Chamber and committees

The Scottish Government continues to press BT to ensure that broadband speeds delivered over copper connections are maximised. BT is currently testing new technologies aimed at maximising broadband performance over copper, including a Long Reach VDSL trial on the Isle of Lewis. If successful, this should improve speeds across rural Scotland.

Any premise unable to receive superfast broadband speeds following the completion of the Digital Scotland Superfast Broadband programme, and not part of commercial deployment plans, will be eligible for future phases of public investment to extend superfast access.

There are a wide range of factors that can impact broadband speeds or service, not limited to the level of simultaneous use.

Highlands and Islands Enterprise (HIE) initially allocated £300,000 from its contractual innovation fund to support the delivery of vouchers provided as part of the National Satellite Broadband Scheme. Around £50,000 was utilised. This scheme has since been replaced by the UK Government’s Better Broadband Scheme and is now wholly funded by the UK Government. The balance of HIE’s original funding allocation for satellite has since been reallocated back to the innovation fund, and will be used to extend coverage across the region.

The Scottish Government’s original application for European Regional Development Fund (ERDF) resources sought £20.5 million for the Rest of Scotland Digital Scotland Superfast Broadband project. The Scottish Government subsequently reduced the funding sought from the ERDF programme in light of revised criteria for calculating eligible capital expenditure. £12 million was subsequently drawn down.

A breakdown of the £14 million is provided on page 10 of the Audit Scotland report. This comprises innovation funds across both contracts, funding originally allocated to deliver non-fibre technology and interest accrued.

The savings outlined on page 10 of the Audit Scotland report emerged due to BT’s actual costs being lower than expected. These calculations were made by BT not by the Scottish Government or Highlands and Islands Enterprise. The budget freed up by lower than expected actual costs will be redirected into extending the coverage footprint of both projects further, reaching more premises than originally anticipated.

We will set out our delivery approach, once we have finalised the coverage to be delivered through the existing Digital Scotland Superfast Broadband programme and consulted with the market to confirm future commercial investment plans. We will do this ahead of new procurement activity starting in 2017.

At least 95% of premises across Scotland will have fibre broadband access by the end of 2017, as a result of our investment in the Digital Scotland Superfast Broadband programme and commercial rollout.

It is not possible to state definitively at this stage what speeds will be accessible by 2018. Much of this is dependent upon the commercial deployment of superfast broadband, which the Scottish Government does not hold information on.

The Scottish Government plans to launch an Open Market Review, ahead of new procurement activity in 2017, to determine (a) what has been delivered commercially and (b) what will be delivered commercially over the next 3 years. This will require suppliers to provide speed information at premise level. We will use this information to define a new intervention area for future public investment in broadband.

The Digital Scotland contracts agreed between the Scottish Government, Highlands and Islands Enterprise and BT contain clauses that generate revenue for the public sector if broadband take-up on the new infrastructure exceeds a certain level. BT brought forward almost £18 million of this so-called Gainshare funding in 2015 which can be reinvested in the contracts. BT has modelled this funding, alongside other residual funding within both contracts, in recent months in line with criteria laid out by public sector partners. This process is not yet complete across both contracts. We will announce further details of the coverage impacts arising from the modelling in the coming weeks.

BT’s calculation of the estimated take-up rate across both Digital Scotland contracts was based on analysis of historical take-up data, BT’s own deployment experience and BDUK’s assessment of similar projects in other parts of the UK.