Meeting documents

Councillor Mrs J Blake

Cabinet Member for Business Transformation

To consider the attached information.

Contact Officer:  Evelyn Kaluza (01296) 585549

(a)       Decision(s)

That the draft business plan prepared by Aylesbury Vale Broadband Ltd be approved.  (A full copy of the Plan was appended to the confidential part of the Cabinet agenda).

(b)       Reason(s) for Decision(s)

            To enable the Company to progress the expansion of superfast broadband across the District in accordance with previous Council decisions.

(c)       Alternative Option(s) Considered

            Not to continue investing in the further expansion of superfast broadband.  But this would be contrary to the Council’s previously agreed strategy in this field.

(d)       Relevant Scrutiny Committee

            Economy and Business Development.  That Committee will be receiving a similar report at its next meeting.

(e)       Conflicts of Interest / Dispensation(s)

None.

In December, 2014, the Council had committed £1.536m of New Homes Bonus funding to support the roll-out of superfast broadband across the District.  In April, 2015, the Council had approved an initial loan from this funding of £200,000 to run a pilot project through the creation of a limited liability company – Aylesbury Vale Broadband (AVB) – to provide superfast broadband to the villages of North Marston and Granborough.

Progress with the pilot had been reported to the Economy and Business Development Scrutiny Committee on a regular basis, with the last report having been submitted on 15 March, 2016.  That Committee would also be receiving a report similar to this one at its meeting on 7 September, 2016.

As a result of the success of the pilot, in April, 2016, a further loan was approved in the sum of £500,000 to support further expansion of the service across the Vale.  These loans had been made under commercial rates and were expected to be repaid by 30 June 2022.

AVB had been structured with the majority shareholder (95%) AVDC and 5% Ironic Thought.  Ironic Thought was owned by Andrew Mills who had been appointed as the managing Director in July, 2016.  Some of the wider benefits of AVB's progress to date include:-

·         AVB’s network, in the middle of rural Aylesbury Vale, was delivering speeds that only 2% of the UK population could currently receive.

·         Approximately one in three of AVB’s customers were small businesses who were now benefitting from AVB’s 100% fibre broadband.

·         As a direct result of AVB’s pilot, its competitors (including fixed and wireless providers) had spent an estimated £600,000 on upgrading their existing solutions and were providing new services to Aylesbury Vale.  This expenditure was unlikely to have happened without AVB’s existence and it meant fewer people were having to make do with poor broadband in Aylesbury Vale.

The business plan included plans for expansion which went further across the Vale to deliver fibre to the home (FTTH) to more villages.  This was predicated on an additional £550k loan being allocated to AVB from the original £1.536m of funds earmarked for superfast broadband (and previously approved by the Council).

It had been forecast by several industry bodies that demand for bandwidth was expected to grow exponentially by 2020.  Fibre was the only known technology that could cope with this demand, without additional investment and therefore by selecting FTTH, AVB was reducing its future support and maintenance costs and increasing confidence in the financial forecasts for the future.

A copy of AVB’s draft business plan was submitted as part of the confidential Cabinet agenda. It was necessary to resolve to exclude the public to enable the plan detail to be discussed under section 100(A)(4) of the Local Government Act, 1972, because of the commercial sensitivity of the information contained therein as defined in Paragraph 3 of Schedule 12A of the Act.

RESOLVED –

That the draft business plan prepared for Aylesbury Vale Broadband Ltd (attached to the confidential Cabinet agenda), be agreed.