OK, NOW I recognize what has happened.
There is a very small wiring harness (three wires) that enters the steering column near the base of the steering column, which happens to be very close to where the plastic cover above the footwell (the accelerator and brake pedals) is.
If the driver has a habit of kicking (intentionally or unintentionally) the plastic cover above the footwell, or if the technician is careless when he or she re-installs this plastic cover (it inserts into a clip at the forward end, and is retained by three fasteners at the aft end), the wires in this harness will become pinched. Once they are sufficiently pinched, the current will not flow and the car will display this 'steering fault' message.
The fix is simple: If you get stuck out in the middle of no-where, just wiggle the cover above the accelerator-brake pedals - this will probably get you going. Once you get the car to the workshop, the problem only takes about 20 minutes to fix - you clip off the damaged wires, and then fit repair wires onto the end and re-assemble the electrical connector.
You DON'T need to replace the steering column - this is grossly un-necessary overkill. This 'pinched wire' problem has been the cause of all steering / electrical complaints ever reported by Phaeton owners.
For Phaeton owners outside of North America (in other words, in the ROW, or Rest of World, as VW refers), Campaign 97J9, criteria 1 specifically addresses how to correct the risk of damage to these wires.
What the damaged wires look like
What they look like after the wire repair is carried out
What the fault message looks like
Modified by PanEuropean at 7:19 AM 3-17-2010