The Labour Party wants to nationalise the UK's internet infrastructure and make it free at the point of use.
A proposal by the Labour Party to provide free, fast internet access to every home and business in the UK by 2030 has grabbed headlines recently. The reason why universal broadband is seen as desirable is that lots of things we use the internet for, from work to school assignments to buying a new toaster on Amazon, are regarded as things that make our economy stronger. By this logic, the easier and quicker it is to use the internet, the easier and quicker it is to strengthen the economy. That’s why the Labour Party says their proposal will create billions of pounds by making the UK more competitive and productive.
There’s actually quite a lot of agreement on this point, even from the rival Conservative Party. What people mainly don’t like about Labour’s plan is that it will nationalise the UK’s internet infrastructure, i.e. take it off the current owner (the private company BT) and make it government-owned.
They are worried that the nationalisation will cost lots of government money that has to be funded by tax rises, that being able to choose between lots of businesses offering competing broadband packages allows customers to get lower prices than if there’s only one state-provided option, and that it sets a bad precedent about how Britain treats businesses. That may make existing companies want to decamp elsewhere and budding entrepreneurs reluctant to set up shop.
Labour’s plan will cost £20 billion, according to an independent report by the consultancy Frontier Economics. That’s hardly pocket change - it’s more than the UK spends on the police force each year. But Frontier Economics says it’s a lot cheaper than it would be if universal broadband was left to businesses.
That’s because rival firms would each build their own versions of key bits of infrastructure, and the overlap would raise the total cost to £32 billion. The difference would probably be passed on to customers as higher prices. And Labour says most of the £20 billion figure will be funded by taxes on big multinational companies, not individuals.
The Conservatives are right, however, that many businesses don’t like the proposal. Telecoms firms are furious. And the multinational companies like Amazon and Google that Labour wants to pay for the scheme aren’t exactly known for being pro-tax. Plenty of voters may not care, particularly those from lower-income families who think free broadband may help increase social equality in the UK. But others will be concerned that if lots of firms decide Britain is a bad place to do business, there will suddenly be a lot less jobs to go around.
Read our explainer on: technology.