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Volume 404: debated on Thursday 1 May 2003

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[Relevant documents: The First Report from the Welsh Affairs Committee, Session 2002–03, on Broadband in Wales, (NC95), and the Government's response thereto, (HC 4130).]
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Derek Twigg.]

1.38 pm

It is no secret that compared with a number of other countries the UK has made a slow start with broadband communications. It is equally clear, though, that we are making rapid progress, and I believe that the whole House will welcome that. However, there are major challenges on the road to our target, which is that the UK should have the most extensive and competitive broadband market in the G7, and in opening this important debate I want to concentrate on those challenges.

In our debate on rural broadband in Westminster Hall on 25 March, the hon. Member for Blaby (Mr. Robathan), who I am pleased to see in his place, referred in generous terms to a report that I wrote on broadband, which was published in 1987. In that I forecast that there would be 600,000—[Interruption]

Order. I am sorry to interrupt the Minister, but I think that he is entitled to the undivided attention of the House and I deplore other conversations—indeed, other meetings—taking place in the Chamber during a debate.

Thank you, Mr. Deputy Speaker.

In that report, I forecast that there would be 600,000 broadband connections in the UK by 2000. In fact, it took longer than that: 600,000 was reached by the time of my appointment to my present position a year ago this month. By that time, however, thanks to the work of my predecessors and the effective competitive environment that we have established in the UK, the number was growing rapidly: from 1987 it took until last October to reach 1 million UK broadband connections, but it will have taken only about nine months to add the second million, which I expect us to achieve in the course of this month. Today, there are more than 1.9 million connections—1 million via cable modems and 900.000 via ADSL—and the number is increasing by well over 30,000 a week, which is one of the fastest rates of growth anywhere. Independent research has identified the UK as having the second-largest broadband network in Europe after Germany. More than 70 per cent. of households can access one of the mass-market broadband services.

All those data give us grounds for a good deal of satisfaction and an opportunity to congratulate all those in the service-providing organisations on what they have achieved. Those organisations include BT; the cable companies NTL and Telewest; the broadband internet service providers Pipex, AOL, Freeserve and, on some estimates, more than 300 others; wireles sproviders such as Firstnet; and committed locally based innovators such as. Rutland Online and Alston Cybermoor. I believe that the whole House will join in congratulating them on the progress made in the past 12 months.

Unfortunately, I was unable to join the Minister and my hon. Friend the Member for Blaby (Mr. Robathan) for the Westminster Hall debate on rural broadband access. If he has an opportunity, will the Minister say when he envisages 100 per cent. accessibility to broadband being achieved? Houses, including my own, in rural constituencies such as mine and my hon. Friend's cannot get broadband, I presume because of the sparsity factor. Next. Friday, I am to open a broadband business centre, but that is in quite a big village; we in the smaller rural hamlets cannot get broadband—

Order. The hon. and learned Gentleman must not anticipate my ruling, but I think he guesses that he has gone on too long.

As far as I know, nowhere in the world has 100 per cent. broadband availability, but I shall address the issues that the hon. and learned Gentleman raises soon.

I add my congratulations to all the providers my hon. Friend mentioned. In my area, that the local exchanges have been enabled is owed to a community local partnership—the FAST group—going out and persuading people. Is not that the way to broaden the broadband agenda for Britain?

My hon. Friend is absolutely right. I join him in paying tribute to all the community campaigns that have developed throughout the country and encouraged people to sign up for the broadband demand registration schemes that some operators have implemented. BT tells me that it has now upgraded 104 exchanges for broadband as a result of its demand registration scheme, and it plans in the next few months to announce targets that, if they are met, will take ADSL coverage to 90 per cent. of UK households. Service providers have found that the initiative of community campaigns has built demand that makes their investments in broadband worthwhile in a large number of communities around the country, and my hon. Friend is right to draw attention to the importance of the achievements of those campaigns, many of which are continuing.

I welcome the enthusiasm and resources that the regional development agencies have contributed, recognising the importance of broadband for small firms in their regions. In addition, we are witnessing the rapid roll-out of wi-fi technology, which enables public access to wireless broadband in public places such as coffee shops and business hotels, and which will become a significant element in provision.

