Rural broadband funding ready for England and Scotland

image captionCumbria gets the largest share of the money

Rural areas in England and Scotland have been allocated nearly £363m to improve their broadband connections.

Cumbria gets one of the largest shares of the £530m pot, with over £17m to cope with its 96.2% of homes eligible for subsidies.

By contrast, London gets nothing as it assumed that private investment will cover all parts of the capital.

It is a change of strategy for the government which originally asked counties to bid for money.

Local authorities and residents will decide how the money should be spent.

County councils and private enterprise partnerships will be put in charge of broadband rollouts in their areas, and will be required to draw up delivery plans and find additional funding from elsewhere.

It will be up to the Scottish government how to use the money in Scotland.

Wales and Northern Ireland have already been given their share of the £530m broadband fund which was set aside from the TV licence fee.

The government hopes that by allocating money instead it will speed up the process.

It has pledged to make the UK the best place in Europe for broadband by 2015.

Up to one third of UK homes will not get fast broadband services from the big commercial players without government subsidy.

This is because the number of people living in rural areas versus the cost of creating a next-generation broadband do not represent a good return on their investment for players such as BT and Virgin Media.

So for example Northumberland has 71% of premises that will not be reached by commercial projects. It has been allocated over £7m.

Berkshire, with only 8% of homes unlikely to get next-generation services via commercial firms, gets £1.4m.

But some have questioned whether the £530m will be enough to fill in the gaps.

Malcolm Corbett heads up the Independent Networks Cooperative Association (INCA), which aims to co-ordinate community broadband projects around the UK.

He lives in Suffolk, which has been allocated £11.6m.

"That equates to around £70 per house or business while the cost of fibre is £1,000 per premises so there is a disparity between what the government is putting in and what it will actually cost to provide a future-proofed solution," he said.

He welcomed the new urgency from government.

"There had been pressure from MPs who were saying not much was happening and that, in part, is why they changed the process from councils bidding for money to allocating it. I think that makes a lot of sense," he said.

The Countryside Alliance welcomed the investment but doubted whether it would be enough to propel the UK to the top of the broadband league tables.

"Today's announcement will only ensure 90 per cent of our homes and businesses will have access to superfast broadband by 2015.

"In other European countries, such as Denmark, they only have 1% of homes outside the reach of ADSL, WiMAX or fibre-optic broadband coverage," it said in a statement.

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