Georgia Gilholy: Beware of this new government threat to bank account privacy

Georgia L Gilholy is a journalist.

The government has long admitted that it has been tirelessly “surveilling” journalists, everyday citizens and even its own parliamentarians because it was not a crime to dare to criticize its response to Covid-19.

Several years after the peak of the coronavirus, it is clear that many overzealous government mandates that promised to reduce the damage have done more than good. Yet Westminster's impulse to increase surveillance of a politically exhausted population is not punished but further satisfied.

On Tuesday evening, despite the huge potential impact, the government quietly inserted a clause into the Data Protection and Digital Information Act. If passed, these changes would force banks to monitor all bank accounts.

But surely all banks do that? Oh, and isn't this just about welfare recipients?

With this column I would like to warn you against this naivety.

Critics argue that the proposed law represents an unprecedented financial intervention by the state, particularly on marginalized groups such as people with disabilities and carers, who are disproportionately more likely to use the welfare system.

Aside from these specific concerns, these clauses run counter to the English common law tradition that one is free until the law forbids one, and reflect the civil presumption, once foreign to the English judiciary, that one is free only when if the law expressly requires this. This should be enough to oppose them.

Under current regulations, the Department for Work and Pensions (DWP) can only request transaction details from bank account holders on a case-by-case basis where there are reasonable grounds to suspect fraud. The proposed powers would allow the DWP to access the personal data of welfare recipients by requiring the third party to whom a notice has been served – such as a bank or building society – to carry out mass surveillance without suspicion of fraudulent activity. The new laws would force banks to process the data of all bank account holders and conduct automated surveillance scans on benefit recipients.

Chris Bryant, the Labor MP, tried to table a motion for reopening that would force the bill to be considered at committee stage, but his colleagues apparently disagreed. The clauses will now be referred to the Lords for further consideration.

The new law would give the DWP the power to access the personal data of welfare recipients through mass surveillance, even without suspicion of fraudulent activity.

Section 3(a) states that this includes anyone “connected” to the receipt of a benefit. Although Section 2(6) appears to imply that “connected” means the same person claiming this benefit, the term remains vaguely defined and includes not only the benefit recipient but also others such as ex-partners, housemates, children or landlords.

Additionally, the amendment's lack of specificity allows a wide range of information to be requested, potentially revealing sensitive details about individuals, including their personal preferences and lifestyle choices.

A government spokesman told a publication that the clause is intended to target “welfare fraudsters who aim to rip off the Treasury”, while Secretary of State for Work and Pensions Mel Stride claims the powers will be “used proportionately” but can do you assume this will be the case?

Does anyone really trust the government to only punish those who have actually committed a crime when this mass surveillance begins? The fact that the change is based on automated decision-making processes is questionable, as is the lack of legally binding assurances that no automatic decisions will be made based on data alone.

How could we forget the postal scandal that landed hundreds of government network employees in more than two decades of legal trouble after a computer accounting system falsely implicated them in theft at their workplace. A public inquiry into the matter is ongoing? Or should the Scottish council get a whopping £2.1 million back from HMRC after being wrongly taxed for 16 years? The many small business owners who complain that their livelihoods are being “smothered” by tax investigations?

According to the civil rights group Big Brother Watch, banks must process the data of all bank account holders and conduct automated surveillance scans on benefit recipients to comply with these new regulations. This level of interference and surveillance, affecting millions of people, is likely to lead to serious errors and set an extremely dangerous precedent. They also warn that these penalties could cripple small local businesses that have limited ability to respond to such requests.

It doesn't help the government that it appears to have done little to publicly explain this huge legislative change, which could lead to an unprecedented assault on financial privacy, with the greatest impact, as usual, on those at the lowest rungs of the income ladder.

Unless the government backs down from these plans, it will reaffirm its determination to treat ordinary citizens as if they were guilty, to the detriment of our Constitution, unless proven otherwise.