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Surrey County Council catches £3.8m gain share windfall for broadband

Local authority to receive £3.8m to extend a BDUK broadband roll-out through the gain share clauses written into its BT contract

Better-than-expected take-up of fibre-to-the-cabinet (FTTC)-based broadband services will see Surrey County Council reap a £3.8m advance windfall through the gain share mechanism written into BT’s Broadband Delivery UK (BDUK) contracts.

The gain share clauses, written into the original BDUK contracts, specify that BT will pay back some of the cash it receives should adoption of the taxpayer-backed roll-out exceed 20% of properties passed, which has happened in most cases. More than £129m will be returned in this manner across the UK.

In Surrey itself, 96% of premises can currently access so-called superfast broadband services, and about 86,000 properties have been passed under the BDUK programme.

However, up to 15,300 premises in out-of-the-way parts of Surrey are still unable to receive such a product, and the council wants to use its extra cash to address the needs of as many of these residents as possible.

The council’s deputy leader, Peter Martin, said: “We are already the country’s best-connected county and now we can look at beginning to help people in those hard-to-reach parts of Surrey, which we simply couldn’t do without this cash, given the severe strain that rising demand for services such as adult social care is putting on our finances.”

In a cabinet report recommending the immediate reinvestment of the £3.8m lined up by BT, the council pointed out that it required no new capital expenditure, or council money. Having received state aid approval to use the money within a slightly revised area, it now plans to move ahead as soon as possible, without an additional procurement.

Read more about broadband roll-out

“The need for fast broadband services by Surrey residents and businesses has increasingly become a necessity rather than a preference for operating a business, working from home, accessing educational material, utilising local and national government services, shopping online and accessing other TV and digital services,” the report’s authors wrote.

“Surrey County Council’s investment in fibre broadband infrastructure over the past four years through the contract with BT has had a very significant impact on the wellbeing and economic prosperity of thousands of residents and businesses around the county.”

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