Millions committed to full-fibre internet and 5G in autumn statement

Philip Hammond - Image credit: Kirsty Wigglesworth/AP/Press Association Images

The Treasury has offered more details of its £1bn investment in digital communications set out as part of the Chancellor’s autumn statement yesterday.

Philip Hammond announced the creation of a National Productivity Investment Fund, which will spend £23bn on housing, transport, digital connectivity and research and development over the next five years.

Of this, £740m will go towards supporting the UK Government’s pledge of encouraging the market to roll out full-fibre connections and 5G across the country.

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As well as the already announced £400m Digital Infrastructure Investment Fund – which will have to be matched by private finance – Hammond also announced a set of tax breaks for broadband suppliers.

This will see companies receive 100 per cent business rate relief for new full-fibre infrastructure for a five-year period from 1 April 2017.

The idea is to help smaller businesses by reducing the costs of fibre broadband, but big providers like BT have campaigned against the proposed new business rates, with the company saying that the move would lead to higher process for consumers and businesses.

The productivity fund will also back a series of trials for integrated fibre and 5G, which is needed to support the ever-increasing number of internet-connected devices and new technologies such as driverless vehicles.

More details of this will be given in the 2017 budget.

In addition, the fund will offer local areas support for investment in a bigger fibre “spine” across the UK, while part of a separate, extra investment in the Local Enterprise Partnerships across England will also be used to support digital connectivity.

Commenting on the statement, Shaun Collins, chief executive of wireless analysis firm CCS Insight, said that any investment in the UK digital backbone was welcome, but that it “only offers a small step” in the right direction.

“Realistically 5G services are unlikely to be available before 2020 in the UK,” he said.

“High quality broadband has become essential to support an increasingly digital workplace and home. The UK has lagged behind other nations and this had to be addressed quickly.”

Tech industry representative body TechUK agreed, saying that the full costs of deploying the networks would be “many times greater” than the £1bn announced, and that public funding must be “targeted carefully”.

And, in a series of tweets, Scottish Local Government Chief Digital Officer Martyn Wallace suggested the focus should be on the getting 4G and fibre to rural areas before rolling out 5G.

One tweet read: “Would be good to see investment on faster network in rural and island areas! 4G, fibre now not teasing us with 5G yet”.

In another, he said: “Industry/investment teased about 5G, yet despite 4G rollout started 4yrs ago 3G investment halted, Rural areas stuck on GPRS”.