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Data Protection and Digital Information Bill

Volume 837: debated on Monday 22 April 2024

Committee (6th Day)

Scottish, Welsh and Northern Ireland Legislative Consent sought.

Clause 109: Storing information in the terminal equipment of a subscriber or user

Amendment 199

Moved by

199: Clause 109, page 133, line 21, leave out “(2D)” and insert “(2F)”

My Lords, in moving Amendment 199, I will also speak to the other amendments in this group. In so doing, I declare an interest as the principal proprietor of the Good Schools Guide; we make a lot of use of cookies on our website.

I am completely in favour of what the Government are doing in this part of the Bill as an attempt to reduce cookie consent pollution. It is a tiresome system that we all go through at the moment. The fact that it is tiresome means that, most of the time, we just click on it automatically rather than going through to the details. In a way, it is self-defeating. What the Government are trying to do will very much improve the quality of people’s response to cookies and will make them more aware, in situations where they are asked for consent, that this is important.

However—this will be the request at the end of my speech—between Committee and Report, I would really like to sit down with any noble Lords who are interested and are representatives of the relevant industry to discuss how we should deal with cookies that relate to supporting advertisement delivery. A lot of the web relies on advertisements for the revenue to support itself. By and large, for a lot of sites that you are not asked to pay but from which you get a lot of value, that value is supported by advertising. As a website, if you are going to charge someone for delivering advertising, you have to be able to prove that the advertisement has been delivered and to tell them something about the person to whom you are delivering it. In this process, you are not interested in having individual information. What you want is collective information; you want to know that you have delivered 24,000 copies of this advertisement and know what the audience looks like. You absolutely do not want to end up with personal information.

Within that envelope—absolutely excluding the sorts of cookies that chase you around the internet saying, “Do you want a deckchair?”, just because you bought one two days ago—this is a vital part of the way the internet works at the moment. In Amendments 199 to 201, I suggest ways in which the clauses could be adapted to make sure that that use of cookies—as I say, it does not involve the sharing of personal information; it very much involves collective information—is allowed to continue uninterrupted.

I will try to line up with it better. Amendments 202 to 205 flag concerns with proposed new Regulation 6B, which sets out to remove cookie banners automatically when the technology is available. The concerns very much relate to that last phrase: “when the technology is available”. How will this work? How is it to be managed? There is only a thin layer of controls on the Government in the way that they will use these new powers; it is also unclear how this will affect consumers and advertisers. There could be some far-reaching effects here. We just do not know.

I am looking for, and hope the Government will agree to, wide consultation because, on something such as this, it is never true that everybody knows everything. You want to put the consultation out to a lot of different people with a lot of different experiences of how to use the net to make sure that what you are doing will have the sort of effects that you want. I want to see proper, thoroughgoing impact assessments, including of the impact on competition and on the economic health of participants in the net. I would like to see a real analysis of the readiness of the technology, not just an assumption that, because somebody likes it, it will work, but a real, critical look at whether the technology is actually up to what it is hoped it will do, and proper testing, so that, in giving the Government the carte blanche that they have asked for with these clauses, we do not end up letting ourselves in for a disaster.

As I said, most of all, I am looking for a meeting between now and Report, so that I can go through these things in detail, and we can really understand the Government’s position on these matters and, if necessary, discuss them further on Report. I beg to move.

My Lords, I will speak briefly in support of the amendments in the name of the noble Lord, Lord Lucas, to which I am pleased to have added my name. I apologise for not being able to speak at Second Reading, but I understand from other Members of the Grand Committee that an occasional guest appearance and a different voice are welcome.

I declare an interest, as set out in the register, as a director of RSMB Ltd, a company specialising in the methodology of audience measurement, cross-media measurement and data integration. More fully, I am nominated and remunerated by the advertising group Havas, which owns the company jointly with Kantar Media.

As the noble Lord, Lord Lucas, so clearly set out in his introduction, these simple and uncontroversial amendments would bring greater clarity and certainty to the key measurement of users, readers and audiences of digital websites and platforms. By including the measurement of aggregate audiences online in the list of cookies that would not require specific consent, these amendments would protect and enhance the interests of both consumers and businesses: consumers because, as the noble Lord, Lord Lucas, said, with the maintenance of advertising revenue funding, websites that provide news, entertainment and a wealth of other services would otherwise cost those consumers much more in subscriptions; and businesses, as through the quality of anonymised, aggregated data, they can build better offers to consumers and advertisers, as well as increase their financial resilience.

The Minister brings profound knowledge and understanding of this field, so he well knows how important the digital advertising market is and how innovative and respected UK companies are in the global industry. That applies not only to the websites, platforms and advertisers but to the research, quality audit and measurement companies specialising in this area. These amendments would support this growing and productive high-tech data, research and measurement sector in reinforcing its world-leading position.

As in so many industries and sectors of the economy, long-term stability is vital to rapidly evolving digital markets. Including these amendments in the Bill, rather than relying on secondary legislation and regulation to flesh out details in the future, will enhance that stability.

Likewise, the amendments relating to the implementation of centralised opt-out controls are intended also to promote that long-term stability, as well bringing enhanced transparency and scrutiny. The interests of consumers and businesses are not in conflict with each other in relation to audience measurement and data quality. They are constructively interactive.

My Lords, Clause 109 makes changes to the regulations relating to the use of cookies, which, on the face of it, clarify and expand the PEC regulations. Some of the amendments seem benign enough, adding useful flexibility and much-needed clarity; others give the Secretary of State pretty wide-sweeping powers.

Taking a look at new Regulation 6A(1)(a), for example, a future Secretary of State will be able to add new exceptions to the cookie consent requirements. The regulation will also enable variations and omissions. All the Secretary of State would need to do is “consult” the commissioner and such other persons as the Secretary of State considers appropriate—so they will be left with some fairly wide powers and opportunities.

Before turning to Amendment 202 in the name of my noble friend Lady Jones of Whitchurch, I want to quickly respond to Amendments 199, 200 and 201, from the noble Lords, Lord Lucas and Lord Clement-Jones, and very ably supported by my noble friend Lord Chandos. These seek to introduce an additional exemption for cookies used for the purposes of non-intrusive audience measurement and ad performance, both of which are obviously very important to publishers, who need to understand how their websites are used and ensure that advertising is delivering revenue. It is famously hard to predict how successful advertising is; you are never quite sure whether the adverts are hitting home, but this sort of data is critical to that activity.

As noted by others, the Bill currently contains an exemption for cookies used solely for statistical purposes. It may be that the Minister is able to provide comfort to the publishing sector that audience measurement and ad performance are both areas that fall within this new exemption. If he cannot do that today, I hope he will be able to come back to interested colleagues in writing or, as the noble Lord, Lord Lucas, suggested, hold further discussions on this ahead of Report.

We had a number of significant debates during the passage of the Digital Markets, Competition and Consumers Bill regarding the fragility of the publishing sector. Newspapers, sectoral magazines and other sources fulfil a valuable role and we should seek to nurture that as far as is practical.

Amendment 202 in the name of my noble friend is another means of trying to support publishers by probing the potential consequences of the Government’s proposals around centralised cookie controls. Some users may happily accept cookies from the websites of trusted organisations, such as news sources that they use regularly, but generally decline cookies from other websites due to privacy concerns. I would like to know from the Minister how this nuance would be reflected if automatic preferencing is rolled out.

Organisations have also raised competition concerns. The number of mainstream internet browsers is incredibly small and they are operated by firms likely to be designated as having strategic market status under the digital markets Bill. If this legislation establishes a system that makes these browsers some kind of cookie gatekeeper, does that not risk amplifying existing competition barriers in digital markets, rather than bringing them down?

Our amendment would remove provisions around automatic cookie consent. Amendment 203 in the name of the noble Lord, Lord Lucas, proposes a different option, providing a straightforward means for users to override their general preference when using specific websites. That is an interesting alternative, and we need to listen carefully to the Minister’s reply because it gets to the heart of the issue. The noble Lord’s Amendment 204 would also be important, ensuring broader consultation before statutory instruments were brought forward under new Regulation 6B.

We wholeheartedly agree with the view that the current situation around cookies needs sorting. The system is annoying and needs overhauling so that users are not constantly bombarded by pop-ups, but also so that websites are able to get the kind of audience statistics they need to operate and innovate. We are not convinced that the current proposals strike the right balance. The consultation required under proposed Regulation 6B is both too little and too late, with far too much discretion for the Secretary of State.

There are a number of interesting models and proposals for addressing cookie fatigue out there. My sense is that the department and the regulator would be better off getting together and looking again at those models, possibly on the basis of widened consultation, and then regulating, rather than taking sweeping powers now on the promise that they may get it right in future. The Government have some serious questions to answer here. We are particularly supportive of the efforts of the noble Lord, Lord Lucas, and others to get a better quality of consultation before we take significant legislative steps forward.

My Lords, I do not know how unusual this is, but we are on the same page across both sides of the Committee.

First, having signed the amendments by the noble Lord, Lord Lucas, I express my support for the first batch, Amendments 199 to 201, which are strongly supported by the Advertising Association and the Interactive Advertising Bureau for obvious reasons. The noble Lords, Lord Lucas and Lord Bassam, and the noble Viscount, Lord Chandos, have expressed why they are fundamental to advertising on the internet. Audience measurement is an important function, for media owners in particular, to determine the consumption of content and to price advertising space for advertisers.

I understand that the department, DSIT, has conceded that most of the use cases for audience measurement fit within the term “statistical purposes”. It is this area of performance that is so important. As the noble Lord, Lord Bassam, seemed to indicate, we may be within touching distance of agreement on that, but the Minister needs to be explicit about it so that the industry understands what the intent behind that clause really is. As a number of noble Lords have said, this is a specific and targeted exemption for audience measurement and performance cookies that limits the consent exemption for those purposes and, as such, should definitely be supported. I very much hope that, if the Minister cannot give the necessary assurance now, then, as a number of noble Lords have said, he will engage in further discussions.

Amendments 203, which I have signed, and 205 are extremely important too. Amendment 203, picked up clearly by the noble Lord, Lord Bassam, is potentially important; it could save an awful lot of aggravation for users on the internet. It is potentially game-changing given that, when we approach the same site—even Google—we have to keep clicking the cookie. I very much hope the Minister will see the sense in that because, if we are changing the EC regulations, we need to do something sensible and useful like that. It might even give the Bill a good name.

As all noble Lords have rightly said, the Secretary of State needs to think about the implementation of the regulations and what they will affect. Amendment 202 is fundamental and badly needed. You need only look at the list of those who are absolutely concerned about the centralisation of cookies: the Internet Advertising Bureau, the Advertising Association, the Data & Marketing Association, the Market Research Society, the News Media Association, the Incorporated Society of British Advertisers, the Association of Online Publishers and the Professional Publishers Association. I hope that the Government are in listening mode and will listen to their concerns.

As the PPA says, centralising cookie consent with browsers could cause consumers far more harm than good. The Secretary of State’s powers would override cookie consent relationships between individuals and specialist publishers, which the noble Lord, Lord Bassam, talked about in particular. As the PPA says, in all likelihood a significant number of internet users would not consent to cookies from the browser but would consent to cookies on the websites of publishers that they know and trust. If the Secretary of State were to use this power to enforce cookie centralisation, many publishing businesses would be forced to present consumers with paywalls in order to be financially sustainable. As the PPA says, this would lead to consumers missing the opportunity to access high-quality publishing content without having to pay a fee.

The PPA has made an extremely good case. This would amplify existing barriers to competition in the digital market. There are provisions in the DMCC Bill that would give powers to the CMA to address any problems, such as enforced data sharing from platforms to publishers, but centralising cookie consent would completely undermine the objectives of that legislation. It is clear that this Bill should be amended to withdraw the provisions giving the Secretary of State the power to introduce these centralised cookie controls. I very much hope that the Minister will have second thoughts, given the weight of opinion and the impact that the Secretary of State’s powers would have.

My Lords, if the Committee will indulge me, I was a little late arriving for the introduction to this group of amendments by my noble friend Lord Lucas, but I heard most of what he said and I will speak briefly. I am quite sympathetic to the arguments about the exemption being too tightly drawn and the advantage that this is likely to give the likes of Google and Meta in the advertising ecology. As the noble Lord, Lord Clement-Jones, said, a range of different trade bodies have raised concerns about this, certainly with me.

From my perspective, the other point of interest that I want to flag is that the Communications and Digital Committee is currently doing an inquiry into the future of news. As part of the evidence that we have taken in that inquiry, one of our witnesses from the news industry raised their concerns about a lack of joined-up thinking, as they described it, within government when it comes to various different bits of legislation in which there are measures that are inadvertently detrimental to the news or publishing industry because there has been no proper understanding or recognition of how the digital news environment is now so interconnected. Something like this, on cookies, could have quite a profound effect on the news and publishing industry, which we know is reliant on advertising and is increasingly feeling the pinch because the value that it gets from digital advertising is being squeezed all the time. I just wanted to reinforce the point, for the benefit of my noble friend the Minister, that concern about this is widespread and real.

My Lords, it is a pleasure to make my first foray at the Dispatch Box on this Bill in what has been an interesting Committee stage thus far. I thank my noble friend Lord Lucas and the noble Baroness, Lady Jones of Whitchurch, for tabling these amendments and other noble Lords who have signed and spoken to them in support.

Many people are irritated by repetitive pop-ups that appear on websites seeking consent for cookies and other similar technologies. The current cookie rules apply to all organisations placing cookies on a person’s device. Rather than engaging with these banners, people will select “accept all” so that they can access the webpage as quickly as possible. We want users to be able to make more meaningful choices over their privacy. One way in which web users may be able to reduce the number of consent pop-up banners that they see is by using automated consent management technology.

New Regulation 6B, which Amendment 202 seeks to remove, is important as it will allow the Secretary of State to require relevant technologies to meet certain standards or specifications, thereby ensuring that individuals using this technology have effective control over their privacy when they are online. Amendment 203 seeks to amend Regulation 6B by making it clear that consents given on individual websites should override any prior choices made using automated technology. However, this could pre-empt the outcome of consultation with relevant sectors, civil society and regulators on the design of any new regulations. I fear that this amendment could have the effect of encouraging the continued use of consent banners, may not reduce the overall number of pop-up banners and could increase the risk of influencing consumers to give up more personal data than they intended.

We feel that Amendments 204 and 205 are unnecessary and duplicate existing requirements and standard practice. There is already a requirement in new Regulation 6B to consult. We have engaged extensively with stakeholders on this Bill and will continue to do so in the context of using any of the new regulation-making powers linked to these clauses. Our engagement so far has highlighted the complexity of the ecosystem and the range of impacts on different interest groups. We will continue to consider these impacts carefully when considering whether to use the new regulation-making powers. Impact assessments are generally required for all interventions of a regulatory nature that affect the private sector, civil society organisations and public services.

The Government have taken powers in the Bill to remove consent requirements for other purposes if the evidence supports it while recognising that this is a complex and technical market. The Government will therefore continue to engage fully with all players before introducing any new exemptions or deciding to set standards for the market.

The new power in Regulation 6B recognises that there is a range of different stakeholder interests that would need to be considered before making regulations. The Secretary of State must consult the Information Commissioner, the Competition and Markets Authority and any other person the Secretary of State considers appropriate. While browser-based or centralised consent options have been discussed as a possible solution, nothing in the Bill mandates them. The regulation-making power, which follows the affirmative resolution procedure, would allow the Secretary of State to set standards of design that will be key to ensuring that the regulations can move with technology.

Amendments 199 and 200 would permit the storage of information or accessing information stored on a person’s connected device, including the internet of things, to enable the organisation to generate audience measurement information. This proposed new exemption does not explain what data would need to be gathered to meet the objective of the amendment and is potentially broad in its application. For example, if it permitted activities such as tracking and profiling, it may not be appropriate to permit it without the consent of web users.

We know that some stakeholders would have liked us to go further with the exemption in new paragraph (2A) and remove consent requirements for a wider range of uses. Any additional exemptions should not be added to the Bill in haste. There is a balance to strike between removing cookie consent requirements to drive growth and innovation in the advertising sector and ensuring that people retain some choice and control over how their data is used. The Government know that there are people who want to continue to make an active choice over cookies that are used for more intrusive purposes, such as tracking and profiling users.

The delegated power in the Bill ensures that exemptions to the consent requirements can be kept under review and amended in future where the evidence supports it, and we can devise appropriate safeguards to minimise privacy risks. We are satisfied that the current list of exemptions applies to a limited number of low-privacy intrusive purposes and can be used by any organisation placing cookies on a user’s device. This regulation applies to complex—

I am interested in the Minister’s point about the flexibility the Government see in this clause, but I am not sure who in the end has the responsibility to lead on that flexibility. Will it come from the commissioner or be driven by the Secretary of State’s considerations? The consultation duties seem very dependent on the commissioner’s view and I am not sure at what stage the Secretary of State would want to intervene to ensure that they have got this bit right. That is very important, because the balance is quite sophisticated.

The Minister used the expression “when the evidence emerges”, as did the noble Viscount, Lord Camrose, in another context last week. I would have thought that these organisations know what they are about, and they have provided some pretty comprehensive evidence about the impact on their businesses. Is that not a pretty good reason for the Government to think that they might not have this set of provisions entirely right, quite apart from the other aspects of this group of amendments? If that evidence is not enough—I read out the list of organisations—the Government are more or less saying that they will not accept any evidence.

I thank both noble Lords for their interventions. On the point from the noble Lord, Lord Bassam, there is a trifecta of decision-making between the Secretary of State, the ICO and the organisations all working together. That is why there is a consultation requirement before using the power. On the point from the noble Lord, Lord Clement-Jones, it is a question of your point of view; we feel that we have done stakeholder engagement and believe that we have got the balance right between the needs of organisations—

Will the Minister write and unpack exactly what the balance of opinion was? We are talking about pretty crucial stuff here. It is not always a question just of numbers; it is quite often a question of weighting the arguments. The Minister should write to us and tell us how they came to that conclusion, because the case was clearly being made during the consultation, but the Government have effectively ignored it.

I am not a gambling man. It is an interesting term. The Minister is suggesting that power rests equally among those three elements but it does not. The Secretary of State is the all-powerful being and the commissioner is there to ensure that regulation works effectively. How will this operate in practice? There is no advisory body here; it is the Secretary of State having a discussion with the commissioner and then, on the balance of some of the consultation information that comes in, making a decision. That will not enable the sector, the market and those providers to be engaged.

I thank noble Lords for those further points requesting clarification. On how we have come to this decision, I am happy to write to all noble Lords in the Committee. The noble Lord went in an interesting direction because, in the context of the rest of the Bill, so many of the amendments have been about protecting private users, but the noble Lord seems to be swaying more in favour of the advertisers here.

My Lords, it is all about the relative importance and the weighting. Maybe that is a good illustration of where the Government are not getting their weighting correct for the beginning and this part of the Bill.

I take the noble Lord’s point. We are working with industry and will continue to do so. For the benefit of the Committee, we are, as I said, happy to write and explain the points of view, including those from Data: A New Direction. In response to the noble Lord, Lord Bassam, power ultimately lies with Parliament via the affirmative resolution procedure for the Secretary of State power.