Congratulating those who have contributed to the achievements of the past year is not to underestimate the scale of the challenge that remains Almost 30 per cent. of households are not within reach of a mass-market broadband service. Almost 5,000 small businesses in such areas use satellite broadband, which is available more or less everywhere—it may be the approach being employed in the constituency of the hon. and learned Member for Harborough (Mr. Garnier). However, for many that is a rather expensive solution, so we must go much further in extending the availability of the affordable services that are now having such an impact on competitiveness in the areas in which they are available. That is the reason that broadband is so important. Broadband enables companies to work better and faster, boosting competitiveness and creating new jobs and services. Increasingly, MPs—mainly those representing rural areas not served by broadband—tell me that firms in parts of their constituency are at a disadvantage, in some cases to the extent that they might consider moving elsewhere.

The experience of Sarah Smith, a specialist medical writer based in a village in north Wales, underlines the point. She uses satellite broadband and finds that the new connection saves her about two days a month in time spent waiting for large files to download. She no longer has to alert her ISP when she is expecting an especially large file. The installation was not cheap, but it has saved her money. Malvern Boilers, a manufacturer of condensing boilers that employs 20 people in Worcestershire, found that broadband allowed it an instantaneous e-mail service, resulting in much better communications with its suppliers and customers. Another result of adopting broadband is that the company uses the internet far more to aid its marketing. The company has found real competitive advantages in broadband. In the Westminster Hall debate, I mentioned the case of Quintdown Press in Cornwall, whose proprietor I met during a visit last autumn. Broadband is available in rural parts of Cornwall through the Access for Cornwall through Telecommunications for New Opportunities Worldwide, the ACT NOW partnership, funded by European Union regional development funds.

My hon. Friend will be aware of the route map—not for the middle east, but for rural broadband—recently published under the auspices of BT, which has result ed in the creation of a number of partnerships in various remote parts of the country. Does he agree that there is a need to increase their number? What role can the Government play, not only with BT, but with RDAs, county councils and other local government bodies, and small and medium-sized business, to bring those partnerships together so that they can genuinely effect the type of changes he is describing?

My hon. Friend makes an important point, which I will spend some time exploring later in my speech. However, I agree that the partnerships now being established with RDAs as key players will be an important part of the solution.

To return to the example of Quintdown Press, by using broadband rather than a van to transfer artwork, the company has been able to reduce the turnaround on print jobs at its shop in Truro from three days to one day. The impact on the quality of its service and on the competitiveness of its customers' businesses is significant. The examples I have given show how important it is that we step up our efforts to extend the availability of broadband and that we maximise the resulting economic gains for rural communities and the UK as a whole.

Just as broadband will be key in the commercial economy, so it will be key in delivering the reforms to public services that are the Government's highest priority. The past few years have witnessed dramatic improvements in public services and a new confidence on the part of those who deliver them and the rest of us who depend on them. Taking full advantage of technological advances will be key to the next stage of reform, and broadband will be at the heart of that. That is why, between them, Ministers in education, health, the criminal justice system and local government have earmarked 1 billion from their spending settlement last summer for spending on broadband communications.

In education, every school will be provided with broadband by 2006—at least two megabits two-way in each primary school and eight megabits per second in every secondary school. So far, about a quarter of England's schools have broadband. The roll-out of broadband to every school will open up pupils' access to vast new online resources for teaching and learning.

Will not two problems relate to the issue of connection of schools, bearing in mind the huge expenditure that the Government have committed to it? Obviously we all want to see schools connected. First, there are large parts of the country where pupils may be able to use broadband at school but will not be able to do their homework on it because the areas in which they live are not connected to it. Secondly, having invested a great deal of money in connecting schools, that will be of no use to the community because the network goes through the Government network and therefore cannot be used as an access route for the rest of the community.

The hon. Gentleman raises an important issue on which I want to spend quite a lot of time. Essentially, I believe that there are ways of leveraging the investment that will be made in broadband for public services to extend access to those services to other users. I shall explain in a little more detail how I see that happening. The hon. Gentleman may be familiar with the Cambridgeshire schools' broadband project, which is demonstrating clear benefits in time saved and much greater use of online educational resources. That has translated into increased levels of attention—particularly from boys, and we know that underachievement on the part of boys is a key challenge for schools—and improvements in performance. That is what we want to see throughout the school system.

