The European Commission is pushing broadband with one hand but holding on tight to the purse strings with the other.

The EC is busy setting new targets for broadband penetration in the EU while simultaneously warning there will be little extra money to fund the planned rollout of high-speed internet access.

In a paper dubbed e-Europe 2005, the EC has called for the EU’s 15 member states to have broadband connections for all public administrations by 2005.

"A lot of public services are already online but without fast internet access it is difficult to offer interactive services," explained commissioner for enterprise and the information society, Erkki Liikanen. But money to fund the move to broadband will have to be found from existing budgets.

Some €6bn of so-called structural funds were earmarked for high-technology projects in poorer regions between 2000 and 2006. Now, however, the EC will increase its share in co-financed projects from the current ceiling of 10 percent to around 35 percent. "This means we will be able to support fewer but bigger projects," Liikanen said.

Liikanen didn't provide figures about the level of funding needed to meet the targets but shrugged off concerns that neither telcos nor governments may be particularly eager to foot the bill.

Telecomms companies are still struggling to digest the billions of euros invested in third-generation mobile phone licences.