April 8, 2010 3:00 am

Digital boost proposals fall by wayside

  • Share
  • Print
  • Clip
  • Gift Article
  • Comments

The majority of the flagship reforms envisaged in the government's much-vaunted Digital Britain initiative to "reboot" the British economy have been abandoned as ministers turn their attention to fighting the general election.

The government last night ditched proposals to fund regional television news in its digital economy bill, which was supposed to implement much of the initiative.

Several Digital Britain measures have been dropped because of Tory opposition, industry resistance or lack of legislative time.

The one reform to survive is a crackdown on online piracy , but the plans bear little resemblance to the government's original proposals. The crackdown has been strengthened, and MPs approved the slimmed-down digital economy bill last night.

Digital Britain was the brainchild of Lord Carter, Gordon Brown's former strategy director, who became communications minister in 2008.

He highlighted the opportunity for the communications industries to help in "rebooting" the recession-hit British economy, and lessen its dependence on financial services.

Lord Carter, who declined to comment yesterday, used his Digital Britain white paper in June last year to outline ways to strengthen the media and telecoms sectors.

His centrepiece measure was a tax on telephone lines to help fund the expansion of superfast broadband networks in rural areas , where telecoms companies are unlikely to build infrastructure without state subsidy.

The 50p a month tax on landlines was due to be implemented in the finance bill, but ministers have dropped the levy because of Tory opposition.

Ben Bradshaw, culture secretary, accused the Tories of "economic vandalism". He said: "The market simply won't provide fast, quality broadband in much of the country."

Jeremy Hunt, shadow culture secretary, condemned the 50p tax and claimed it would have forced 200,000 people to abandon their internet connections.

Lord Carter, who left the government last summer, also devoted much time to trying to end a dispute between mobile phone operators over ownership of radio spectrum.

However, the row has continued to rage since Lord Carter's departure, and is holding back the expansion of mobile services based on third-generation wireless technology, which enables web surfing on handsets.

Furthermore, Lord Carter tried unsuccessfully to strengthen Channel 4, the state-owned broadcaster, by promoting the idea of it forming a joint venture with BBC Worldwide, the BBC's commercial arm.

Lord Carter also enraged the BBC by proposing that the state-owned broadcaster should share a portion of its licence fee with its com-mercial rivals for the first time.

He said up to 3.5 per cent of the £3.6bn licence fee should be used to fund regional news made by independent broadcasters and shown on ITV.

Lord Carter does, however, have one obvious legacy. Both Labour and the Tories are committed to some form of public subsidy to expand superfast broadband networks to rural areas.

If the Conservatives win the election, they would use a portion of the BBC licence fee to pay for the expansion of superfast broadband infrastructure outside urban areas.

If Labour wins, the party would go back to its original plans and introduce the telephone tax.

Related Topics

Copyright The Financial Times Limited 2016. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.

  • Share
  • Print
  • Clip
  • Gift Article
  • Comments
SHARE THIS QUOTE