The Culture Online venture, proposed by former Culture Secretary Chris Smith, was contained within the Culture and Recreation Bill that had reached its second reading in the House of Lords.
"The bill fell with the election, and so we now need to think of a new way of moving forward with the project," confirmed a representative for the Department for Culture, Media and Sport (DCMS).
The government is denying reports that the Internet scheme has been shelved. Despite the DCMS's hesitancy about the Culture and Recreation Bill being included in the new legislative program to be announced Wednesday by the Queen, it is confident that the pilot scheme will go ahead.
"The initiative was in the Labour party manifesto, and money has been set aside to develop it already," said the representative.
The Internet venture unveiled by Smith at the Labour party conference last year intends to allow the nation to watch and interact with Royal Shakespeare Company actors or members of the London Symphony Orchestra on the Web. It promised to put the best of British comedy, drama poetry and sport on the Internet.
Smith had hailed the initiative as "what the Open University was to the sixties and Channel 4 was to the eighties." But the launch of a pilot version has been hampered by the need for new legislation to bring it into being.
The DCMS will confirm the go-ahead for Culture Online later this week, once the government's new legislative program has been announced.
Staff writer Wendy McAuliffe reported from London.