With the launch of the Gigabit Broadband Voucher Scheme in late March 2018, the UK Government will support UK SMEs that currently don’t have access to full fibre broadband (FTTP/FTTC) with vouchers worth up to £3000 per business to get the necessary infrastructure in place. In this post, we will answer a few important questions around the new scheme.
How long will the vouchers be available?
While there is no rush, the scheme will only be open for a maximum of three years (March 2021) or until funding from the allocated pot of £67 million dries up. The new scheme steps into the shoes of the old Connection Voucher Scheme which came to an end in October 2015 after the £81 million public funding had been used up.
Why is the government funding this?
The Gigabit Broadband Voucher Scheme is a step towards fulfilling the UK Government’s commitment to make full fibre broadband available to 10 million+ businesses and homes by 2022.
“We’re backing Britain’s small businesses by investing £67 million to bring full-fibre broadband to more businesses up and down the country. This means faster, more reliable broadband access as we build the digital infrastructure we need to make our economy fit for the future.” Philip Hammond, Chancellor of the Exchequer
“Small businesses are the backbone of the British economy and now they can turbo-charge their connectivity with gigabit speeds. By building a full fibre future for Britain we are laying the foundations for a digital infrastructure capable of delivering today what the next generation will need tomorrow.” Matt Hancock, DCMS Secretary of State
While the old Connection Voucher Scheme was supposed to enable businesses to install superfast broadband with speeds of at least 30Mbps, the new Gigabit Broadband Voucher Scheme aims at gigabit capable broadband connections with 1000Mbps (1Gbps) bandwidth.
These efforts are supported by recent regulatory changes brought forward by Ofcom which allow easier access to Openreach/BT’s cable ducts as well as a simpler electronic communications code.
Despite the recent government funding round, most of that full fibre coverage is expected to come from private investment i.e. the pockets of suppliers such as Openreach, Virgin Media, or CityFibre.
Where is the money coming from?
While the Gigabit Broadband Voucher scheme builds on the wider £200 million Local Full Fibre Networks programme, the £67 million is supposed to be “new spend” from the £31 billion National Productivity Investment Fund.
What are the prospects of success?
The old Connection Voucher Scheme approved grants for more than 54,000 small and medium businesses in 50 UK cities, and similar local schemes have been run successfully in London and Wales. Moreover, the new Gigabit Broadband Voucher Scheme has already been trialled in four areas where around 1,000 small businesses were issued vouchers.
How can the Gigabit Broadband Vouchers be used?
Vouchers will be given out through suppliers of gigabit cabable connections, and can be issued to existing or new customer alike.
Since the Government recognises that “in some areas the value of a single voucher will not fully meet the installation costs of a gigabit capable full fibre connection”, vouchers can also be aggregated. Especially in more remote areas, smaller businesses will have to form group schemes and pool the value of their vouchers to be able to afford gigabit capable connections which can cost tens of thousands. Residents can only access the scheme through to local community scheme, which has to be made up of a majority of businesses. Each resident contribute £500 to the scheme.
If you are considering to make use of a business voucher, either individually or as part of a group scheme, or if you would like advice on using business and residential vouchers for a bigger community scheme, please get in touch and we can discuss your options with you.