Patricia Hewitt MP, e-commerce Minister

Question: You have got ambitious targets for getting government services on line by 2005, how confident are you that you will achieve this ?

Patricia Hewitt: I am sure we will. Ian McCartney who is the government minister with the day to day responsibility for this, Andrew Pinder as the new e-Envoy, and I have been working very very hard to get colleagues - political and official - to understand the importance of the target, the need for leadership from the top, the need to integrate e-government with the public service targets, the PSA targets, and with the whole modernising government agenda. There is no doubt that we are making progress. I was just looking at the figures: of more than 500 different identifiable government services we have got 218 already e-enabled and that is 42%. We should be up to about three quarters by 2002 and 99% by 2005.

Question: What are the big obstacles do you think, in the way of achieving it?

Patricia Hewitt: In some cases there are technical obstacles. Take the Department of Social Security or the Benefits Agency. They have huge legacy systems, they are dealing one way or another with every resident in the country, these are big issues and there are major changes to be made in their IT systems. That as we all know takes time. But fundamentally I don't think these are technical problems. They are very much to do with getting the leadership we need from the top, and we have certainly got cabinet ministers absolutely signed up to this agenda.

Putting Government online is about not seeing IT as something that is separate from the rest of what you do. Not seeing e-enablement as just putting your existing processes on-line. But actually seizing the opportunity to change your business processes in order to do better, to deliver services and information, get information from citizens. And the other big challenge is getting more active working across government so that we can take the advantage of the internet revolution, to deliver services to citizens in seamless ways, make it much easier for citizens to get what they need when they need it, instead of having to go from one department to another. That is what we are doing with the UK on-line citizens portal, creating a front end that gives citizens that seamless view built around life episodes, but equally important behind it creating a government gateway that then ties up the different systems and back end processes.

Question: Your critics argue that you are going to find it difficult to keep your promises of keeping Britain at the forefront of an Internet revolution now that you have scaled back your plans for broadband Britain. What do you say to that ?

Patricia Hewitt: Well we haven't scaled them back, I mean it is a bizarre accusation and I do think it is a pity that there are some sections of the media who only seem to be interested in bad news stories about Britain. And they will believe the worst that anybody says to them without bothering to check if it is true and they assume that every other country is ahead of us, even when it isn't true which most of the time it isn't.

The fact is if you look at our own and other independent benchmarking surveys in terms of the first generation of internet access which is PC based, we have now got a third of households connected, we have got 1.7million small businesses on-line and we are well ahead of the target that we set for next year which was only one and a half million small businesses. We have got a large and rapidly growing e-commerce market, we are very clearly the number one destination for foreign direct investment into Europe, and a growing proportion of that foreign direct investment is in the high tech sector. A survey out recently in the Financial Times, showed that specifically on e-commerce we are the number one destination for direct investment into Europe, we are judged by that and a number of other surveys, including the Economist Intelligence Unit, to be one of the best businesses environments in the world.

You then look at what is going to happen with the next generation of the Internet, which is digital television and, mobile devices of all kinds, and we are a world leader here. It is not just the fact that we had the world's first option for third generation spectrum, which will help to create a leading edge market place, we have got a base of very high mobile phone penetration, we have got enormous strengths in the creative industries and the content side and we have got very deep industrial strength in wireless technology. When we look at digital television, we have got one in four households already with digital television, it is one in two when you look at families with children, which is a really startling growth rate, when it has only been around for two years. What we are trying to do is build upon those strengths, drive competition further and faster into the telecommunications market place and, finish the job of unbundling the local loop which is one of the final barriers where we still haven't got enough competition. But local unbundling is happening and with the cable companies who were slow off the mark, but now rolling out cable modems, we have got another source of broadband connections.

Finally on broad band, if you look at the report we published yesterday, the independent forecast is that we will be the leading major economy for broadband access by 2003. Yesterday we set a new target which is to have the most extensive and competitive and broadband market in the G7 by 2005, and although it is a stretching target because the USA and Germany in different ways are a bit ahead of us at the moment, they both started on the unbundling earlier, I believe we can achieve that goal.

Question: In a recent interview, Chris Smith said that the UK has fallen behind in the development of broadband services...

Patricia Hewitt: Well I talked to Chris, and he said two things. One of which was that not everybody is going to want a broadband connection by 2005. Clearly that must be right. And secondly on local loop unbundling we started later than Germany and the USA. That is a pity but I am afraid it is down to the policies of the last government and the previous Director General of Oftel and there is nothing we can do about that accept drive it forward as fast as we possibly can now. That is a matter of Oftel making tough decisions on local loop unbundling which is what they are doing and they are doing it with the government's and my full support. But ADSL and local loop unbundling are not the only routes to broadband connection. Cable modems are crucial, and of course we have got cable networks covering half the population. Broadband fixed wireless access will be a new source of broadband which is why we have allocated some spectrum and we are now offering the unsold licences. Fibre direct to the home and the end user is falling quite sharply in price and I think we will see more of that moving beyond the big business market into the small business and even the multi-user household market. And then there is the potential of satellite, which at the moment is very much in the big business market but again the technology is developing so fast, we will probably see that moving in to the smaller end of the market place.

Question: So broadband remains a high priority?