Every doctor's surgery will have at least a 256 kilobytes per second connection by March 2004. There will be larger facilities of 2 megabytes per second and more. Patients will have electronic records so that, wherever they are in the national health service, all the key details about their medical history will be accessible by the professionals responsible for their care. Through the new NHS university, professional development material will be delivered online via broadband to NHS staff at their place of work, with the Government investing in their skills.

The criminal justice system will be transformed from the paper-based system that is now in operation. We shall see radial changes as well in local government.

As well as delivering these important improvements to public services, the investment in broadband by the public services as a customer will provide the opportunity to extend access to broadband services into many communities where they are not available at present.

My hon. Friend will be aware of the considerable work that is done in Canada, where those involved examined the barriers that stopped communities using various networks and opened up the different networks to communities. Will my hon. Friend assure us that the efforts that were made in Canada will be replicated by Government Departments in this country, and that we will not have the mentality that prevents universal access?

I agree with my hon. Friend. There are some important lessons for us to learn from what has been achieved in Canada. I agree with him also about the direction in which we need to go. I shall explain how we see us making a reality of that. In principle, once the school or the doctor's surgery in a community has broadband, there should be the opportunity for others in that community to access the services provided by it. To make a reality of that possibility by organising the demand from public services in aggregating them and so creating a viable business case for the provision of broadband in areas where it is not yet available will be the key. That is in line with the Canadian experience and experience elsewhere, and will lead to the next phase of broadband development in the UK.

As I understand it, many public service connections are delivered down a dedicated private line. Is the Minister saying that all these private lines will be accessible to public use at some stage in the near future?

I shall explain how I see these things going forward. I can tell the House that I shall be chairing a ministerial steering group with representatives from each of the major Government Departments to drive forward the development of this project and to ensure that we make it a success. It will ensure that individual departmental programmes contribute to the greatest degree possible to broadband roll-out in the UK, while also ensuring that the Departments are provided with value-for-money services that are consistent with the targets and timetables which they have set. The regional developmental agencies will be involved as well, and a project board will direct day-to-day running. I can announce the appointment this week of a director for broadband in the Department of Trade and Industry, who will be delivering on an important recommendation that was made to us by the Broadband Stakeholder Group in its most recent report.

We have quite a short window of opportunity given the imminence of substantial public sector investments in broadband. We need to establish the balance of demand aggregation between national and regional levels, and set up structures to carry out aggregation and procurement in an efficient way. The project will play a big part in extending broadband availability for public sector use throughout the country. To answer the hon. Member for Blaby (Mr. Robathan) specifically, we shall be ensuring that the infrastructure investment being delivered will make broadband more widely available. That is available to small and medium-sized enterprises and others in areas where broadband has not been available until now, so giving a major boost to the economy in rural areas in particular.

Will the Minister kindly tell us who is to be the director of broadband? Will it be a career civil servant or someone from the private sector?

It will be a career civil servant from the Department of Trade and Industry.

An interesting example is provided by what has been happening in the west midlands. Advantage West Midlands, the regional development agency, spotted that in its area the contracts for two broadband networks—both of them were in the education network—were up for renewal this summer. One of the networks is serving all the schools in the region and the other is serving all the universities. By bringing both networks into a single contract, it will be possible to offer all the users greater functionality for the same price. After that, the intention is to open up the infrastructure to users outside the public sector—for example, to provide the backhaul into the telecommunications network for wireless broadband initiatives serving rural areas. Final contract negotiations are taking place with a company, Synetrix, and the preferred telecommunications supplier will be the cable company Telewest. Once they have their infrastructure in place, other users outside the public sector will be able to take advantage of the system as well.

Is it not the case that the flexibility of the project that my hoa. Friend has outlined underpins the development of broadband in Britain? When his group is looking for good quality examples throughout the country, will it make particular reference to the mobile set-up that has been brought forward by the Discovery project of North Yorkshire county council, which goes out to some of the most rural and isolated parts of the county, including my constituency, and affords the linkages while debunking some of the myths about the so-called digital divide?

That sounds like a welcome initiative. There is much work to be done in communicating the benefits of the technology and ensuring that business users and other users understand them.

It is sometimes suggested that we need a generalised subsidy to make broadband happen in the UK. I do not agree with that. That is not the way to get a competitive and sustainable broadband market throughout the country. I think that we shall see, through competition between the service providers, the momentum that will drive the roll-out that we need. However, there will be cases where the market will not deliver and targeted support may well be needed. Where the lack of broadband availability is a limiting factor in economic regeneration, that can be a justification for using existing funds for regional economic development. The RDAs have £1.8 billion at their disposal in the coming year. We have seen the success of that approach in Cornwall's ACT NOW project, which I mentioned, which draws also on European Union funding.

