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Viscount Astor: My Lords, before the Minister sits down, perhaps I might briefly interject. The noble Baroness says that the previous government were against her amendment. I find that rather surprising. It was the previous government who negotiated the directive with Europe in the first place. If it had not been for our part in that, we would not have a Data Protection Bill now.

Lord Williams of Mostyn: My Lords, I do not wish to intrude into private grief.

Lord Dholakia: My Lords, I am grateful to the Minister. Once in a while when amendments of this nature are accepted it restores one's faith in this House.

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Perhaps I may press the noble Lord a little further about the timescale so that we are aware of the progress being made.

Lord Williams of Mostyn: My Lords, I can do no more than say that we hope to have the provision ready for Third Reading. However, Third Reading is almost upon us. If it is humanly possible to achieve a properly workable amendment, we shall do so before the Bill leaves your Lordships' House. If not, I undertake that the measure will be brought forward in another place so that it will form part of the Bill in due time.

Lord Dholakia: My Lords, I am grateful to the Minister. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 5 [The Data Protection Commissioner and the Data Protection Tribunal]:

The Solicitor-General (Lord Falconer of Thoroton) moved Amendment No. 9:


Page 46, line 13, after ("Act") insert ("or section 158 of the Consumer Credit Act 1974").

The noble and learned Lord said: My Lords, in this group, I beg to move Amendment No. 9, and speak to Amendments Nos. 12, 13, 16 and 70. This set of government amendments effectively brings the rights which data subjects have under the Consumer Credit Act 1974 to obtain access to their data under the same roof as those of the Bill.

As it presently stands, Clause 8(8) of the Bill takes a first step towards streamlining the two access rights. It imposes an order of priority on unspecific access requests. But it leaves the dual regime intact; namely, data protection and consumer credit. As such, it can be seen only as an interim measure. The new government amendments complete the task. They replace the present Clause 8(8) with a unitary system of access under the Bill. They therefore ensure that all requests for general access have the benefit of the more comprehensive rights and remedies provided by the Bill.

But we have gone a step further. These amendments introduce in Clause 7 of the Bill a new right of access to specific data. Your Lordships will be aware that the subject access right under the Bill is a right of access to the generality of data held. It is not a right to insist on partial access. But the new amendments will now provide that a data subject making a subject access request to a credit reference agency may specify that his request is limited to personal data consisting of information as to his financial standing. This new limited right is supported by representatives of consumer bodies, trading standards authorities and the credit reference agencies themselves. Very often, this is the only information in which data subjects are interested in this context. We intend to use the powers in Clause 7 to make regulations to prescribe terms for the new limited access rights which are more favourable to consumers than the general subject access conditions may be. The new right is intended to be a cheap and fast means of acquiring access to the key financial information held by credit reference agencies.

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We think, therefore, that we have given data subjects the best of both worlds. General access rights are given the benefit of the Bill's more extensive protections. And the new, optional, limited right preserves the advantages of speed and cheapness from the 1974 Act.

Those of your Lordships with an eye for detail will note that we have as a consequence removed rights of access to personal data from the scope of the 1974 Act. We have left other access rights (for partnerships and unincorporated bodies) under that Act intact. They are not the business of this particular Bill.

We have also preserved the rights of individuals who consider their consumer credit files to be incorrect, which are found in Section 159 of the 1974 Act. But where those rights relate to personal data, we have provided for their enforcement to be the responsibility of the data protection commissioner rather than, as now, of the Director General of Fair Trading. This is also part of the policy of bringing all of the 1974 Act's rights in respect of personal data into the Bill's fold. The rights in Section 159 are of course without prejudice to data subjects' rights under Clause 12 of the Bill, and the fourth data protection principle, in respect of inaccurate data.

These amendments therefore represent a clear shift of emphasis. That brings with it an increase in the commissioner's responsibilities. We are looking into the matter of an appropriate transfer of resources accordingly. I hope your Lordships will be able to welcome these amendments as an improvement to both data protection and consumer credit law.

Perhaps I may use this opportunity to mention a subject not specifically dealt with by this group of amendments; namely, enforced subject access. At Second Reading, I mentioned two important omissions from the Bill. One was the transitional provisions in relation to which the Government have now brought forward amendments to be discussed later in the course of Report stage. The second was provisions to meet the Government's commitment to outlaw the practice of enforced subject access.

I very much regret that the Government have still not yet been able to bring proposals on that second matter before this House. It is proving to be an extremely difficult issue. We still, however, intend to do something about the problem and will try to bring forward proposals at Third Reading. If we cannot manage to do so, we shall be looking to return to the matter in another place.

I now turn to Amendments Nos. 10 and 11 in this grouping. These are technical amendments. They ensure consistency in the terminology used within Clause 7. That is what the directive says. Subsection (1)(c) refers to the "communication" of information. Subsection (5), which relates to the same information, inadvertently uses the verb "supply", which is the language of the 1984 Act. These amendments substitute "communicate" for "supply" in subsection (5).

In Committee, the noble Lord, Lord Teviot, proposed an amendment to Clause 7(1)(c) to add the words, "or made available", to the word "communicated". The noble Lord thought that the addition of "or made

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available" would deal with the situation where people were given the opportunity to find for themselves information that it might be wearisome for somebody else to find. We said that we did not believe that "communicated" constrained the means by which information was provided. Because of what the noble Lord said, we consulted parliamentary counsel as to whether our view was correct. She confirmed that view. Under Clause 8(2) the controller, by agreement with the subject, may make information available to the data subject otherwise than by providing him with a copy. We therefore thought that the assurances we gave to the noble Lord were met, and hoped that by checking with parliamentary counsel we could give him further reassurance as to the concerns he raised in Committee.