Patricia Hewitt: It is a very high priority which is why we are setting up a new UK on-line broadband stakeholders group that I will chair. We are putting £30 million into getting the regional development agencies and the devolved administrations, finding new ways of getting broadband out into the rural areas that do risk being left behind otherwise. And we are going to pull together the public sector procurement in broadband. At a very rough initial estimate, we can see already half a billion pounds of public money going into broadband over the next three years. Schools, colleges, hospitals, libraries, doctors, police stations, office blocks, goodness knows what. It is very fragmented at the moment, so we are not getting best value for money and the private sector can't see the scale of the demand. That is a problem because if you are in Leicester or one of the other smaller cities, or if you are in a market town, if the private sector is just seeing little pieces of the overall picture they are not going to be interested in making a large investment of their own. We can make that transparent, and if we say this is what we need to build and we are going to pay for, we think the private sector will then be much more interested in making some investments of its own so that they can offer broadband services to a wider commercial market.

Question: We are going into the next phase, as you mentioned, the digital phase, moving towards digital television. Do you think the internet revolution is not really going to happen until we have this digital television technology?

Patricia Hewitt: I think digital television is a very important part of it because it is a new means of access to the internet and electronic multi media, that will reach people who don't want and can't afford a PC in their houses. So digital television is hugely important and again as we said in yesterday's white paper we want to try and push that uptake of digital television as fast as we can and we are going to run some technical pilots where we take small areas, we equip everybody with a converter and we can look at the practical problems moving an entire area across from analogue to digital, and really make sure that we understand that as we move towards a digital switchover.

Question: How do we compare internationally in terms of the progress towards digital television?

Patricia Hewitt: We are absolutely up there, we are ahead of the USA in terms of penetration. We are one of the world's leading markets for digital television.

Question: What is your message to UK businesses who are still cynical about the benefits of the Internet?

Patricia Hewitt: There are far fewer of them actually. It is very interesting. On all our benchmarking studies, large businesses, in terms of their usage of networks, have been up there with the world's big businesses for some years. 18 months ago, it was very much the small businesses who were lagging behind, and that has changed, partly because it is almost impossible to escape from the reality of the internet these days. Partly because we have put in some very attractive tax relief's, close to 100% capital allowances, and partly because of the UK on-line for business programme, which has given them the sort of practical disinterested advice that they wanted, on how they could actually exploit ICT for their business. It is all those factors, it is certainly not just government, that has got us to 1.7 million SMEs on-line. That figure is rising all the time. We've expanded the UK on-line for business programme, we are launching another wave of advertising in a couple of week's time to push the take up of that even further. What I am seeing with businesses, it is now much more about deepening their usage and getting beyond email and a bit of a website in to full scale electronic trading and using the networks really to transform the way they do business right through the supply chain. Dealing with their suppliers as well as their customers.

Question: Isn't there a generational or an attitude problem with many of these people who have been dealing with telephones, faxes and as you say moving to this next phase, where their business is being driven in many direction by this e-technology ?

Patricia Hewitt: Well, clearly there are barriers that are holding some people back and in some cases yes, it is an older generation of business people, who like me, did not grow up with this stuff at university or at school. But that is not universal. You can't simply say, if you are over forty or over fifty you are not using this stuff, that is manifestly not true. I think the bigger problem is for a lot of small business owner managers, they are desperately busy. They may not have the skills themselves, they don't know who to go to for advice, which is why UK on-line for business has been so important, they may not have anybody in the family or in the business with good IT skills so they are worried about what they will do when the kit falls over and the server doesn't work, or whatever. This is another reason why broadband is important because it will make it much easier for small businesses to access ASPs and get in a sense the benefit of IT outsourcing, or just dedicated IT departments that big businesses have been using for years.

Question: The Guardian newspaper recently argued that although government sing the praises of the internet, very few MP's are taking advantage of the internet to communicate to their constituents?

Patricia Hewitt: It's very patchy. I only became an MP in 1997, but clearly one of the things that needs to be modernised about the House of Commons is provision of IT. We have this absurd system that each MP buys their own computers, and sorts out their own finance deal and decides on their own software. It's dotty. The parliamentary intranet has got some good and useful applications on it, but dial up access remotely when you are using it from constituency offices is quite clunky. That needs changing. Again some members of parliament are very good at this and simply couldn't survive, particularly without email, or without a good case management system for instance, or without ELpac which is what Labour MPs tend to use to manage voting data. There are others who aren't particularly interested and I think there is more that the House of Commons could do to make it easier for members of parliament. It is on the agenda of the modernisation committee and the House of Commons authorities. The other thing is, a constituency like mine which has got a high proportion of people on low incomes, and a high proportion of unemployed and so on, certainly in '97 a web site and email was simply not my first priority, with a limited budget. Now that is changing, obviously now we have got all the schools on line for instance, and internet penetration is going up very fast. Not this election, but the next election I have no doubt at all email and the Internet will be as important as television. But it will be important in this general election for a minority of voters and I think that experience will wake up an awful lot of MPs up to it.

Question: But the next one no doubt will be the e-election?

Patricia Hewitt: I think so.

Question: And do you see any period in the future where electronic voting may be a possibility?

Patricia Hewitt: Absolutely. And of course we have opened the way to that with the electoral reform act. We have some pilots. Obviously there are access issues because we have got to drive through towards even greater internet penetration which is where digital TV and mobile becomes so important, but there are also security issues that need to be sorted out because for obvious reasons elections demand a very very high standard of security.

Question: But future local, European and General Elections not out of this world?

Patricia Hewitt: Why not. It's what we should be aiming for.