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Thursday, November 4, 1999 Published at 16:55 GMT
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UK Politics
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The e-minister answers your questions
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Patricia Hewitt the minister with special responsibility for e-commerce answers questions sent in by users of News Online.

Q: Firstly, thank you for the opportunity to allow us to air our views, and please allow me to applaud your efforts.

To begin with. What is your remit, what do you see as the best qualifications for your post, and how do you fulfil them?

What is your current understanding of what E-commerce is, or what the internet can do? What is your current computer knowledge?

Do you see the government's role on the internet as supervisory or regulatory? How do you feel about the view that regulation invariably makes for higher costs?
Wallace W Chastain

A: The internet is changing everything - the way we work, learn, communicate with friends and family and get entertainment.

So e-commerce isn't just about shopping on the internet, it's about businesses working with other businesses online and about all those other things as well.


Q: Tony Blair has given a wake-up call to British business on e-commerce and e-business. There are some parts of industry that are well advanced - I would like to think the motor industry is, what with e-licensing of new cars, MOT computerisation coming along with the Vehicle Inspectorate, suppliers and manufacturers talking almost exclusively electronically - but how do you plan to spread the word and best practice more rapidly to more people?
Christopher Macgowan, Chief Executive, The Society of Motor Manufacturers and Traders

A: This week we're having what we call "Knowledge Economy Week" with a whole series of government announcements to try and raise the media profile.

Later this week, Tony Blair will be having his first computing and internet lesson. And that will demonstrate better than anything else, that the internet is for everyone!

Tony Blair also announced today that Bill Gates' Learning Foundation is giving a gift of �2.5m to establish more IT learning centres in disadvantaged areas.


Q: Thank you for the opportunity of sending you an e mail question.

For far too long the debate on Telecommunications has centred on the Urban model. Recognition is needed that rural ICT issues deserve a different solution if we are to avoid excluding vast swathes of rural UK from an Information Age.

Please could you tell me whether you have any specific plans to assist rural areas in specific regulatory policies that are more beneficial to assist rural areas with affordable ICT solutions that overcome the distance related costs and rural deprivation.
Mark Elliott, Executive Assistant Cyngor Sir Ceredigion County Council

A: The internet offers great opportunity for rural businesses to find business and retail customers well beyond their existing market. For instance, we have seen small holiday cottage businesses bring in visitors, not only from Britain, but from other countries by marketing on the net.

We also hope that the new regional development agencies will pay special attention to creating an e-commerce strategy in their region - including the rural area.


Q: Dear minister, how will you ensure that a greater percentage of the average population are soon buying online?
Harpreet

A: This isn't just about getting people to buy online. It's about learning online and just communicating with other people as well.

But we can help by encouraging more people to use the internet and feel confident in using it. We are also introducing the new e-communications bill in Parliament to make e-commerce transactions safe and secure.

People need to be quite certain that their credit card details won't be misused if they shop online.


Q: How do you plan to make sites secure enough to avoid credit card fraud without strangling the very freedom that makes the Internet so vital?"
Tom Dolphin

A: We are working with the Alliance Electronic Business to develop a voluntary, self-regulatory scheme of trusted service providers who will be able to guarantee the confidentiality of credit card details spent online. They will also be able to guarantee that both the parties who do a transaction really are who they say are. Microsoft has described our bill as a model for Europe.

Q: Can you clarify the police's position on ENCRYPTION KEYS , and when we have full encryption, do you have any plans to enforce seizure of encryption keys?
Joe Farmer

A: The first point is that we are not introducing what is called mandatory E SCROW. It will not be part of the new self-regulatory system but there is an important issue about law enforcement.

Increasingly, the police find that if they have a search warrant, for instance, to look for paedophile pornography, they can take away the computer but they can't decipher what is on it.

So we are planning to give the police a new power in that kind of situation. To get the material deciphered or, as a last resort, get the key.

But this does not give the police any new power to seize information that they can't already seize.

Q: We are a small business providing e-commerce solutions to businesses and want to do more - what tangible things are you offering to small e-commerce technology companies and if so ,who is the person we should be talking to in your department?
Tamer Garip, Chairman, Digital Communications Agency

A: We are offering small businesses help with practical advice, information and training. Businesses should contact their local Business Link. For IT companies specifically, they should also contact the Software Business Network.


