Public investment in fibre – a lesson for the UK government

BT has announced plans for a fibre project ‘to tranform the Cornish economy‘ under which next generation fibre-based network infrastructure will be rolled out to up to 90% of local businesses and homes in Cornwall (and including the Scilly Isles).

The investment is on top of BT’s existing £2.5bn national fibre investment programme and BT believes (although without citing evidence other than the sorts of new services that fibre investment will help deliver) that it will create up to 4,000 jobs and protect a further 2,000 in a largely rural economy which does not otherwise have a great deal else for local people once all the tourists have gone home.

Particularly interesting is that 50% of homes and businesses are expected to be hooked up to fibre to the premises solutions, delivering faster speeds and delivering some future proofing of the investment – nationwide (or, perhaps, outside the Cornish nation), the investment in fibre is expected to be much less, BT having estimated that one in four homes and businesses within its investment programme would have fibre to the premises (i.e. about 17% of the country).

Excitingly, the £132m investment programme (final costs dependent on demand) is split approximately 60:40 on a private-public basis, with BT being partnered not by UK public sources of finance but by the European Regional Development Fund, which is contributing £58.5m of the finance. This is the largest investment in England backed by EU regional funds, which the ERDF clearly sees predominantly in terms of its role in encouraging a lower carbon economy (according to Johannes Hahn, European Commissioner for Regional Policy). With the population of Cornwall being just over half a million people, the scope of the public investment is about £100 per head.

This looks a good deal to me – providing fibre to a large region on this cost basis illustrates what can be done when the public sector gets involved: a lesson for the ConDems that fibre needs more than just warm words and crossed fingers. The trouble is that only Wales otherwise has the requisite development status [possible paywall] triggering the ERDF investment: so the wider applicability of this particular project is scant (while the few areas of the UK that thus qualify on this basis is disappointingly small).

So, it seems we may reasonably expect a similar investment for Wales reasonably soon but, otherwise, a gap which will continue to remain outside the two-thirds which will receive fibre investment on a competitive basis while the ConDems – well, while they wait to see what happens. Actually, after they have finished their programme of public spending cuts, in the process winding up the regional development agencies which facilitate this sort of deal, there may not many public institutions left to broker such deals in the future. Shame.

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Beer better than water: it’s official

Part of my regular jaunts to London involves catching the sleeper between Scotland and London, and I continue to be amazed that the bottles of beer for sale have sell-by dates longer than just about anything else I’ve seen:

OK, alcohol is a preservative but when bottles of water have drink-by dates that are, in comparison, just around the corner, the only conclusion I can come to is that beer is less likely to do damage to you than water.

Made in Dagenham

I’ve been in London these past few days, and all over the buses and the tube are adverts for Made In Dagenham, the new film about the seminal equal pay strike strike by Ford sewing machinists in 1968. The film opens on 1 October and had its world premiere last Monday (and I have already blogged about it below).

I really hope it’s a success. Certainly the early reviews are reasonably positive, and that’s welcome, but, in advance of seeing the film (and I will be doing so) I have a number of reservations from a trade union perspective:

1. I’m nervous about the title: there’s a word play at work here and the last thing we need is the perception that this is an issue by and for a bunch of old women.

2. The director of Made in Dagenham was previously responsible for Calendar Girls; forty years on, equal pay remains a serious issue and I don’t want it to be viewed from a similar quirky, light comedic perspective.

3. The strapline: ‘1968. It’s a man world but not for long’ is all wrong. It encourages the view that equal pay is a problem resolved, that there is equality in pay (and in other areas of sex discrimination). In thousands of workplaces up and down the land, women are still suffering from a lack of equal pay, which remains a continuing, and serious, problem.

Still, I’m comforted by the involvement of Billy Bragg, and the comments of the stars of the film at the premier are an encouraging start to how the film must be seen. It’s also important that some of the original strikers have had at least some involvement in the work.

But, is it slightly possessive about a key aspect of labour movement history to want a proper serious film about a proper serious issue, rather than the product of a serendipitous tap into a 60s zeitgeist stemming from current pop culture? And which, dammitall, may turn out to be highly popular? There is a role for trade unions and other activist groups in running special screenings which seek to engage and to energise people around the equal pay issues that remain and, if the film both entertains, informs and encourages debate, that has to be helpful. It must do all three.

Public sector pay

So Panorama has a database of top people’s pay.

I’m not a natural defender of high pay – except where negotiated by a trade union, obviously – but I’m a little puzzled by two things:

1. a private sector where executive pay has long spiralled out of control is evidently going to have knock-on effects on the public sector, which is competing for similar talent. Those that live by the market die by it, surely?

2. we ought not to be surprised when a public sector which has been commercialised, contractorised and privatised beyond all recognition of the term ‘public service’ becomes influenced by private sector practices, including on pay. Not only is it playing catch-up with the private sector on pay, it has also, in terms of ethos, become dominated by private sector approaches and, in the current environment, it is looking for private sector expertise.

In these circumstances, appealing to some ‘old fashioned’ public service ethos, as Francis Maude is doing, looks rather quaint in itself.

Union leaders who argue that this is another attack on the public sector may well have a point. More than that, however, if we want to start sorting out the pressures on pay which lead to what people are arguing are inflated salaries in the public sector, it makes no sense to start within the public sector – which is the symptom of the problems, not the cause. As superficially ‘attractive’ as it might seem, in a time of budget cutbacks, to have another bash at the public sector, solving the problems of out of control senior pay means tackling it first, and above all, in the private sector. Motion 27A, carried at last week’s TUC, has a lot to commend in this direction, seeking a ‘shadow’ high pay commission to investigate high pay across the economy, not least in FTSE100 companies.

