Delivery of the Scottish Government’s “Reaching 100% programme”, more commonly known as the R100 programme, which commits to delivering 100% superfast broadband across Scotland, has not been without its challenges. These challenges, and background information on the programme, are explored in previous SPICe blogs:
- Superfast broadband – will Scotland reach 100? (September 2019)
- R100: Moving (slowly) towards superfast broadband (January 2020).
However, momentum has shifted recently with some positive milestones achieved and increased clarity around programme delivery. These recent developments are detailed throughout this blog.
R100 will be delivered via three strands of deployment activity – the R100 procurement contracts, connections delivered by commercial suppliers, and the Scottish Broadband Voucher Scheme (SBVS).
Work underway on the Central and South Lots
In August, the Minister for Energy, Connectivity, and the Islands advised that work is underway on contracts with BT for the £83 million Central Lot and the £133 million South Lot of the R100 procurement. It is expected some premises will have benefited directly from R100 by the end of 2020.
In the South Lot, there are approximately 22,000 premises in the updated intervention area, a reduction of 5,000 from previous estimates because of additional commercial build. BT has indicated that it will build to around 21,000 premises in the south through the R100 contract and will deliver to around 800 commercially. That leaves approximately 200 premises that will need to use the £5,000 voucher, discussed in more detail elsewhere in this blog.
The Central Lot intervention area covers 41,000 premises, of which 32,000 will be covered by the R100 procurement contract. BT expects to commercially build to around 4,700 premises, leaving just over 4,000 eligible for the voucher scheme.
Some advancement on the North Lot
The award of the third and largest R100 contract at £384 million, covering the north of Scotland and all of Scotland’s 93 inhabited islands, had been on hold pending the resolution of a procurement challenge raised by Gigaclear Ltd in December 2019. The Scottish Government and Gigaclear Limited agreed to settle the action related to this contract in August 2020 and the case has now formally been dismissed.
The Scottish Government are now focused on finalising the North Lot contract award with BT. They anticipate that the contract will be signed by the end of 2020. Once signed, work will then be undertaken – to update the speed coverage template, to finalise the intervention area, and to enable survey work at a local level to be start – as previously happened in the other lots.
Is R100 on track to be delivered on time?
At the end of 2017, when the Scottish Government announced R100, it was intended that every home and business in Scotland would have access to superfast broadband by 2021. However, due to the various challenges and delays, discussed in previous blogs, it is now expected that the vast majority of the contract build in the south and centre will be completed by the end of 2023. By the end of 2023, it is expected 96% of the contract build in the Central Lot will be complete, and in excess of 80% for the South Lot. Thus, it will be 2024 for full completion in the south and central. Until there is an agreed contract in place, it is not possible to confirm exactly when physical contract build in the North Lot will end.
While the timescale has moved beyond the end of 2021, the Scottish Government has tried to honour their original policy commitment. Anyone who cannot access superfast broadband by the end of 2021 will be eligible for a voucher scheme. The Scottish Broadband Voucher Scheme (SBVS) was launched on 12 September 2020.
Details on the Scottish Broadband Voucher Scheme (SBVS)
The SBVS aims to ensure that every address in Scotland will have the ability to access a superfast broadband connection by the end of 2021, regardless of whether or not it will ultimately receive a superfast connection through the R100 programme. Every connection delivered through a voucher must be capable of speeds of 30Mbps and above. The scheme itself is technology neutral, meaning that any superfast-capable technology can be used.
The SBVS will provide two distinct levels of subsidy:
- A voucher worth up to £5,000 to help deliver a permanent broadband connection to those properties for which there is no roll-out of superfast broadband planned.
- A voucher worth up to £400 to help deliver an interim connection to those properties for which there is roll-out of superfast broadband planned, but not until after the end of 2021. Properties in more difficult-to-reach locations may be eligible for an additional subsidy of £250.
Individuals can check if their premises is eligible for a voucher by using the online checker. Where the checker indicates eligibility for a superfast voucher, individuals are asked to continue their enquiry with any of the registered suppliers listed, as the supplier will request the voucher on the premises’ behalf.
There are currently approximately 30 telecom suppliers signed up to the scheme. And the Government expect this to expand further. The telecom suppliers cover a variety of broadband solutions – full fibre, fixed wireless, fixed mobile, and satellite. Once an individual engages with a supplier, the supplier will double check eligibility, request the voucher and start working on delivering the superfast connection.
Vouchers can be used to subsidise any installation costs associated with delivery of a service, including any equipment that delivers a connection, such as new fibre connections, satellite dishes, outdoor mobile antennas and broadband routers. For a service to be eligible for the SBVS, its monthly cost must not exceed £46.10. That is the same figure that is used for the Universal Service Obligation. Individuals should discuss with their supplier exactly what will be delivered from the voucher costs that can be claimed. Vouchers do not cover monthly broadband service charges.
Who’s eligible for R100?
The launch of an online address checker in August 2020 has allowed households and businesses to find out:
- Whether or not they already have the ability to order a superfast service.
- Whether or not they will receive a connection through the R100 contracts and, if so, when.
- Whether or not they will receive a connection from a commercial supplier and, if so, when (where possible).
- Or whether or not they are eligible for a voucher through the SBVS and, if so, which voucher they will be eligible for.
Impact of COVID-19 on the R100 programme
When asked about the impact of COVID-19 on the roll-out of R100, in August, the Minister for Energy, Connectivity, and the Islands advised:
“Clearly, we are affected by the impact of Covid-19 but, thankfully, not as significantly as I would have feared. Up until now, work on the R100 programme has been mainly desk based, but outdoor works have now resumed in the central and south lot areas. To date, there has been no known impact as a result of Covid-19 although, obviously, we have put in place physical distancing and lockdown measures.”
What will R100 cost?
Across the three strands of deployment activity, it is known that:
- The three procurement lots (the north, south and central) total £600 million (£579 million from the Scottish Government and £21 million from the UK Government);
- The Scottish Government has estimated that the overall cost for the SBVS is between £26.4 million and £50.7 million over a five-year period. That range of figures is based on take-up of between 20% to 40%;
- There is limited information in the public domain on the commercial build element of the R100 programme. One known aspect comes from the Minister for Energy, Connectivity, and the Islands telling the Rural Economy and Connectivity Committee that BT will be investing approximately £34 million in the commercial elements of the south and central contracts.
Alison O’Connor, Senior Analyst, Financial Scrutiny Unit