Delays to 5G rollout to cost country tens of billions, report finds
Delays to the rollout of 5G could cost the country tens of billions of pounds in lost economic output, a new report has found.
According to the Centre for Policy Studies (CPS), steps to speed up the rollout could provide the UK GDP with an extra £41bn over the next seven years.
However, if delays continue at their current rate over 11m households and businesses could be missing out on vital digital connectivity in the same timeframe.
Improving the UK’s digital infrastructure is a key tenet of the government’s “levelling up” agenda, which seeks to eradicate regional inequality by investing heavily in poorer parts of the country.
However, the attempt to do so suffered a knock back in July when the government decided to ban Chinese firm Huawei’s products from its 5G networks from next year.
In addition, all its existing Huawei infrastructure will be removed by 2027 in a major U-turn.
The move meant the rollout of the 5G network has been moved estimated two to three years, from an original target of 2025, and will cost taxpayers an extra £2bn.
But earlier this week BT boss Philip Jansen said the UK would only hit the new 2027 target with sweeping reforms to the system to the tune of £9bn worth of tax and red tape cuts.
Otherwise, he added, full coverage might not be in place until 2033.
Using analysis by the independent consultancy Policy Points, the new paper argues that if 5G coverage reaches a quarter more of the population than the Government’s current target of 51 per cent, the UK could be in line for the windfall.
But according to the Future Communications Challenge Group, if the UK can speed up its adoption of the new network, it could be worth as much as £173bn over the next decade.
In order to do so, the report calls for urgent reforms to the Electronic Communications Code and national planning rules.
Report author Alex Jackman, a former digital adviser to the government, said: T”his is no time for the government to be passive on the deployment environment – the difference between the UK as a 5G pioneer and ceding leadership to others is as much as £173bn.
“Productivity gains to business, equality gains for regions and economic gains for the country are only as achievable as the networks we can access.”
Former Labour MP Patricia Hewitt, chair of the Speed up Britain campaign, said:
“There aren’t many low-cost ways to unlock serious economic growth, but small changes to the Electronic Communication Code could unlock billions of pounds in our economy, drive the UK’s Covid-19 recovery, and deliver significant regional growth.”
In response, the minister for digital infrastructure, Matt Warman said: “Alongside record amounts of funding, we are exploring how to bust any barriers holding back industry from speeding up rollout.
“We’ve committed to reforming planning law and to consult on whether further reforms to the Electronic Communications Code are needed and will consider the points raised in this report carefully.”