I will go back to the amendments we were discussing. This regulation applies to complex and technical markets. The very reason we have taken a delegated power is so that the new exemptions can be carefully created in consultation with all affected stakeholders. As I explained, the Bill includes a requirement to consult the Information Commissioner, the Competition and Markets Authority and any other relevant stakeholders, which would include trade associations and consumers or web users.

Amendment 201 would widen the application of the “strictly necessary” exemption. Currently, it applies only to those purposes essential to provide the service requested by the user. Amendment 201 would extend this exemption so that it applies to the purposes considered essential to the website owner. We do not think this would be desirable, as it would reduce a user’s control over their privacy in a way that they might not expect.

For the reasons I have set out—and once again reaffirming the commitment to write to noble Lords on how the weighting was worked out—I hope my noble friend and the noble Baroness will not press their amendments.

My Lords, my noble friend makes a good point. I can promise all Members that there will be thematic meetings between Committee and Report.

My Lords, I am grateful for that assurance from my noble friend.

On the first amendments, clearly, we are dealing with something that is quite tricky and technical. My noble friend sees these amendments in a different light to me. It is possible that my drafting may be imperfect; that has never happened before, of course, but there is always a first time. Therefore, I seek an opportunity to look at this issue in detail. It is absolutely not my objective to engage the objections; this is something where my noble friend’s objections are valid. My amendment is not intended in any way to allow tracking or profiling. If I am wording things imperfectly or imagining something that just cannot be achieved in practice, the best way to deal with these matters would be to hammer them out in a technical discussion, not in Committee. I would happily look to an opportunity to do that between Committee and Report.

When it comes to new Regulation 6B and its ramifications, as the debate has gone on, I have found myself favouring more and more the amendment in the name of the noble Baroness, Lady Jones of Whitchurch. This is an uncontrolled bit of power that we are looking to give the Government, with some serious implications. It should not be done. We should wait until the technology is available and then do something when we can really take our time to look at the options. Again, this is something that we will have a chance to talk through.

It is really important that, in doing what seems to be convenient—as my noble friend put it, it is about getting rid of an irritation and making the whole process of giving permission much more effective; I am absolutely with him on that—we make sure that we are not letting ourselves in for some greater dangers. I personally want to make sure of that. The oldies among us—most of us, I suspect—will remember when Google said, “Don’t be evil”. I wish that it had kept to that.

For now, I beg leave to withdraw my amendment.

Amendment 199 withdrawn.

Amendments 200 to 205 not moved.

Clause 109 agreed.

Clauses 110 and 111 agreed.

Clause 112: Duty to notify the Commissioner of personal data breach: time periods

Amendments 206 and 207

Moved by

206: Clause 112, page 139, line 13, at end insert—

“(1A) In regulation 5C of the PEC Regulations (personal data breach: enforcement)—(a) in paragraph (4)(f), for “from the service of the notice of intent” substitute “beginning when the notice of intent is served”, and(b) in paragraph (5), for “21 days of receipt of the notice of intent” substitute “the period of 21 days beginning when the notice of intent is received”.”Member's explanatory statement

This amendment adjusts the language of regulation 5C of the Privacy and Electronic Communications (EC Directive) Regulations 2003 so it is consistent with language used in new provisions inserted into those Regulations by clause 116 of the Bill.

207: Clause 112, page 139, line 24, at end insert—

“(iii) after the third subparagraph insert—“This paragraph is to be interpreted in accordance with Article 3 of Regulation (EEC, Euratom) No. 1182/71 of the Council of 3 June 1971 determining the rules applicable to periods, dates and time limits.”, and” Member’s explanatory statement

This amendment provides for the rules of interpretation in Article 3 of Regulation No 1182/71 (rules of interpretation regarding periods of time etc) to apply to Article 2(2) of Regulation (EU) No 611/2013 on the measures applicable to the notification of personal data breaches.

Amendments 206 and 207 agreed.

Clause 112, as amended, agreed.

Amendment 208

Moved by

208: After Clause 112, insert the following new Clause—

“Emergency alerts: interpretation of time periodsIn regulation 16A of the PEC Regulations (emergency alerts), in paragraph (6), for the words from “7 days” to “paragraph (3)(b)” substitute “the period of 7 days beginning with the day on which the time period specified by the relevant public authority pursuant to paragraph (3)(b) expires”.”Member’s explanatory statement

This amendment adjusts a description of a period of time in regulation 16A(6) of the Privacy and Electronic Communications (EC Directive) Regulations 2003 to clarify that the day on which the time period specified under regulation 26A(3)(b) expires (which triggers the 7 day period mentioned in regulation 16A) is included in the 7 days.

Amendment 208 agreed.

Amendment 208A

Moved by

208A: After Clause 112, insert the following new Clause—

“Prohibition on unsolicited calls regarding personal injury claims(1) The PEC Regulations are amended as follows.(2) In regulation 21 (calls for direct marketing purposes), in paragraph (6), leave out “or 21B” and insert “21B or 22A”.(3) In regulation 22 (use of electronic mail for direct marketing purposes), after paragraph (4) insert—“(5) Paragraph (1) does not apply to a case falling within regulation 22A.”(4) After regulation 22 insert—“22A Unsolicited calls and use of electronic mail by claims management companies for personal injury claims(1) A person must not—(a) use, nor instigate the use of, a public electronic communications service for the purpose of making unsolicited telephone calls for direct marketing, and(b) transmit, nor instigate the transmission of, unsolicited communications for the purpose of direct marketing by means of electronic mail or otherwise,if the conditions in subsection (2) are met.(2) The conditions are that—(a) the person making or instigating the call or transmitting or instigating the use of electronic mail—(i) is acting on behalf of a claims management service, or(ii) does so with a view to providing information to a claims management service, and(c) the purpose of the call or the electronic mail is to engage a consumer in commencing a claim for a personal injury. (3) In this regulation—“claims management service” has the meaning given by section 419A of the Financial Services and Markets Act 2000;“unsolicited” means an approach which has not been specifically requested, even if a person has consented to receive marketing information;“claim for a personal injury” means proceedings in which there is a claim for damages in respect of personal injuries to the claimant or any other person or in respect of a person’s death, and“personal injuries” includes any disease and any impairment of a person’s physical or mental condition.””Member's explanatory statement

This new Clause seeks to implement an outright ban on cold calling and spam texts from claims management companies for personal injury claims. Claims management companies would only be allowed to contact people about personal injury claims if they have specifically requested to be contacted about a potential claim.

My Lords, in moving this amendment, I will also speak to the other amendments in this group in the name of my noble friend Lady Jones of Whitchurch: Amendments 209 to 211 and 215.

It is estimated that a staggering 134 million personal injury compensation calls and texts have been made and sent in the UK in the past 12 months. YouGov research shows that more than 20 million people were contacted by companies touting for business through injury compensation claims. Personally, I have had more than my fair share, so I suppose I must declare an interest in this issue.

However, unsolicited calls are more than just a modern-day nuisance. If people have suffered an accident, they can be reminded of the trauma. People’s hopes of compensation can be raised cynically and unrealistically in order to encourage them to share personal financial information that can then be used to scam them out of their money. Research shows strong emotional responses to these calls. People are left feeling angry, anxious, disgusted and upset. That is hardly a surprise when they are being pestered in their own homes or on their own phones.

Some 89% of people surveyed want a total ban on such calls. The Association of Personal Injury Lawyers, which campaigns on behalf of people injured by negligence, also wants the Government to ban cold calls encouraging personal injury claims. It knows that such practices are exploitative and intrusive, and that they often prey on the elderly and vulnerable. In fact, these calls are rarely, if ever, based on whether a person might have a genuine claim. Solicitors are banned from cold calling for personal injury claims but claims management companies are still allowed to contact people. For them, it is simply a numbers game, and it is made possible and cheap by modern communications technology.

The Privacy and Electronic Communications (EC Directive) Regulations 2003 set up rules relating to unsolicited electronic marketing for messages sent by fax, telephone, email or text—we do not have to worry about unsolicited faxes now because they are not around any more, but that indicates that our current legislation is somewhat out of date. That is what Amendment 208A seeks to rectify. It would facilitate an outright ban on these calls and would allow claims management companies to contact people about personal injury claims only if they had specifically requested such contact. I hope that the Government will support it.

On Amendments 211 and 215 to Clause 116, while Labour supports the Government’s ambitions to tackle nuisance calls, we believe that establishing a duty to notify the ICO of unlawful direct marketing does not engage reasonably with the practical realities of telecoms companies, or the technology available to them, in fulfilling their obligations. These amendments would remove some of their get-out-of-jail-free cards—some potential excuses that operators could use to avoid making any substantial efforts to change the status quo and reduce nuisance calls.

Amendment 211 clarifies that intercepting or examining the content of any communication is not required in order to comply with the duty to inform the commissioner. Amendment 215 would ensure that appropriate guidance was in place within six months so that everyone was aware of them; hopefully, that would tighten the rules of the game. If the Minister is not inclined to accept Amendment 215, perhaps he could tell the Committee what engagement the Government have been undertaking with interested parties since the Bill passed its Commons stages.

On this matter in particular, I am more than happy to receive the Minister’s response in the Room, by telephone call or by text, but not by fax. I beg to move.

My Lords, I support Amendment 208A. I declare my interest as a solicitor but not one who has been directly involved with personal injury claims. This is an area of particular specialism that requires particular expertise and experience for it to be carried out to the best advantages of those who seek that help.

Looking back, I am concerned that this matter has been raised, in different fora, on a number of occasions. For instance, in 2016, the Telephone Preference Scheme opt-out was discussed when it was removed from the control of Ofcom to that of the ICO. At that point, there was a great opportunity for this matter to be dealt with. Indeed, a number of organisations, including personal injury lawyers, the Motor Accident Solicitors Society and others, said that it was vital to carry this out and that cold calling should be ended because of the pressures it placed on an awful lot of very vulnerable people.

Since 2016, things have got worse in one respect—although, perhaps, they are a little less bad in respect of telephone calling. It is a little while now since I was last told that I had just had a major accident in my car as I was sitting enjoying a glass of wine and not having such worries in my mind. Telephone cold calling seems to have diminished but pressures through social media contact, various scams and so on have increased dramatically. I have been told this by a number of my legal colleagues.

In 2023, the Government produced the UK’s Fraud Strategy. As I am sure noble Lords will know, when it was published, it specifically pursued the question of extending the ban on cold calling to personal injury cases; that was very important and included all servers. So, unless there is some relationship already in place—something where that is a defence, as it were, here—and a voluntary willingness on the part of those who suffer from personal injuries to be contacted by an organisation with which they already have a relationship, this is something that we should pursue very strongly indeed.

Although it is correct that the legal profession, and perhaps other professions, are banned from this procedure, on a regulatory or disciplinary basis, some of my colleagues in the profession are, in some cases, susceptible to financial and commercial challenges through these organisations, such that they would become—sometimes, almost inadvertently—part of the process. Therefore, I hope that, in passing such an amendment, we would give a clear sign to the Solicitors Regulation Authority and the Law Society that it underlines yet again that these practices are not acceptable to those members of the profession.

My Lords, I support Amendment 208A. I am a recovering solicitor. Many moons ago, I gave public affairs advice to the Association of Personal Injury Lawyers, which is a fine organisation. I very much support its call and this amendment on that basis. I congratulate the noble Lord, Lord Leong, on his introduction to this amendment; he and the noble Lord, Lord Kirkhope, made a terrific case.

APIL took the trouble to commission research from YouGov, which showed that 38% of UK adults had received a cold call or text while 86% had a strong emotional response and were left feeling annoyed, angry, anxious, disgusted or upset. Therefore, the YouGov research reveals that almost all those who received a call supported a total ban on personal injury cold calls and text messages.

There is little for me to add but I am sorry that the noble Baroness, Lady Buscombe, is not with us—she has just exited the Room, which is unhappy timing because, in looking back at some of the discussions we have had in the House, I was about to quote her. During Report stage in the Lords on the Financial Guidance and Claims Bill, when she was a Minister, she told us:

“We know that cold calls continue and understand that more needs to be done truly to eradicate this problem. We have already committed to ban cold calls relating to pensions, and are minded to bring forward similar action in relation to the claims management industry. I have asked officials to consider the evidence for implementing a cold-calling ban in relation to claims management activities, and I am pleased to say that the Government are working through the detail of a ban on cold calling by claims management companies. There are complex issues to work through, including those relating, for example, to EU directives”;

of course, we do not have those any more. She went on to say:

“We would therefore like time to consider this important issue properly, and propose bringing forward a government amendment in the other place to meet the concerns of this House”.—[Official Report, 24/10/17; col. 861.]

How much time do the Government need? Talk about unfinished business. I know it is slightly unfair as you can unearth almost anything in Hansard but the fact is that this is bull’s eye. It is absolutely spot on on the part of APIL to have found this. I thought for one delirious minute that the noble Baroness, Lady Buscombe, was going to stand up and say, “Yes, I plead guilty. We never pursued this”.

I have texted the noble Baroness asking her to return as soon as possible so that she can listen to the noble Lord’s wise words.

I am not going to carry on much longer. I know that that will be a grave disappointment but it makes the case, I think, that it is high time that the Government did something in this area. It is clearly hugely unpopular. We need to make sure that Amendment 208A is passed. If not now, when?

My Lords, I thank the noble Baroness, Lady Jones of Whitchurch, for tabling Amendment 208A and the noble Lord, Lord Leong, for moving it. This amendment would insert new Regulation 22A into the privacy and electronic communications regulations and would prohibit via email or text unsolicited approaches encouraging people to commence personal injury claims sent by, or on behalf of, claims management companies.

The Government agree that people should not receive unsolicited emails and texts from claims management companies encouraging them to make personal injury claims. I assure noble Lords that this is already unlawful under the existing regulations. Regulation 22(2) prohibits the sending of all unsolicited electronic communications direct marketing approaches—including, but not limited to, texts and emails—unless the recipient has previously consented to receiving the communication. Regulation 21A already bans live calling by claims management companies.

In the past year, the Information Commissioner has issued fines of more than £1.1 million to companies that have not adhered to the direct marketing rules. Clause 117 considerably increases the financial penalties that can be imposed for breaches of the rules, providing a further deterrent to rogue claims management and direct marketing organisations.

Amendments 211 and 215 relate to Clause 116 so I will address them together. Amendment 211 seeks to confirm that a provider of a public electronic communications service or network is not required to intercept or examine the content of any communication in order to comply with the new duty introduced by Clause 116. I assure the noble Baroness and the noble Lord that the duty is a duty to share information only. It merely requires providers to share any information that they already hold or gather through routine business activities and which may indicate suspicious unlawful direct marketing on their networks; it does not empower, authorise or compel a communications provider to intercept messages or listen to phone calls.

Should a communications provider become aware of information through its routine business activities that indicates that unlawful direct marketing activity may be taking place on its service or network, this duty simply requires it to share that information with the Information Commissioner. For example, a communications provider may receive complaints from its subscribers who have received numerous unsolicited direct marketing communications from a specific organisation. We know from the public consultation that people want action taken against nuisance calls and spam, and this duty will support that.

Amendment 215 seeks to delay commencement of the new duty for a period of six months after the Information Commissioner’s Office has published its guidance on what may constitute reasonable grounds for suspecting a breach of the direct marketing rules. We are committed to working with the ICO and the sector to agree a sensible plan for implementation. We have engaged in detail with the ICO and industry on this matter and will continue to do so. Setting timings in the legislation could be counterproductive if a shorter or longer period is needed to prepare. Setting dates through secondary legislation benefits the sector by ensuring flexibility over timings.

For these reasons, I hope that the noble Lord will withdraw the amendment.

My Lords, I thank all noble Lords who have spoken, especially the noble Lords, Lord Kirkhope and Lord Clement-Jones, who have kindly supported this amendment.

I shall just make two points. The first is that “unlawful” is just not good enough. People are still carrying on making these cold calls. Sometimes we have to listen to experts. The Law Society says that they are banned from making cold calls, and the Association of Personal Injury Lawyers is asking for a ban. Sometimes, as politicians, we need to listen to people who perhaps know more than we do. If they are asking for it, it is basically because they need this clarified. I hope that the Minister will look at this again.

As for Amendments 211 and 215, perhaps the Minister could share with me the detail of the various points just made about the sharing data with various other stakeholders. If he could write to us or share it with us, that would satisfy our position.

On that basis, I beg leave to withdraw the amendment.

Amendment 208A withdrawn.

Clause 113: Use of electronic mail for direct marketing purposes

Amendment 209

Moved by

209: Clause 113, page 139, line 37, leave out “, political or other” and insert “or”

Member’s explanatory statement

This amendment would remove the introduction of soft opt-in for political parties and campaigners, whose activity is governed by other regulation.

My Lords, in moving Amendment 209, I will also speak to Amendment 210, and I thank the noble Lord, Lord Clement-Jones, for adding his support.

These amendments return to the major debate that we had on day 2 in Committee regarding direct marketing for the use of democratic engagement. It is fair to say that no-one was convinced by the Minister’s arguments about why that relaxation of the rules for political parties was necessary. We will no doubt return to that issue on Report, so I shall not repeat the arguments here. Meanwhile, Clause 113 leads into the democratic engagement provisions in the Bill and provides a soft opt-in for the use of electronic mail for direct marketing for charitable, political or other non-commercial activities when the data has been collected for other purposes.

As we made clear in the previous debate, we have not asked for these more relaxed rules about political electronic marketing. We believe that these provisions take us fundamentally in the wrong direction, acting against the interests of the electorate and risking damaging the already fragile level of trust between politicians and voters. However, we support extending the soft opt-in for charities and other non-commercial organisations. This is a measure that many charities have supported.

Of course, we want to encourage campaigning by charitable organisations to raise awareness of the critical issues of the day and encourage healthy debate, so extending their opportunities to use electronic marketing for this purpose could produce a healthy boost for civic engagement. This is what our amendments are hoping to achieve.

Therefore, our Amendments 209 and 210 would amend the wording of Clause 113 to remove the relaxation of the rules specifically for political parties and close the loophole by which some political parties may try to negate the provisions by describing themselves as non-commercial entities. We believe that this is the right way forward. Ideally, these amendments would be combined with the removal of the democratic engagement provisions in Clause 114 that we have already debated.

I hope noble Lords will see the sense of these proposals and that the Minister will agree to take these amendments away and rethink the whole proposition of Clauses 113 and 114. I beg to move.

My Lords, tracking the provenance of Clause 113 has been a very interesting exercise. If we think that Clause 114 is pretty politically motivated, Clause 113 is likewise. These rules relating to the fact that political parties cannot avail themselves of the soft opt-in provision have been there since 2005. The Information Commissioner issued guidance on political campaigning, and it was brought within the rules. Subsequently, there has been a ruling in a tribunal case which confirmed that: the SNP was issued with an enforcement notice and the information tribunal dismissed the appeal.