Companies are coming forward with proposals to address these issues while recognising that we need to achieve a competitive outcome. My hon. Friend the Member for Stroud (Mr. Drew) referred to the work that BT has done in coming forward with five models, building on its experience with ACT NOW, which are applied to other circumstances and allowing for open tendering so that other operators can bid for contracts as well. These models have merit as a general framework for a partnership approach to developing broadband schemes that maximise the prospects for competition in the supply of broadband for areas where there is now none.

I appreciate the Minister giving way again—he has been characteristically generous with his time. Does he accept that there is a difficulty in rural areas, where community campaigns do not regard ADSL as a solution, usually on economic grounds? As he knows, the Select Committee on Environment, Food and Rural Affairs is taking evidence on this topic at the moment, and we were impressed by the campaign to bring broadband to Blewbury, which has gone for a wireless solution. If people go for a solution other than ADSL, people who join up need to be aware that ADSL is not going to come in afterwards and sweep away the investment that has been put in. I should therefore be grateful if my hon. Friend would comment on the need to guarantee that communities that are looking for innovative solutions will not have their legs cut away from under them afterwards.

I am glad to do so. Let me give my hon. Friend an example from Oakham, the county town of Rutland, where in March I visited Rutland Online, which employs 15 people. It started six years ago by hosting websites and providing e-commerce solutions for businesses in the area, but broadband has become an increasingly major part of what it is doing. There is no broadband service at all in Oakham today, but in the next few months three separate broadband services will be established. An operator called Independent Networks is taking orders and will use local loop unbundling to provide the first broadband service in the area. On 21 May, BT expects to upgrade its local exchange for ADSL, the registration trigger threshold having been reached. Later on, Rutland Online will establish a wireless broadband service with which it expects to be able to support 60 small and medium-sized enterprise users. I can tell my hon. Friend the Member for Stroud that the fact that by that time there will be two other broadband services in the area is not deterring Rutland Online from introducing the wireless service as well. There is therefore potential for wireless and other solutions to coexist.

The main obstacle to the provision of more affordable broadband in rural areas concerns the fact that the initial investment required to provide broadband by any technology other than satellite is expected to obtain a slower return in rural areas, where there are fewer people within a given distance and where the cost of backhaul is likely to be greater than in areas of high population density. The so-called backhaul issue—the cost of connecting a local exchange or a new wireless base station to the core network—is a major barrier to the extension of broadband to rural areas. Rutland Online, for example, told me that of the £90,000 cost of providing a service for two years backhaul will account for £50,000. However, there are ways forward, including alternative technologies which can do the job more cheaply and, in particular, realise the potential of plans for public sector broadband connectivity in the way in which I have described. In the west midlands, it is envisaged that the network that I described could be used to provide backhaul for wireless broadband services in rural areas. That is an important part of the solution for rural areas.

ADSL, of course, is not the only solution, although it will be available to a substantial proportion of the rural population in time. We have talked about satellite, and there are schemes to help small and medium-sized enterprises gain access to satellite broadband, including the remote area broadband inclusion trial or RABBIT initiative, and other satellite schemes such as those led by the south-east RDA and Yorkshire Forward. Over 1,000 small rural firms across the country have benefited from those schemes so far, with the provision of funding towards the cost of a satellite connection. My hon. Friend the Member for Stroud has drawn attention to the importance of wireless, and there are already pilot projects such as those in Alston and Hawkshead in Cumbria and Tendring in Essex which use wireless technology to get broadband to residents and SMEs. I am sure that we will hear of other examples in our debate. I hope that the imminent auction of 3.4 GHz wireless licences will help to spread wireless broadband a lot further.

I should like to draw attention to an imaginative development that has taken place since the launch of the Alston Cybermoor project in Cumbria 18 months ago. With public financial support to help get the project going, it addressed issues of economic regeneration, lifelong learning and access to electronic Government services. It has been successful, and has achieved over 300 local connections and five public access points, but now faces the problem of how to keep going. Local residents have taken the initiative by adopting a social enterprise model, and have registered as a co-operative that other residents can join and help to develop. They have mutualised the public sector investment, and other communities could benefit from looking carefully at that example.

