Skip to main content

UK Labour party pledges free broadband funded in part by Silicon Valley tax

UK Labour party pledges free broadband funded in part by Silicon Valley tax


Free full-fiber broadband for every home and business by 2030

Share this story

Germany Expands Rural Broadband Connectivitty
Fiber optic cables being installed in Germany.
Photo by Sean Gallup/Getty Images

The UK’s opposition Labour party has promised it will give free full-fiber broadband to every home and business in the country if it wins Britain’s upcoming December elections.

The party said it would nationalize part of UK telecoms firm BT to achieve its goal, and introduce new taxes on Silicon Valley tech giants like Apple and Facebook to fund the network’s maintenance.

Parts of the UK’s internet infrastructure would be nationalized

Labour’s shadow chancellor John McDonnell told BBC News the plan would cost £20 billion ($25.74 billion), but would ensure that fast internet speeds were available in every corner of the UK. “It’s visionary I accept that, but other countries are having these visions and we’re not,” said McDonnell.

The announcement took the business world by surprise, with shares in BT dropping four percent in early trading before recovering to a roughly two percent fall. The chief executive of the company Philip Jansen told the Financial Times that “free broadband for all” was an “appealing” prospect, but would need to be carefully considered.

The UK’s ruling Conservative party criticized Labour’s plans as “fantasy” and a distraction from its election woes. The chief network architect of BT, Neil McRae, tweeted “Labour plans broadband communism!”

The move would be part of a much broader program of nationalization the Labour party has pledged in its recent manifesto. It seeks to take control of a number of utilities, including the UK’s water network, its railways, and the Royal Mail. Many of these industries were privatized in recent decades, from the 1980s onwards. The UK telecoms firm BT, formerly known as British Telecommunications, was itself only privatized in 1984.

Labour would specifically nationalize BT’s Openreach division, which maintains much of the Uk’s physical broadband and telephone infrastructure. It would issue government bonds to compensate shareholders, while taxing US tech companies to raise the £230 million it estimates would be needed annually to run the network.

Nationalizing a country’s internet is a surprising but not wholly unprecedented idea. In 2009, Australia’s government pledged A$43 billion ($29 billion) to bring broadband to every home by 2017, though the plan has been widely considered a failure with speeds in the country lagging far behind poorer nations.