more than 600 internet service providers, as well as BT.
BT itself was one of the first businesses in which ordinary people bought small shareholdings, and its shares are still owned by almost a million people. These shares, of course, fell dramatically on Labour’s bombshell policy announcement, leaving many people worse off just from Labour putting the idea forward. The CEO of BT has ridiculed Labour’s notional figures for nationalising its huge operation. BT pays the wages of thousands of staff, along with the pensions of hundreds of thousands more.
But will the total price to the taxpayer – knocking on the door of £100 billion, with ongoing costs every year, plus small share investment losses for almost a million people, thousands of job losses and the losses of the competitive market, 600 service providers, and the investment and innovation behind them – be worth it?
It’s hard enough trying to deal with BT’s customer service, but can you imagine calling the government’s State-owned monopoly broadband company and trying to arrange an installation? At the moment, broadband is often bundled with pay-tv, mobile and other services. These add-ons are used to generate costs and keep prices down. People would still need these and have to pay for them, alongside paying through their taxes for their broadband, with no such savings for the state provider. Unless, of course, mobile, tv and all else will also be State-managed?
Australia, as you may know, tried a similar thing in 2016, setting up the National Broadband Network. It didn’t last long – unravelling at a cost of AUS$73 billion, and was a national bad joke.
So Labour plans to nationalise the telecoms sector at a cost of £100 billion to the taxpayer, fund the NHS with an extra £26 billion, flood defences by an extra £6 billion, set up a ‘social transformation fund’ at a cost of £30 billion, set up a ‘green transformation fund’ at a taxpayers cost of £50 billion. Plus spending almost £200 billion nationalising water, the Royal Mail, rail companies and energy networks. Not to mention free tuition fees for all, free electric cars, free childcare, free parking and a four day week.
Shadow chancellor, John McDonnell says in his Who’s Who entry that his hobby is “fermenting the overthrow of capitalism”. Sounds like he’s got a plan.