In the meantime, a government that recognised that, which recognised the nature of the links between the two, and which therefore was prepared to adopt a holistic approach to the issue, might command a bit more respect when talking about the need for restraint in the public sphere.

Back from the game – Boro

Boro is the furthest game away for the mighty Royals this season – but it’s the nearest thing I get to a home game and with the Rz unbeaten in five, I set off with a quickness of step yesterday morning to the game, and one which wasn’t affected by National Rail’s habitual autumn shut-down of the rail line between Edinburgh and Newcastle, and the subsequent diversion via Carlisle, making a one-way five-hour journey of the trip.

The return was a different story, though: a 3-1 defeat meant that the miles back hung heavy. The lads gave themselves a mountain to climb after conceding a goal after 24 seconds (it was our kick-off too, which meant that we’d kicked off twice within 1 minute and 2 seconds of the start of the game 😦 ) and Brian McD was probably right to criticise the ‘flat‘ nature of the performance. Truth to tell, the second and third Boro goals came somewhat against the run of play and we didn’t play that badly. We were punished heavily for mistakes, though, and never turned a significant lion’s share of the possession into meaningful sustained attack which put pressure on the Boro goal. And a game plan on keeping Boro quiet from the off – well, that worked well and, as a reuslt, the Blue Army never really got goingeither.

With three goals leaked and a three-game suspension after a straight red (it’s not clear from this that it was a sending-off) to provide the opportunity to swap things around, we can expect some changes for Barnsley at home, including Khizanishvili for Pearce (who was horribly at fault for that first goal), and probably Church for the suspended Howard. Get Tabb and Griffin back from injuries and I don’t think we’ll be far off. Still, this was indeed a bitter pill to swallow (as my iPod on random shuffle gave me at one point on my return).

More reaction to the game from the HNA? back to the game thread here.

More Policy Exchange nonsense

One of the nicer things about the period of Labour government since 1997 was that all the daft right-wing think tanks that marked the Tory years since 1979, especially in the area of trade unions and industrial relations, seemed to have all crawled back into the woodwork (and certainly had, as regards policy impact). Unfortunately, they’ve only been hibernating and the last year has brought a few out again. I mentioned the Institute for Economic Affairs yesterday and Policy Exchange, which has produced a couple of nutty pieces, not least on pensions and on industrial relations, has gone and done it again.

Sarah Veale at the TUC has done a pretty good job running through the report, but I wanted to emphasise a couple of things:

1. trade unions tend not to prosecute a dispute if there isn’t much support for it – it’s a question of strategy and credibility. Self-evidently. As a result, disputes that go ahead tend to have a high level of support from the workforce.

2. employees can, actually, choose to be a member of any union they want (subject to admission criteria in the rule book). It does, however, make sense to join a union which is recognised by the employer (and let’s not forget that employers recognise unions for a reason). So to call this ‘monopoly conditions’ is stretching the definition of the term very thin.

3. I can’t even begin to understand what the policy implications of ‘using competition policy to address monopsony power on the part of employers’ means in the context of ‘replacing the system of monopoly unions bargaining with monopsony employers’. I know what monopsony means, technically, and I’m guessing that what the report is implying is the splitting up of large public sector employers into  a series of smaller ones. I haven’t yet read it – though I will (owing to a lack of time and, besides, the simple act of downloading the report would just make me feel dirty 😉 ).

4. Unions are simply not monopoly suppliers of services: where workers have a choice of being in the union or not, there can simply be no question of monopoly power. I think everyone should be in the union as a matter of principle and also in terms of giving meaning and strength to the union memberships of those who are members – but it’s never a monopoly.

Evidently, the issue on taxpayer support for unions is an attack on public sector unions and the extent to which lay reps receive paid time-off for union activities. Time-off for reps is a good thing – industrial relations run much smoother as a result of the hard work done by activists in representing fellow workers’ views to managers, whether it’s in the public or the private sector. All Policy Exchange has to do is to read ACAS reports on the issue and there is a long-standing body of academic research citing the practical and economic benefits to employers of the union voice (as a special service to Policy Exchange staff, try here and here).

At the same time, this sort of nonsense does need to be knocked back whenever it appears – allowing it to gain traction by not being challenged is the simplest way of seeing it wind up on the statute book.

Pensions: going down a bomb in the boardroom

A belated welcome to last week’s publication of the TUC’s annual PensionsWatch survey.

This is a really useful reminder of the true nature of the pensions divide in the UK – not between public sector and private sector, but between the pensions of senior executives and everyone else. Among the findings of the 2010 survey, we find that the value of the average executive pension pot has increased by 11.7%, to £3.8m – a sum that would deliver an annual pension of over a quarter of a million, some 26 times the average occupational pension in payment. Over half of all directors in the survey are in defined benefit schemes (a percentage coverage reached among employees in general in 1983, since which time it has fallen back to less than one-third), even though many such directors retain such provision despite having closed it for many of their staff. And the average contribution into an executive’s defined contribution scheme was 19% – three times the average for shopfloor workers. For executives not in a scheme, the average cash payment was £120,000.

As Brendan Barber pointed out, directors have been in the vanguard of attacking pensions provision in the UK, via its so-called ‘independent‘ pensions commission with the Institute for Economic Affairs, while a more fair and reasonable approach would be one based not just on greater transparency of executive pension arrangements but a common scheme for all in the organisation. Not least since taxpayer support for executive pensions is so huge. The point is not lost on Joanne Segars, of the National Association of Pension Funds, which has ‘real concerns‘ about the issue on the grounds of fairness. Real change, however, is likely to require a somewhat stronger intervention.

On top of today’s research showing that executive bonuses are back to pre-recession levels, the notion that it’s business as usual in the boardroom, regardless of what is going on elsewhere in the economy, is one that increasingly seems to define our modern age.