The £1bn plan to eliminate rural mobile signal ‘not spots’ is in jeopardy as escalating costs threaten funding shortfalls.
MPs caution that the ambitious project may face significant delays and obstacles.
Significant Cost Challenges
The Public Accounts Committee (PAC) released a report highlighting “significant cost challenges” within the programme. Officials remain uncertain about the final expenses. The scheme is overseen by Building Digital UK (BDUK), an arm’s-length body. Involvement of mobile operators who absorb additional costs as part of their licence obligations adds complexity.
Risk to Programme Viability
Regulator Ofcom might offer relief from these obligations if costs become excessive. This move could jeopardise the programme’s viability.
Shared Rural Network Collaboration
The first phase of the SRN focuses on “partial not-spots,” areas where at least one operator provides coverage. Government-funded second phase aims to address “total not spots,” where no operators currently offer 4G services.
Cost Escalation and Funding Shortfalls
One segment of the programme has seen costs rise by £44 million due to irrecoverable VAT and inflation.
Impact on Mobile Networks
PAC noted that ministers are exploring options to manage the extra costs, potentially achieving the required increase in 4G coverage with fewer mobile masts.
Setbacks and Delays
The PAC’s report criticised the Government for not identifying specific areas within the 5% of the UK landmass that will remain uncovered by the scheme.
Unclear Benefits and Taxpayer Money
PAC criticised the Government for not demonstrating the achievements from investing taxpayer money in 5G so far.
Government and Operator Uncertainty
As the deadline approaches, it remains uncertain how the Government and mobile operators will navigate the financial and logistical hurdles to achieve the ambitious coverage targets set out in the SRN.
The escalating costs pose a significant threat to the £1bn plan for rural mobile networks.
Without a clear strategy to manage these expenses, the project faces potential delays and obstacles.