LONDON, 22 November 2007 — In another disastrous week for the Labour government, British Prime Minister Gordon Brown yesterday in a somber House of Commons apologized to the nation for the loss of 25 million child benefit records by HMRC (Her Majesty’s Revenue & Customs), the largest loss of personal data in history.
While the government and law enforcement agencies were frantically working to prevent the data being used for fraud and ID theft, millions of British families affected were rushing to change their bank accounts into which the child benefit was paid, with high street banks warning of a customer overload at branches throughout the country.
Customers were yesterday urged by the government and banks to keep a close eye on their accounts “for unusual activity”.
Accounts that are particularly at risk are those that use children’s names or dates of births as passwords. The banks were monitoring all 7.25 million bank accounts whose details were on the discs, and the government was quick to assure people that anyone who lost money as a result of any misuse of the data would be covered for losses under the banking code.
The loss of the discs yesterday also precipitated one of the biggest police hunts for computer data, with Scotland Yard’s crack computer fraud unit leading the search for the missing discs.
On Tuesday Chancellor of the Exchequer Alistair Darling admitted to the House of Commons that a junior HMRC official had lost two special discs containing the personal and bank account details on 25 million people. The HMRC data on the two missing discs includes names, dates of birth, bank and address details. This extraordinary blunder affects every family in the country claiming child benefit, which is a right for every child up till the age of 16 under Britain’s welfare system.
Yesterday Conservative leader David Cameron scoffed at Brown saying that his government had “failed in its first duty to protect the public. What people want from their prime minister on a day like this is to show some broad shoulders, be the big man and accept some responsibility.” Acting Liberal Democrat leader Vincent Cable said that the Treasury had become the second office of state not to be “fit for purpose.”
Brown tried to put on a brave face, amid the deafening groans of the opposition backbenchers. “I profoundly regret and apologize for the inconvenience and worries that have been caused to millions of families who receive child benefits. There is no excuse for not following proper procedures. I am not going to start running away from things when things get difficult. When mistakes happen in enforcing procedures, we have a duty to do everything we can to protect the public. The idea that we are complacent about this is quite ridiculous. We are taking all the action that is necessary.”
The debacle could be costly in political terms for the Brown premiership. His popularity in the polls has plummeted following his earlier honeymoon with the media and the public when he took over in July. The government also plans to introduce identity cards, which has precipitated huge controversy in a country that prides personal freedom and civil liberties. The opposition parties are both against the introduction of ID cards — whether voluntary or compulsory. This astonishing data protection failure has raised serious questions about whether the government can guarantee and deliver on similar protection for ID card holders.
Those against the “big brothernization” of Britain warn that there is a big gap between the efficacy and claims for data protection and reality.
For Darling this is yet another setback following continued criticism last week of his handling of the future of troubled mortgage lender, Northern Rock, in which the Bank of England has pumped £29 billion of taxpayers’ money. On Tuesday, the head of the HMRC, Paul Gray, Britain’s most senior taxman, was forced to quit over the tax disc disaster.
Opposition leaders have been gunning for the scalp of the chancellor, calling on him to resign because he was not “up to the job.” Darling said he “deeply regretted” what had happened, but stressed there was no evidence of misuse of the data. “People are entitled to trust the government to look after information that is given to it — for child benefit or any other purposes — and that did not happen here,” he told the BBC in an interview. He denied the problem was related to the merger of the Revenue and Customs departments and staff cuts, as claimed by staff members in e-mails to the BBC. The way in which the discs were lost is farcical. The entire child benefit database was sent via internal mail by a junior official from HMRC’s office in Washington, Tyne and Wear, near Newcastle, to the audit office in London through the courier company, TNT on Oct. 18.
The official had broken the rules twice — first by downloading the data to disc and secondly by sending it by unrecorded delivery. Senior officials at HMRC only found out about the missing discs on Nov. 8 and the prime minister and the chancellor were only told on Nov. 10.