Q: As widespread access to the net is vital to the UK's performance, what initiative are there to improve telecommunications infrastructure?
Hiroko

A: We're doing a number of things to improve telecommunications infrastructure. We will be one of the first countries in the world with third generation mobile telephony.

That means access to the internet and all kinds of multi-media services on the move. The telecommunications regulator OFTEL are consulting on how we get upgrading of the local loop - the fixed wire that fixes your telephone to the local exchange.

Upgrading a local loop is vital for faster, cheaper internet access.


Q: Jack Straw has announced the new Freedom of Information Act. How much of this data will be made available on the net?
John Rodgers

A: We are already publishing a lot of government information on the net and that will continue to grow.


Q: I hear a lot from Tony Blair and yourself about the UK, the new economy, and e-commerce.

However, Gordon Brown and Dawn Primarolo are busy destroying small IT businesses. The IR35 tax changes are disproportionate, and unfair. They favour large US based companies. They will reduce aggregate tax take, and send the UK population the signal that entrepreneurship is not worth it.

Does the e-minister realise that thousands of UK e-businesses are being sacrificed due to New Labour dogma.

How can you call your e-strategy and the Treasury's greed for others' money "Joined up Government"?

Canada here I come.
Stephen Simpson, Simpson Professional Services Limited

A: IR35 is the proposal from the Inland Revenue to close a tax loophole. The problem arises when someone who is a full-time employee of a company leaves the company one week and then comes back next week on a self-employed basis through a personal service company.

The result is they pay much less tax even though they are doing the same job. But I know that many IT consultants work this way and they have been very worried about the effect of IR35.

I am glad to say that Gordon Brown and his colleagues at the Treasury have been listening to what the industry is saying. And they have come forward recently with revised proposals.


Q: What is the Ministers view on the tax allowances given by the Dutch authorities to IT workers. Will there be the same thing here?
MartinTallett

A: I have been asking about the situation in Holland. But I understand that they are also taking steps to counteract the use of what they call Management BVs which could be used in the same way to avoid tax.

Holland does have some special tax incentive for foreign workers with scarce skills. But increasingly IT jobs in the Netherlands require people who speak Dutch.


Q: The government says that it wants UK to become a leader in e commerce but how can it support this when there is a MASSIVE shortage of computer professionals in this country and everything that the government is doing is driving this shortage. I have had to pay my own fees at university and am now over 20000 in debt, anyone who says that fees don't discourage students is in cloud cuckoo land and more recently wanting to introduce national insurance for contractors.

IF the government wants to increase the number of professionals in this country and keep them here shouldn't there be more financial help for science students as well as lower taxes for jobs in areas where there are shortages such as computing. We are already as a country 10-20 years behind the US and the Europe in terms of consumer technology must we drop even further behind due to a government that wont listen to what is right.
Vishal Vashisht, Recent Graduate

A: We do have a worrying shortage of computer professionals. We've been working with industry to tackle this problem and Stephen Byers will be making an announcement on this very soon.

In particular we need to encourage more women to go into IT jobs which can offer very good money!

A 22-year-old with an IT degree has just accepted a job, a first job, for �28,000!


Q: What is the government planning for e-commerce week?
Emma

A: I think that you're referring to Knowledge Economy Week which starts this Thursday. I've already mentioned the Prime Minister's announcement for money for IT learning centres. There will be a lot more announcements over the next week but I don't want to spoil the surprise!


Q: How do you plan to assist small businesses when large companies can invoke pressure on the Govt to introduce legislation that removes competition?
Phillip Rendell

A: I wonder what you have in mind? We are strengthening competition. We have introduced the new Competition Act and have given new competition commission much tougher powers to deal with anti-competitive behaviour.

That includes the power to fine companies if they break the competition rules.


Q: How do UK e-commerce policies conflict/compare with EU policies on e-commerce?
D Morrison

A: We are working very closely with our European partners to get a legal framework that will be good business right across Europe.

The e-commerce directive should be an important step forward but we also have to get our own laws right and we have to get small businesses using the internet. France and Germany are catching us up fast.

Q: Have you ever purchased goods online?
J Barton

A: I'm just starting my supermarket shopping on the internet - I would have done it months ago but there was nobody who delivered where I lived!