The Conservative Party was fined in 2021 for sending emails to people who did not ask for them. Then, lo and behold, there was a Conservative Party submission to the House of Lords Democracy and Digital Technologies Committee in 2020, and that submission has been repeated on a number of occasions. I have been trying to track how many times the submission has been made by the Conservative Party. The submission makes it quite clear that there is frustration in the Conservative Party. I have the written evidence here. It says:

“We have a number of concerns about the Information Commissioner’s draft code”—

as it then was: it is now a full code—

“on the use of data for political campaigning. In the interests of transparency, I enclose a copy of the response that the Conservative Party sent to the consultation. I … particularly flag the potential chilling effect on long-standing practices of MPs and councillors from engaging with their local constituents”.

Now, exactly as the noble Baroness has said, I do not think there is any call from other political parties to change the rules. I have not seen any submissions from any other political party, so I would very much like to know why the Government have decided to favour the Conservative Party in these circumstances by changing the rules. It seems rather peculiar.

The guidance for personal data in political campaigning, which I read while preparing for this debate, seems to be admirably clear. It is quite long, but it is admirably clear, and I congratulate the ICO on tiptoeing through the tulips rather successfully. However, the fact is that we have very clear guidance and a very clear situation, and I entirely agree with the noble Baroness that we are wholly in favour of charities being able to avail themselves of the new provisions, but allowing political parties to do so is a bridge too far and, on that basis, I very much support the amendment.

My Lords, I thank the noble Baroness, Lady Jones, for Amendments 209 and 210, which would amend Clause 113 by removing electronic communications sent by political parties from the scope of the soft opt-in direct marketing rule. A similar rule to this already exists for commercial organisations so that they can message customers who have previously purchased goods or services about similar products without their express consent. However, the rule does not apply if a customer has opted out of receiving direct marketing material.

The Government consider that similar rules should apply to non-commercial organisations. Clause 113 therefore allows political parties, charities and other non-commercial organisations that have collected contact details from people who have expressed an interest in their objectives to send them direct marketing material without their express consent. If people do not want to receive political messaging, we have included several privacy safeguards around the soft opt-in measure that allow people to easily opt out of receiving further communications.

Support for a political party’s objectives could be demonstrated, for example, through a person’s attendance at a party conference or other event, or via a donation made to the party. In these circumstances, it seems perfectly reasonable for the party to reach out to that person again with direct marketing material, provided that the individual has not objected to receiving it. I reassure the Committee that no partisan advantage is intended via these measures.

My Lords, perhaps the Minister could elucidate exactly what is meant by “supporting the party’s objectives”. For instance, if we had a high street petition, would that be sufficient to grab their email address and start communicating with them?

I suppose it would depend on the petition and who was raising it. If it were a petition raised or an activity supported by a particular party, that would indicate grounds for a soft opt-in, but of course anyone choosing not to receive these things could opt out either at the time or later, on receipt of the first item of material.

So what the Minister is saying is that the solicitor, if you like, who is asking you to sign this petition does not have to say, “Do you mind if I use your email address or if we communicate with you in future?” The person who is signing has to say, “By the way, I may support this local campaign or petition, but you’re not going to send me any emails”. People need to beware, do they not?

Indeed. Many such petitions are of course initiated by charitable organisations or other not-for-profits and they would equally benefit from the soft opt-in rule, but anyone under any of those circumstances who wished not to receive those communications could opt out either at the time or on receipt of the first communication on becoming aware that they were due to receive these. For those reasons, I hope that the noble Baroness will not press her amendments in relation to these provisions.

My Lords, I thank the noble Lord, Lord Clement-Jones, for digging and delving into the background of all this. That is helpful because, all the way through our previous debate, we kept saying, “We don’t understand why these provisions are here”. When the Minister in the Commons was challenged, he said, “We have no intention of using this; it’s just a general power that might be there for anyone to use”, but the noble Lord has put the lie to all that. It is clear that only one party wants to pursue this issue: the Conservative Party.

The Minister said that there is no partisan objective or reason for this but, to be honest, I do not know how he can say that. If only one party wants it and no one else does, then only one party is going to implement it. Without going over the whole of the previous debate, I think a lot of people felt that we as political parties have a lot to do to improve our relationships with the electorate and be seen to represent them on an honest and authentic basis.

This goes in the opposite direction. It is almost collecting data for one purpose and using it for a different one. The noble Lord, Lord Clement-Jones, and the Minister discussed the example of collecting information on a street stall; we have all done that a bit, in that you can put very generalised questions on a questionnaire which could then be used for all sorts of purposes.

This is certainly not how we want to proceed and I would like to think that the Conservative Party would not want to proceed on this basis either. Our amendments today are specifically on allowing charities and non-commercial organisations to do it. I think we have accepted that proposal but, as far as we are concerned—I absolutely agree with the noble Lord on this—political parties are a bridge too far. We will return to this on Report. I beg leave to withdraw my amendment.

Amendment 209 withdrawn.

Amendment 210 not moved.

Clause 113 agreed.

Clauses 114 and 115 agreed.

Clause 116: Duty to notify the Commissioner of unlawful direct marketing

Amendment 211 not moved.

Amendments 212 to 214

Moved by

212: Clause 116, page 145, line 14, leave out “with the day on which” and insert “when”

Member's explanatory statement

The amendment in my name to insert a new clause after clause 108 will apply the rules of interpretation in Article 3 of Regulation No 1182/71 to the Privacy and Electronic Communications (EC Directive) Regulations 2003. This amendment adjusts the language of new regulation 26A(3) of those Regulations to ensure that Article 3 is able to apply.

213: Clause 116, page 145, line 37, leave out “with the day” and insert “when”

Member's explanatory statement

The amendment in my name to insert a new clause after clause 108 will apply the rules of interpretation in Article 3 of Regulation No 1182/71 to the Privacy and Electronic Communications (EC Directive) Regulations 2003. This amendment adjusts the language of new regulation 26B(4) of the 2003 Regulations to ensure that Article 3 is able to apply.

214: Clause 116, page 145, line 40, leave out from “beginning” to end of line and insert “when the notice of intent is received”

Member's explanatory statement

This amendment adjusts the language of new regulation 26B(5) of the Privacy and Electronic Communications (EC Directive) Regulations 2003 to ensure that Article 3 of Regulation No 1182/71 is able to apply to it and also makes a small change to when the 21 day period starts.

Amendments 212 to 214 agreed.

Amendment 215 not moved.

Clause 116, as amended, agreed.

Clause 117 agreed.

Schedule 10 agreed.

Clauses 118 and 119 agreed.

Clause 120: The eIDAS Regulation

Amendment 216

Moved by

216: Clause 120, page 151, line 25, leave out “124” and insert “(Time periods: the eIDAS Regulation and the EITSET Regulations)”

Member's explanatory statement

This amendment is consequential on the amendment in my name to insert a new clause after clause 124.

Amendment 216 agreed.

Clause 120, as amended, agreed.

Clauses 121 to 124 agreed.

Amendment 217

Moved by

217: After Clause 124, insert the following new Clause—

“Time periods: the eIDAS Regulation and the EITSET Regulations(1) In Chapter 1 of the eIDAS Regulation (general provisions), after Article 3 insert—“Article 3APeriods of timeReferences in this Regulation to a period expressed in hours, days, months or years are to be interpreted in accordance with Article 3 of Regulation (EEC, Euratom) No. 1182/71 of the Council of 3 June 1971 determining the rules applicable to periods, dates and time limits.”(2) The Electronic Identification and Trust Services for Electronic Transactions Regulations 2016 (S.I. 2016/696) are amended as follows.(3) In regulation 2 (interpretation), at the end insert—“(3) References in these regulations to a period expressed in days or years are to be interpreted in accordance with Article 3 of Regulation (EEC, Euratom) No. 1182/71 of the Council of 3 June 1971 determining the rules applicable to periods, dates and time limits.”(4) In Schedule 1 (monetary penalties)—(a) in paragraph 4(f), for the words from “a period” to the end substitute “the period of 21 days beginning when the notice of intent is served”,(b) in paragraph 5, for the words from “a period” to the end substitute “the period of 21 days beginning when the notice of intent is received”, and(c) in paragraph 6, for the words from “a period” to the end substitute “the period of 21 days beginning when the notice of intent is served”.”Member's explanatory statement

This amendment provides for the rules of interpretation in Article 3 of Regulation No 1182/71 (rules of interpretation regarding periods of time etc) to apply to Regulation (EU) No. 910/2014 on electronic identification and trust services and to the Electronic Identification and Trust Services for Electronic Transactions Regulations 2016.

Amendment 217 agreed.

Clause 125 agreed.

Amendment 218 not moved.

Clauses 126 and 127 agreed.

Clause 128: Power to require information for social security purposes

Debate on whether Clause 128 should stand part of the Bill.

My Lords, I also submit that Schedule 11 should not stand part of the Bill. I note the amendments from the noble Baroness, Lady Sherlock, which seek to temper the impact of these powers, but they do not go far enough. To have these clauses in a Bill labelled “data protection” contradicts its very title. I thank the noble Baroness, Lady Chakrabarti, and the noble Lords, Lord Clement-Jones and Lord Kamall, for their support. The noble Lord, Lord Anderson, is detained elsewhere but he asked that I raise a number of his concerns. I am grateful for his experience, as I am for the legal opinion provided by Dan Squires KC and Aidan Wills of Matrix Chambers.

The provisions create new powers for the DWP to obtain information about the bank accounts of people who receive benefit payments by requiring financial institutions to monitor customers’ accounts, to identify cases that merit further consideration and to establish whether the relevant benefits are being, or have been, paid in accordance with the law. Paragraph 2(1) of proposed new Schedule 3B makes it clear that the information that can be requested is very wide indeed, although it is not specified.

Schedule 11 also sets out provisions that would allow the DWP to issue account information notices; those AINs would apply to any account into which benefits will be, are being or have been paid within the past year, as well as to any account linked to such an account. The account holder may be a person who is entitled to the benefit or a person who receives the payment on their behalf, such as a parent, partner or carer. It may also include a joint account holder or, where housing benefit is paid direct, a landlord and all their related accounts.

All benefits, both those that are means tested and those that are not—child tax credit, the state pension, personal independence payments, the disability living allowance, working tax credit, universal credit and the employment and support allowance—are in scope. Counsel’s advice is that it is

“reasonable to assume that AINs will be issued on a rolling basis to most financial institutions which provide banking services and, in order to comply, financial institutions would need to subject most, if not all, of their account holders to algorithmic surveillance”.

Counsel also found that an AIN being issued to a particular financial institution would almost certainly be secret, to avoid tipping off account holders, and that the criteria triggering a search would also be kept confidential.

The Social Security Administration Act 1992 already contains powers for the Secretary of State to compel banks and others to provide information in order to ascertain whether a benefit is being paid correctly, as well as to prevent, detect and secure evidence of benefit fraud—that is to say, the DWP already has these powers if it has reasonable grounds to suspect that fraud is taking place. What is proposed is that the DWP no longer has to have a suspicion of wrongdoing but can survey vast swathes of the UK population without their knowledge in order proactively to surface cases that may or may not merit further consideration.

The legal opinion is also pretty damning on whether the powers contravene Article 8 on the possibility of extremely private information—such as on political allegiance and sexuality—being accessed, and it is equally damning on both the practicalities and the lack of oversight. If the noble Lord, Lord Anderson, had been with us, he would have made the following points. First, this is a power to collect highly sensitive personal information in bulk. Such powers exist under the Investigatory Powers Act but are attended by an array of statutory safeguards, ranging from authorisation of the original warrant, which must be approved by an independent judicial commissioner, and checks on the level of material requested to other issues such as record keeping, retention, dissemination and destruction, error reporting and a right to reply to the Investigatory Powers Tribunal. Few, if any, of these safeguards exist in the Schedule 11 power.

Secondly, the full extent and significance of the power will be apparent only once there is a code of practice. However, there is no draft code of practice and no commitment to produce one; there is merely a discretion. This is in sharp contrast to the Investigatory Powers Act, where key excerpts were made available in advance of Committee in both Houses. The impact of Schedule 11 on privacy is arguably much greater, yet we have seen no draft code of practice—indeed, we cannot be sure that a code of practice will be issued at all.

Finally, Schedule 11 contrasts with HMRC’s much more limited power to access information and documents for the purpose of checking a taxpayer’s tax position or collecting a tax debt. Under paragraph 4A of Schedule 36 to the Finance Act 2008, HMRC has been able to authorise a financial information notice on an individual, but not on a bulk basis. An FIN, unlike an AIN, must name the taxpayer to whom it relates. The most recent corporate report records that only 647 FINs were issued in the year to March 2023—an insignificant number in relation to the proposals in front of us. I hope that, when he responds, the Minister will be able to explain why investigating tax fraud is so carefully and narrowly constructed, whereas the DWP measures that will impact many more millions of people, a significant proportion of whom do not even receive benefits, are so broad.

On the day I tabled my amendments, I received an email from a woman who cares for her adult son with complex needs. She has a bank account to receive his benefits, from which she pays for his care. Under the terms of the Government’s proposal, all her bank accounts would be connected to his payments and therefore open to monitoring. Caring for an adult child is a heavy burden for a parent. Many parents do it with a love-filled grace that is humbling to witness, but it is a task that is out of season with the life that most of us live and all of us expect, in which children grow up, leave home and, as our strength wanes, come to our aid. It is also a service that the Government—and, by extension, all the rest of us—rely on.

In 2023, the University of Sheffield and Carers UK estimated that unpaid care, largely from family members, saved UK plc a whopping £162 billion a year, dwarfing the £120 million the Government expect to retrieve by these measures. It is nothing less than cruel to make a claimant or carer anxious, let alone homeless. But, if I cannot appeal to the Government’s compassion, I hope they will consider this: some who have contacted me suggested that they would no longer be prepared to continue to hold accounts on behalf of others; others suggested that their landlords would not be prepared to let them rent; and one said that their mental health had already suffered at the prospect. How many families need to put caring responsibilities back on the state, how many landlords need to make people on benefits homeless and how many people need to seek support from mental health services before the advertised gains are eroded?

For the life of me, I cannot work out whether these measures are intended to hurt or whether a focus on the shiny prospect of AI to sort out the DWP’s problems led incrementally to this place. Whichever it is, the measures are cruel to a degree that should worry us all. In a later group of amendments, we will discuss the capacity for technological systems to malfunction. Horizon might be top of mind, but Nationwide, McDonald’s, Tesco, Sainsbury’s, Greggs, 999, air traffic control and public bodies, including the NHS and DWP, have all experienced technology failures where service provision suffered.

I am not against technology—we live in a world organised by technological systems—but introducing a system that may impact the finances of up to 40% of the UK’s population, including the most vulnerable, the poorest and the oldest, without checks and balances and, indeed, while downgrading the protections on automated decision-making, is dangerous.

Can the Minister can tell the Committee what plans the DWP has for when things go wrong, when people have benefits stopped and their children go hungry because the computer says no? Can he tell us how it will prevent a repeat of the hounding of so-called fraudulent payments, as is currently being reported in relation to the carer’s allowance, until people lose homes, jobs and mental health as a result of overpayments? In many cases, they were the department’s own fault and, in one case, involved as little as 30p a week. What has the department learned from a similar Australian scheme that, over 12 months, resulted in 1 million additional welfare payments being stopped, often without warning and notified by text with no human to complain to? That scheme dissipated as it became unworkable.

It is reported that the department anticipates 74,000 prosecutions and 2,500 custodial sentences over the course of 10 years. This is a dangerous move from a Government who have refused an AI regulator and are yet to absorb fully the costs and learnings of the Horizon scandal.

Lastly, it is disproportionate. I am supportive of tackling fraud—whether tax, money laundering, Covid, electoral or benefit—but the DWP already has the powers to tackle suspected fraud. This point was echoed by the Information Commissioner, who, in December 2023, said that he had

“not yet seen sufficient evidence that the measure is proportionate”

and that he is

“unable, at this point, to provide my assurance to Parliament that this is a proportionate approach”.

Last month, he again confirmed that the Bill, as currently drafted, remains disproportionate.

It will be of interest to many noble Lords to understand that receiving the state pension, which is calculated by the Government and given without means testing to most recipients, means that their own bank accounts will be subject to the provisions. Meanwhile, I have submissions from 42 organisations representing the diverse concerns of tens of millions of UK citizens, including those providing end-of-life care. The Equality and Human Rights Commission has advised the Government that the clause should be removed. Bank lobbyists have highlighted the huge drain on resources that would be better placed fighting serious fraud and organised criminal gangs. Criticisms have been widely reported by local, national and specialist media, including Computer Weekly, while concerned parents are speaking out on Mumsnet, which any Government take on at their peril.

Nesta will shortly publish a report showing that one in four households with children that are eligible for universal credit do not claim it—roughly 183,000 households—meaning that £8.4 billion is left unclaimed each year. I ask the Minister to say how much investment will be allocated to the measures in front of us and how much will be reserved to ensure that children in the UK who are entitled to benefits do not grow up in poverty unnecessarily.

This measure is cruel, dangerous, disproportionate and unwanted. I hope the Minister will not try to suggest that any of these organisations or signatories to the amendments are unconcerned about fraud. Fraud is something that we all pay for in the price of goods, our taxes and the undermining of public services. However, what is being proposed is nothing less than a giant fishing expedition focused on the vulnerable, the poor and the old. The DWP is grasping at surveillance to tackle a crisis in management and staffing; the fact that these measures are restricted only to benefit fraud, not to the many more billions that could be clawed back from Covid loans and tax fraud, reveals that, as currently formulated, this measure is ideological, not practical. I beg to move.

My Lords, it is a pleasure and a privilege to support that tour de force from the noble Baroness, Lady Kidron. I do not need to repeat it but, to summarise, I completely agree with the opinion from Matrix Chambers that, in addition to its immorality, this provision is in contravention of Article 8 of the European Convention on Human Rights on respect for private and family life—relating to correspondence in particular. It is not necessary or proportionate, as we have heard. It is discriminatory and, for the purposes of the convention, is not in accordance with law. Once more, as we have heard, promising the possibility of guidance in future is no substitute for properly confining a power of this kind. Instead, the power is breathtaking in its scope and in its intrusive nature over the most sensitive financial and other personal information that could be gleaned this way.

It is an intrusion and an indignity as the breaches of privacy are not just for vulnerable people who are on benefits—not only non-means-tested benefits but means-tested benefits too. They are also an intrusion on the financial privacy of those who have linked accounts, whether they are a family member who is helping out by way of paying carers, landlords and so on or a family member who gives a small gift to a vulnerable person on benefits. Perhaps that is the Government’s intention—I do not know—but it is breathtaking in its sweep and in the number of citizens and people in this country who will be caught up in it. That is what makes it disproportionate and not in accordance with law relying on hypothetical guidance.

The discriminatory aspect cannot be emphasised enough. There are, broadly speaking, two categories of people for these purposes in these islands: those who earn, have inherited or otherwise have enough wealth to come within the scope of HMRC and who should pay tax and not avoid it—that is, not defraud other taxpayers and the country as a whole; and those who are on benefits, whether means-tested or universal. Neither category of humanity should be exempt from fraud but nor should there be a discriminatory approach to policing any potential fraud. Why is it that, as we heard from the noble Baroness, Lady Kidron, we have this breathtaking snooper’s charter for those on benefits but a much more targeted approach to those who should be paying taxes? That discrimination cannot be justified.

