I recently presented the prizes in the e-commerce awards which are supported by the DTI through our UK Online for Business Project. The overall winner for the smartness of the way it had built its business around web capabilities was a small firm in Glasgow called Global Recycling. As I presented the award to the Managing Director, I asked him if any of his colleagues had come with him. His reply was "No, the other person had had to stay behind to keep the business going". There are in the knowledge economy immense opportunities for small and innovative firms.

In the UK, the challenges facing us are clear. We need to exploit our superb science base and promote innovation to create world-class ideas, breakthrough technologies and high value businesses. I’m looking today at some great examples of that happening in the North East Firms need to master the art of innovation. Where product lead times are becoming shorter, companies need constantly to develop and adopt the best products and practices available.

Businesses need both to collaborate and to compete, to share ideas, to invest in research and development and to take informed risks. They need to take up the new digital technologies and exploit the opportunities of e-commerce The Prime Minister bas set a goal to make Britain the best place in the world to do e-commerce.

One of my particular responsibilities at the Department is for the development of broadband communications. We have waited a long time in the UK to see benefits from telecommunications infrastructure competition, and we were slow to make a start with broadband. But, thanks to competition between the telephone and cable networks, we now have broadband prices among the most competitive in the world, and broadband connections being sold at 20 per week—roughly half and half between cable modems and telephony DSL connections- Last week, we were able to celebrate the one millionth broadband connection in the UK- Project North East was quick off the mark in equipping all its sites with broadband three years ago一boosting what has developed today into a cluster of 70 new media businesses.

Next month, a new Regional Broadband Unit will open for business. Working closely with the Regional Development Agencies and the Office for Government Commerce to co-ordinate public sector broadband procurement, its purpose will be to stimulate economic growth and enhance the delivery of public services. The new unit will work between public and private sectors to ensure best use is made of public sector purchasing and identify opportunities to aggregate public sector broadband demand f so maximizing the potential to extend the reach of broadband services.

The community will benefit from extended broadband services in important ways. Following the Chancellors budget announcements earlier this year, we will have funding in place for a new health services communications infrastructure. It will provide a faster network access to every doctor and to all support staff, and a larger bandwidth across NHSnet gateways. The result will be better local health services.

Over 20% of schools in England now have broadband connections. This figure continuing to rise further as broadband services become more reachable. We will see more and more curriculum material online, improving the quality of teaching and learning, so that for example students will be able to follow online at their own pace courses for which there is insufficient demand in their school for a separate taught class.