UK Public Sector Incompetence Sinks to New Low - Loss of 25m UK Child Benefit Records

By: Nadeem_Walayat

The UK Public sector, renowned for gross incompetence and negligence sinks to a new low today as the government announces that the HMRC (Tax and Customs Department) has lost what tantamount's to ALL of the financial records and personal information of ALL of the UK Child Benefit Claimants. This now puts 25 million people at the potential risk of identity theft.

The data was lost on two discs that were en route from the HMRC to the National Audit Office.

As a result of this unprecedented loss of data, the head of HMRC, Paul Gray resigned.

The Chancellor Alistair Darling, Stated in the House of Commons : "In March of this year it appears that a junior official within HMRC provided the National Audit Office with a full copy of HMRC's data in relation to the payment of child benefit.

"This information should not have been handed over by HMRC in the way that it was. However, I understand that in this case the NAO subsequently returned all the information it received in March to HMRC after auditing it.

"It now appears that following a further request from the NAO in October for information from the Child Benefit database, and again at a junior level and again contrary to all HMRC standing procedures, two password protected discs containing a full copy of HMRC's entire data in relation to the payment of child benefit was sent to the NAO, by HMRC's internal post system operated by the courier TNT. The package was not recorded or registered."

"It appears the data has failed to reach the addressee in the NAO."

"The police tell me that they have no reason to believe that this data has found its way into the wrong hands. The police are not aware of any evidence that it has been used for fraudulent purposes or criminal activity.

"Let me tell the House what is missing as a result of this extremely serious failure on the part of HMRC to protect sensitive personal data entrusted to it in breach of its own guidelines."

"The missing information contains details of all child benefit recipients: records for 25 million individuals and 7.25 million families. These records include the recipient and their children's names, addresses and dates of birth, it includes Child Benefit numbers, National Insurance Numbers, and, where relevant, bank or building society account details.

"Mr Speaker, I regard this as an extremely serious failure by HMRC in their responsibility to the public."

"The UK Payments Association, the British Banking Association and Building Societies Association have been informed. Through them HMRC informed individual banks and other financial institutions including building societies and post offices of affect accounts. Second, individual institutions are flagging these accounts which enables them to continually monitor for irregular activity. They tell me that so far they have found no evidence of such activity."

"The UK Payments Association have confirmed they are confident that every action has been taken by the banking industry to minimise the risk of any fraud.

"They have also confirmed the missing data is not enough in itself for someone to access a person's bank account for fraudulent purposes - as additional security information and passwords are always required. But we have to recognise the increased risk caused by this missing data.

"So people will want to monitor their accounts and guard against any unusual activity."

"This is an extremely serious matter. HMRC has a responsibility towards the general public who entrust it with highly sensitive personal information. It has failed to meet the high standards that should be expected of it.

"Mr Speaker, I recognise that millions of people across the country will be concerned about what has happened. I deeply regret this and apologise for the anxiety that will undoubtedly be caused."

The British people are subject to continuing gross incompetence and negligence from the uncompetitive public sector, right from GP Surgeries, to Hospital Killing Fields to now even the Tax and Customs Department. And this in the light of government plans to implement identity cards that are set to contain highly confidential personal information.

By Nadeem Walayat
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Nadeem Walayat has over 20 years experience of analysing and trading the financial markets and is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication. We present in-depth analysis from over 100 experienced analysts on a range of views of the probable direction of the financial markets. Thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

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