I'm familiar with what Paul Boateng said and I've quoted it on here more than once. In the early days somebody else (Howard Peel ?) quoted it with additional words which were subsequently requoted by others as though they were part of PB's parliamentary answer. To say that the police must use discretion is almost meaningless as it applies to everything, but it was eventually dressed up as a Home Office directive not to enforce this. That's the urban myth.
They do say that actions speak louder than words and David Blunkett's actions were to extend fixed penalties to s72 of the Highways Act 1835 - legislation which had been largely unenforced for decades - and to give the power to issue those penalties to his own then recent creation, Police Community Support Officers. At one time, this was the only power they had. As most saw being a PCSO as a career step to joining the police, it's not surprising that they filled their boots.
Incidentally, I mentioned this in response to a suggestion that increased police powers more generally were all introduced by Tory governments. In the context of pavement cycling IIRC, the power of arrest for any offence - including summary offences such as this - was introduced in 2005.http://www.legislation.gov.uk/ukpga/2005/15/section/110
PS I've checked and a search suggests I've posted the word "Boateng" a couple of dozen times in the last decade.
Here's something I prepared earlier:viewtopic.php?p=439894#p439894