The government’s promise to provide high-speed internet access to all by 2005 looks doubtful despite a commitment yesterday for another injection of cash to get the country online.

Downing Street confirmed it had set up a £30m fund to develop high-speed internet services throughout the country [see our previous story]. But it is expected, even by the government, that the creation of a broadband Britain is estimated to cost nearer £1bn.

“We never promised billions [for this end],” said a spokesperson at the Department of Trade and Industry. “The government is still as committed to the unbundling process as they ever were.”

But Culture Secretary Chris Smith confirmed last week to the Financial Times that the 2005 deadline now seems highly unlikely. Smith's department, the Department for Culture, Media and Sport is, perhaps strangely, one of the bodies in charge of wired up the UK. The £30m government investment will not go far - this is an expensive process. It looks like the burden still lies with Oftel to create a ‘broadband Britain’.

Individuals are reliant on telecoms regulator, Oftel, to push the unbundling process forward.

“[We want to push the process on] in a way that is most cost effective to the public,” said the spokesperson. “spending billions of pounds [of tax payers money] is not the best way to do this.”

But telecoms giant BT, responsible for unbundling the local loop, is being attacked by ISPs Freeserve and AOL, which say BT is unfairly distributing DSL lines, giving preference to its own ISP. It could therefore be some time before all consumers have high-speed permanent internet access.

The government’s recent Communications White Paper proposes Oftel be merged with broadcasting watchdogs, to form Ofcom, a communications super regulator.