What is the difference between the trawl in looking at people who are seeking to avoid tax, which is not a crime, and in looking at those who are possibly mis-stating the extent of their assets? In the noble Baroness’s view, how is the surveillance different in terms of this Bill?

I am grateful to the noble Baroness. It is not just my view. It was put very well by the noble Baroness, Lady Kidron, and, as I recall, is outlined in the legal opinion. HMRC’s powers are more targeted and have more safeguards.

When the noble Baroness says, “more targeted”, is what way are they more targeted? That is what I would like to know.

They relate to individual people by name, not whole sweeps of people who have done nothing wrong but get a particular benefit.

What I am advocating to the Committee is that, in terms of our approach in this country to everyone in either category—or to people who are sometimes in both categories because they are, for example, entitled to some universal benefits but none the less must pay tax on their earnings, inheritance or whatever—the appropriate approach is a targeted approach beginning with at least some reasonable suspicion that a person’s financial matters are a cause for concern. Once there is reasonable suspicion—not even hard proof—because of their activities, that should be the trigger for an intrusion into their affairs. We have had that approach to privacy in this country for a very long time; it is the approach that, broadly speaking, is entrenched in Article 8 of the convention. Even if one does not like human rights conventions, it is none the less a tradition that people in this country—not just lawyers—have long understood.

Further, and in reference to the remarks attributed to the noble Lord, Lord Anderson of Ipswich—who is not in his place, which is the reason why I am also risking being sensible—it is absolutely flabbergasting that there are greater checks and balances for investigating matters of national security than for investigating what could be minor benefit fraud. An example is the allegation that the person giving a Christmas present to their pensioner relative or their relative who is not able to work should trigger a response in the algorithm that this is somebody who should no longer be worthy of the benefit or who, worse still, should face criminality or even potential incarceration.

I cannot say how horrified I am that the Government should have proceeded with a measure of this kind even as we still learn about the extent of the injustice perpetrated on the postmasters. After what we are just beginning to understand about the postmasters, I cannot understand why the Government would allow this kind of discriminatory intrusion to be turbocharged by AI and inflict the potential for the same type of injustice—not just for a limited cohort of people who were unfortunate enough to be serving their communities by working as postmasters—on millions of people in the United Kingdom.

This is what Committee on a Bill is for. I will therefore calm myself in the knowledge and belief—and certainly the hope—that, in his response, the Minister will at least offer to meet with Members of the Committee who have put their names to the clause stand part notice from the noble Baroness, Lady Kidron, and with campaigners and experts to hear a little about the detail of the concerns and to compare this provision with the other provisions, as the noble Baroness, Lady Buscombe, suggested in relation to national security, or indeed for tax fraud. Nobody is suggesting that fraud should be perpetrated with impunity, but we must learn from the mistakes of injustices already perpetrated. They are perpetrated because of blanket trust in the authorities and AI and a lack of checks and balances. There were plenty of humans in the loop at the Post Office, but that is not enough. This is a sweeping power that will lead only to intrusion, discrimination and the worst kind of injustice. In the meantime, before that moment even comes, millions of people will live in fear.

My Lords, I will address, first, the exclusion of Clause 128 and, secondly, Amendment 219 in my name.

I spoke at Second Reading to oppose Clause 128. I was a little too late to put my name to the clause stand part notice in the names of the noble Baronesses, Lady Kidron and Lady Chakrabarti, and the noble Lords, Lord Clement-Jones and Lord Anderson. I would therefore like to address a few things relating to that before I move on.

This clause creates two kinds of citizen: those who are entitled to financial privacy and others who are not entitled to any privacy, just because they happen to be poor, old, sick, disabled, infirm and unfortunate. Hopefully, the Minister can explain the rationale for creating this form of discrimination. This discrimination will particularly affect women, because a lot of women receive social security benefits, and people of colour, who are generally paid poorly and often have to rely upon universal credit and other benefits to make ends meet. Hopefully the Minister will also be able to tell us how this squares with the levelling-up agenda. Certainly this clause does not really provide any fairness at all.

I have received lots of emails and letters and met individuals who are very concerned, as earlier speakers articulated, that they will be made homeless because their landlords will not want their bank accounts to be put under surveillance. What assessment have the Government made of the impact that this clause may have on future homelessness?

Many individuals have their benefits paid into a joint bank account. Under this, the third party, who does not receive any benefits, would be under surveillance. One lady wrote to me whose brother is in a mental institution and receives a very small state pension; no banks would open an account for him because they did not feel that they should grant one. Now his state pension is paid into her bank account to buy him clothes, shoes and the occasional bar of chocolate, and she is petrified that she will be under surveillance. What would this person in a mental institution do?

At Second Reading and even beforehand, the Minister said that the state pension is categorised as a benefit. What exactly is a “benefit”? Unlike most social security benefits, the state pension is taxable, based on national insurance contributions for a number of years and payable only on attaining a certain age. So by what logic is it considered a benefit? I hope the Minister can clarify.

At Second Reading, he referred to fraud prevention as a reason for having Clause 128, but was unable to provide any financial numbers on the state pension. When pressed, he said:

“Although proportionately fraud in the state pension is very low”—

whatever that means—

“it is still there. That will not be the initial focus, but the purpose is to future-proof the legislation rather than to have to keep coming back to your Lordships’ House”.—[Official Report, 19/12/23; col. 2217.]

Does “initial focus” mean that the Government have a timetable? If so, can they share it with us? What exactly is the extent of this fraud on the state pension? Who has committed it and how many people have been prosecuted? What kind of amounts are involved? Why are the rest of the pensioners, who have never committed any fraud, subject to this monitoring?

What does the Minister mean by “future-proof”? I do not know whether he has taken a ride in Doctor Who’s TARDIS—I have not and do not know what the future is, but the Minister said that this will “future-proof” the legislation. Why is that not followed through in other laws? For example, we could link benefits, public sector wages and personal allowances to inflation. That would certainly future-proof them, but there is no attempt whatever to apply this principle across our laws, so why is it being singled out? I do not know.

There is a more serious problem. I have received correspondence from pensioners who live abroad. Many recipients of the state pension live abroad, and the government website tells them:

“Your State Pension can be paid into … a bank in the country you’re living in … You can use … an account in your name … a joint account … someone else’s account—if you have their permission and keep to the terms and conditions of the account”.

Can the Minister name the countries which have agreed that the UK Government can snoop 24/7 on the bank accounts of their citizens or at least those of people resident there? What treaties have they signed with foreign Governments and what happens to the right of privacy, which is valued in those countries?

Many people have joint accounts, or the money is paid into “someone else’s account”, to use the Government’s phrase, which means that the third party with no contractual relationship with the UK Government will also become subject to surveillance. Can the Minister explain how many foreign Governments have agreed to this? According to the DWP website, certain benefits, such as maternity allowance and bereavement allowance, can also be paid to people living abroad. What agreements have been made with other countries? How many foreign banks have agreed that they will assist the Government in snooping on accounts held there when the banks are not supervised by the UK regulatory authority? There is clearly an international dimension, about which so far we have heard absolutely nothing from the Government.

I turn now to Amendment 219, which follows on from many of the points made by the noble Baroness, Lady Kidron, and my noble friend Lady Chakrabarti. As drafted, Clause 128 is really a weapon in the Government’s war on the old, the sick, the disabled, the infirm and the unfortunate. The Government camouflage this by claiming that it is about fraud prevention even though no power of any kind is taken to snoop on the bank accounts of tax dodgers, money launderers, profiteers and their enablers, which include accounting firms, law firms, financial services experts and others. If the Government are serious about checking fraud, they need at the very least to take powers of surveillance of the bank accounts of all individuals and organisations that receive money from the public purse, as well as all those organisations and individuals that prevent money flowing to the public purse by their actions.

In September 2023, a report by the Public Accounts Committee, Tackling Fraud and Corruption Against Government, stated that,

“in addition to the £10 billion of tax fraud and £6.4 billion of benefit fraud last year … government lost somewhere between £2.5 billion to £28.5 billion from fraud and error, but it does not know exactly where or how”.

It referred to “fraud and error”. The Government have no idea how much of this is due to fraud and how much is due to error; therefore, they are really floundering. Surely the Government’s logic in terms of fraud detection and prevention through surveillance ought to apply to this £28.5 billion too. If my suggestion were adopted, it would certainly help with fighting fraud.

Of course, the full extent of fraud is not known. A document published on 14 March 2024, Government Counter Fraud Functional Strategy 2024-27, estimates that fraud and error each year is between £33 billion and £59 billion, but, again, the Government are not going after the bank accounts of those who may be benefiting from it. Not only are billions at risk; billions have already been written off. The Department of Health and Social Care’s accounts for 2023 refer to £9.9 billion possibly being written off due to fraud or error.

I apologise; I have two elements to address, as I said earlier, so, if noble Lords will permit me, I will finish what I have to say. The Government are taking legal action against PPE Medpro, a company controlled by the noble Baroness, Lady Mone, and Mr Doug Barrowman, but no powers have been taken to look at their bank accounts. No powers have been taken to follow the money. Without access to their bank accounts, it is hard to know how exactly the money from these contracts flowed.

The noble Lord, Lord Agnew, resigned live in this House on 24 January 2022. Why? He said it was because the Government had no fraud strategy. He said:

“Schoolboy errors were made: for example, allowing more than 1,000 companies to receive bounce-back loans which were not even trading when Covid struck”.

He went on,

“three out of the seven main lenders account for 87% of loans paid out to companies already dissolved”.—[Official Report, 24/1/22; col. 20.].

None of this can happen without the involvement of banks, accountants, lawyers, financial services experts, company formation agents, directors and other advisers, so why are the Government not taking on powers to focus on those individuals?

There are also companies that have regularly short-changed the public purs,; for example, by overcharging the NHS for drugs. They, too, are clearly depleting the public purse. UK emergency services were overcharged by £200 million a year for a communications network. No companies faced any surveillance. Energy companies are overcharging, and defence companies have overcharged the Government by millions. Serco and G4S have overcharged the Government for monitoring services. What I am saying is that the bank accounts of any company, individual or organisation receiving public money ought to be given the same monitoring treatment as the Government are proposing for those receiving public money in the form of benefits and pensions.

My Lords, I will speak in favour of the amendment to which I have added my name, with other noble Lords here today, and also to some of the other amendments in the group. I find it interesting having to follow the noble Lord, Lord Sikka. Quite often we disagree on issues, and we are probably coming at this from different angles, but actually we have come to the same conclusion.

Noble Lords will know of my concerns raised at earlier stages about automated decision-making. We have to ensure that there is always human intervention but, even when there is human intervention, things can go seriously wrong. When I first saw this proposal for mass trawling of bank accounts, I have to say that the first thought that came into my mind was, “This is Big Brother”, so I was not surprised when I received an email and a briefing from Big Brother Watch. I thank Big Brother Watch for its point. I will quickly dip into some of the points made by Big Brother Watch. There are many more points.

People may find it interesting that the noble Lord, Lord Sikka, and I are speaking on this amendment from different angles. Let me be quite clear: I am a classical liberal. Some people call me a libertarian. I believe in a smaller state and government doing less, but there has to be a state to help those who cannot help themselves and people who have fallen on hard times. For some people, that is all they have. They have only the state benefit. There are no local community organisations or civil society organisations to help them, and therefore you have to accept that role for the state.

Those people are quite often the most vulnerable, the least represented and unable to speak up for themselves. I do not want to patronise them, but quite often you find that. When I saw this, I thought, “First of all, this is going to force third-party organisations to trawl”—I use the term advisedly—“customers’ accounts in search of matching accounts”. When we talk about those third-party organisations, we are talking about banks, landlords and a number of other organisations that have some financial relationship with those individuals. Some estimates put it at approximately 40% of the population who could be vulnerable to being trawled.

I am also worried about the precedent that this sets. I know that the noble Lord, Lord Sikka, talked about this in a different way. He would perhaps like this power to be extended. I do not want this power at all. I do not want it to be extended to others. I just do not want it at all.

I also worry about what this surveillance power does to the presumption of innocence. Are we just trawling everyone’s accounts in the hope that they will be found guilty? While I do not always agree with the Information Commissioner’s Office, we should note that it does not view these powers as proportionate.

One general concern that a number of noble Lords have is about AI and, in particular, the transparency of datasets and algorithms. We would want to know, even if we do not understand the algorithm itself, as the noble Lord, Lord Clement-Jones, and I discussed in a debate on earlier amendments, what these algorithms are supposed to be doing and what they are looking for in trawling people’s bank accounts.

There are some precedents to this. We see from financial institutions’ suspicious activity reports that they have a very high false hit rate. I have a friend who is a magistrate, who told me that she heard a case about a family who wanted to get back access to their bank account. She felt that they were under suspicion because of their ethnicity or faith, and said to the bank, “You have not made a clear case for why we should freeze this account. This family has suffered because they are not able to access their bank account”. Think about that mistake being repeated over and over with false positives from this data. The noble Baroness, Lady Kidron, was right to remind us that this is all against the background of the Horizon scandal. Even when people intervene, do they speak up enough to make sure that the victims are heard or does it need an ITV drama to raise these issues?

Think about the burden that this will impose on third-party organisations and about those smaller third-party organisations for which this is not proportionate. Third parties will face fines for failures to comply. Many noble Lords have spoken about the unintended consequences of legislation on PEPs—politically exposed people—and we have been victims of that. However, if you look at that legislation, it makes the financial institutions responsible for understanding their customers. Is it any wonder that the banks have made it more difficult for us? They probably think that it is just not worth the effort to go into your accounts. They ask you for an intrusive interview of a few hours, in which they go through almost every transaction. As noble Lords can imagine, in such a case, landlords, banks and others may say that it is just not worth the effort for these individuals to continue banking with them. Where will these vulnerable people go? Whatever we think about this proposal, we must always be aware of the unintended consequences.

People are also worried about what will happen if landlords suddenly withdraw or decide not to offer accommodation to people on benefits. The noble Lord, Lord Sikka, may be right that it may force people into homelessness. I hope that my noble friend the Minister has heard these concerns and can answer noble Lords’ questions. I know that there are a number of questions, but also a number of credible concerns from noble Lords across the House.

We support tackling fraud. Wherever we are on the political spectrum and whatever we think of the benefit system, we do not think that people should be receiving money to which they are not entitled. At the same time, we must make sure that this is not an excuse for a mass trawling exercise or a Big Brother initiative, which many of us would oppose.

My Lords, it is a great pleasure to follow the noble Lord, Lord Kamall. Although we probably come from very different positions on the role of the state, I agree with virtually everything that he said. I apologise for popping up at this late stage of proceedings on the Bill but, as someone with a long-standing concern about social security matters, I was shocked by the inclusion of these powers and want to add my support to those opposing them and, should this opposition prove unsuccessful, to the very sensible set of recommendations made by my noble friend Lady Sherlock.

The Child Poverty Action Group, of which I am honorary president, and Z2K warn that the stakes are high for claimants, as getting caught up in an error and fraud investigation can lead to the wrongful suspension and/or termination of their benefits. They give some horrendous examples of where this has happened. I will read just one: “A claimant with severe mental health problems whose main carer had recently passed away had his UC suspended in October 2023 by the UC case review when he was unable to obtain and upload bank statements on request. The suspension continued for four months and he was unable to pay for food, electricity or heating. When he was referred for benefits advice and his welfare rights adviser contacted the UC case review team, she was told that claims under review are randomly chosen and they are not targeted in any way”. This is someone with mental health problems left without any money; this could become the norm under this proposal.

The briefing from the CPAG and Z2K also cites the perspective of Changing Realities—families with experience in claiming low-income benefits. One warns that

“it will put folk off claiming altogether”.

I always remember, when I worked at the CPAG, getting a phone call from a woman who started by saying, “Please don’t think I’m a scrounger”. I am afraid that is still very much how people often feel about claiming benefits. Treating all social security recipients as potentially fraudulent can but increase the stigma associated with claiming. Amendment 219 in the name of my noble friend Lord Sikka is highly pertinent here. The point has already been made, but how would we feel if we knew that our bank accounts could well be scrutinised for potential tax evasion? I realise that I should declare an interest: as a pensioner, ultimately my bank account will be trawled, but that is down the line. Underlying this is a double standard that has operated year after year in social security and tax fraud.

The CPAG and Z2K also warn that some of the most marginalised people in our society could get caught up in these speculative searches. Given this, can the Minister explain why—I believe this is still the case—there is no equalities impact assessment for these provisions? Disabled people’s organisations are very worried about the likely implications for their members, such as in the case of disabled people who set up bank accounts to pay for their social care. They warn of the potential mental health impact as existing mental distress and trauma could be exacerbated by the knowledge that they are under surveillance—a point made by the noble Baroness, Lady Kidron.

The Government state that they

“are confident that the power is proportionate and would operate in a way that it only brings in data on DWP claimants, and specifically those claimants where there is a reasonable suspicion that something is wrong within their claim”.

Given the evidence of people already being wrongfully targeted for fraud and the strongly expressed view of organisations such as Justice, as well as the Information Commissioner, that the measures are disproportionate and therefore arguably unlawful, can the Minister say on what evidence that confidence is based? Given this confidence, I hope that the Government will accept without demur Amendments 220 to 222 in the next group from my noble friend Lady Sherlock.

Picking up what my noble friend Lord Sikka said, what is the breakdown between suspected fraud and error? It is not helpful that they are always talked about as though they are one and the same thing. The Government have argued that one reason the power is necessary is to provide the tools to enable the DWP to

“minimise the impact of genuine mistakes that can lead to debt”.

Try telling that to recipients of carer’s allowance who have been charged with fraud as a result of genuine mistakes relating to the earnings threshold. The fact that the DWP already has the information and power it needs to act to ensure that debts do not accrue in this situation, yet in countless cases has not used it until the point where very large sums may be owing, does not instil confidence, as mentioned by the noble Baroness, Lady Kidron.

On Amendment 303, which relates to Amendment 230, one of the criticisms of these provisions has been the lack of consultation. Has the Social Security Advisory Committee been consulted? If so, what was its response; if not, why not?

In conclusion, I support the opposition to Clause 128 and Schedule 11 standing part of the Bill, but so long as they do stand part, I hope very much that the Minister will take seriously the amendments in the name of my noble friend in this group and the next two.

My Lords, I was also too late to put my name to these stand part notices for Clause 128 and Schedule 11. There must have been a stampede towards the Public Bill Office, meaning that some of us failed to make it.

At Second Reading, I described Clause 128 as “draconian”. Having dug into the subject further, I think that was an understatement. Data protection is a rather dry subject and, as the debates throughout this Committee stage have shown, it does not generate a lot of excitement. We data protection enthusiasts are a fairly select group, but it is nice to see a few new faces here today.

The Bill runs to 289 pages and is called the Data Protection and Digital Information Bill. Nothing in that name suggests that around 20 pages of it relate, in effect, to giving the Government unlimited access to the bank accounts of large swathes of the population without suspicion of any wrongdoing—20 pages is larger than many Bills. I wonder what the reaction in this Committee and the other place might have been if those 20 pages had been introduced as a stand-alone Bill—called, perhaps, the government right to access bank account information Bill. I suspect that we might have had a few more people in this Room. It feels as if this draconian clause is being hidden in the depths of a Bill that the Government perhaps felt would not generate much interest. It is particularly concerning that it was dropped into the Bill at the last minute in the other place and has not, therefore, received scrutiny there either. This sort of draconian power deserves much more scrutiny than on day 6 in Committee in the Moses Room.