But I can't wait to never have to go the supermarket again!


Q: Seeing as Tony Blair is having his first lesson can Mrs Hewitt tell us how experienced she is with the internet?
David

A: Before I became a Member of Parliament in 1997, I spent two and a half years working with Andersen and Consulting as their Director of Research so I used the internet and I also used the firm intranet that connected about 50,000 people across 55 countries.

That was what made me realise the incredible power of these networks.


Q: Europe is currently ahead of the USA in the handheld PDA and mobile telecommunications market. Microsoft is now targeting this market aggressively. Could you illustrate what steps you will be taking to ensure that Britain and our European partners will retain our lead in the new world of mobile e-commerce for the next 5 years?
Andy Mayer, also ex-Andersen Consulting

A: This is an area where we are streets ahead of the USA. And we'd like to keep it that way. I will very soon be announcing the Auction for the Radio spectrum for third generation mobile telephony.

This will be the first Auction in Europe. We had a conference recently of companies interested in building and selling the mobile devices and the software and multi-media services that will be available through third generation mobiles. There is enormous interest amongst business and we will get there very quickly.

Q: What are your plans to encourage e-commerce between the US and UK?
Andrew Hoover

A: We already have very close trading links with the USA. I recently met the Governor of California to help build those links.

I must say he was staggered by the number of mobile phones used in Britain. We're well ahead, even of California. But we also have a new programme called Export USA to help small businesses open up new markets in America.


Q: Would it not be a good idea to be at least on par with America in the telecommunications markets too? (i.e. competitive in the local loop)?
Bob

A: It is very important that we get the costs of peak hour internet access down. Evening and weekends, if you use a free subscription internet service, our costs are lower than in America.

But our peak hours, each minute online costs you more. I am talking to BT and OFTEL about how we tackle this and I am glad to see that BT said this morning that they plan to introduce some lower charges for internet access.

Q: BT is still the dominant network carrier in the UK. Can you (or OFTEL) do anything as this will stifle the growth of e-commerce in this country?
Mr McKay

A: We already have one of the most competitive telecommunications market in the world. We have about 100 licensed providers.

But we need to get competition in to the local loop and that is why Oftel are consulting on unbundling the local loop so that other operators can compete for local telephone services. This way, we can upgrade the local loop.

The cable companies are also another source of competition for multi-media services in to people's homes.


Q: How do you think e-commerce will change government delivery of services?
Paul Fisher

A: I think the internet transforms the way all of us as citizens go business with the Government. Tony Blair has said that at least 25% of government services must be available online by 2002.

I am pulling together a network of ministers across the main government departments to co-ordinate this work, and I am working very closely with Ian McCartney who is the Minister with day to day responsibility for e-government.

And on top of that, Tony Blair has also appointed an e-envoy, Alex Allan to co-ordinate all the official machinery.

Q: Why is it so difficult to get backing for Internet Ideas in the UK?
Roamer

A: Is she joking? Next week I'm going to the First Tuesday Club which is bringing together thousands of people with internet business ideas and people who want to invest in them.

But there is a problem despite that, of start up capital for small businesses. That's why we are putting 150 million pounds to the Enterprise Fund to help attract more private investment in to small and growing companies.


Q: What are your wildest dreams for e-commerce?

A: I try and imagine what life might be like in five years time. Everything has changed so dramatically in the last five years. And the one thing we can be certain of is that it will change even faster in the next five years.

That's why we are so determined to give everybody the skills and access that they need to survive and thrive in this tumultuous. But I don't know what it will be like and neither does anybody else.


Q: Would you back the formation of an internet security body/hotline to protect UK consumers on the internet from poor security sites?
J Wignall

A: We are already working with groups like the Consumers Association to develop codes of good practice that will guide consumers to the sites and the businesses they can trust. If you like it's a trust UK kite mark and I believe it will encourage British and foreign consumers to do electronic business with British companies.

A: We are already working with groups like the Consumers Association to develop codes of good practice that will guide consumers to the sites and the businesses they can trust. If you like it's a trust UK kite mark and I believe it will encourage British and foreign consumers to do electronic business with British companies.

We are also working in the European Union for a directive on e-commerce to back up the distance selling directive that already helps to protect consumers.

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