I add my words of thanks to Bruce Crawford for bringing the motion to the chamber, and to colleagues from all parties who have contributed to what has been a lively debate. While I was sitting through the speeches, waiting for my opportunity to speak, I felt that the debate was showing the Parliament in a very good light, because we have heard very intelligent speeches from members from across the chamber on an important subject that is of interest to both rural and urban Scotland. I also thank you, Presiding Officer, for letting Tom Arthur speak; his contribution was a very worthwhile addition to the debate.
The debate has offered a great opportunity to discuss a subject that is perhaps less well covered in the general debate about broadband: the roll-out of commercial provision in our cities. At the same time, I agree whole-heartedly with Finlay Carson and others who want us to focus on ensuring that there are no new sources of digital divide in rural Scotland. I hope to come on to that aspect later in my speech.
Since taking the helm as Minister for Energy, Connectivity and the Islands, I have had many discussions with stakeholders, businesses and community representatives across Scotland, in which it has been made clear to me that there is a unanimous desire to make our country one of Europe’s most well connected. As several members have said, we will have an opportunity to do so in the years ahead of us, and to make cities such as Stirling, Aberdeen and Edinburgh digital world leaders. Although I appreciate that, across the chamber, there might be competition among members on that, I hope that all our cities will be able to meet that standard.
However, as I alluded to earlier, all too often, we forget that the provision of broadband is, first and foremost, a commercial matter. I therefore applaud CityFibre, and other commercial providers, for choosing to invest in Scotland. The Government is very grateful that they are doing so. As the motion in Mr Crawford’s name suggests, CityFibre has committed funds approaching £200 million to its fibre investments in Scotland, which is a significant figure. Governments, regulators and the wider public sector have an important part to play in creating an environment that attracts investment—I will touch on that shortly—but it is commercial investment that will drive world-class digital connectivity and the innovation that it enables across all aspects of our society and economy, as was mentioned by Finlay Carson, Clare Adamson and, latterly, Tom Arthur.
It is clear that CityFibre’s substantial investment in locations such as Stirling, through its gigabit cities programme, and the rapid deployment of its networks have delivered huge benefits for Scotland, driving value and choice for its customers in the private and public sectors, and helping cities such as Aberdeen to diversify their economy, as Lewis Macdonald and Maureen Watt alluded to. I know that back in 2017, the Scottish Government delivered £2 million to support Aberdeen City Council’s ambition to increase broadband speeds for key public buildings. CityFibre has delivered that connectivity, which has helped to pave the way for the deal with Vodafone that will see residents in Aberdeen enjoying gigabit-capable broadband.
I am pleased to say that CityFibre is one of a number of companies that has announced substantial commercial investment plans in Scotland in recent months. Openreach, Virgin Media and Hyperoptic are all investing in fibre, with others poised to enter the Scottish market. All are playing a key role in delivering the Scottish Government’s digital ambitions.
However, it is clear that not all of Scotland has benefited from that commercial investment. I agree with Finlay Carson, Clare Adamson and others that—despite telecoms being reserved—the Scottish Government is doing all that it can to make Scotland the best place for the telecommunications industry to invest in digital infrastructure.
We are taking a number of steps to incentivise industry. We have introduced rates relief on new fibre infrastructure for 10 years, which is double the UK Government’s commitment; we have relaxed planning legislation to make it easier for operators to deploy new infrastructure; we are developing proposals to extend permitted development rights to assist new projects; and, to pick up on Clare Adamson’s point, we are amending our building regulations to ensure a set standard for the in-building of new physical infrastructure, including digital infrastructure. I hope that that information is helpful to Clare Adamson.
We have also created a Scottish version of the UK Department for Digital, Culture, Media and Sport’s street works toolkit, to support operators to navigate the complexities of road works across Scottish local authorities and avoid timely and costly deployment delays.
That all serves to demonstrate the extent to which we are making sure that Scotland is at the forefront of the digital revolution, despite telecoms being reserved, as I have mentioned. In that regard, Scotland has already come a long way. No matter what source is used, the evidence categorically demonstrates that Scotland has caught up dramatically with the rest of the UK and continues to do so, thanks in large part to the £400 million digital Scotland superfast broadband programme, which Bruce Crawford mentioned.
Without the programme, only 66 per cent of premises across the country were expected to have access to fibre broadband, and only 21 per cent coverage was expected in the Highlands. There were no commercial coverage plans at all for Orkney, Shetland and the Western Isles—a point that is not lost on me as minister for the islands.
