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Most people use banks to transfer money and we should be able to obtain information from them. But there are other companies which transmit money and which would not be so covered, such as Western Union. This is a money transmission company that enables a person to send money to someone within the UK or abroad for a service charge. Senders can transfer the money by handing in cash, by credit card or by telephoning the companies. The recipients can collect the funds from the companies' agents by proving their identity.
Given that the noble Lord simply asked about the context of this provision, I hope I have answered his question. We obviously need such information to identify people who are colluding in organised international fraud and to track the movements of stolen benefit in order to recover that money when benefit cheats are prosecuted.
For example, in one operation, people who were involved in making multiple fraudulent benefit claims--including a member of the DSS staff--were observed using money transmission companies to send money abroad. That is why we need to bring them in under this remit. If the amendment were accepted, we should be unable to obtain such information; what is more, if it were an exempt territory, one could see a growth in the use of such services to send money to banks abroad so as to evade detection. I hope that I have answered the noble Lord's question and that he will be able to withdraw his amendment.
The water, gas and electricity industries also recognise the significance of social security fraud and the potential role to be played by private sector companies, including utility suppliers in efforts to tackle this form of crime. However, they have concerns about some aspects of the Bill--specifically, potential costs, data protection aspects and the impact on customer relations.
Utility companies, and especially electricity companies, as almost every household has an electricity meter, will be affected by the large costs associated with the Bill. Although the Bill allows the Secretary of State to make payments to utility
The companies are also concerned about the way in which this will affect relations with their customers. Electricity companies are working extremely hard to introduce initiatives designed to combat fuel poverty. In so doing, they often deal with sensitive customer groups. The industry believes that the requirement for such companies to hand over information to the Government about those customers places a strain on electricity suppliers, who are trying to do their very best for vulnerable customer groups.
On data protection, the industry feels that the Government may be seeking on-line access to information held by the electricity suppliers. Can the noble Baroness tell the Committee whether the Government believe that this will raise specific data protection problems for the electricity industry? I look forward to hearing the Minister's response to those two points. I beg to move.
Baroness Hollis of Heigham: My Lords perhaps I may respond first to the noble Lord's second point relating to data protection. I have received an assurance to the effect that the answer to that question is no. No data protection issues are raised for the electricity companies. However, given that this is the Committee stage, it may be worth outlining why we need this information. These amendments seek to remove the power to obtain information from water companies and gas and electricity suppliers. Fraud is committed by people lying about where they live--for example, claiming housing benefit for a property that is actually empty. Members of the Committee will know from ample discussion in this Chamber about housing benefit fraud how often systematic frauds arise as regards properties where people are not living. Fraud is also committed by people lying about their identity.
Utilities, including water companies, can provide information on levels of consumption. No consumption may mean no resident at a property; for example, if we suspect that a gang of organised criminals are using a number of empty addresses to claim benefit from, information from the utility companies could tell us if it was likely that anyone was living there. Such companies can also provide information on who they think lives in a property which we can cross check with our own records. Therefore, they can help us combat those types of fraud.
Water companies also have information on how bills are paid. For example, if we were to ask about the bank account used to make payments by direct debit, this may lead us to identify undeclared income in those accounts. The type of information that we would require from gas and electric companies would be
Therefore, we can obtain information about residency fraud. We may also get information about what other forms of income people may have. If a utility company tells us that our customer is not the registered user at an address, that might suggest either that he or she is not living at that specific address or that he or she is living with an undeclared partner who is working and paying the domestic bills. Indeed, I could go further.
The noble Lord, Lord, Astor, also said that he thought this provision was unfair because of the bulk issue as regards the utilities. Given the likely cost of extracting the data, it is difficult to see why it is appropriate to make payment. This is just a large amount of bulk information.
With that explanation--namely, that giving the information is not contrary to the Data Protection Act and the fact that we do not believe it is appropriate to make such payments, and bearing in mind that it is information particularly about residency to which these companies have unique access--I hope the noble Lord will feel able to withdraw the amendment.
Lord Astor of Hever: I am grateful to the noble Baroness for her response. I quite accept, as does the industry, the need for the DSS to have such information. I was disappointed with the Minister's response on the recovery of costs, but I am grateful that there will not be any specific data protection problems for the electricity industry. In the light of that, I beg leave to withdraw the amendment.
The noble Lord said: Should the Bill receive Royal Assent in its current form, there is concern in the telecommunications industry at the imposition of what it believes to be an unreasonable burden on companies. Although I understand that the Government would be prepared to meet some of the costs to the telecommunications companies when using services, such as directory enquiries, for which companies already charge, these payments would not be sufficient to cover the majority of the costs that would fall on them.
As the companies expect to have to deal with up to 90,000 enquiries per year over the whole sector, they believe that this Bill will have serious resource implications for them. They feel that those implications go beyond any reasonable expenses that they should be obliged to bear as good corporate citizens.
In today's House of Lords Official Report, in a Written Answer to my noble friend Lord Northesk, the Government recognise that Internet service providers (ISPs) and communications service providers (CSPs) do bear substantial costs for providing data to law enforcement agencies and should, therefore, be entitled to enter into cost recovery agreements. The noble Lord, Lord Bassam, has accepted that a requirement to provide communications data places operational and financial burdens on the CSP. In the light of that response, can the noble Baroness clarify the Government's position on compensating the communications sector for the data that it provides?
In particular, I should be grateful if the Minister could clarify why the telecommunications services should be treated differently from the ISPs, if in fact telecommunications services do fall into this category of CSPs mentioned by the noble Lord, Lord Bassam. If they do, it seems extraordinary to allow them to recover their costs under the Regulation of Investigatory Powers Act 2000, only to prevent them from doing so under this Bill, the aim of which is also to facilitate improved law enforcement.
We hope that the Government will eventually agree with themselves that these companies should be entitled to some sort of reimbursement for the prospective costs that they will shoulder as a result of this Bill. It is important that we do not take for granted those British businesses that have legitimate concerns about how such costs will affect their businesses when drafting legislation which will have to rely heavily on their co-operation for its effectiveness. I beg to move.
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