Amendment No. 14 is, again, a rather technical amendment. It changes the definition of "relevant day" in Clause 7. Noble Lords may recall that we amended this definition in Committee to improve its drafting. I am afraid that even with those improvements, the definition as it stands is not quite right.

The Bill sets a time period within which data controllers must respond to subject access requests. As the Bill stands, the period may in some cases not start until the data controller has also obtained the consent of any third party who can be identified from the information in question. This could have the effect of delaying a data subject's access to the rest of this information unnecessarily. That is not what we want. The amendment, read with the existing Clause 7(5), addresses the point.

There is one other amendment in this group standing in the name of the noble Viscount, Lord Astor. Subject to the views of other noble Lords, I thought that I would leave the noble Viscount to develop that amendment. I beg to move.

4.15 p.m.

The Earl of Northesk: My Lords, as the noble and learned Lord has indicated, a number of these amendments bring an individual's rights of access to his credit reference agency files under the data protection regime. On the surface there is nothing wrong with that, albeit that the access has been satisfactorily regulated for 25 years under the Consumer Credit Act--which, incidentally, gave the first subject access rights available in the UK.

This is a major change being introduced at short notice, to all intents and purposes without consultation with the consumer credit industry. The potential knock-on effects are considerable. It could be argued that the primary function of the Consumer Credit Act is to ensure responsible lending, whereas the primary function of the Data Protection Act is to ensure confidentiality. The tension between those two very laudable aims has already led to enforcement action from the Data Protection Registrar in this area. The Data Protection Tribunal, seeking to balance the need for both responsible lending and confidentiality, gave a ruling. When lenders check the existing commitments of an applicant for a loan, credit reference agencies supply information about members of the applicant's family at

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the same address to avoid financial over-commitment in a family. The Director General of Fair Trading adjudged that an individual searching his or her credit reference agency file should be given all the information with which a lender might be supplied. Thus, so-called "third party" information may be included in an individual's file. That is a relatively small price to pay to avoid over-indebtedness and fraud.

However, Amendments Nos. 12 and 16--relating to the effective removal of subsection (8) of Clause 10--run against the grain of that ruling.

The provisions relating to disclosure in the current Data Protection Act and this Bill would appear to have two possible effects on the present situation. Either a data subject would not see all the information that might be given to a lender; or the credit industry would effectively no longer be able to see information about other persons with the same surname at the same address as the applicant. The consequences of either scenario would be very grave for the industry. The Bill is all about striking the right balance. While the credit reference industry may not be particularly popular, it is nonetheless an important contributor to personal and national prosperity. These amendments put it, and the safeguards to ensure its continuing viability and responsibility, at risk.

I should like to take this opportunity to make a more general point, which may become something of a refrain as we progress through the Bill. The noble Lord, Lord Williams of Mostyn, began his contribution to the Grand Committee with a mild chiding:


    "I would gently ask that amendments are put down in a reasonable time".--[Official Report, 23/2/98; col. CWH 4.]

I do not wish to carp, but the Government tabled a number of amendments on Thursday and Friday of last week which, taken in toto, could fundamentally alter the balance of the Bill to date. Moreover, the substance of many of them concerns matters which have not been widely trailed and which, as a result, were not well rehearsed in Grand Committee. The amendments to which I have referred are a case in point. I hope, therefore, that the Government will give careful consideration to whether it is appropriate to press ahead with these amendments and others at this stage. In the circumstances, it might be more appropriate to think in terms of bringing them back at Third Reading when we have had the opportunity to reflect more adequately on their likely impact and effect.

Turning to Amendment No. 70, which is also in this grouping, I have considerable reservations about this new clause. As the noble and learned Lord explained, the amendment to Section 158(1) of the Consumer Credit Act 1974 substitutes a new meaning to the defined expression "the consumer" by extending it to partnerships and unincorporated bodies. Whatever the merits of so doing in a data protection sense, this revision is not repeated by way of amendment to the provisions of Section 158(5), which still talks about files in relation to an individual, an expression which will be removed from Section 158(1)(a). This is compounded by the amendment now proposed to Section 159(1), which will remove the expression "consumer" and substitute the expressions "individual" and "objector",

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the latter being defined in relation to the former--that is, individuals--but no longer being relevant to the definition of "consumer" in Section 158(5). These amendments show an alarming lack of clarity and consistency of thought. As drafted, they are highly likely to create a muddle and lead to inconsistencies of interpretation.

Equally disturbing is the amendment proposed in relation to the new subsection (8)(b) to Clause 159. This appears to have the effect of giving the data protection commissioner exclusive jurisdiction in relation to correction of information relating to individuals--that is to say, objectors other than partnerships or other unincorporated bodies or persons. I contend that such exclusivity runs against the grain of the Bill's intent to strike an adequate and appropriate balance in data protection terms. Perhaps inevitably, I find myself repeating my counsel to the noble and learned Lord that here again is an instance where our interests might best be served if we can return to the matter at Third Reading, particularly bearing in mind the apparent absence of any proper and/or effective consultation with credit reference agencies on these matters.


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