"Then another and it's basically anything any ISP fancies blocking."
Umm....
But an amendment by the House of Lords published this week [PDF] appears to permit an ISP to engage in content filtering, provided that it is consistent with its terms of service.
It's on page 15 of the PDF:
A provider of an internet access service to an end-user may prevent or restrict access on the service to information, content, applications or services, for child protection or other purposes, if the action is in accordance with the terms on which the end-user uses the service.