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Labour’s Free Broadband Pitch – Will It Work?

November 15, 2019 Leave a Comment

The Labour Party has won the battle for coverage today, with most news outlets giving high profile coverage to the party’s promise that if elected, it will nationalise parts of BT, and offer free fibre broadband to everyone in the country.

It’s an eye-catching pitch to say the least. But will it actually move the election?

To assess the policy on its own terms, it’s a curious one as it lacks so much detail it is almost hard to judge: We know that Labour would national OpenReach, the largely separate part of BT that runs the underlying broadband infrastructure, but would it also operate a state run Internet Service Provider (ISP)? What would it mean for other private operators? (John McDonnell seemed to suggest in an interview this morning that the likes of Virgin and TalkTalk could end up being nationalised too.)

There’s also big question-marks over funding. Taxing Big Tech is very emotionally appealing, but how to do it in practice is harder. We all know, colloquially, “Big Tech” refers to Amazon, Facebook, Google and Apple – but these are companies with very different business models that compete asymmetrically. So what exactly do you tax? If a tax was imposed on digital advertising networks, for example, it would hit Google and Facebook, but not Amazon and Apple. If a tax was put on digital marketplaces, Google and Apple might be hit – but Facebook wouldn’t. And so on. So the detail of the policy – assuming Labour has more than a scribble on the back of an envelope – is going to be interesting to see.

And aside from the practicality and whether it would achieve its desired aims, if we assume Labour can do it, it will surely entail shouldering a significant amount of political risk, as let’s face it – everyone hates their broadband provider, and now downtime will mean blaming the government, rather than a private company. It would at the very least make the 2024 election interesting.

In any case, this is almost beside the point, as the policy is more about signalling something bold and catching the public’s attention. And this invites the real question off the back of today’s policy debate: Will it move any votes? If you’ve got money riding on the outcome of the election, should you shift it around based on the announcement?

The bull case for Labour is that a splashy policy like this helps reset the election on to Labour’s terms. In 2017, the party performed better than expected partially because the campaign moved away from being about Brexit and Labour’s muddled position, to being about domestic policy – and we all remember Theresa May’s difficulties over the dementia tax.

The bear case is that though the policy captures headlines, it isn’t really one well positioned to move votes. The voters who will react most enthusiastically to the broadband policy are likely under 45s who are already mostly in Labour’s camp. The reality is that older people – those who most reliably vote, and most reliably vote Conservative – are the least likely to see the value in fibre broadband.

I also think there could be another factor at play that we don’t know the answer to yet: The broadband proposal is big and bold but, regardless of the merits of the policy in reality, could a cynical electorate ever believe such a thing possible? Especially given how Brexit has paralysed politics – is it really possible to imagine a future where a Labour government can do something quite so dramatic?

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