Data Protection and Digital Information Bill

Debate between Viscount Younger of Leckie and Lord Anderson of Ipswich

Committee stage
Wednesday 24th April 2024 Grand Committee

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, this has been a somewhat shorter debate than we have been used to, bearing in mind Monday’s experience. As with the first two groups debated then, many contributions have been made today and I will of course aim to answer as many questions as I can. I should say that, on this group, the Committee is primarily focusing on the amendments brought forward by the noble Baroness, Lady Sherlock, and I will certainly do my very best to answer her questions.

From the debate that we have had on this measure, I believe that there is agreement in the Committee that we must do more to clamp down on benefit fraud. That is surely something on which we can agree. In 2022-23, £8.3 billion was overpaid due to fraud and error in the benefit system. We must tackle fraud and error and ensure that benefits are paid to those genuinely entitled to the help. These powers are key to ensuring that we can do this.

I will start by answering a question raised by the noble Lord, Lord Anderson—I welcome him to the Committee for the first time today. He described himself as a “surveillance nerd”, but perhaps I can entreat him to rename himself a “data-gathering nerd”. As I said on Monday, this is not a surveillance power and suggesting that it is simply causes unnecessary worry. This is a power that enables better data gathering; it is not a surveillance or investigation power.

The third-party data measure does not allow the DWP to see how claimants spend their money, nor does it give the DWP access to millions of people’s bank accounts, as has been inaccurately presented. When the DWP examines the data that it receives from third parties, this data may suggest that there is fraud or error and require a further review. This will be done through our normal, regular, business-as-usual processes to determine whether incorrect payments are indeed being made. This approach is not new. As alluded to in this debate, through the Finance Act 2011, Parliament has already determined that this type of power is proportionate and appropriate, as HMRC already owns similar powers regarding banking institutions and third parties in relation to all taxpayers.

I listened very carefully to the noble Lord and will, however, take back his points and refer again to our own legal team. I think the point was made about the legality of all this. It is a very important point that he has made with all his experience, and I will take it back and reflect on it.

[Lord Anderson of Ipswich (CB)]

I take the Minister’s point and I will settle for the appellation “investigatory powers nerd”; I am quite happy with that. Does the Minister agree with me, however, that the legal difficulty —we see this with the other bulk powers already in our law—is that Article 8 of the European convention locks in not when a human eye gets stuck into the detail, but as soon as a machine harvests the data in bulk? Most of that data relates to people in respect of whom there could be no possible suspicion. Satisfying the requirements of necessity and proportionality must be done even at that stage. I understand that that is awkward and I am sure a lot of people would prefer that it was otherwise, but that is, as I understand it, the law. That renders the distinction that the Minister seeks to draw between data gathering and surveillance perhaps slightly difficult to maintain.

[Lord Bassam of Brighton (Lab)]

My Lords—

[Viscount Younger of Leckie (Con)]

If I may just answer that question from the noble Lord, Lord Anderson; I think it is important to take one question at a time.

I have every sympathy with what the noble Lord has said. As I mentioned on Monday, points could easily raised about that—I think it may have been the noble Baroness, Lady Kidron, who raised points about computers and their robustness. This is the very point that we agree with. It is incredibly important and we have started already to draw up a proper code of practice to work with the banks on how this will actually work. We need continued time to work these issues through. I also made the point on Monday that, at the end of the day, a human being will be there—must be there—to determine where we go from there.

[Lord Anderson of Ipswich (CB)]

In relation to the code of practice, which I am glad the Minister mentioned, we have just seen the Investigatory Powers (Amendment) Bill through this place. It makes some relatively minor changes to the powers of the intelligence agencies to harvest data in bulk and, to ensure the orderly passage of that Bill through both Houses of Parliament, the key excerpts of the draft code of practice were made available before Committee in either House to enable it to be properly scrutinised. We seem to have left it terribly late in the day still to be talking about a draft code of practice on this Bill, which we have not even seen. Can the Minister assure us that before we come to Report, that code of practice will be available in draft?

[Viscount Younger of Leckie (Con)]

Indeed, I was going to come on to that later in my remarks, particularly to address the points raised by the noble Baroness, Lady Sherlock. We need the necessary time to continue to develop this code of practice, and that is particularly important in respect of this measure. The answer is no, I cannot guarantee to have the code of practice ready by Report. Indeed, I am saying that it will be ready sometime in the summer. It is important to make that point but also a further one, which is that there are many instances, as the noble Lord will know, when a code of practice is finalised and brought forward after the primary legislation is brought through, and this is one of those cases. That is not abnormal but normal. The noble Lord may not like it but there is considerable precedent for that to happen.

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[Viscount Younger of Leckie (Con)]

I appreciate the tone of the noble Lord and, if there is anything that comes from behind me before I conclude my remarks, to be helpful, I will certainly do that.