I hope that my desire to stamp out fraud is well known—indeed, I think I can probably describe myself as rather boring on the subject—so I have a lot of sympathy for the Government’s underlying intention here. However, a right to require banks to carry out suspicionless surveillance over the bank accounts of anybody who receives pretty much any kind of benefit, directly or indirectly, is a huge intrusion into privacy and feels completely disproportionate. Others have covered the detail eloquently, so I just want to ask a number of questions of the Minister—I see that we have had a viscount swap at this stage.

I have been trying to work out exactly which accounts could be covered by this requirement. Schedule 11 is not the easiest document to read. It seems clear that if, for example, I am a landlord receiving rent directly from the benefit system on behalf of a tenant, the account of mine that receives the money would be covered, as would any other account in my name. However, would it also catch, for example, a joint account with my wife? I think it would. Would it catch a business account or an account for a charity where I am a signatory, a director or a trustee? I am not sure from reading it, I am afraid. Can the noble Minister clarify that?

Once received, the information provided by the banks may be used

“for the purposes of, or for any purposes connected with, the exercise of departmental functions”.

That seems extremely broad, and I cannot find anything at all setting out for how long the information can be retained. Again, can the Minister clarify that?

As well as being a data protection enthusiast, I am also an impact assessment nerd. I have been trying to work out from the impact assessment that accompanies the Bill—without much success—how much money the Government anticipate recovering as a result of these proposed rights, as well as the cost to the banks, the department and any other parties in carrying out these orders. The impact assessment is rather impenetrable—I cannot find anything in it that covers these costs—so I would be grateful if the Minister could say what they are and on what assumptions those numbers are based.

The noble Lord, Lord Kamall, mentioned unintended consequences. I echo his points: this is really important. Putting additional onerous obligations on banks may make them decide that it is too difficult to provide accounts to those in receipt of benefits. Access to bank accounts for vulnerable people is already an issue, and any incentive to make that worse is a real problem. As the noble Lord pointed out, we have a good example of that with PEPs. All of us have, I suspect, experienced finding it at least difficult to open an account. Some of us have had accounts refused or even closed simply because we have made it difficult for the banks to act for us. The same risk applies to landlords. Why would a landlord want to receive money from housing benefits directly when it will mean that all of his bank accounts and linked accounts will be looked at? He will simply say no. We are therefore reducing the pool of potential accommodation available to housing benefit claimants.

When the Bill was introduced in the other place, the accompanying press release stated, in relation to this clause:

“To make sure that privacy concerns are at the heart of these new measures, only a minimum amount of data will be accessed and only in instances which show a potential risk of fraud and error”.

But that is not what the Bill says. It allows unlimited trawls of all accounts in any way linked to a relevant benefit, whether or not there is any reason for suspicion. According to paragraph 1(2) of new Schedule 3B, it can be used

“for the purpose of assisting the Secretary of State in identifying cases which merit further consideration to establish whether relevant benefits are being paid or have been paid in accordance with the enactments and rules of law relating to those benefits”.

That is very different from “only in instances that show a potential for fraud and error”.

As I said, my desire to stamp out fraud is well known, but there must be a balance with intrusion of privacy. The Bill seems entirely disproportionate. What will be next? Will it be access to the phone records or emails of people in some way connected to a benefit without reason? That would not be any more intrusive than this proposed power, and I do not believe we would accept it—I certainly hope we would not. If the Government intend to use the power only in more limited circumstances, as they seem to indicate, they should define them in the Bill. This sort of scope overreach is not good law-making.

I point out to the noble Baroness, Lady Lister, that one does not have to be in any way a benefit recipient for an account to be trawled. Logically under this, the banks will have to review all bank accounts in order to find the other ones, so all bank accounts will be surveilled as a result of the Bill.

I caution the noble Baroness, Lady Chakrabarti, who asked the Government to compare these proposals with the more tightly defined rules around tax and national security: there is a risk that the Government may be tempted to remove those safeguards.

I hope the Minister will hear the strength of feeling on this and, between Committee and Report, will seriously consider what power the Government genuinely need and intend to use. I hope he will come back with something rather more tailored and proportionate, perhaps along the lines of the amendments in the next group tabled by the noble Lord, Lord Anderson, and the noble Baroness, Lady Sherlock—although I do not think they go far enough. In the absence of that, I certainly cannot support these clauses. As I said at Second Reading, this is a draconian power that constitutes a worrying level of creep towards a surveillance society, and nothing I have heard since has changed my mind on that.

Most of what needed to be said has been said excellently and clearly by the other speakers. I have just three specific questions that I urge the Minister to answer. However, an important point of context needs to be made first on the opposition of the finance industry to these proposals. It is clear and unambiguous. It could be thought that the finance industry just does not want to bothered and does not care about fraud, but in fact it is making the point that the Government have failed to come up with an overall fraud strategy. This is just a one-off idea thrown up. Some bright spark thought, “Well, we could put this into the Bill. We’ve always wanted to have this sort of overweening power. Let’s shove it in here and hope no one notices”. We need a proper fraud strategy, as other speakers have said. We lose a lot of money to fraud, so none of us are against appropriate measures to deal with it, but this is a one-off, completely ill-timed and ill-thought-out addition to the state’s powers.

I turn to my three questions. First, I have no doubt that the Minister has a predisposition to oppose the state being able to interfere in our private information—I do not doubt that that is his starting point in these discussions. The problem with this proposal is that there is no way of ring-fencing the information required for the purposes of the DWP from all the other information that is disclosed by looking at someone’s bank account. Their whole life can be laid out in their bank account and other statements. You cannot ring-fence the necessary information. This is a widespread, total intrusion into people’s privacy. Does the Minister accept that there is no way of ring-fencing the information required for the purposes of the DWP from all the other information that is available from looking at someone’s bank account?

Secondly, I have several times heard the Minister discuss improving take-up of pension credit. Does he believe that this will encourage people to claim the pension credit to which they are entitled? It will clearly discourage them. Has this been properly assessed? We know that one big reason why people do not claim pension credit is the state’s intrusion into their private affairs. People do not like it. For some people, seeing an extension of the state’s ability to intrude into their private affairs will discourage them from applying. As I say, the Minister has rhetorically encouraged people to claim their pension credit; in practice, this proposal will discourage people. Does he accept that?

Thirdly, we have three debates on this issue and I think this question may arise more in the next group, but I will ask it now, so that I can come back and ask it again later. People have referred to claimants, but this also covers the state pension. It is possible to defraud the state pension, but it is nevertheless an income. Pension or income—whatever you call it; I do not think we should get too hung up on the vocabulary—it is paid as a right and people are entitled to these benefits.

One of the other theories about our state system is about identical benefits. Some people, like me, who have never been contracted out of the state scheme, have a full state pension, but a lot of people were contracted out into private schemes and personal pensions. Now, because I have that state pension, the state can intrude into my bank account. The state is paying me the pension; it can look at my bank account under these provisions.

However, if my pension were payable by Legal & General Assurance Society or the BP pension fund, they would not have the right to demand access to my bank accounts. I am just pointing out that we would react in horror if this Act gave power to the BP pension fund to trawl through my bank accounts. We would react in horror if we were giving power to Legal & General Assurance Society to go through my bank accounts, yet the Government believe that the state should have this overweening power. Does the Minister accept that and does he think that it is wrong?

My Lords, I speak as someone who was a Minister at the Department for Work and Pensions back in 2017. I well remember, when I was in charge of fraud and benefit, when we had a new addition to my team. I felt very strongly about this area because, when I first started as a Minister there, I was incredibly shocked by the level of fraud. Someone talked about having a fraud strategy, but this area is very complex. In the years since then, we have learned that the greatest incidence of fraud is people misstating their assets. Everybody in the Room will know that it is important that you must have only a certain amount of assets to claim benefits, whatever your situation, unless they are not means-tested or are disability benefits.

In 2017, the Treasury ran a controlled pilot. I do not know the details of how it was run, but I saw the results and they were extraordinary. The pilot was at one bank, using the powers they already had, for those who may be avoiding tax—which of course is not a crime—to see whether there was an issue with regard to benefit claimants misstating the extent of their assets when claiming. The extraordinary thing was that they found that between 25,000 and 30,000 at that one bank alone were misstating their assets.

So we know that there is a real problem here, and we know that fraud itself has gone up and up. We are unable to calculate all fraud in the system because, under the legacy system, we found it difficult to check the degree of housing benefit and so on. Maybe it is easier now under universal credit—I hope my noble friend the Minister will be able to tell us that it is—to check people in receipt of benefits who claim to be living alone when they are not.

This is a very nuanced area, but all I can say is that we knew we had a major problem with people misstating their assets. We had to deal with that, but we could not do so without working out how to do so with care, bearing in mind all the issues that noble Lords have raised today about doing it in a proportionate way, in a way that does not conflict with human rights in a way that does not become mass surveillance for everyone. We should bear in mind that since 2011 taxpayers, the people actually funding the benefits system, including some benefit claimants themselves, have had their bank accounts checked to make sure that they are not avoiding tax, which is not a crime—I am talking not about evasion but about avoiding—while fraud in the benefits system is a crime.

We need to be quite careful. Some of the things that have been said today conflating this issue with Horizon are wrong. I have been reading the so-called facts that some of these lobbyists have written about how the clause is disproportionate and unfair and goes too far in terms of people’s privacy. The Department for Work and Pensions works tirelessly to try to do the right thing in the right way. This has not been thrown into the Bill at the last minute as if we have just dreamed it up. That discovery was seven years ago. The noble Lord, Lord Sikka, may laugh, but I do not see the relevance of an awful lot of what he was saying—about the noble Baroness, Lady Mone, and so on—to what we are discussing now.

The reality is that benefit fraud is a serious offence, depriving those who need it most of vital support. A lot of people have come up with cases of very difficult situations that people have to live through. Those are the people we want to support but, frankly, the bill at DWP for this one year is £290 billion. When I was there in 2019, it was £190 billion. We cannot afford to put up with benefit fraud, so we have developed this carefully constructed measure, which needs to be thought through with care. I am sure my noble friend will be able to answer a lot of the questions that have quite rightly been asked today in Committee.

The noble Baroness mentioned lobby groups that say the clause is disproportionate. The Information Commissioner has questioned the proportionality of this measure. Does she consider the Information Commissioner a lobby group?

No. With respect, I am talking about Justice, which I think referenced 40 organisations. There was no list of what those organisations are in the information it sent me. There is also Big Brother Watch and many others.

I just think that everyone needs to take, if I may use the word, a proportionate approach to this. We are talking about tackling a really serious offence. I think all noble Lords agree that we have to tackle fraud but I am sure, and hope, that my noble friend can reassure everybody. The current powers that the DWP has to ensure benefit correctness are mostly over 20 years old. Over that time, fraud has evolved and become increasingly sophisticated. The system currently relies on self-verification for many factors, and that is one of the issues. I know it would sound so much better if people could find another way to check whether someone is being honest about their assets, but the problem is that a lot of this is to do with self-verification.

The suggestion was made that this was carefully thought out and part of a long-term plan. Can the noble Baroness therefore explain why it was introduced into the Bill at such a late stage in going through the Commons, such that it did not receive any worthwhile consideration at all there?

I am sure my noble friend the Minister can talk about the particular timing of why it went into this Bill. Certainly in my time at DWP, the difficulty we had was finding the right Bill that we could add it to. This is one of the things that is really hard about being a Minister: you cannot just say, “This is something we have to do”. You have to find a route—like finding a route to market—to include a measure in a Bill that is relevant. This Bill is entirely relevant in terms of where we are now on data collection. The Minister and his team were right to choose this particular Bill.

I could go on.

I am sorry; I have spent a lot of time listening to others, and a lot of it has been slightly interesting to listen to, I have to say.

The measure will not enable the DWP to access any accounts, and the DWP will not be able to use this measure to check what claimants are spending. The DWP can request information only where there is a link between the DWP, the third party and the benefit claimant or recipient of a payment, and will receive only minimum information on those cases where potential fraud and error are signalled. Once received, the DWP will look at each case individually through its business-as-usual processes and by using existing powers. That work will carefully be undertaken by a human and no automated decisions will be made. That is a really interesting and important point in terms of this measure. I now turn to my noble friend.

I am grateful to the noble Baroness, but could she point out where those restrictions actually are in the Bill? It says that an account information notice can include

“the names of the holders … other specified information relating to the holders … and … such further information in connection with those accounts as may be specified”.

It basically allows the DWP to ask for any information relating to those accounts. I do not see the restrictions that she has just spoken about.

It is important that my noble friend answers that question. The point is that if we find—I am sorry, I still speak as if I am involved with it, which I am not, but I promise noble Lords that I have spent so much time in this area. If the DWP finds that there is a link that needs pursuing then that obviously has to be opened up to some degree to find what is going on. Remember, the most important thing about this is that the right people get the right benefits. That is what the Government are trying to achieve.

My Lords, I note that the DWP has been passed a parcel by the Department for Science, Innovation and Technology—and I am not at all surprised. I am sure it will be extremely grateful to have the noble Baroness, Lady Buscombe, riding to its defence today as well. Also, attendance at this debate demonstrates the sheer importance of this clause.

We on these Benches have made no secret that this is a bad Bill—but this is the worst clause in it, and that is saying something. It has caused civil society organisations and disability and welfare charities to rise as one against it, including organisations as disparate as UK Finance, mentioned by the noble Lord, Lord Davies, and the ICO itself. They have gone into print to say that, for this measure to be deemed a necessary and proportionate interference in people’s private lives, to be in accordance with the law and to satisfy relevant data protection requirements, legislative measures must be drafted sufficiently tightly—et cetera. They have issued a number of warnings about this. For a regulator to go into print is extremely unusual.

Of course, we also have Big Brother Watch and the Child Poverty Action Group—I pay tribute to the noble Baroness, Lady Lister—the National Survivor User Network, Disability Rights UK, the Greater Manchester Coalition of Disabled People and the Equality and Human Rights Commission. We have all received a huge number of briefings on this. This demonstrates the strong feelings, and the speeches today have demonstrated the strong feelings on this subject as well.

There have been a number of memorable phrases that noble Lords have used during their speeches. The noble Baroness, Lady Kidron, referred to a “government fishing expedition”. The noble Baroness, Lady Chakrabarti, called it “breathtaking in its scope”. I particularly appreciated the speech of the noble Lord, Lord Kamall, who said, “What happened to innocence?” In answer to the noble Baroness, Lady Buscombe, this is not “nuanced”: this is “Do you require suspicion or do you not?” That seems to me to be the essence of this.

I was in two minds about what the noble Lord, Lord Sikka, said. I absolutely agree with him that we need to attack the fat cats as much as we attack those who are much less advantaged. He said, more or less, “What is sauce for the goose is sauce for the gander”. The trouble is that I do not like the sauce. That was the problem with that particular argument. The noble Baroness, Lady Lister, talked about stigma. I absolutely agree. The noble Lord, Lord Vaux, more or less apologised for using the word “draconian” at Second Reading, but I thought the word “overreach” was extremely appropriate.

We have heard some powerful speeches against Clause 128. It is absolutely clear that it was slipped into the Bill alongside 239 other amendments on Report in the Commons. I apologise to the Committee, but clearly I need to add a number of points as well, simply to put on record what these Benches feel about this particular clause. It would introduce new powers, as we have heard, to force banks to monitor all bank accounts to find welfare recipients and people linked to those payments. We have heard that that potentially includes landlords and anyone who triggers potential fraud indicators, such as frequent travel or savings over a certain amount. We have seen that the impact assessment indicates that the Government’s intention is to “initially”—that is a weasel word—use the power in relation to universal credit, pension credit and employment support allowance. We have also heard that it could be applied to a much wider range of benefits, including pensions. The Government’s stated intent is to use the power in relation to bank accounts in the first instance, but the drafting is not limited to those organisations.

Of course, everyone shares the intent to make sure that fraudulent uses of public money are dealt with, but the point made throughout this debate is that the Government already have power to review the bank statements of welfare fraud suspects. Under current rules, the DWP is able to request bank account holders’ bank transaction details on a case-by-case basis if there are reasonable grounds to suspect fraud. That is the whole point. There are already multiple powers for this purpose, but I will not go through them because they were mentioned by other noble Lords.

This power would obviously amend the Social Security Administration Act to allow the DWP to access the personal data of welfare recipients by requiring the third party served with a notice, such as a bank or building society, to conduct mass monitoring without suspicion of fraudulent activity, as noble Lords have pointed out. Once issued, an account information notice requires the receiver to give the Secretary of State the names of the holders of the accounts. In order to do this, the bank would have to process the data of all bank account holders and run automated surveillance scanning for benefit recipients, as we have heard.

New paragraph 2(1)(b) states that an account information notice requires,

“other specified information relating to the holders of those accounts”,

and new paragraph 2(1)(c) refers to other connected information, “as may be specified”. This vague definition would allow an incredibly broad scope of information to be requested. The point is that the Government already have the power to investigate where there is suspicion of fraud. Indeed, the recently trumpeted prosecution of a number of individuals in respect of fraud amounting to £53.9 million demonstrates that. The headlines are in the Government’s own press release:

“Fraudsters behind £53.9 million benefits scam brought to justice in country’s largest benefit fraud case”.

So what is the DWP doing? It is not saying, “We’ve got the powers. We’ve found this amount of fraud”. No, it is saying, “We need far more power”. Why? There is absolutely no justification for that. No explanation is provided for how these new surveillance powers will be able to differentiate between different kinds of intentional fraud and accidental error.

We have heard about the possibility and probability of automated decision-making being needed here. I do not know what the Minister will say about that, but, if there will not be automated decision-making—that is concerning enough—if the DWP chooses to make these decisions through human intervention the scale of the operation will require a team so large that this will be an incredibly expensive endeavour, defeating the money-saving mandate underpinning this proposed new power, although, as a number of noble Lords have pointed out, we do not know from any impact assessment what the Government expect to gain from this power.

It is wholly inappropriate for the Government to order private banks, building societies and other societies and financial services to conduct mass algorithmic suspicionless surveillance and reporting of their account holders on behalf of the state in pursuit of these policy aims. It would be dangerous for everyone if the Government reversed the presumption of innocence. This level of financial intrusion and monitoring affecting millions of people is highly likely to result in serious mistakes and sets an incredibly dangerous precedent.

This level of auditing and insight into people’s private lives is a frightening level of government overreach, in the words of the noble Lord, Lord Vaux, more so for some of the most marginalised in society. This will allow disproportionate and intrusive surveillance of people in the welfare system. In its impact statement, the DWP says it will ensure that data will be

“transferred, received and stored safely”.

That is in contrast to the department’s track record of data security, particularly considering that it was recently reprimanded by the ICO for data leaks so serious that they were reported to risk the lives of survivors of domestic abuse. With no limitations set around the type of data the DWP can access, the impact could be even more obscure.

