BT would be part nationalised under £20bn scheme funded by new tax on tech companies

Labour has promised to provide free “full-fibre” broadband for every home and business by part-nationalising BT.

In a speech due to be delivered in Lancaster on Friday, Jeremy Corbyn will outline his proposals to create a new British broadband public service, saying it will “bring communities together in an inclusive and connected society”.

The scheme would be a radical shift in provision of broadband services, which are currently provided by companies at an average cost per household of about £30 a month.

It builds on Labour’s existing plans to nationalise the energy utilities, water companies, postal services and railways as part of its plan for a transformation of the public sector.

Party strategists are hoping that such an eye-catching consumer offer to voters will help narrow the poll gap with the Tories, who are trying to keep the election focused on Brexit and immigration.

Labour said the estimated capital cost of rolling out full-fibre broadband was £15bn, on top of the government’s existing £5bn earmarked for broadband expansion. This would be funded from its green transformation fund – paid for by borrowing.

In addition, Openreach – the broadband network which is a distinct company within the BT group – would be nationalised under the plan. It is worth about £12bn-£15bn but the party said parliament would decide the rate of compensation. Labour has said it would issue government bonds to shareholders for all nationalisations.

The cost of maintaining the network is estimated at about £230m a year and would be partly paid for by high taxes on web companies such as Amazon, Facebook and Google.



“The internet has become such a central part of our lives,” Corbyn will say. “It opens up opportunities for work, creativity, entertainment and friendship. What was once a luxury is now an essential utility.

“That’s why full-fibre broadband must be a public service, bringing communities together, with equal access, in an inclusive and connected society.

“It’s time to make the very fastest full-fibre broadband free to everybody, in every home in every corner of our country. Making it free and available to all will open up opportunities for everybody, at the cutting edge of social and economic change.”

The Conservatives criticised the policy, saying it was a “fantasy plan to effectively nationalise broadband [that] would cost hardworking taxpayers tens of billions”.

Nicky Morgan, the outgoing culture secretary, said: “Corbyn is clearly so desperate to distract from his party’s divisions on Brexit and immigration that he will promise anything, regardless of the cost to taxpayers and whether it can actually be delivered. What reckless idea will be next?”

The Tories said Labour had significantly underestimated the costs, saying BT estimates the cost of full-fibre rollout at £40bn. They also highlighted the wages of Openreach staff amounting to about £800m a year and said the costs of running the network would be far higher.

Labour said its plan was fully costed, would involve a massive upgrade in the UK’s telecommunications network and would put an end to patchy and slow coverage.

It said the rollout would begin with places that have the worst broadband access, including rural and remote communities and some inner city areas, followed by towns and smaller centres, and then by areas that are currently well-served.

John McDonnell, the shadow chancellor, said: “This is public ownership for the future – a plan that will challenge rip-off ‘out-of-contract’ pricing – and that will literally eliminate bills for millions of people across the UK.

“Every part of this plan has been legally vetted, checked with experts, and costed. What we are offering in this election is real change.”

The party will also announce plans for a new Charter of Digital Rights. This would involve powers for individuals and collectives to challenge “algorithmic injustice”, where online algorithms “cause disproportionate harms to particular groups” and powers for individuals and collectives to prevent the use of digital infrastructure for surveillance.

BT’s chief executive, Philip Jansen, told BBC News he was happy to work with whoever wins the election to help build a digital Britain but warned the impact of any changes on BT pensioners, employees, shareholders – and the millions of investors via pension schemes – needed to be carefully thought through.

Julian David, the chief executive of TechUK, which represents many UK tech firms, said: “These proposals would be a disaster for the telecoms sector and the customers that it serves.

“Renationalisation would immediately halt the investment being driven not just by BT but the growing number of new and innovative companies that compete with BT.”

In September, the communications watchdog Ofcom said that full-fibre broadband had been made available to about 8% of homes and businesses, but the UK is still far behind other countries.