Budget: key announcements for the mobile industry

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The promises were made as Chancellor George Osborne delivered his eighth Budget

The chancellor of the exchequer George Osborne announced his 2016 budget yesterday (March 16) in front of the House of Commons.

In his eighth budget, Osborne unveiled several new measures that could have a big impact on the mobile industry.

Mast-er plan

Osborne promised the industry that the Government would give more freedom and flexibilities for the installation of mobile masts. This would include reducing planning restrictions for the existing telecoms infrastructure and allowing taller ground-based masts to be built.

It follows previous criticism from figures within the operators that the government had failed to meet promises made in 2014 when the four networks – EE, O2, Vodafone and Three – agreed to a 90 per cent geographic coverage target for voice and text.

The “landmark deal” with the department for Department for Culture, Media and Sport saw the operators agree to invest a combined £20 billion into their networks. In turn, DCMS promised to work with Ofcom to reform the “restrictive” Electronics Communications Code and planning laws that the operators claimed were slowing the rollout of new masts.

The industry responded to the budget by welcoming Osbourne’s announcement.

Three sees the decision as a positive step. A network spokesperson said: “We welcome the Government’s announcement that they are to help improve coverage by reducing red tape in the planning regime and giving mobile operators the flexibility to build taller masts if needed.  We await further details of the proposals.”

An O2 spokesperson added: “We welcome the Chancellor’s commitment to improve mobile coverage and capacity by proposing changes to the planning regime for building masts. Mobile phones are now seen as essential, with the infrastructure behind them every bit as important to our lives and economy as our roads, rail or our energy networks.”

David Cameron also made promises at Prime Minister’s Questions (March 9) that laws must be changed so more mobile masts can be built to tackle ‘not spots.’

Phone locking

Concerns that operators still charge customers to unlock a mobile phone were also raised. The Government said it would be committed to ensuring companies unlock a customer’s smartphone for free at the end of their contract. It can take between a week and a month, depending on network, to get a device unlocked.

According to uSwitch, unlocking a mobile phone can cost up to £20, with over £48 million being spent collectively by Brits each year.

The Government’s decision was welcomed by Three director of customer strategy Danny Dixon. He said: “Paying to unlock your mobile phone is wrong and frustrating for consumers. That’s why all handsets – contract and prepay – on the Three network have been unlocked at the point of purchase since January 1 2014. It’s good that customers of other networks will finally be able to enjoy a similar experience.”

EE added: “Last year we reduced the charge for unlocking phones by over 50% to £8.99, one of the lowest in the UK, to make it more affordable for customers who want to unlock their old phones when they upgrade. This summer we’ll be going a step further – our Pay Monthly customers will be able to request to unlock their phone for free at the end of their contract, and Pay as you Go customers can request to unlock their phone for free at any time.”

Mobile News contacted O2 and Vodafone for more comment.

Taxes

Osborne announced plans to bring corporation tax down from 20 per cent to 17 per cent by 20 per cent.

Corporation tax is levied on the profits of businesses that operate in the UK. Total net Corporation Tax receipts in 2014-15 were £43 billion.

Debt interest payments used by larger firms to cut corporation tax bills will be capped at 30 per cent of earnings.

Osborne said this will help fund a tax giveaway to SMBs that will see more than 600,000 firms become exempt from paying business rates.

The chancellor announced he was permanently raising the threshold for small business rate relief from £6,000 to a maximum of £15,000 and increasing higher rate relief from £18,000 to £51,000.

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