The UK government’s grand reworking of digital policy, due out Tuesday, has something for every one to chatter about — from funding for a further broadband buildout to reworking television licensing fees to how the country faces up to the issue of media piracy.

But final publication of the Digital Britain report on Tuesday follows the marked deterioration of the economic environment as well as the collapse of the political muscle needed to marshall the report’ more ambitious changes through Parliament.

Stephen Carter, the former U.K. cable executive, named as U.K.’s Minister for Communications, Technology and Broadcasting only nine months ago, plans to leave the government soon after releasing the report.

The current political crisis has Gordon Brown’s government running scared even from the restructuring of the post office. It’s hard to see the Prime Minister creating a major digital legacy for his administration starting from here.

Sanford C. Bernstein has repeatedly argued that British policy is “inching toward a managed economy” in communications. The investment firm makes a rather extreme case that the hobbled fixed-line operator BT Group could win at the expense of successful satellite TV provider BSkyB. It’s hard to see how.