BT executive says Brexit is slowing superfast broadband rollout

Britain’s ability to roll out superfast broadband across the country is being slowed by the “tortuous” process of recruiting workers from the EU following Brexit, the head of BT’s networking business has warned.

Clive Selley, chief executive of BT’s Openreach, the division leading the rollout of fibre optic networks to homes, said countries such as Portugal and Spain have plenty of people with the necessary skills to accelerate the delivery of superfast broadband.

“They want the work, we want the skills and the Home Office have a process that is tortuous,” Selley said in an interview. “We are constraining the rate of fibre build in the UK through the process.”

“If it was easier getting people in, I would take a thousand tomorrow,” he said, referring to contractors rather than full-time staff. Portugal and Spain have the skilled labour required because the countries are close to finishing their rollout, he added.

The delivery of superfast broadband is central to the Conservative government’s pledge to bridge the digital divide and level up the economy. Its last manifesto outlined plans to deliver “full fibre and gigabit-capable broadband to every home and business across the UK by 2025”.

The government is now aiming to have 99 per cent of homes connected by 2030. Selley said it was “quite realistic” and “achievable” for Openreach to lay fibre optic lines to 97 per cent of the country’s homes by 2030, but that it would require greater support and subsidies from government.

Openreach has committed to spend £12bn to connect 25mn of the UK’s 32mn homes by the end of 2026. The rollout, which began in 2018, has so far reached 7.6mn homes.

Addressing the criticism of the challenges in hiring workers from the EU, a Home Office spokesperson said: “We have a points-based immigration system and people are eligible to come if they meet the requirements.”

One government aide said ministers were becoming irritated with companies complaining about the system, which involves skilled workers being allowed to come if they pass language skills and pay a fee, and said businesses needed to have planned better.

The stakes are high for BT after a sluggish start to upgrading its old copper lines allowed competitors, including Virgin Media O2 and dozens of smaller challengers, to begin their own rollouts in the hopes of attracting customers who were frustrated by the poor connection offered by their existing providers.

These so-called altnets, backed by billions of pounds from private investors and banks, are either looking to attract customers directly in cities, towns and underserved rural areas or sell their broadband via wholesale agreements with telecoms companies.

The slower BT rolls out the underpinning for its superfast network, the bigger the danger it loses market share. Analysts at Deutsche Bank warned they expected BT to suffer a “material share erosion”, “especially for the 50 per cent of UK homes where BT is [currently] effectively the monopoly fixed infrastructure provider”.

Although Selley acknowledged the challenge from rival companies, he expects the number of competitors to be whittled down in the coming years.

“You can’t have hundreds of private companies, it’s just nonsense,” he said, adding that delivering telecommunications services was “a scale game” at its heart.

“It’s very clear there are some serious scale players emerging and I have to take that very seriously,” Selley said. “Our response is to build unbelievably quickly . . . and then sell fast.”

Asked about continuing speculation that Openreach could be spun off from BT entirely to crystallise its value for the parent company, Selley, who has led Openreach since 2016, said: “I don’t get a vote on that.”

“What we’re doing isn’t a cheap hobby and [BT] have shown great confidence in us, with £15bn of investment, more than half the group’s capex,” he said. “Right now, it’s working well, we have stability and Openreach is a very healthy business with no constraints from the ownership structure.”

With additional reporting by Jim Pickard in London

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