A governement agency is quite different from "government". Why does the head (and indeed the deputy head) of a private company carrying out a quasi governement function need to be paid 2 1/2 (and 1 1/2) times as much as the head of the Patent Office - which is about 10 times as big? Registrants - not Nominet members - are paying for those inflated salaries.
Why does an entity undertaking such a task need the right to compete elsewhere? If it wants to do that, let it do so having divested itself of the monopoly registry role.
Moving the .uk registry to a Patent Office/Companies House model does not necesarily mean a change in the rights model. Personally I think it is an artifice to say that registration of a domain does not equate to acquiring IP rights - the US courts eventually (when a case worth enough pressed the point) agreed. Better to treat them much like TMs I'd say.
However, the existing "first come first served" type system could apply. A proper dispute system, linked into the courts, as per the TM registry, could be codified. Fixed costs would be recoverable for a succesful defendant - a major failure of the DRS; and decisions would be made by qualified employed arbiters - rather than external people who frequently also represent complainants.
Of course, such an agency (or addition to the Patent Office) would also not be beholden to a handful of members with their own agenda. As with ICANN/Verisign, I think we are seeing that there are some things that government do better than private industry.
As Nominet itself expressly acknowledges, what made sense in 1996 does not make sense in 2006. Pandora's Box has been opened by the EGM - now it is time to consider which alternative option makes most sense - particulary given the events at the EGM show that the issue of control is not just theoretical.
