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Chris Bryant: As ever, the hon. Gentleman is advancing a rational argument, but the new clause gives a very broad definition of the information that is available. Many people would be nervous about the amount of information that might be available as a consequence. A credit card contains a vast amount of personal information about how people live and many would find it worrying that it could be shared quite so readily. Subsection (4) moderates the position slightly, but nevertheless includes a very broad definition of the purposes for which information might be shared.
Charles Hendry: A recurring theme in Committee was the lack of detail in the Bill. The Minister's response was usually that the issues concerned could be resolved in the courts. I should be happy to see an extra schedule or, alternatively, a provision allowing the Secretary of State to issue guidance in statutory instruments. The new clause, however, heads in the right direction. Of course we do not want information about where everyone spends their money to be available to a range of institutions, but if someone has 20 credit cards and has reached the borrowing limit on all of them, it is surely not unreasonable for a lender to have that information before issuing a further card. I agree with the hon. Gentleman that we should be cautious, though. One of the Conservatives' worries about the Identity Cards Bill is the amount of information that would be held and would be generally available.
That could presumably cover details of personal relationships, such as a duty to pay moneys to a former spouse. We need to ensure that we are not giving more extensive powers to credit reference agencies than even the hon. Gentleman would want them to have.
Charles Hendry: One could also argue that, if somebody is looking to take out a credit card or to borrow money, the question of whether they are paying thousands of pounds to a spouse is relevant and should be taken into account in assessing their ability to make repayments. Every time that we take out a mortgage or a loan, we are required to tell the lender about our other outgoings. If we are to encourage responsible lending, it is reasonable for lenders to be able to ask such questions.
The thrust of the new clause is supported by the industry and by organisations that exist to protect consumers, such as Which? The new clause enjoys support from both sides of the argument, which shows that we are moving in the right direction.
We all want to reach the right solution, but under the terms of the new clause, people would have to provide not just financial information but any information. For example, they would have to disclose not merely how much they were paying to an ex-spouse, but any personal information that might have a
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bearing on their financial standing, such as whether or not they have an ex-spouse. The hon. Gentleman's new clause goes too far in seeking to reach an end about which we are all doubtless in agreement.
Charles Hendry: We will all agree that we need to strike a balance between requiring the provision of information that is relevant to a lender's reaching a sensible conclusion about whether lending to a particular person is a fair and reasonable risk, and protecting that person's privacy. However, these issues can be resolved. If the Minister were to say that he accepts the new clause and will bring the Bill back in revised form in another place, but with the word "any" removed, we would be prepared to reconsider this issue.
James Brokenshire: Data sharing is a particularly relevant issue to those on low incomes. Reports such as that produced earlier this year by the Joseph Rowntree Foundation show that it is difficult for them to access credit. A further problem, which is accentuated for such people, is credit assessment and the possibility that their circumstances might change. That strengthens the need for greater data sharing in some form or other. The new clause would enable such sharing and ensure that rational decisions are taken, particularly in respect of those on low incomes.
Charles Hendry: My hon. Friend makes an extremely valid point. We are seeking to protect consumers and ensure that they do not get into vast and unaffordable debt. That must be one of the Bill's most important aims and data sharing is intrinsic to making that reasonable aim achievable.
The Minister will be aware that many people would like us to go much further. He will have seen this week's "debt on your doorstep" campaign, in the Daily Mirror, for an affordability test. We are not going so far as that, but I hope that the Minister sees scope for moving in this direction, that he understands that we have advanced these arguments because we genuinely believe that such measures will help to protect consumers and that, on reflection, he will accept the new clause.
Mr. Sutcliffe: I am delighted with the quality of our debate on new clause 1, but as Members have said, in discussing it we have to consider the wider context of the Bill, on which there is considerable consensus within the industry, among consumer groups and in all parts of this House. Interestingly, new clause 1 is a joint arrangement between the Conservatives and the Liberal Democratsa new pact is emerging. That said, I thank the hon. Members for North Norfolk (Norman Lamb) and for Wealden (Charles Hendry) for tabling the new clause, the spirit of which I genuinely accept.
The new clause raises a very important issue that has been debated in the House and by the Treasury Select Committee, of which the hon. Member for North
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Norfolk was a member. The Government believe that data sharing is a necessary and important means of ensuring responsible lending, but the issues are wider than just those covered by the Consumer Credit Act 1974. They include other types of lending regulated in other statutes, such as the Financial Services and Markets Act 2000, and the important question of data protection, which is regulated by the Data Protection Act 1998. Members of the Association for Payment Clearing Services agreed data sharing principles in 2004 and, among other things, they committed to sharing all data that they are legally able to share.
The Department of Trade and Industry is discussing measures to improve current levels of data sharing with the credit industry, so we are taking the lead that Members have asked us to take. Such measures include working with the credit industry to determine the case for possible legal changes that would allow the sharing of data on accounts dating back to before lenders routinely sought permission to disclose data for credit reference purposes.
Norman Lamb: Is the Minister saying that he shares the objective of addressing the historical problem whereby agreements made before the Data Protection Act 1998 have no wording? Does he agree that we need to find a way to ensure that information and data on such agreements is also shared?
Mr. Sutcliffe: Yes, and it is important that we continue to discuss data sharing with the industry and with the various Departments. As I said in Committee and throughout our discussions, I do not want people to be able to hide behind the 1998 Act in cases where extreme detriment has been suffered.
We have to work with the industry and with the Department for Constitutional Affairs to determine the case for possible legal changes and to identify possible legal routes that allow for the sharing of data on accounts that date back before lenders routinely sought permission to disclose data for credit reference purposes. It is important, however, that the industry be able to show that the benefits gained from the sharing of these data are proportionate to the legislative measures involved. We all recognise how important it is that lenders have the best possible information to make responsible lending decisions, while ensuring that proper safeguards are in place on the use of personal information. Indeed, my hon. Friends have made such points in opposing the new clause.
Discussions are taking place and the DTI is taking them seriously. I am aware of the effect that getting into credit difficulties can have. We all know of tragic cases from our own constituency experience, and I was particularly saddened to hear about the case of the constituent of the hon. Member for Putney (Justine Greening). The Bill's purpose is to ensure responsible lending and that people borrow wisely and when able to do so.
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