New guidelines on the Data Protection Act are set to be given to police to ensure information on suspects is stored and used properly.
Huntley was hired despite prior accusations against him
The move follows revelations that murderer Ian Huntley got a caretaker job at Soham school despite police knowing about sex allegations.
Humberside Police said data protection laws required them to delete computer records of the sex allegations.
The plans have been submitted to the inquiry into how Huntley got the job.
The inquiry, chaired by former civil servant Sir Michael Bichard, will examine how police intelligence was handled, the vetting practices used and why information had not been shared between agencies that dealt with Huntley.
The Home Office says the Soham case shows the need for "additional clearer guidance".
A working group, including Whitehall officials, chief police officers and the information commissioner, Richard Thomas, met for the first time last week to review the current guidelines.
Ministers are also considering setting up a national database of allegations and intelligence on reported crimes, to complement the police national computer, which contains details of convictions and cautions.
Some forces already store this "soft" intelligence for as long as possible.
Huntley was convicted in December of the murder of Holly Wells and Jessica Chapman.
He had previously faced four accusations of rape and one of indecent assault on an
11-year-old girl in Grimsby on Humberside.
Huntley was investigated by the police on several occasions but was not stopped from joining Soham Village College in Cambridgeshire by those responsible for vetting prospective staff.
Humberside police, who gave a submission to the inquiry, said on Tuesday it welcomed the guidelines.
"Without wishing to pre-empt Sir Michael Bichard's findings, the force does look forward to sharing our experiences with other police forces, agencies and the Home Office as part of this review announced to improve understanding of the Act."
The day after Huntley's conviction, the Home Secretary, David Blunkett, announced an inquiry into how the caretaker had been appointed.
Part of the Bichard Inquiry's remit will be to make recommendations for future vetting.
On Monday, the inquiry published evidence from organisations including the Home Office, the Association of Police Authorities, the Police Federation, the Law Society and the civil rights group, Liberty.
Evidence from the Department for Education and Skills, the National Union of Teachers, the NSPCC, the Audit Commission, the Department of Constitutional Affairs, the Department of Health, and Her Majesty's Inspectorate of Constabulary was also collected.
In addition, submissions have been received from Cambridgeshire Police and the Association of Chief Police Officers (Acpo).
The organisations were asked for chronological details of any contacts with Huntley, a general statement on their policy on using and retaining information relating to alleged offenders and suggestions on how to handle this information in
Counsel to the inquiry James Eadie will make a lengthy opening statement, expected to last a day, on 26 February. From 1 March there will about seven days of live evidence.
The proposed guidelines will not apply in Scotland because there are sufficient checks already in place and the eight police forces can share information that has not necessarily resulted in a conviction.