The Government have made no such assessment. The OFT began its formal investigation into whether the charges levied by banks breach the unfairness test in the Unfair Terms in Consumer Contracts Regulations 1999 in April 2007. Until recently, there had been no High Court cases on that subject, but it soon became clear that a wider test case was needed to resolve the issue and to provide legal certainty. That process is now under way, and it is initially focused on clarifying whether the regulations apply or not.
I thank the Economic Secretary for that full answer, for which I am most appreciative. Millions of families could face additional bank charges, because data files containing their banking details are God knows where. [Hon. Members: “Reading.”] Will the Government assure me that they have spoken to the banks to ensure that, if the loss of data leads to identity fraud that causes accounts to be overdrawn through no fault of the families themselves, the Government will underwrite the resulting charges, ensuring that individuals do not suffer for the deplorable error of Her Majesty’s Revenue and Customs?
I understand the frustration faced by my hon. Friend’s constituents and, indeed, the constituents of all hon. Members. However, the decision on the waiver is entirely for the Financial Services Authority, which recently completed a review of it, and concluded that on the whole, although there are some issues to be looked at, the waiver is operating satisfactorily. It is inappropriate for me to say more while a legal case is ongoing.
One of the conditions of the waiver was that the banks did not make materially adverse changes to their charges, which is precisely what they are doing. Most recently, the Co-op bank lifted its daily overdraft rate, which particularly affects low-income customers. Because the condition of the waiver is now being breached, surely the Economic Secretary should be calling for the FSA to raise it.
The waiver is a matter for the FSA. As I have said to my hon. Friend the Member for Newport, East (Jessica Morden), the FSA recently completed a review of the waiver consulting both consumer groups and banks. The findings suggest that the waiver is working satisfactorily. If the hon. Gentleman has evidence to the contrary, I would be happy to pass it on to the FSA.