We have heard about the legal advice obtained by Big Brother Watch. It is clear that, on the basis that,

“the purpose of the new proposed powers is to carry out monitoring of bank accounts”

and that an account information notice can be issued

“where there are no ‘reasonable grounds’ for believing a particular individual has engaged in benefit fraud or has made any mistake in claiming benefits”,

this clause is defective. It also says that

“financial institutions would need to subject most if not all of their accountholders to algorithmic surveillance”;

that this measure

“will be used not just in relation to detection of fraud but also error”;

and that this measure

“would not be anchored in or constrained by anything like the same legal and regulatory framework”

as the Investigatory Powers Act. It concludes:

“The exercise of the financial surveillance/monitoring powers contained in the DPDIB, as currently envisaged, is likely to breach the Article 8 rights of the holders of bank accounts subject to such monitoring”

in order to comply. It is clear that we should scrap this clause in its entirety.

My Lords, I thank the noble Baroness, Lady Kidron, and my noble friend Lord Sikka for introducing their amendments. I also thank all noble Lords who have spoken. I will speak to Amendments 223, 299, 302 and 303 in my name. I should probably say at this point that I am late to this party but, unlike the noble Lord, Lord Vaux, I am not a data protection specialist, I am afraid. However, I am a social security nerd, so I am here for this bit right now.

Since this is the first part of the Bill on DWP powers to tackle fraud, I need to add my little statement on the “fraud is bad” move. Fraud is a problem and has been getting worse across this Government. There have been scandals in procurement, of which the infamous PPE contracts are just one example. There is tax due that goes unpaid at scale and, in social security, the percentage of benefit expenditure lost to fraud has been rising under this Government. However, as my honourable friends made clear in the Commons, a Labour Government would take fraud seriously and pursue all those who seek to take money fraudulently or illegally from the state. They would also focus on helping people to avoid inadvertent overpayments rather than just waiting for them to make mistakes then coming down hard on them at that point. This should not need saying but, in some of the discussions on this Bill elsewhere, there has been a tendency to frame the debates rather along the lines of a classical fallacy: “Fraud is really bad. This will tackle fraud. Therefore, this must be really good”. I know that we are fortunate that in the Minister we have someone who is able to have a much more nuanced debate. I look forward to having exchanges in a way that recognises the important role of this House in scrutinising the powers that the Executive want to take unto themselves, which is exactly what Committees in the House of Lords do so well.

Scrutiny particularly matters here because, as the noble Lord, Lord Vaux, and my noble friend Lord Davies pointed out, all these amendments—more than 200 amendments, 38 new clauses and two new schedules—were introduced on Report in the Commons. My honourable friend Chris Bryant tried to recommit the Bill so that the Commons could discuss it, but the Government refused. The interesting thing is that in their anti-fraud plan back in May 2022, the Government announced that they planned to boost the DWP’s powers to get information from third parties when parliamentary time allowed. The noble Baroness, Lady Buscombe, made a fair point that departments have to wait for the right Bill to come along in order to use it, but the Government have known about this since 2022. They have had two years to draft the amendments, so although they might have had to wait for the Bill to come along, that does not seem a good enough reason for them to have waited until Report in the Commons to deposit them into the process. I hope the Minister will be able to explain the reasons for that.

My noble friend Lady Chakrabarti and others have asked some important questions about the scale on which these powers will be used; I am going to come back to that in our debate on the next group. It is hard to know the scale from the information we have so far, but DWP clearly does know, or has a sense of it, because paragraph 85 of the impact assessment states:

“Using our model to estimate volumes of hits for this measure, over the 10-year appraisal period, internal analysis has estimated that in total there will be an additional 74,000 prosecution cases, 2,500 custodial sentences and 23,000 applications for legal aid”.

It has modelled the volume of matching hits that would require investigation. Can the Minister tell the Committee what that number is? Also, what assurance can he give us that DWP has the resources to investigate that number of hits in a timely manner?

Paragraph 2 of new Schedule 3B says that the account information notices can only cover data going back a year and that they must be done in the week before they are given to DWP. Is there any time limit on how long DWP has to act on the results that have been handed over to it?

I turn now to the amendments in my name. Some of them are quite detailed because these powers are astonishingly wide and it is not at all clear how they could be used. I have deliberately tabled a series of amendments—in three groups in order to make sure that we have a chance to go into detail—to try to get information out of the Government and find out what this is about.

Amendment 223 is a minor probing amendment that would delete paragraph 3(1) of new Schedule 3B, which Schedule 11 to the Bill would insert into the 1992 Act. I will not rehearse it here but can the Minister explain what that provision is for and what its limits are? Neither I nor the people I have spoken to in financial services can understand why it is needed.

The noble Baroness, Lady Kidron, and others mentioned the fact that the Information Commissioner said he could not provide to Parliament his assurance that this measure is proportionate. My other amendments in this group are therefore designed to try to understand the impacts better. Amendment 302 would prevent these new powers coming into force automatically, while Amendment 303 would require the Secretary of State to fulfil several requirements before laying regulations to commence the powers. Amendment 299 is a minor consequential amendment. The effect of this is that the Secretary of State would have to issue a call for evidence, to inform the creation of the first code of practice, and consult relevant bodies. They would also have to lay before Parliament statements on key issues, of which I will highlight two.

The first would say whether and how AI will be used in exercising these powers, as well as how those proposals will take account of protected characteristics; this was touched on by my noble friend Lady Lister and others. That benefits often engage protected characteristics is in the nature of social security. Sickness and disability benefits engage disability, obviously; pensions engage age; benefits relating to children may engage age and also indirectly engage sex; and so on. The National Audit Office has warned that machine learning risks bias towards certain vulnerable groups and people with protected characteristics. So, what external governance or oversight is there to ensure that, once data are collected on the scale envisaged here, we do not end up with a mass breach of equality law?

The second issue I want to highlight concerns the provision that will be made to ensure that individuals subject to investigation do not experience hardship during it or lasting detriment afterwards. Given the comments of my noble friend Lady Lister about the cases from CPAG, can the Minister say whether a claimant’s benefits will be kept in payment while they are investigated following the data that are surfaced as a result of these trawls?

I am concerned that, given the potential scale of hits, a claimant who had, say, inadvertently breached the capital limit but then found themselves at the back of a long queue to be investigated could find themselves ending up paying back really large sums. The Minister will be aware of the recent media coverage, which others have mentioned, of how the DWP is treating people who were overpaid the carer’s allowance, a benefit that gives £81.90 a week to people providing at least 35 hours a week of unpaid care. It is a cliff-edge benefit—if your net earnings are under £150 a week, you get the lot; if they are over it, you get nothing—so a small rise in the minimum wage or a change in tax thresholds or rates can be enough to make someone entirely ineligible overnight, even if nothing changes in their circumstances.

As my noble friend Lady Lister said, apparently, DWP’s IT systems can flag when a carer’s income breaches the threshold but it does not necessarily do that, allowing them then to rack up potentially thousands of pounds’ worth of overpayments. The Guardian has investigated this issue; I shall mention two cases that it offered. First, an unpaid carer with a part-time charity job unknowingly breached the threshold by an average of £4.40 a week—£58 in total—caused by the automatic uprating of the national minimum wage. Because that left her not eligible for anything, she ended up being told to repay £1,715, including a civil penalty.

In the second example, a woman caring for her husband with dementia and Parkinson’s was told to repay nearly £4,000 for inadvertently exceeding the earnings threshold by calculating earnings from her zero-hours job on a monthly basis, as she thought the rules required, rather than a four-weekly basis, which they actually do; the rules around allowable costs and earnings are quite complicated. Crucially, according to the Guardian, she was told that, if she appealed, it could cost her even more. The Guardian quotes from a DWP letter telling her that, if she challenged the repayment order,

“the entire claim from the date it started will be looked at, which could potentially result in the overpayment increasing”.

Is that standard practice? Is DWP currently acting on all the alerts it receives of overpayments? If these powers are switched on, what safeguards will there be when that happens to protect millions of people from ending up paying back years of overpayments that DWP could have prevented?

Before embarking on investigations on this scale, we need to understand more about how this measure will work. We have had some excellent questions in Committee from the noble Lord, Lord Vaux, and others; I look forward to the Minister’s reply.

My Lords, I thank all those who have spoken today. I have been made well aware of the strong views expressed about this measure in Committee. I thank the noble Baroness, Lady Sherlock, for her kind remarks. She is right: I take all these matters extremely seriously. I have listened carefully to all the speeches, although I might not agree with them. Many questions have been asked. I will attempt to cover them all, of course; I doubt that I will be able to but I assure noble Lords that it is likely that a long letter will be required after this. Obviously, I will reflect on all the speeches made in Committee today.

I start by talking about the timing of the introduction of this measure. The noble Baroness, Lady Sherlock, said that the measure was introduced, in her words, “on the late side”. As she alluded to, the DWP published the Fraud Plan in May 2022, where it outlined a number of new powers that it would seek to secure when parliamentary time allowed. In answer to her question and others, in the parliamentary time available, the DWP has prioritised our key third-party data-gathering measure, which will help it tackle one of the largest causes of fraud and error in the welfare system. We will not sit back and ignore an opportunity to bring down these unacceptable losses and better protect taxpayers’ money. I will expand on all of that later in my remarks.

Before attending to the themes raised and addressing the amendments, it is important to set out the context for the power for which we are legislating. Fraud is a serious and damaging UK-wide issue, accounting for more than 40% of all crime. To be fair, many speeches alluded to that. The welfare system is also a target for fraudsters, and we are seeing increasingly sophisticated attacks occur on a scale that we have not seen in the past. We all have our own experiences at home of fraudsters who try completely different methods, not linked to the benefits system at all, to try to gain money through ill-gotten uses and methods.

In 2022-23, the DWP paid out more than £230 billion in benefits and payments to people across Great Britain. I very much took note of the figure that my noble friend Lady Buscombe raised. I say to the Committee that this figure is forecast to rise to nearly £300 billion by 2024-25, in quite short order, so this is a really serious issue to address. However, more than £8 billion has been overpaid in each of the past three years because of deliberate fraud against the state or because genuine errors have been made.

To assist the noble Baroness, Lady Lister, to whose speech I listened carefully, fraud, not error, is the biggest cause of welfare overpayments, totalling £6.4 billion of the £8.3 billion overpaid last year. The noble Lord, Lord Vaux, also asked about the figures. These losses are largely because people are intentionally and knowingly taking money that they are not entitled to. This is not organised fraud either; the vast majority comes from individuals who are not entitled to the money. We cannot underestimate the lengths to which some will go in order to take money they are not entitled to or promote ways to defraud us to a wider audience. This new legislation is not just about protecting the taxpayer; it will help those who make genuine mistakes in their claim, and our swift action will avoid them building up large overpayments.

Some people have said that the department has the powers that it needs to fight fraud and error—I think that was alluded to even today. However, some of the current powers that we have to ensure benefit correctness are over 20 years old—a point that I think my noble friend Lady Buscombe made. In this time, fraud has evolved and become increasingly sophisticated and we must keep pace with the fraudsters. It is for this reason that the Government are bringing these new third-party data powers, as set out, as said earlier, in the fraud plan.

The change will modernise and strengthen DWP’s legislative framework; will ensure that we remove fraudsters from the system; and—to answer a question from the noble Lord, Lord Vaux—will save up to £600 million over the next five years and provide a £1.9 billion net benefit over 10 years. There is public support for this approach, too, which again came out in some of the speeches. In public perceptions survey of fraud, error and debt, conducted in 2023, 64% of respondents thought that this measure was an acceptable way to tackle fraud and error in the welfare system.

I would like to move on to a very important area, namely how the power will work and addressing misconceptions. My noble friend Lady Buscombe is right; there are misconceptions, and I hope that I can go some way to help on many of the points raised by Peers, including the noble Baronesses, Lady Chakrabarti and Lady Kidron. I suspect that I may not, but I will do my best. There has been a lot of interest in this power, as I understand today, outside Parliament. Much of this has fuelled misconceptions, which I would like to address by placing on record how the power will work and what it will and will not do. The power will work by requiring designated third parties to look within their own existing data and provide relevant, limited data to DWP only—I repeat, only—where it signals that someone might not be eligible for the payment that is being made.

To address another misconception, it is not a surveillance or investigations power, as was alluded to by the noble Lord, Lord Vaux. This measure does not meet the legal definition of surveillance, as the data gathering will be neither covert nor the purpose of an investigation. This is solely a data-gathering power that will help us to check whether individuals appear to meet the eligibility rules for the benefit that they are receiving. This should not be confused with powers that the DWP already holds under the Investigatory Powers Act 2016 to investigate individual cases where there is a suspicion of criminality.

I apologise for interrupting, but can the Minister show us in the Bill where those restrictions on the information that can be requested reside? As I read it, as I mentioned to the noble Baroness, Lady Buscombe, paragraph 2(1) of new Schedule 3B, as inserted by Schedule 11 of the Bill, is pretty wide when it refers to

“names of holders … other specified information relating to the holders … and … such further information in connection with those accounts as may be specified”.

So it appears that the DWP can ask for whatever it wants, rather than what the Minister just described.

That is a fair challenge and I will certainly be coming on to that. I have in my speech some remarks and a much more limited reassurance for the noble Lord.

It is only when there is a signal of potential fraud or error that the DWP may undertake a further review, using our business-as-usual processes and existing powers—an important point. DWP will not share any personal information with third parties under this power, and only very limited data on accounts that indicate a potential risk of fraud or error will be shared with DWP in order to identify a claimant on our system. As I said earlier, I will say more about the limited aspects of this later in my remarks.

I am sorry to interrupt the Minister, but will he be coming on to explain what these signals are? He is almost coming to a mid-point between innocence and suspicion called “signals”—is this a new concept in law? What are we talking about and where in all of Schedule 11 is the word “signal”?

If the noble Lord will allow me, I would like to make some progress and I hope that this will come out in terms of what we may be seeking on a limited basis.

The first third parties that we will designate will be banks and other financial institutions, as the Committee is aware. We know that they hold existing data that will help to independently verify key eligibility factors for benefits.

This clause does not give DWP access to any bank accounts—a very important point—nor will it allow DWP to monitor how people spend their money or to receive sensitive information, such as medical records or data on opinions or beliefs.

As the noble Baroness, Lady Sherlock, mentioned—I want to try to answer one of her questions—this power cannot be used to suspend someone’s benefit. Cases that are flagged must be reviewed under existing processes and powers—business as usual, which I mentioned earlier—to determine whether incorrect payments are being made.

Our approach is not new. HMRC has long been using powers to request data at scale from banks on all taxpayers under Schedule 23 to the Finance Act 2011. Our approach carries similar safeguards. Tax fraud is no different from welfare fraud and should be treated similarly. This was a key point that the Prime Minister made only on Friday when he committed to bring DWP’s fraud and error powers more in line with those of HMRC. This is one clear area where we are seeking to do this.

This allows me to go on to very important points about safeguards. Not all the cases found through this power will be fraud. Some will be errors which the power will help to correct, preventing overpayment debt building up. Some cases may also have legitimate reasons for seemingly not meeting eligibility requirements, for example where claimants have certain compensation payments that are disregarded for benefit eligibility rules. In those cases, no further action will be taken. Our robust business-as-usual processes will ensure that all cases are dealt with appropriately.

Another question raised by the noble Lord, Lord Vaux, on safeguards was to do with the legislation. A key safeguard is that we cannot approach any third party either; there must be a three-way relationship with the department, the claimant and the third party. This safeguard will narrow the use of this power substantially and ensure that it is used proportionately, as these three-way relationships are limited, meaning that data cannot be gathered at scale from just any source for any purpose. Any third party we will want to get data from will need to be designated in affirmative regulations that noble Lords will have an opportunity to scrutinise. These regulations will be accompanied by a code of practice. We will be bringing that forward, and we will consult on the code before presenting it to Parliament—which answers a question raised by, I think, the noble Baroness, Lady Kidron.

The power also ensures that we can request only very limited data on benefit recipients. I think this addresses a point raised by the noble Lord, Lord Vaux. We must work with key third parties to define what is shared, but our expectation is that this would be a name and date of birth or a unique payment number, along with the eligibility criteria someone has matched against: for example, a benefit claimant who has more savings than the benefit rules would normally allow.

Outside controls will apply here, too. DWP already handles vast amounts of data, including personal data, and must adhere to the UK GDPR and the Data Protection Act 2018.

On the point, which again was raised during this debate, about the remarks made by the Information Commissioner’s Office and its updated report on this measure, published as Committee started and which the Committee may be aware of, I was pleased to see that the commissioner now acknowledges that the third-party data measure is in pursuit of a legitimate aim, stating:

“I understand and recognise the scale of the problem with benefit fraud and error that government is seeking to address and accept that the measure is in pursuit of a legitimate aim. I am not aware of any alternative, less intrusive, means of achieving the government’s stated policy intent based on their analysis”.

I think that is a significant point to make, and it is a point with which I very strongly agree.

It is also worth pointing out that the paragraph I quoted follows immediately on that. That is the qualification that I quoted.

Yes, I am aware of that. I think the noble Lord was alluding to the point about proportionality. I listened carefully and took note of that, but do not entirely agree with it. I hope that I can provide further reassurances, if not now then in the coming days and weeks. The point is that there is no other reasonable way to independently verify claimants’ eligibility for the payment that they are receiving.

I turn to the amendments raised, starting with the stand part notice from the noble Baronesses, Lady Kidron and Lady Chakrabarti, the noble Lord, Lord Anderson of Ipswich, who is not in his place, and the noble Lord, Lord Clement-Jones. They and my noble friend Lord Kamall, who is not in his place, interestingly, all made their case for removing the clause, of which I am well aware. However, for the reasons that I just set out, this clause should stand part of the Bill.

In raising her questions, the noble Baroness, Lady Kidron, made some comparisons with HMRC. There are appropriate safeguards in place for this data-gathering power, which will be included in the code of practice. The safeguards for this measure will be equivalent to those in place for the similar HMRC power which Parliament approved in the Finance Act 2011.

When might we see the code of practice? It would be extremely helpful to see it before Report, as that might short-cut some of these discussions.

I will need to get back to the noble Lord on that, but perhaps can reassure him that it is already being worked on. You can imagine that, because of the sensitivity of these powers, we are working very carefully on this and making sure that it will be fit for purpose.

That is part of the answer that I gave to the noble Lord, Lord Vaux, which I think is a fair point.

The noble Baroness, Lady Kidron, asked about the code of practice and what steps my department will take to ensure transparency and accountability in the exercise of these powers if they are implemented. In the primary legislation, we will make provision to publish the code of practice, which will set out general guidance on how the third-party data power will work, as I have mentioned. We will develop the code of practice with relevant third parties and it will be consulted on publicly before being laid in Parliament. We will explain what the expectation is for data holders and ensure full compliance for the DWP. This will provide assurance that we will operate transparently and mirror the approach that we have taken with other DWP powers. Any changes to the code of practice, other than minor changes, will also be done in consultation with stakeholders.

