Boris: £100bn BT takeover is ‘crazed Communist’ plan
LABOUR’S “crazed communist” plans for state-controlled broadband will cost taxpayers an eyewatering £100billion, bosses warned last night.
The party’s promise of free connection for all homes and businesses saw shares in the sector plummet and forced operator TalkTalk to delay the sale of part of its business.
Shadow chancellor John McDonnell said the plan to nationalise parts of communications giant BT could extend to other providers such asVirgin Media and Sky.
His announcement sent a chill through the City and left broadband firms reeling. Nearly £200million was wiped off telecoms giant BT’s value when its share price plunged after the announcement.
BT said Labour’s estimated £20billion price tag for seizing its Openreach business and providing free services would end up five times higher. BT chief Philip Jansen said the proposals were “very, very ambitious” and involved “very big numbers” and told the BBC: “You’re not short of £100billion.”
He said shareholders were already nursing “massive losses” over the past two years and further falls would damage confidence in the sector.
Labour leader Jeremy Corbyn said the plan would be paid for through its green transformation fund and taxing corporations such as Amazon, Facebook and Google. But the £20billion earmarked would cover only half the predicted bill for full fibre roll-out. On top of that, Openreach holds assets of £12.5billion and has an annual salary bill of around £858million a year, while maintenance costs are likely to reach more than £2billion a year.
Labour also failed to explain how the plan would deal with BT’s £60billion pensions liability and
BT’s chief network architect, Neil McRae, said it was “broadband communism”.
TalkTalk reacted by putting the sale of its full-fibre broadband business, FibreNation, just days away from completion, on hold.
Prime Minister Boris Johnson called Labour’s plan a “crazed communist scheme”. He said:
“What we are going to deliver is gigabyte broadband for all and what we won’t be doing is some crackpot scheme that would involve many, many tens of billions of taxpayers’ money nationalising a British business.”
Mr Corbyn wants to create a public enterprise, British Broadband, that would deliver fullfibre internet to every home and business by 2030 for free.
His plan to grab broadband provision is on top of promises to put rail, mail, energy and water under state control. Labour says Parliament will set the amount paid to take over BT assets, which is unlikely to match the market rate.
The plans horrified business lead