My hon. Friend the Member for Milton Keynes, North-East (Brian White) talked about what has been happening in Canada. On a recent visit there, I met someone who was concerned about the steady economic decline of his rural community and had set up a not-for-profit organisation to roll out a fixed wireless broadband network, providing affordable broadband access to homes and businesses in the region. That service is now serving a community of 100,000 residents. A social enterprise and co-operative model may well be the way forward for areas in the UK as well.

One problem is the availability of skills so that people can provide those services. While the learning and skills councils often concentrate on people who need basic skills, there is not much support for people who need medium skills that would allow those companies to develop. Will my hon. Friend address that issue?

I know that my hon. Friend welcomed very much the launch of e-skills UK on 8 April. He is right about the need to focus on those technical skills, which is a high priority for us. When the Government publish the skills strategy on which the DTI is working with the Department for Education and Skills and other Departments, he will see that intermediate technical skills are of particular importance to it.

Another interesting possibility is the use of the electricity infrastructure for broadband, with the so-called Powerline technology for delivering broadband along ordinary electricity cables. Some of the £30 million UK broadband fund has been used on projects in Crieff and Campbeltown on trials of that technology, and other projects are planned in Stonehaven and Winchester, the results of which will be interesting.

While my hon. Friend is holding forth on the range of different technologies that can deliver broadband, will he turn his attention to the future prospects of broadband? I entirely accept that some Members are frustrated that their communities cannot even receive ADSL, but it will be important for the UK to ensure that as the widespread delivery of even higher band widths becomes increasingly economic we begin to ensure that people have the skills to deliver to the user products and services that will take advantage of 10 megabytes and higher speeds.

My hon. Friend rightly draws attention to the fact that in due course we will need to do a great deal of further work on the capacity and availability of much higher speed networks. Whereas 93 per cent. of public libraries have broadband at 2 megabytes a second or more, Middlesbrough libraries are adopting a broadband capacity of 2 gigabytes a second. Undoubtedly, we will need to address that much more widely in due course.

I shall work closely with my right hon. Friend the Minister for Rural Affairs and Urban Quality of Life to make sure that everybody has the opportunity to take advantage of the benefits of broadband. Together with the Department for Environment, Food and Rural Affairs, we are collecting information on current projects and best practice in rural areas. The Countryside Agency has commissioned research, due to report this month, which looks at best practice in a number of projects. Research has been carried out on evidence of the use of broadband to increase productivity of businesses in rural areas, which account for a third of UK small businesses.

The challenge of broadband is an important economic challenge for the UK. Delivering broadband will be an important step towards improving public services, raising productivity and promoting inclusion, and it is important that in due course every part of the country should be able to benefit and not just a few.

I hope that I have reassured the House today that we have made good progress, but that the Government are determined to address the significant challenges that remain, and to maintain and build on the rate of progress that we have seen over the past year, so that the rich promise of broadband Britain can be fulfilled.

2.10 pm

I was interested in the Minister's speech and in his announcement about the director of broadband. That is a positive development, although we urge the Government to go further.

If I may say so, to hold the debate today is perverse. The topic is enormously important, as the Minister rightly said. It is especially important for rural areas that cannot get access to broadband, whereas urban areas generally find it easier to get access. The Minister will know of the Country Land and Business Association's campaign on rural access to broadband. However, almost all rural Members are currently in their constituencies supporting their local candidates, so we are left with a few hon. Members present, including one or two from rural areas. I am not sure whether Milton Keynes counts as rural, but let us assume so.

My right hon. Friend the Member for North-West Hampshire (Sir George Young)—who led a debate on 25 March—and my right hon. Friend the Member for East Yorkshire (Mr. Knight), both of whom were particularly keen to be present for the debate, have had to apologise because they had to go back to their constituencies.

My area, which is England's largest rural county, North Yorkshire, is, as I said in my earlier intervention, making a considerable impact in delivering broadband to rural areas. The experiments in e-enablement of the electoral process allow hon. Members present today to vote via the internet or other mechanisms. That is reaching all parts of the country.

Yes, but I am sure local govt candidates in the hon Gentleman's Labour association would have been pleased to see him in person, rather than in e-form.[Interruption.] It is suggested that the hon. Gentleman's e-form is better than his person, but I would not dream of commenting on that. Personally, I voted by post a couple of weeks ago.

