VOA puts a price on rural broadband

Internet infrastructure

VOA puts a price on rural broadband

Cliff Saran

The Valuation Office Agency (VOA) has published guidance for the rateable value of superfast networks in the final third in England and Wales.

Business rates on superfast networks have been an inhibitor to the huge investment in new network infrastructure required to deliver fibre to rural areas of the UK. 

Broadband Delivery UK (BDUK) has £530m of funding to bring superfast broadband to the third of UK homes and businesses not provided for by the broadband market.

Prior to the guidance, the application of business rates to telecommunications would have been based on historical valuation of how well a network performed commercially, rather than future looking. With no prior historical data available for new rural networks, any valuation would lead to uncertainty for investors.

Following input from The Broadband Stakeholder Group (BSG) to provide the VOA with an evidence base for its valuation, the guidance sets out the likely rateable value per home connected in each of the BDUK project areas.

“This guidance addresses one of the uncertainties facing investors considering the deployment of residential superfast broadband networks in the final third," said Antony Walker, CEO of BSG. "It provides industry with greater clarity about the rates liability for these networks, and the provisional rates are generally significantly lower than those that will apply to networks in more urban areas within the first two-thirds. While further work is required to ensure the guidance is understood by all stakeholders and that industry has an opportunity to provide feedback, this is a big step forward.”

Peter Shearman, head of infrastructure policy at BSG, said: “This is a big step forward and gives clarity to investors. It has an additional benefit in that the valuation is lower than for urban networks.”

He said business rates for telecommunications in rural areas were 90% cheaper in a quarter of BDUK areas due to challenging geography in these regions.

Photo: Creatas

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