The noble Baroness, Lady Kidron, stated that the power was too broad and the gist of one of her questions was that there is no need for all these benefits to be in scope. As the noble Baroness has demonstrated, there is a wide range of benefits and therefore potential avenues for fraudsters to seek to exploit or for error to creep in. That is why it is important that the power enables the department to respond proactively, as new fraud risks emerge.

That said, as the noble Baroness knows, the power will not be exercisable in all the benefits that she listed, such as child benefit, because the legislation is drafted in such a way that it could reasonably be exercised only in relation to benefits for which the Secretary of State is responsible. I reassure the Committee that using Section 121DA of the Social Security Administration Act 1992 is a consistent approach that we take to defining benefits in this way to safeguard all existing legislation and account for a benefit being, for example, renamed or amended. It should be stressed that the listing of a benefit does not mean that this power can or will be exercised upon it. The conditions in the third-party data legislation must still apply, and therefore not all benefits will be subject to this measure. That is a very important point.

The noble Baroness, Lady Kidron, and the noble Baroness, Lady Chakrabarti, who is not in her place, asked about appointees. Landlords were also mentioned; I reassure noble Lords that I will cover that in the next group. The noble Baroness, Lady Chakrabarti, asked what steps we are taking to ensure that there is no repeat of the Post Office Horizon scandal, which I think was also raised by another noble Lord. I want to be quite firm and robust on this: the errors stemming from the Horizon system and the subsequent wrongful convictions of postmasters are one of the greatest miscarriages of justice in our nation’s history, and I am very surprised that it has been raised today. The DWP third-party data measure is a data-sharing power, not an investigation power. It requires third parties to look within their own data and provide relevant information to my department that may signal where DWP claimants do not meet the eligibility criteria for the benefit they are receiving. It is fair to say that no data source is perfect or infallible, and that is why a human will always be involved in decision-making. Any signals of potential fraud or error will be looked at comprehensively. I do not want to go any further except to say that any comparison with the Horizon scandal—and it is indeed a scandal—is unwarranted and unjustified, in my personal view.

The noble Baroness, Lady Kidron, asked what plans my department has for those whose benefit is stopped or who incur overpayment. Again, as I may have alluded to, under this measure it is only when data that has been received signals potential fraud and error that the DWP may consider further intervention to ensure that a claim is correct. If, as a result of this business-as-usual process—business as usual means that we do this all the time—an overpayment is identified, the DWP is committed to working with anyone struggling with their repayment terms and will look to negotiate sustainable and affordable repayment plans, as we do at the moment.

I have covered the definition of a benefit, but there will be more on that in the next group of amendments.

I was interested to listen to the speech by the noble Lord, Lord Sikka. We will address state pensions in the next group, but we do indeed have a list of those countries that allow uprating and those that do not. I think the default is where we allow uprating, but there is definitely a list. I recall answering an Oral Question on this very subject, as noble Lords may recall. I will try to address that in the next group. That includes the state pension, which I mentioned.

My noble friend Lord Kamall, the noble Baroness, Lady Chakrabarti, and, particularly, because she is in her place, the noble Baroness, Lady Kidron, asked whether this will adversely impact the most vulnerable, such as severely sick or disabled claimants. That is a fair point, but the DWP is confident that this proposal meets our obligations to eliminate discrimination, in that we have not identified any groups with protected characteristics that could be disproportionately impacted. The measure does not target a particular group of benefit claimant. For vulnerable claimants, including those who have an appointee, which is covered in the next group, or who may be in care, which was mentioned as well, we have tried-and-tested safeguarding processes to protect vulnerable groups and, as I mentioned earlier, will follow the business-as-usual processes.

On the remarks from the noble Lord, Lord Sikka, on his amendment, fraud against the public sector is a crime that impacts us all. It affects the quality and quantity of public services and ultimately damages those whom society should protect the most. The Government are committed to tackling all fraud committed against the taxpayer. That is why we have established the Public Sector Fraud Authority within the Cabinet Office. To broaden these powers, as suggested by the noble Lord, would be disproportionate and unworkable. It would undermine the effective safeguard in place as part of the power to ensure that it is targeted only where there is a link between the department, the claimant and a third party, and would diverge from the policy intent, which is to tackle welfare fraud and error.

I would be convinced about the Government’s intentions, and would not press this amendment at the next stage, if the Minister can name just one big accounting firm which since 2010, as a result of a court judgment that said it was selling unlawful tax avoidance schemes, has been investigated, fined or prosecuted. If he can give me such an example then I will be convinced that the Government are seriously tackling tax fraud and its enablers.

The noble Lord has set me quite a challenge at the Dispatch Box. It is out of scope of today’s session but, having said that, I will reflect on his question afterwards.

I am aware that time is marching on. My noble friend Lord Kamall asked about burdens on banks. We believe that the burdens on banks will be relatively low.

The noble Baroness, Lady Sherlock, made a number of points; I may have to write to her to expand on what I am about to say. Removing the requirement for third parties to provide legible copies of information means that DWP could receive the information but there is a risk that the information is not usable; that is my answer to her points. This could limit the data that DWP receives and prevent us utilising the power in full, which could in turn impact the savings due to be realised from this important measure.

I turn to the final amendments in this group, which were raised by the noble Baroness. They would place requirements on the Secretary of State to issue statements in the House and consult on the code of practice. We will talk more about the code of practice later on in this debate, and I have already made clear my firm opinions on it: we will take it forward and are already working on it. There will be a consultation that will, of course, allow anybody with an interest in this to give their views.

I turn to the number of statements that must be made in the House regarding the practical use of the measures before powers can commence, such as the role that artificial intelligence will play or assurances on any outsourcing of subsequent investigations. This is an important point to make and was raised by other Peers. I want to make it clear that this measure will be rolled out carefully and slowly through a “test and learn” approach from 2025, in conjunction with key third parties. To make these statements in the House would pre-empt the crucial “test and learn” period. I say again that discussions with the third parties are deep and detailed and we are already making progress; this point was made by the noble Lord, Lord Clement-Jones, on the link with banks and third parties.

Importantly, I assure the noble Baroness, Lady Sherlock, that we will not make any automated decisions off the back of this power; this was also raised by the noble Baroness, Lady Kidron. The final decision must and will always involve a human being—a human agent in these cases—and any signals of potential fraud or error will be looked at comprehensively. I am grateful for the remarks of my noble friend Lady Buscombe on this matter.

I know that I have not answered a number of questions. Perhaps I can do so in our debate on another group; otherwise, I certainly wish to answer them fully in a letter. I hope that I have explained clearly, from our perspective, why this power is so important; why it is the right power to take; and how we have carefully designed it, and continue to design it, with the key safeguards in mind. I strongly value the input from all those who have contributed today but I remain unconvinced that the proposed amendments are necessary and strengthen the power beyond the clear safeguards I have set out. With that, I hope that the noble Baroness will not press her opposition to Clause 128.

I may have missed something, but can I just check that the Minister will deal with the matter of signals, which he mentioned at the beginning of his response? Will he deal with where that phrase comes from, what they are, whether they will be in the code, et cetera? There are a lot of questions around that. Does it amount to actual suspicion?

Absolutely; I am keen to make sure that I answer on that. It may be possible to do so in the next group but, if not, I will certainly do so in the form of a precise letter—added to the larger letter that I suspect is coming the noble Lord’s way.

A number of pensioner groups are watching these proceedings. I have received some messages. They are asking, “When is the Minister going to answer the questions asked about the operation of the surveillance of recipients of the state pension, especially those who have foreign accounts?” I assume that the Minister will clarify that in any subsequent letter to me.

Absolutely; the noble Lord will know that I have not managed to answer all the questions. I have tried to bring in everybody on this important and serious debate. The answers will be forthcoming.

I thank my noble friend very much for all the explanation that he has given thus far. I just want to add a word that has not been mentioned: deterrent. One of the reasons why the Government have sought to introduce this in the Bill, I believe, is that it is hugely important that we are much more thoughtful about what will stop people doing the wrong thing. It has become an old-fashioned word but, from a legal, practical and moral standpoint, does my noble friend agree that this is a practical deterrent to make sure that people do the right thing?

I have a response to the question from the noble Lord, Lord Clement-Jones, about signals. The signal is where the criteria or rules for benefit eligibility appear not to be met, and Parliament will have agreed those rules.

My Lords, the Committee will be grateful to hear, I hope, that I will not try to capture such a rich conversation. I thank the Minister for his careful listening and consideration. I will read carefully what was said at the Dispatch Box and what is about to be said during our discussion on the next two groupings because, without seeing all that in the round, I cannot truthfully say whether the questions asked by noble Lords have been answered.

I share a little of the concern that I can see agitating the noble Lord, Lord Clement-Jones, about the words “signals”, “criteria” and “codes”, which are not promised in the Bill but are suddenly appearing. Indeed, the Minister will remember that, in a private meeting, we talked about how those criteria might be gamed and, therefore, how detailed they could possibly be. There may still be some differences of opinion, and possibly differences of practice, that need to be worked out.

Of course, for now, I will not press my opposition to Clause 128 standing part. I welcome further conversation between now and Report but, I have to say, I lost count of the number of times noble Lords have said “proportionate” in this debate and how many times the issues of scope, sweeping powers and so on were stated by some very expert people—both in and outside of this Room, not simply noble Lords.

The noble Baroness, Lady Buscombe, mentioned a pilot but I seem to remember that some of the outcomes on equality in that pilot got lost in translation. Perhaps it would be good to find out exactly what the pilot did and did not reveal—that is, not just the things that the department would like to reveal but some of the things that were not tested.

I do not doubt the personal integrity of the Minister in the slightest but I am unsure about the idea that the “test and learn” approach has no boundaries around it in the Bill. It is like saying, “Trust us. We test and learn, and all those powers exist”. With that, I will withdraw my stand part notice on Clause 128, but we have quite a lot of questions still to answer in our discussions on the next group of amendments and beyond.

Clause 128 agreed.

Amendment 219 not moved.

Schedule 11: Power to require information for social security purposes

Amendment 220

Moved by

220: Schedule 11, page 245, line 1, leave out from “only” to “relevant” in line 3 and insert “in cases where there are grounds to suspect that”

Member's explanatory statement

This amendment, alongside others to paragraph 1 of Schedule 11 in the name of Baroness Sherlock, would reframe the Secretary of State’s power to give account information notices, making clear that the power should only be used in cases where there is suspicion that benefits are not being paid in accordance with enactments and rules of law relating to those benefits.

My Lords, I will also speak to the other amendments in my name, which are designed to dig further into exactly what the Government plan to do with these powers. Amendments 220 to 222 are probing amendments which seek to establish what would happen if the powers to give account information notices were used only where there is suspicion that benefits are not being paid as the law intends. I will try to use this to find out exactly what will happen with the signal that the noble Lord, Lord Clement-Jones, has been referring to.

Can the Minister explain how this will differ from what the DWP can do at the moment with its powers? As far as I understand it, the plan is this: first, the DWP will ask banks to find accounts into which benefits are paid or linked accounts; secondly, the DWP will specify criteria such as capital limits and assets; thirdly, the bank will go hunting for accounts which meet those criteria. What will happen in the fourth stage? What will the bank or body tell the DWP? Will they simply say, “Yes, Mr X ticks those boxes”, and then the DWP will use its other powers to do whatever it wants, or will information be taken from the bank and given to the DWP? It would be helpful if the Minister could explain it in really simple language for those of us unfamiliar with how the DWP’s processes work.

The question of scale keeps coming back. I do not know how many people will be covered by these powers. I started adding up the numbers on the main benefits: there are almost 10 million people on the state pension, over 6 million on universal credit, roughly another 3 million on PIP and 1.6 million on ESA. There is some overlap there, but I got to around 18 million. That made me realise that I do not know what we are dealing with, because I did not have a clear list of benefits covered by these powers. They are not listed in the legislation. Rather, as the Minister explained in his last answer, the Bill says that the power to issue notices covers all relevant benefits as set out in paragraph 16 of Schedule 11. However, that paragraph refers to benefits defined in the Social Security Administration Act 1992 and two other Acts. I looked up the 1992 Act, which referred to benefits covered by a list of 13 other Acts. This way of defining benefits is not unusual in social security legislation, but the bottom line is that I still did not have a list of all the benefits.

I confess that I went to officials, who were astonishingly kind and helpful and enabled me to get one. I hope the Committee will indulge my reading it into the record, because it is important that people know what they are—I will do so even more quickly than I normally speak, which I recognise is at the speed of light.

The relevant benefits are: attendance allowance, DLA, income support universal credit, housing benefit universal credit, council tax benefit, widowed parent’s allowance, state pension, state pension credit, additional pensions, state maternity allowance, bereavement payment, bereavement allowance, bereavement support payment, attendance allowance, Christmas bonus for pensioners, statutory parental bereavement pay, statutory neonatal care pay, industrial injuries benefit, guardian’s allowance, industrial injury benefit, incapacity for work, expenses of paying sums in respect of vehicle hire et cetera, universal credit, health and pregnancy grant, child benefit, JSA, ESA, PIP, social fund awards, sickness benefit (incapacity benefit), invalidity benefit (incapacity benefit), diffuse mesothelioma payment scheme, disablement pension, invalidity pension and allowance, reduced earnings allowance, severe disablement allowance, sickness benefit, unemployability supplement, unemployment benefit, care and attendance allowance, disablement pension increase, disability living allowance, mobility allowance, Christmas bonus, vaccine damage payment, carer’s allowance, carer support payment, carer element of universal credit, incapacity benefit, widowed mother’s allowance, widow’s pension, long-term incapacity benefit, child’s special allowance, graduated retirement benefit, invalid care allowance, retirement pension and community charge benefits.

However, it is more complicated than that. This still is not the whole story because, as the Minister explained, some of these are historic benefits which are not paid any more and others such as child benefit are complicated because they are the responsibility of HMRC, not the DWP. That does not take us all the way, but the bottom line is that I still do not have a list of which benefits the Government can and intend in practice to cover with these powers.

This all leads me to two conclusions. First, we need some consolidating legislation in the DWP very badly. Secondly, we need more clarity, so my Amendment 235 would require regulations specifying those working-age benefits to be covered by these powers to be approved by Parliament. If the Government do not like that, a simple solution would be for the Minister to tell the Committee which benefits the Government intend to use these powers on.

When Ministers started talking about these powers, the message was that they were focusing on people getting means-tested benefits who should not. Indeed, on 29 November my honourable friend Chris Bryant asked the Minister in the Commons if these powers would allow the Government to look at people getting the state pension. In reply, the then Minister for Data and Digital Infrastructure, John Whittingdale, said:

“I can tell the hon. Gentleman that it is not the case that the DWP intends to focus on the state pension … This is specifically about ensuring that means-related benefit claimants are eligible for the benefits for which they are currently claiming”.—[Official Report, Commons, 29/11/23; col. 880.]

However, the Government will not rule out using these powers in relation to the state pension. The state pension is not means tested. The only things that affect its value to an individual pensioner are their contribution record, the date at which they reached state pension age and where they live. The DWP already knows the first two of those, so why does it need access to the bank accounts of people getting the state pension? I can think of only two possible reasons: either the Government want to keep open the option to test the means or assets of people who get the state pension, or they plan to trawl the bank accounts of almost 10 million pensioners in the UK to find out if they are spending time abroad, because UK pensions paid abroad are uprated only in certain countries.

The impact assessment reports that DWP did two proof-of-concept tests where it established data-sharing collaborations with two banks and focused on two risk areas. One was capital and the other was “abroad entitlement”, although I still do not know how you can distinguish between someone who has moved abroad and someone who is spending either a long holiday or lots of short holidays abroad—say, visiting their grandkids. In order to find that out, my Amendment 234 would remove pensions from the scope of these powers. If the Minister does not agree with that amendment, perhaps he could tell us which of those two reasons is the one that the Government need these powers for.

Either way, do the Government plan to tell all the pensioners that they intend to use these powers? The Minister says the powers will be very popular and will have public support but I would be interested to know, if he told people that the Government were going to look into the bank account of every single pensioner in the country, whether they would still be popular then.

Amendment 222A was prompted by a letter that I received; I do not know if it was from the same person or a different one from that mentioned by the noble Baroness, Lady Kidron, in the last group, but I suspect it was a different one. I will call her Mrs Carter to protect her identity. She has an adult son who has severe learning and communication difficulties. He will never be able to live independently or to have a job. He has been in receipt of benefits, or benefits have been paid for him, since childhood. When he turned 16, because of the severity of his disabilities, the DWP told his mother that she needed to be named as her son’s appointee and that she needed to set up a number 2 account in her name into which all his benefit money would be paid so that she could manage his funds for him on a day-to-day basis.

She asked me if that meant that the DWP could request information on the number 2 account because the son’s benefits were paid into it. At the same bank she has a current account and a savings account as well as a joint account with her husband, none of which play any part in her son’s finances, and she wanted to know whether those accounts could also be looked into. At first I assumed not because it is about the account into which the money is paid, but I had a look to be absolutely sure—because, as I said, I am a social security nerd.

Paragraph 2(2)(a) of new Schedule 3B says:

“An account information notice … may require information relating to a person who holds a matching account even if the person does not claim a relevant benefit”,

and the Explanatory Memorandum said that was about appointee accounts. We therefore have to conclude that information could be sought on the number 2 account in Mrs Carter’s name. Sub-paragraph (3) says that:

“‘Matching accounts’, in relation to a specified relevant benefit, are accounts … linked to the receipt of that benefit”.

Sub-paragraph (5) says that:

“An account is to be regarded as linked to the receipt of a particular relevant benefit if it is … an account into which the benefit is (or is to be) paid … an account into which the benefit has been paid, or … an account linked to an account within”

either of those types of account. Lastly—I will stop shortly—sub-paragraph (6) says that:

“An account is to be regarded as linked to another if the same person holds both accounts”.

Mrs Carter’s name is on the number 2 account, her own accounts and her joint account. My reading of this suggests that information could indeed be sought on any accounts in Mrs Carter’s name, including joint accounts, without her knowledge. Could the Minister specifically confirm if that reading is correct? If so, how can he justify it? If it is correct, and if he accepts that it cannot be justified, will he accept Amendment 222A, which would simply make clear that the personal accounts of a benefit claimant’s appointee are not to be considered linked accounts for the purposes of fulfilling account information notices? I beg to move.

My Lords, I intervene very briefly. I thank my noble friend who, with her usual forensic clarity, identified some really important points. The last one in particular is very worrying. I have a question. It may be that I misheard what the Minister said in response to the last set of amendments. I thought I heard him say that child benefit would not be included, but it appears to have been on the list that was given to my noble friend. Of course, the point is partly that it is administered by HMRC, but it has replaced child tax allowances, so it should be treated in the same way as a tax allowance when it comes to this purpose—so I hope that I heard the Minister correctly and that child benefit will not be included.

My Lords, in relation to the excellent speech of the noble Baroness, she mentioned “personal” accounts. I would like to double-check that business accounts, charitable accounts and other accounts that have one’s name or one’s partner’s name on, or are connected, do not go on ad infinitum.