In the circumstances, the debate is a bit of a filler. I am sorry about that. It should be an important debate that is well attended, but sadly it is not. The Order Paper states that the First Report from the Welsh Affairs Committee is of particular relevance, yet I note that there is certainly not a single Conservative MP from Wales in the Chamber, nor are there any MPs from Wales from any other party. Also, I regret that the debate will be interrupted by the important statement on Northern Ireland.

The importance of broadband is that it gives us the potential to change our lives and the way that we work, and it is doing so. The information highway—the internet—has been compared to railways in the 19th century and roads in the 20th century. It is of enormous importance to communications. E-commerce has arrived and is having an impact. Politicians should be cautious about being too visionary in their claims on technical matters, or too reactionary. Business men should also avoid being reactionary. Only three years ago, the then chairman of BT, lain Vallance, said that he saw no market for residential broadband. When I heard that, it reminded me of politicians between the first and second world wars who extolled the virtues of mounted cavalry in preference to noisy and smelly tanks.

It was the business of the chairman of BT to have a little vision, and politicians can assist in that where necessary, but we should beware of technical aspects, especially if we are not qualified. The Minister is extremely well qualified. He wrote a book on broadband back in the 1980s, before most of us had even heard of it. I trust that he is using his knowledge to assist in its development. I confess that I come to the debate with an O-level in physics with chemistry from 1966, but neither we, nor our constituents, need technical qualifications or detailed knowledge to understand the concepts and benefits that the technology can bring us. It is for others to explain the technology to those of us—I see one or two others in the Chamber—who may need it explained from time to time.

I applaud the Government's stated target, which could be called a vision, of having the most extensive and competitive broadband market in the G7 by 2005. We support that, although I am not entirely sure whether it will come about. In my speech, I shall discuss the importance of broadband, what the Government and the public sector can do, what the role of competition and private enterprise should be, and possible future developments.

E-commerce is changing business, almost to the extent that the industrial revolution did 250 years ago. Laymen like my self use Amazon, Sainsbury's to you, and E-commerce is entering every nook and cranny of business, and every aspect of business can benefit from it. It can benefit plumbers to pharmaceutical giants. Businesses are using the internet, and they want to use broadband. The information society is also benefiting all public services, which can only improve as a result. It is changing the way in which people communicate with their friends and access information at home. We all accept that the rapid introduction of broadband is important for the UK, and we support the Government in that.

My access to the internet on the House of Commons network, which of course is broadband—Demon, I think—is almost instantaneous. I contrast that with my experience at home in Lutterworth in my constituency, where I spend hours waiting for it to dial up and then get cut off after about two minutes, which is rather trying.

Although we may all agree on the targets and benefits, we note that the strategy is not yet working as we would wish. The Minister touched on that. Ministers want broadband to be accessible to all parts of the country, yet terrestrial broadband is still unavailable to one third of the UK's 24 million households, including two out of five suburban households. In rural areas, as we know, access is patchy. We want diversification in the rural economy. The Minister mentioned speaking to the Minister for Rural Affairs and Urban Quality of Life, which is important. Areas such as mine—and those of all my hon. Friends in the Chamber and some on the Government Benches—where farming is in the doldrums have many small businesses, which need fast, cheap and easy access to the information highway.

I am grateful to the hon. Gentleman for allowing me to intervene again. Given his broad welcome for the project, can he confirm that the £30 million that the Government have allocated to regional development agencies to develop broadband access, particularly in rural areas, would be continued and developed further by his party?

Indeed. Moreover, I wonder whether the £30 million could be better spent. I shall deal with that in detail and answer the hon. Gentleman, but I should prefer to do it in my own order than in his.

I emphasise a different point that has been made by several of us. The issue is not just giving people access, but the follow-up afterwards. Whenever I speak to BT, the biggest criticism is of the amount at which it has set its trigger level, which could be seen as an unfair system, but it is the one that we have. What follows or does not follow is not taking the broadband revolution forward as quickly as it might. Will the hon. Gentleman comment on that?

There is a lack of follow-up. People who get on to the trigger list do not see it through. That is galling, because it means that the process is not being taken forward.

