Packnet Blog

A new report from the London School of Economics (LSE) has suggested that the broadband targets set by the government are unlikely to be achieved, following a £1.1 billion funding shortfall.

The government’s initial target for broadband is to see the whole country having access to fast broadband services by 2015. Another target wants to see 90% access to superfast broadband.

The targets have been set largely in a bid to increase the economic output from companies.

With access to faster services, e-commerce and communications through business phone systems will be greatly improved. The LSE report says that just a 10% increase in broadband penetration can result in a 0.9%-1.5% increase in GDP per capita.

However, it goes on to say that a lack of investment is preventing faster access being developed and the government needs to take action accordingly.

The project will cost a total of £2.4 billion, but public funding totals just £1.3 billion. It was hoped the funding gap would be met by private investors, but this has not transpired.

The report says:

“The government target of 100% coverage by basic broadband by 2015 is likely to be met, but it is less clear when the government targets of 90% coverage by superfast broadband, and 100% coverage by fast broadband, are likely to be met.”

According to the LSE, the definitions for speeds of broadband are: Basic – up to 2Mbps, Fast – 2-24Mbps and Superfast – above 24Mbps.

However, a Department for Culture, Media and Sport spokesman claimed that the targets would be met, saying:

“We are confident of completing the roll-out by 2015. All local authorities except two met the government’s timeline by submitting their initial broadband plans on time.”

The UK is doing better for spending than other European countries too, though penetration rates are below those of Germany, France and Holland.

Callum Byrnes