Our debates on this measure have covered many issues. This group, as mentioned earlier, focuses primarily on the operational delivery of the power, so it would be quite good to move on. Just before I do, for the benefit of the noble Lord, Lord Anderson, in terms of the late introduction—his words—of this measure, as mentioned on Monday the DWP published a fraud plan in May 2022, where it outlined a number of new powers that it would seek to secure when parliamentary time allowed. In the parliamentary time available, DWP has prioritised our key third-party data-gathering measure, which will help it to tackle one of the largest causes of fraud and error in the welfare system. That is a short version of what I said on Monday, but I hope that it might be helpful.

Before I turn to the amendments, it might be helpful to set out how the legislation will frame the delivery of this measure. When we issue a request for data to a third party or, as it is set out, an account information notice or AIN, which is in the Bill, we can only ask it to provide data where it may help the DWP to establish whether benefits have been properly paid in accordance with the rules relating to those benefits. As mentioned earlier, this is defined clearly at paragraph 1(2) of the new schedule. This is where the data that DWP receives may signal—to use the word raised by the noble Lord, Lord Clement-Jones—potential fraud and error. The noble Lord asked for further clarification on that point. To be clear, a signal of fraud and error is where the rules of benefit eligibility appear not to be met. For example, this might be where a claimant has more capital than the benefit rules allow. As I made clear on Monday, all benefits and payments have rules that determine eligibility, which Parliament has agreed are the right rules in its consideration of other social security legislation. To issue an AIN, we must also have designated a third party in affirmative regulations, which need to be passed by both Houses.

As has been covered, we can also only request data from third parties where there is this relationship, which I will not repeat again and which I think the Committee will be familiar with. Our intention is to designate banks and financial institutions as the first third parties that we can approach, enabling us to request information on accounts only held in the UK. Just to clarify that point, we will not be able to request information on overseas accounts.

On the question raised by the noble Baroness, Lady Sherlock, on examples of non-financial organisations that the power could appropriately be used on, we will bring forward regulations to specify the data holders in scope. I hope that this is helpful. In the first instance, this will be, as mentioned, banks and financial institutions. The power also has potential use cases with other third parties, such as housing or childcare providers, but, just to reassure the Committee, this would be subject to further parliamentary approval.

[Lord Anderson of Ipswich (CB)]

I am grateful to the Minister—I am just trying to catch up. On the point that he made about regulations, I imagine that the power to prescribe the descriptions of persons to whom an account information notice may be sent comes under paragraph 1(1) of the schedule. I think that that is what he was saying. In paragraph 2, on the content of the account information notices, there is a reference to

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

Does that simply mean anything specified in the account information notice or is there a power to make regulations that will limit the types of information that can be specified in an AIN?

[Viscount Younger of Leckie (Con)]

Again, I hope that I might have covered this earlier. If I read the noble Lord’s question correctly, the definitions will need to be debated by both Houses. I have made clear what we are bringing in at the moment for banks and financial institutions, but this will need to be looked at by both Houses in future. I hope that that is clear.

[Lord Anderson of Ipswich (CB)]

I apologise; I did not make myself clear. I think that we are on entirely the same wavelength on the persons to whom an information notice can be given; the Minister has reassured us that they will be specified in regulations and considered by both Houses. My question relates to the content of an account information notice under paragraph 2 and the very broad references to “other specified information”, “such further information” and so on. I did not read that as a regulation-making power. I rather assume that the discretion over the choice of information that is specified remains entirely at large. If the Minister is saying that there will be regulations that will specify the information that an AIN can include, hence mitigating the breadth of paragraph 2, I would be glad if he could make that clear.

[Viscount Younger of Leckie (Con)]

My understanding —with his experience, I am sure that the noble Lord will be ahead of me on this—is that this is defined. We define it pretty clearly in paragraph 1(2). In the interests of time, I will reflect on what he has asked and will be absolutely sure to add this to the letter that I pledged to write on Monday—it is getting bigger by the moment, as I fully expected.

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[Viscount Younger of Leckie (Con)]

I can reassure the noble Lord that that is the case, yes.

[Lord Anderson of Ipswich (CB)]

I do not know whether I can help. I agree with the noble Baroness: I do not think it is very clear from paragraph 1(1) that there is a regulation-making power. However, if you look at paragraph 5 of the new schedule, there is a reference there to regulations under paragraph 1(1) as well as two other paragraphs of the schedule. That is the rather tortuous route by which I came to the conclusion that the Minister is quite right.

[Viscount Younger of Leckie (Con)]

I reassure noble Lords that is correct—it is paragraph 1(1). It may be rather complex, but it is in there, just to reassure all noble Lords.