Indeed, Ofcom’s most recent “Connected Nations” report confirmed that, once again, Scotland has outperformed the UK as a whole on the deployment of new digital infrastructure over the previous 12 months and is closing the digital divide.
Taken in total, access to superfast broadband has now increased by more than 31 per cent in Scotland in the past five years, compared with an increase of 19 per cent in the UK as a whole. I could give a list of examples, but I will not today, because of the time, Presiding Officer. However, a response to a question from Emma Harper contains the details, which show that local authorities have gone from almost zero to more than 70 or 80 per cent coverage in some cases over that timeframe. Figures provided by the independent analysis site, thinkbroadband, paint an even more positive picture, indicating that more than 93 percent of all homes and businesses in Scotland now have access to superfast broadband infrastructure capable of delivering speeds of 30 Mbps and above.
Of course, although that success is to be celebrated, we cannot be complacent. Finlay Carson is right about the need to avoid creating new opportunities for a digital divide to emerge. He also mentioned the cost benefits of tackling outer areas first and working our way in. I certainly want to reassure members that, through R100, we are seeking take an outside-in approach.
Telecoms is at the heart of everything that we do. Whether for work or pleasure, we have come to expect that we will be able to access fast and reliable digital connectivity wherever and whenever we need it. Although we are demonstrably closing the gap, too many people across the country cannot yet reap the benefits that access to fast, reliable broadband can provide. I am sad to say that some householders would describe their broadband speed as steam driven, as has been mentioned. Thankfully that number is diminishing as we speak, and I hope that it will eventually be eliminated.
The benefits are substantial. In 2014, Scotland’s digital economy was, even at that point, estimated to be worth about £4.5 billion, with the potential to grow well beyond that. We have heard great examples from Gordon Lindhurst and others about areas where growth can be seen and where the multiplier effect from broadband investment kicks in.
A recent independent report has further highlighted the increasing importance of good-quality digital connectivity by stating that every £1 of public investment in fibre broadband infrastructure in Scotland delivers nearly £12 in benefits to Scotland’s economy, which is not an insubstantial return on our investment by anyone’s measure. Indeed, the commercial investment on the part of CityFibre and others will be having a similar impact on our economy. It is vital that that momentum is not lost, and that is why we have chosen to take the lead and invest Scottish Government resources to deliver the infrastructure that Scotland needs to help our country prosper, despite responsibility for broadband investment across the UK resting with the UK Government.
Mr Carson asked about timing in relation to our £600 million R100 programme, so I will give some indication of that. We would argue that no other part of the UK has made a commitment on the scale that we have, or with such ambition. From the outset, we have sought to ensure that we have a competitive bidding process, so that we can deliver the best value for money. The process is complex. We have had to build in a degree of flexibility in response to changes in the intervention area, such as the number of properties that we have to cover. We will award contracts later in 2019, and I will give Mr Carson and colleagues across the chamber as much notice of that as I can, when we get nearer to the time. I recognise the strong interest in the matter across the chamber. Procurement for R100 continues to progress apace, and we have retained three highly credible bidders in the process—I hope that that information is of value to members. That level of competition will help to ensure the best possible solutions and outcomes for Scotland, and I look forward to sharing further progress in due course.
What I can say at this point is that we are confident that the R100 procurement is going to produce a fantastic outcome—one that will make rural Scotland one of the most digitally connected places anywhere in Europe. To pick up on the points that were made earlier, just imagine what a difference that could make in terms of tackling depopulation and improving economic growth in our rural communities.
The future-proofed network that we expect R100 to deliver across the country will enable all of Scotland to be part of the digital revolution that members have talked eloquently about today and to share in the economic benefits. To pick up on points that were made by Mr Carson, Mr Lindhurst and others, full-fibre and 5G networks will enable the movement of data, ideas and applications in the same way that canals and railways underpinned the previous industrial revolution. Our investment—alongside that of commercial players such as CityFibre—will ensure that Scotland is well equipped to compete.
I am conscious of time, so I will wrap up. We believe that we have created a distinct offer for industry. CityFibre is one of many companies that are responding to that, which we welcome. Its investment and that of others is helping to strengthen our position as one of Europe’s most well-connected nations. From what I have heard tonight, I believe that I have the support of the chamber in delivering that ambition.
Meeting closed at 18:37.