Consumer Credit Bill

moved Amendment No. 15:"Before Clause 62, insert the following new clause—"    ““DATA SHARING (1)   In this section—    ““authorised person”” means any person who is— (a)   a consumer credit business or consumer hire business; and (b)   a data controller;    ““data controller”” has the meaning given by section 1 of the Data Protection Act 1998 (c. 29) (basic interpretative provisions);    ““personal data”” has the meaning given by section 1 of the Data Protection Act 1998. (2)   It shall be lawful for an authorised person to disclose to a credit reference agency any personal data relating to a debtor which are processed by him if the conditions in subsection (3) are satisfied, notwithstanding that the debtor has not given his consent to such disclosure. (3)   The conditions are that— (a)   the authorised person has given the debtor notice of his intention to disclose the debtor’s personal data under this section and obtained proof of delivery of such notice to the address given for the serving of notices upon the debtor in the agreement between the debtor and the lender; and (b)   the debtor has, within 28 days of the date of that notice, failed to give the authorised person notice that he does not consent to the disclosure of his personal data. (4)   It shall be lawful for— (a)   a credit reference agency, or (b)   an authorised person, to process and use personal data disclosed under subsection (2). (5)   Regulations may make further provision in relation to disclosure of personal data under this section.”” The noble Lord said: My Lords, as I explained in Committee, the amendment introduces a new clause to modify the Data Protection Act 1998, in respect of an agreement entered into before that Act was contemplated and which would not have specifically included the debtor’s agreement to disclosure, allow a lender to disclose to a credit reference agency information about a debtor, without the consent of that debtor, where 28 days’ notice had been given to that debtor and he failed to respond. Concerns have understandably been widely expressed in debates on the Bill about debtors being sucked into a morass of unsustainable debt from which escape is difficult because they incur liabilities which their means will never permit them to repay. As I explained in Committee, all this amendment seeks to do is, from a data-sharing perspective, to bring lending agreements entered into before the Data Protection Act on to a par with those entered into since. In stating his objections to the amendment, the Minister said:"““We need to fully understand the wider implications that such a provision may generate. We also need to consider carefully whether the potential benefits gained would be proportionate to the loss of the right of privacy for the individuals concerned””." In an attempt to address these concerns by ensuring that the debtor does indeed have the best possible chance of seeing the notice and then, if he wishes, objecting to disclosure, which would be respected, we have changed the amendment to add the words,"““and obtained proof of delivery of such notice to the address given for the serving of notices upon the debtor in the agreement between the debtor and the lender””." The Minister also said,"““the amendment does not ensure that the data shared would be so used””." We are not sure that you can compel use by legislation, but nor do you need to do that. Lenders are crying out for more and better data upon which to base their lending decisions. The Minister also had concerns about what information should be shared. He stated:"““For example, should it include all or any of the following: the date of the agreement; the period of the agreement; the amount borrowed or credit limit; the updated monthly balance; the debtor’s payment history detailing whether they pay on time or fall into arrears; the date the account was closed or defaulted; the default amount if relevant; and the debtor’s previous balances or credit limits””.—[Official Report, 16/11/05; GC 320.]" The answer is that it should include information to the same level of detail that is already permitted to be disclosed in agreements entered into since the Data Protection Act. The amendment ties in with the Data Protection Act 1998. It turns up ““personal data””, which we say has the same meaning as that given in the 1998 Act. Consistency is achieved by this mechanism. I beg to move.