Labour promises full-fibre broadband for all with plans to nationalise Openreach

Labour’s Jeremy Corbyn is set to outline plans to provide free full-fibre broadband to every home and busines should his party win next month’s general election.

Corbyn, who will deliver the promise as part of a speech in Lancaster later today, has also pledged to create a new British broadband public service by part-nationalising BT’s Openreach – the UK’s wholesale broadband provider.

“The internet has become such a central part of our lives,” Corbyn said. “It opens up opportunities for work, creativity, entertainment and friendship. What was once a luxury is now an essential utility.

 “That’s why full-fibre broadband must be a public service, bringing communities together, with equal access, in an inclusive and connected society. It’s time to make the very fastest full-fibre broadband free to everybody, in every home in every corner of our country. Making it free and available to all will open up opportunities for everybody, at the cutting edge of social and economic change.”

Labour has already made similar pledges to nationalise energy and water companies, postal services and railways, and estimates that the cost of fullfilling its full-fibre pledge is set to cost £15bn, on top of the government’s existing £5bn earmarked for broadband expansion.

Part of the money involved would be funded by making sure companies such as Amazon, Facebook and Google pay high taxes. Although, The Conservatives said that nationalising the network would actually result in “costing hardworking taxpayers tens of billions” and the cost estimates are way off, with BT putting them closer to £40bn in capital and operating costs closer to £100bn.

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Labour responded by saying its plan was fully costed and would put an end to patchy and slow coverage, starting in areas with the worst broadband access. John McDonnell, the shadow chancellor, said: “Every part of this plan has been legally vetted, checked with experts, and costed. What we are offering in this election is real change.”

This has been echoed by analysts. Matthew Howett, founder and principal analyst at Assembly told Expert Reviews it was a “spectacularly bad take” by the Labour Party, adding: “The almost cut-throat competition between broadband rivals has meant faster speeds, improved coverage and lower prices for consumers up and down the country.

“The current government, and independent regulator Ofcom, have spent the last three years incentivising alternative operators to BT to deploy faster fibre technologies. Companies such as Virgin, CityFibre and others have committed billions to rival Openreach. Those plans risk being shelved overnight.

“Only one other country in the world to come close to going down this route, and for a good reason – it’s hard, expensive and fraught with difficulty. Australia’s NBN is years late, massively over budget and offering speeds and technology a fraction of the original political intention.”

Following the news, shares in BT slumped by 4% before later stabilising somewhat to 2% – although the latter still equates to around £500 million being wiped off the company’s value. Elsewhere, TalkTalk’s chief executive Tristia Harrison announced the sale of its own full-fibre broadband business, FibreNation, has been put on hold due to this announcement.