I understand now what the hon. Gentleman means; that having registered, people do not take up their registration at a later date. I put that down to consumer choice. BT is willing to enable an exchange at what it says is half the likely return that it will receive, because it believes that that will grow. I am sure that BT is right.

Britain has little more than a quarter of the number of broadband connections per head of population of Sweden, and we lag woefully behind Japan and Germany. Measured against the Government target, we are sixth among the G7 countries, ahead only of Italy. We are also behind countries such as Iceland and Portugal. The Minister may be about to tell me that that situation has changed in the last week.

Those figures will be reassessed in the course of the next few weeks and I am confident that the new ones will tell a rather happier tale than the one that the hon. Gentleman is relating.

We will welcome that. We led the way in narrowband internet access, mobile telephony and digital television.

Is the hon. Gentleman suggesting that we should follow Germany's example where the incumbent, Deutsche Telekom, put in DSL to prevent competition when it had to divest itself of its cable companies?

I did not say that or suggest it. The hon. Gentleman will know that Deutsche Telekom has its own serious commercial problems, partly caused by its investment in DSL.

I come now to the Government's role and how the public sector can assist. I was interested in what the Minister said about how public sector enablement will help us. Technical improvements are moving faster than Government legislation or regulation, or bureaucratic minds, possibly can. Nevertheless, there is a big role to be played in creating the environment in which broadband can be accessed easily throughout the UK. The situation is improving, so I do not knock the Government.

On 20 March my exchange in Lutterworth still had a few to go to reach the trigger mechanism, but in May we should be enabled, and the local Member of Parliament is expected to be asked to inaugurate—or whatever one does—the exchange. Throughout Britain more exchanges are being enabled. I understand that under the trigger mechanism, 59 have been enabled, making a total of 1,182 BT exchanges, and more than 300 rural exchanges have reached the trigger levels.

I am interested to hear about my hon. Friend's experience in Lutterworth, which is about 40 miles from my area. The Lutterworth exchange will presumably serve between 15,000 and 20,000 inhabitants, not only within the town itself but within the wider area. I am concerned about the smaller hamlets that are desperate to get on to broadband but which do not have the populations to justify the sort of registration that he has been talking about.

My hon. and learned Friend is right to be concerned about smaller hamlets and isolated farmhouses where there may have been diversification or where it is simply the farm business that requires broadband.

To be fair to BT, it is reacting well. Since Sir Iain Vallances extraordinary comments about residential broadband, BT has been pushing things forward. The Government are also committed to connecting public services, about which we have heard. Notwithstanding what the Minister has said—I hope that he will explain further when he replies to the debate—the Government have gone somewhat awry. In my constituency, schools are being enabled. For example, Sherrier primary school in my home town of Lutterworth has broadband. I thought that it had a midband speed, but the Minister tells me that it has over 1 megabyte. Why should not that school have brought broadband access to the whole of Lutterworth? That would seem the obvious way to go. Sherrier and other primary schools have obtained access through the East Midlands Broadband Consortium. Similarly, Sapcote library has a connection, but through the People's Network, which I believe the NHS uses as well. The library has broadband, but at the Sapcote exchange, which has a trigger of 350 connections, only 212 have registered so far, so it will have to wait.

BT and others tell me that aggregated public sector demand, which often uses the BT network but private dedicated lines, could pull all that broadband demand through to the private sector and to all homes. Will the Minister clarify that? I am still not entirely clear about whether those private dedicated lines can be used as a backhaul to bring broadband to every home in an area.

I shall be happy to explain further what I had in mind when I reply, but once the infrastructure has been provided to meet the public sector commitments, it is available to other users as well; for example, to provide backhaul from a local wireless broadband service, if that is a way of meeting the needs of a particular community. I should also add that the 2 megabyte per second two-way target for primary schools is for 2006. I am not saying that every primary school has that at the moment. That certainly is not yet the case.

I am grateful to the Minister for that. He has an enormous knowledge on which many of us rely.

The roll-out is fairly slow. The schools completion will not be until 2006. As the Minister has now told us, some of the connection is only midband. When Sapcote library—sitting on its midband—and perhaps Sherrier primary school are surrounded by an enabled exchange, the residential houses on either side will have 512 kilobytes whereas the library and the school will, as I understand it, still have a slower midband connection.

I will, but it will be for the last time because I wish to sit clown shortly after 2.30 pm because of the extremely important Northern Ireland statement.

