Q&A: Child benefit records lost

What has happened?

HM Revenue and Customs has lost computer discs containing the entire child benefit records, including the personal details of 25 million people - covering 7.25 million families overall. The two discs contain the names, addresses, dates of birth and bank account details of people who received child benefit. They also include National Insurance numbers.

How were the discs lost?

They were sent via internal mail from HMRC in Washington, in the North East of England, to the National Audit Office in London on 18 October, by a junior official, and never arrived. That broke data protection laws and is the reason Revenue and Customs chairman Paul Gray resigned.

What is the government saying?

Prime Minister Gordon Brown told MPs: "I profoundly regret and apologise for the inconvenience and worries that have been caused to millions of families who receive child benefits. When mistakes happen in enforcing procedures, we have a duty to do everything we can to protect the public." He denied the data was lost because of "systemic" failures at the HMRC saying it had been due to procedures not being followed. He ordered security checks on all government departments to ensure data is properly protected.

What is being done to find the discs?

The Metropolitan Police, National Audit Office, Revenue and Customs staff and courier firm TNT have all been searching for the discs.

How worried should people be?

The details on the lost discs would be sought after by fraudsters. Mr Darling says the information was password protected, but that was not good enough. He said there was no suggestion that anything untoward had happened as a result of the discs' loss to date. Experts say such data should normally be sent in encrypted form.

Analysis: How worried should we be?

How could the information be misused?

Banks say the information on its own would not be enough to allow someone access to your bank account, as other security information and passwords should be required. But the details would be enough for criminals to use in other types of fraud, such as setting up credit or financial agreements like mobile phone accounts. There may also be child protection concerns, as the discs contained names, addresses and dates of birth of children.

What are people advised to do?

Mr Darling said people should check their bank accounts for any "irregular activity"
He said there was no need for people to close accounts as the details would not be sufficient to allow fraudsters to access them
But people should not give out personal or account details "requested unexpectedly" by phone or by email
People who bank online should monitor accounts and change passwords if they are a child's name or date of birth
Contact your bank immediately, but only if you spot something suspicious as banks are expecting to be overwhelmed with calls
Banks also warn customers to be on the lookout for signs of ID theft and fraud - such as regular post like bank statements going missing, bills for items you have not bought, or letters approving or denying you credit you know nothing about

Is my money safe?

Mr Darling said there was no evidence of fraud or that the details had fallen into the "wrong hands", but said that anyone who loses money as a result of fraud resulting from the lost discs would be reimbursed. But he said there was no need for anyone to close their bank accounts.

How can I find out more?

Her Majesty's Revenue and Customs has set up a Child Benefit Helpline on 0845 302 1444 for customers who want more details.

What has been the political reaction?

Prime Minister Gordon Brown has apologised for any inconvenience and worry caused. David Cameron says the government has failed in its duty to protect citizens. Lib Dem acting leader Vince Cable questioned whether the buck should stop with Mr Gray or whether ministers should share blame.

Is anyone looking into what went wrong?

Yes, Keiran Poynter, UK chairman at PriceWaterhouseCoopers, is looking into the circumstances surrounding the loss of the discs. His interim report on his findings is due to be unveiled in the Commons by Alistair Darling on 17 December, 2007, with a full report set for spring 2008. The chancellor says some other missing discs would also be looked at as part of the Poynter inquiry.

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