Because of the way the amendments are grouped, I have the opportunity to repeat my questions. The first one is relatively straightforward. Does the Minister accept that introducing these provisions—obviously we are talking about Amendment 234 on pensions—will discourage people from claiming pension credit? Despite all the efforts of the Government to encourage people to claim pension credit, clearly this will discourage them. Have the Government made any effort to estimate what impact this will have? Obviously, it is a very difficult task, but have they thought about it and does the Minister accept that it will have a deterrent effect.

My second question relates to the issue I have already raised. The state pension or state pension equivalent is paid by the state, by a pension fund or by a personal pension provider. Does the Minister think it odd that there is a difference in treatment? Everyone is receiving their pension from the state, but with a person who receives their pension from a private pension scheme or personal pension provider there is not the same right to look at their bank accounts in relation to those benefits. Now I am not advocating that as a solution. The question is: does this not indicate the illogicality and extent of the Government’s powers over some people’s incomes that they do not have over other types of income? To me, particularly when it comes to the payment of a pension—a benefit paid as of right—this discontinuity points to the extent of the Government’s overreach.

My Lords, I must begin by joining the general applause for the characteristic tour de force from the noble Baroness, Lady Sherlock. I was having a flashback because it was the noble Baroness in debate on what is now the Pension Schemes Act 2021 who taught me how to cope with Committee stage very kindly a long time ago —and we are very used to that. I rise briefly to address this group, but I start by saying in relation to the last group that I entirely agree with the proposition that Clause 128 should not stand part: the spying clause should not be part of the Bill.

I have a couple of points to make on the amendments in this group, one of which was raised by the noble Lord, Lord Clement-Jones, on the last group and is about protecting the Government from themselves. The amendments put down by the noble Baroness, Lady Sherlock, are probing. However, if we were to restrict the Government’s use of these powers, they might end up at a vaguely manageable scale. It is worth raising that point when we look at these groups.

I declare my position on the All-Party Parliamentary Group on Frozen British Pensions because, as I was listening to the noble Baroness, Lady Sherlock, I was thinking about pensioners who may spend lots of time abroad, visiting the grandchildren or whatever, as the noble Baroness said. They often have foreign bank accounts; where do they fit within this? What will the UK Government do about the many challenger start-up banks that we have now, which operate in multiple currencies across multiple jurisdictions? How far can the Government go or do they want to go with foreign or foreign-linked money, or more complex banks than your simple current account here in the UK?

I stress the important point made by the noble Baroness with Amendment 235; the Government need far more explanation of what they intend than just this huge blanket clause, which is sitting there apparently allowing them to probe into pretty much anything that they want to.

The Minister, the noble Viscount, Lord Younger, quoted a survey from 2023 on the public’s views of these powers. I point out that, as the noble Baroness, Lady Sherlock, said on the last group, we have recently heard a great deal about how recipients of carer’s allowance have been absolutely hammered by its cliff-edge nature and the way that the DWP has been chasing them. I suggest to the Minister that, after all those revelations, public views might have changed quite a lot.

My Lords, I was not intending to speak on this group, but another question occurs to me. We have been assuming throughout this that we are talking about requests of information to banks, but the Bill actually says that:

“The Secretary of State may give an account information notice to a person of a prescribed description”.

Could the Minister explain what that is?

My Lords, I would of course much prefer Clause 128 not to stand part, but we were just privileged by a master class from the noble Baroness, Lady Sherlock. She talked about these being probing amendments, but I do not think that I have seen a schedule so expertly sliced and diced before. If those are probing, they are pretty lethal. I agree with so many of those elements. If we are to have provisions, those are the kinds of additions that we would want and the questions that we would want to ask about them. I very much hope that the Minister has lots of answers, especially for the noble Baroness, Lady Sherlock, but also for the other noble lords who have spoken.

My Lords, the debate on this group has focused largely on the amendments from the noble Baroness, Lady Sherlock, regarding using powers only where there is a suspicion of fraud, making provisions so that information collected can be used only for the narrow purpose of determining overpayment, removing pension-age benefits from the scope of the powers and requiring approval from Parliament before the power can be used on specific working-age benefits.

I was going to go over the reason behind these measures once again, but I will not delay the Committee on why we are bringing them forward. I believe I did that at some length in the previous group, so I am going to turn to the amendments raised.

Narrowing these powers as suggested by the noble Baroness, with Amendments 220, 221, 222 and 222A, will leave us exposed to those who are deliberately aiming to defraud the welfare system and undermine the policy intent of this measure. In fact, taken together, these amendments would render the power unworkable and ineffective.

To restrict the power to cases where DWP already has a suspicion of fraud, as suggested by the noble Baroness, would defeat the purpose of this measure. The intent is to enable us to use data from third parties to independently check that benefit eligibility rules are being complied with. We use data from other sources to do this already. For example, we use data from HMRC to verify earnings in UC and check that the benefit eligibility rules are being complied with. Parliament has determined that, to be eligible for a benefit, certain rules and requirements must be met, and the Government have a responsibility to ensure that taxpayers’ money is spent responsibly. Therefore, the DWP should be able to utilise information from third parties to discharge that duty. This is an appropriate and proportionate response to a significant fraud and error challenge.

The noble Baroness, Lady Sherlock, also proposed that the power should be restricted such that it would not apply to persons who hold an account into which a benefit is paid on behalf of someone who cannot manage their own financial affairs—such persons are referred to as “appointees”. An appointee is a person who may be appointed by the Secretary of State to act on behalf of the benefit customer. Usually, the appointee becomes legally responsible for acting on the customer’s behalf in all matters related to the claim. It is also made clear to the appointee, in the documents that they sign, that we may get information about them or the person they are acting for from other parties, or for any other purposes that the law allows, to check the information they provide.

Under our proposed legislation, it is right to say that there may be some people who are not themselves benefit claimants but who have given a person permission to pay benefits into their bank account, who may be picked up in the data returned by third parties. Under the noble Baroness’s amendment, we would not be able to gather data on appointees, which would make the power unworkable, because third parties would not be able to distinguish between an individual managing their own benefit and an appointee. It also assumes that no fraud or error can occur in these cases, which is definitely wrong. I assure the noble Baroness that we handle such cases regularly and have robust existing processes for identifying appointees on our own database and for carefully handling cases of this nature.

The noble Baroness would also like to see the power—

Rather than asking all my questions at the end—I only have four—I will try to get answers as we go. On the appointees, I think that the Minister has just said that the reason the Government need these powers is that some appointees will have their benefit money paid into their own account, not into a separate second account, so that therefore needs to be the case. I am very happy to reword this amendment to make that clear. I was talking specifically about the linking arrangements; the amendment does not talk about excluding appointee accounts. It specifically says that accounts that are linked to an account into which the benefit is paid are not there. I am happy to reframe that in a way that defines it—I am sure we can find a way around this—but does the Minister accept the principle behind this: that, if there is a separate account that, say, I hold for a child who is there, this should not give a reason to look into my own accounts? Or is he saying that the Government want to look into my own accounts, or business accounts, or family accounts as well? Which is it?

The Government do wish to have that power. I should make it clear that an appointee could be a claimant as well, so there is a dual issue. It is important that we retain that power, to be sure that we cover the whole ground. But I will reflect on the noble Baroness’s point.

There were a number of questions on the other group that related specifically to people’s willingness to take these roles on and what the unintended consequence of putting appointees and carers in this position might be for the DWP, with people saying, “Actually, not me, then”.

The noble Baroness makes a very good point. I may be able to give her further reassurances in a letter because, on the one hand, we do want the power to be able to cover the ground. On the other hand, there are necessary protections that we must put in place. So further reassurances probably need to be given. There is that balance to be struck, but I hope I can continue to do that.

If I may pursue this, I am not sure I heard the Minister’s answer to the question of the noble Baroness, Lady Kidron—or maybe I did. If it was a charitable bank account, a business account or anything else, I think the Minister said that it would be subject to that scrutiny as well. Once someone acts for a carer, all of their bank accounts could be scrutinised—surely that is ridiculously unfair.

I am not sure I agree with that. I hope I can reassure the noble Baroness, as I tried to on the previous group. Using our test and learn process, which is already under way working closely with the banks, bringing them along with us and them bringing us along with them—there is a good relationship there—we are working through these important matters.

The point made by the noble Baroness, Lady Kidron, is important, as is that of the noble Baroness, Lady Jones. Again, it is important to give those reassurances. They will be forthcoming, and that is all part of our test and learn process, which I hope provides some reassurance.

I want to be absolutely clear on this point, because I am still not totally sure I am—I raised this the first time around on the last group. If I, as a landlord, have been paid rent as housing benefit directly, my accounts are caught. If I am a trustee of a charity and a cosignatory on a bank account, is the Minister saying that that charity’s account will be caught or not? I want to be absolutely crystal clear on that.

Yes it would. Landlords are in scope. We will filter this through in terms of the business as usual. If we receive any information—

Given that, has the department done an assessment of the likely impact on landlords being willing to take people on housing benefit? It is already an issue that landlords are reluctant to take housing benefit recipients, but, with this, I could see the market completely freezing for people on benefit.

I clearly cannot go far enough today, but, because this is important and we are in Committee, I need to give some further reassurances on where we are in the process in terms of filtering. If I may conclude my remarks, I will finish this particular point. This is all part of the test and learn, and I give some reassurance that we are working through these important issues in relation to appointees and landlords.

It is precisely as the noble Baroness, Lady Kidron, said on the last group—this is a massive net. It feels as though this is so experimental that there is no certainty about how it will operate, and the powers are so broad that anything could be subject to it. It sounds extremely dangerous, and it is no wonder that everybody is so concerned.

I do not agree with that. We have done quite a lot of business together across the Chamber. That is a slightly sweeping issue, because I have given some reassurance that we are already working with the third parties to make sure that we have robust processes in place. For instance, when we are talking about landlords, while it is possible that a landlord’s account may be matched under the measure, only minimum information will be provided by the third parties to enable my department to identify an individual within our own database. With all the data received, we will make further inquiries only where appropriate and where the information is relevant to the benefit claim. This is already part of our business-as-usual processes.

My Lords, I am sorry to interrupt the Minister but, throughout these two groups, he has, in a sense, introduced wholly new concepts. We have “test and learn”, “filtering”—which sounds extraordinary—and “signals” but none seem to be in the black letter of the schedule, nor in the rest of the Bill. We have a set of intentions and we are meant to trust what the DWP is doing with these powers. Does the Minister not recognise that the Committee is clearly concerned about this? It needs tying down, whether we need to start from scratch and get rid of the clause or take on board the amendments put forward by the noble Baroness, Lady Sherlock. The uncertainty around this is massive.

My Lords, I ask the Minister for clarification. The noble Baroness, Lady Sherlock, asked about the number of individuals; I guess it may be 24 million or 25 million. However, from what the Minister has said, the number of bank accounts subject to surveillance would be far greater than that. For example, I receive a state pension and am also a trustee of a small not-for-profit organisation; from what the Minister said, I would be caught, as would that organisation. Landlords and many others could possibly be added. It seems that the number of bank accounts would be far greater than the number of individuals. When he provides the data, can the Minister estimate how many bank accounts and transactions there might be?

I will add to that the issue of overseas bank accounts. I cannot see how the British Government can apply this measure to them. Will this not push people to go to overseas bank accounts? Or will the Government try to pursue them through challenger banks—including multiple accounts from one person who may have one original, normal current account here?

How many accounts of “signalling” already exist in the current backlog in the business-as-usual version? What kind of investment will it take when you supercharge these powers and get many more tens of thousands of signals?

I will add to the Minister’s grief. He has talked a number of times about the limited information that will be provided to the DWP, but that is not what the Bill says. The Bill refers to

“such further information in connection with those accounts as may be specified”.

There is no limitation in the Bill to the information that the DWP can request from the bank—assuming that it is a bank, after my previous question. I am struggling to understand how we get from that to “limited”.

Right. A number of questions have been asked. I am not sure that I can give too much more clarity—only that I will go back to what I said on the first group in terms of the limited nature of what we are trying to do. I was very clear about its limited nature, I think.

This leads on to the numbers that noble Lords are asking me about. Of course, I cannot give that figure, as we do not honestly know it. Until we move forward on bringing the measure in, we will not know it. What is certain is that we need this power to be able to gain the limited data that we need. When we receive the data, it may be the case that we need to follow up. I am sure that we will not need to follow up in the vast majority of cases but we must have this power.

To the noble Lord, Lord Vaux, I say this: this measure is for UK accounts only. I hope that that is also helpful to the noble Baroness, Lady Bennett.

This is the problem. We have been talking about limited information, a limited nature and the limited things that we will look at, but that is not what the Bill says. We need to think seriously about how we should limit the rights in the Bill to match the requirements of the DWP. At the moment, there seems to be a huge gap.

That point is very much noted. I will certainly take it back. Clearly, we need to provide greater reassurance on the limits and scope, as well as on what we are trying to do. I regret that I am not able to give those answers in full to the Committee now but I hope that, today, I have already taken us further forward than we were before we started. That is quite an important point to make.

I shall touch on the benefits that are in scope of this measure, a point that was raised by the noble Baroness, Lady Sherlock. I think the noble Baroness wishes to restrict the power to working-age benefits, but pension-age benefits are not immune to fraud and error—I wanted to address that—and it is our duty to ensure that these benefits are paid correctly and in line with the benefit eligibility rules that Parliament has previously agreed. Every payment that the DWP makes has eligibility criteria to it. Parliament has considered these criteria in the passage of the relevant social security legislation, and the Government have a responsibility to check that payments are being made in line with those rules so that taxpayers’ money is spent responsibly.

Pension benefits other than pension credit have eligibility criteria attached, but I do not know any eligibility criteria applying to pensions that you could discover from someone’s bank account.

The example that the noble Lord will be aware of links to what the noble Lord, Lord Sikka, was saying about some pensioners who have moved abroad but, for whatever reason, have not told us that they have done so and continue to receive the uprating. The figure for the fraud aspect—or it could be error—linked to state pensions is £100 million.

Presumably the DWP already knows the address of the bank account to which an overseas pension is being paid. Why does it need to know any more?

My understanding is that it needs to have these powers to be able to cover the ground properly. I say again that these powers are limited, and whatever comes from the data that is requested from the third parties will end up being, we hope, limited. Even then, it may not be used by us because there is no need to do so.

The power covers all relevant benefits, grants and other payments set out in paragraph 16 of new Schedule 3B to the Social Security Administration Act 1992, as inserted by Schedule 11 to the Bill. To remove pension-age payments from the scope of the power would significantly undermine our power to tackle fraud and error where it occurs. Pension-age payments are not immune to fraud and error, as I have mentioned. I will give an example of that. The noble Baroness, Lady Sherlock, asked whether people would be notified of their bank accounts being accessed.

I know that I said earlier that child benefit was not included. I will clarify that child benefit is not a benefit for which the DWP is responsible or has any functionality for. This measure will be exercised by the DWP Secretary of State, and we cannot use this power for that benefit.

I was in the middle of answering a question from the noble Baroness, Lady Sherlock.

I will finish this answer, if I may. The DWP personal information charter lists banks and financial institutions, and other parties, among the parties with which DWP may share data and from which we may receive data. It also lists checking accuracy and preventing and detecting fraud among the purposes for which we may share or receive information.

A claimant will not be notified if their account details have been returned to DWP by a third party as that could alert fraudsters to the criteria, enabling them to evade detection—I think that is a valid point—but they will be notified if a DWP agent determines that a review is required as a result of the information provided by the third party. That notification will be done through the business-as-usual processes.

Moving on to defining working-age payments in legislation, which relates to the final amendment in this group, Amendment 235, which was tabled by the noble Baroness, Lady Sherlock, it would require the Government to specify in regulations the working-age benefits with which this power could be used. As she demonstrated, there is a wide range of benefits and therefore potential avenues for fraudsters to seek or exploit or for error to creep in. That is why it is important that the power enables the department to respond proactively as new fraud risks emerge.

That said, as the noble Baroness knows, the power will not be exercisable in all the benefits she listed—I took note of her long list—such as child benefit, which we have just mentioned, because the legislation is drafted in such a way that it could reasonably be exercised in relation to benefits for which the Secretary of State is responsible. I reassure the noble Baroness, Lady Sherlock, and the Committee that in the first instance, we plan to use this with universal credit, employment and support allowance—ESA, pension credit and housing benefit. That is the way forward.

There may be a number of questions that I have not addressed, but I hope that I have continued to make the case for why this measure is so important and our aim to tackle fraud and error. I continue to make the case that it is proportionate and that proportionate safeguards are in place. With that, I hope the noble Baroness will agree to withdraw her amendment.

Will people with power of attorney over the account of someone who receives a benefit also be caught up in all this? That is another vulnerable group, so this could be extensive and quite worrying. Secondly, I am concerned by the Minister’s answers on this group. They have made me feel somewhat more strongly than I did when giving my response on the previous group, so I feel I should put that on the record.

That is understood. I know that I need to provide further reassurances. Attorneys are included for the reasons that I set out for appointees.

My Lords, I thank the Minister for taking the time to try to answer the questions. I know that we have given him a hard time, but I thank him for responding so graciously.

He did not take the opportunity to explain the process simply to the Committee. It may be that it is too difficult to explain simply or that, in fact, he can explain what they intend to do, but the powers allow them to do something much wider than that. It would be helpful if he could reflect before he writes as to how best to frame this. I think I heard him trying to say to the Committee that people think that more information is being handed over than will in fact be handed over. If that is the case, it would be helpful if he could spell that out because that would at least begin to help people understand better what is going on.

Secondly, in responding to me, the Minister focused, understandably, on the content of the amendments. I was trying to explain that the reason they are probing is that it is quite hard to get a handle on this. It is a big, sprawly thing, and I am trying to find a way of nailing some jelly to the table; I am trying to find ways of containing it. I still do not know which benefits the Government can use the powers over and which ones they intend to. It is a great step forward to know where they are going to start; that is really helpful. I am also grateful for the clarity, whether people are happy or not, that the Government intend to use the powers on the state pension and make that clear because that was not the impression given in the House of Commons when the matter was debated there. That is a helpful piece of clarity for the Committee and the wider community.

I know this is hard; fraud is difficult. A case was mentioned where an organised fraud gang stole more than £50 million in social security benefits. I know it is hard, and I know it is hard for the DWP to understand precisely where these things will lead when you begin to go there. I understand that if it is too boxed in, it makes it difficult to be able to follow where the fraudsters go, who are often one step ahead of the Government. I get all of that, but there is a risk that when it has spread so widely, the level of concern gets to the point that it will not be as publicly acceptable as the Minister thinks it is. I ask him to take the opportunity, when he goes back to the department, to talk to colleagues and think about what kind of assurances the Government could try to find a way of giving to people, either staging processes or government oversight. I ask him to think about that because the kinds of concerns he has heard here will only increase as the powers start to unfold.

In the next group of amendments, which I think will now be discussed on Wednesday, I want to dig further into the question of who the data and account notice can be given to and what criteria will be used. That will be another chance to flush out some things, so I give notice now that I would like the Minister to look into those areas next. I am grateful for his efforts and to all Members of the Committee who have explored this matter. I beg leave to withdraw my amendment.

Amendment 220 withdrawn.

Amendments 221 to 224 not moved.

Committee adjourned at 8 pm.