Does the hon. Gentleman accept that the UK online access in particular that can be obtained through public libraries is an important part of creating public awareness about the capabilities of broadband, and that the Government are entirely right to promote such facilities, because if people see the benefits for their home or business, it will lead them to register, showing service providers such as BT that the demand exists?

I agree up to a point that it is valuable for libraries to have broadband but perhaps—funnily enough, the Government are coming around to this with the appointment of a director of broadband—that could be done in a slightly different way to allow access for residential and business users.

The private sector is usually of greater importance than the public sector in developments such as this, and I think that the private sector will drive this matter. It has been suggested that the DTI is obsessed with competition in the roll-out of broadband, although I do not necessarily agree with that. I tend to the view of others in the industry who suggest that competition is driving development, technology and access. However, the Government should take a pragmatic view and consider what they want to achieve with their investment. The present competitive and dynamic market has been largely achieved by private investment.

We are already the most competitive in the EU and to that extent the Government's policy on driving competition has been right. We have already heard about the number of connections; 1 million cable connections were announced yesterday in a press release from Telewest and NTL. Interestingly, BT tells me that it has only 22.6 per cent. of the share of the retail broadband market because over half is on cable. It has 51 per cent. of the retail DSL market, 49 per cent. going to other internet service providers. I applaud that and I congratulate cable providers. I also congratulate BT, which is striving to increase its share of the market. It would be churlish of me not to do so, as I received from it in today's post an invitation to the CBI annual dinner. I do not think that that involves a registrable interest, but I do not want to be rude to my hosts.

We want the Government to create conditions in which the broadband market can thrive. I reiterate that we are not sure that all investment in the public sector is currently being made along the right lines. A £30 million grant has been made available to RDAs, as the hon. Member for Scarborough and Whitby (Lawrie Quinn) mentioned. I am not sure whether that is the right approach. My RDA, the East Midlands Development Agency, is very good at producing big, glossy documents such as the one that I am holding, which is the second copy that it has sent me; it obviously knew that I put the first copy in the bin, where I will put this one. It is a very glossy document featuring nice pictures of lambs and flowers, but it does not set out much action.

EMDA plans to use its share of the £30 million on a wired-up communities competition that will take three years to come to fruition. As we have heard, this is a very fast-moving field and we would not expect the situation to be the same in three years' time. Indeed, more than 30,000 new broadband connections are made every week. None the less, the same RDA blames the lack of vision in providing broadband services to rural areas on the slowdown in the international IT industry and the money spent by mobile phone companies on the 3G auction. Anybody who has seen the RDAs at work knows that they are not likely to drive fast broadband roll-out.

I wish to speak briefly about the future before I sit down to allow the Secretary of State for Northern Ireland to speak. As I said, we should beware of being too visionary about technical matters. Of course, "broadband" is a somewhat amorphous and imprecise term anyway and is used in respect of anything between 100 kilobytes and several megabytes, as I understand it.

Higher bandwidth will be offered, largely because of competition. The process is a continuing one and is increasingly sophisticated. People are investigating compression technology, which could allow fibre-optic cable to be laid from every exchange to the remote concentrating units. [Interruption.] I am sorry that the hon. Member for Ealing, North (Mr. Pound) finds this so funny; perhaps he would like to give us a digression about remote concentrating units, which are situated at the end of every street and in villages. The Government need to be flexible and enabling, and not dirigiste and controlling.

A particular proposal that has been raised with me relates to something called wi-fi. I am sure that the hon. Member for Ealing, North knows a lot about wi-fi, which would use wireless standard 802.11. The Minister might like to mention the proposal, which I understand could lead to a system that would not require the digging up of roads but would not be entirely wireless, as it could be provided through wires to small, remote communities.

I note that the Secretary of State for Northern Ireland is waiting to speak and I shall conclude my remarks. Although broadband has not been on the lips of everybody to whom I have spoken on the doorsteps of Lutterworth and elsewhere during canvassing for the local elections, which is what most hon. Members are doing now, I suspect that it should be. It is an enormously important issue—

As my right hon. Friend says, broadband is enormously important in Penrith as well as elsewhere. We hope to address it further and to see more of it, and I hope that the Government will be able to answer one or two of the questions that I have asked in my brief speech. We now look forward to hearing from the Secretary of State for Northern Ireland.