It's a really slippery slope. And to be honest, yeah - having a net connection is a pretty big luxury I don't think criminals serving at her Majesties' pleasure should actually be entitled to. Obviously if they're to be rehabilitated, then it would make sense to allow them that, but whilst they're serving time, isn't the whole point to take away the home comforts?
There was also some call (Probably from EU) to give criminals in jail the right to a vote. Which I also strongly disagree with.
They're in there to separate them from society. And that includes 'online' society IMHO - hence they should not have net connections.