NEWS that the government has found an extra £440m to connect around 600,000 extra homes and businesses to superfast services in broadband ‘not-spots’ has received a cautious welcome from business leaders.

Culture secretary Karen Bradley said the cash had come from £150m in savings from “careful contract management’’ and £292m released through a clawback system that re-invests money when people take up superfast connections installed under Broadband Delivery UK programme (BDUK).

Ministers set up the BDUK to provide superfast broadband to 95% of the UK by December 2017.

Ms Bradley said: “Our Broadband Delivery UK programme is giving families and businesses in hard-to-reach areas the fast and reliable internet connections which are increasingly at the heart of modern life.

“Strong take-up and robust value-for-money measures mean £440m will be available for reinvestment where it matters - putting more connections in the ground.

“This will benefit around 600,000 extra premises and is a further sign of our commitment to build a country that works for everyone.

“We have made great progress but there is still more to do.

“Broadband speeds aren’t boosted automatically - it needs people to sign up. Increasing take-up is a win-win-win: consumers get a better service, it encourages providers to invest, and when more people sign up in BDUK areas, money is clawed back to pay for more connections.’’

The Country Landowners Association (CLA) which represents thousands of rural businesses has been campaigning for faster rural connections.

CLA south east regional director Robin Edwards said: “The next two years are crucial in cementing the end of the digital divide that continues to hold back the rural economy from fulfilling its potential.

"The legal imposition of a universal service obligation, as provided for in the Digital Economy Bill, can ensure that every home and business owner will no longer have to accept substandard connections.

“It is also essential for government and industry to embrace the range of technologies that could be used to deliver the best possible connections to tackle the final five per cent of the most remote and difficult to connect homes.

"Providing communities with a voice and stake in how they are connected will be crucial to ensuring the right investments are made in this area.

"The CLA will be working with the Government to ensure the mechanics of this are put in place so that rural areas can overcome barriers to connectivity.”

Chief executive of Hampshire Chamber Stewart Dunn said this was good news for business and would improve productivity in the UK, which lags behind many European competitors.

However he said that businesses should be aware of the “big jump” in costs involved in connecting to a faster services.

He said the chamber had recently connected to ultrafast broadband which was costing them 20 times more than their old connection.

Mr Dunn also stressed that not all ‘not-spots’ were rural.

He gave an example of Millbrook where houses on one side of the bypass were connected to superfast broadband while businesses on the other were not.