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A bill that forms parts of the UK’s open banking plans could promote “mass surveillance” of individuals’ bank accounts, left-wing Members of Parliament (MPs) have warned.
Opposition is mounting for the Data Protection and Digital Information (DPDI) Bill, which is seen as essential to fostering future open finance opportunities in the UK.
The bill is intended to replace the EU’s General Data Protection Regulation now that the UK has left the bloc, as well as enabling data sharing.
Among its provisions are new powers for the Department for Work and Pensions to demand information from banks on their customers who receive welfare payments.
It has already provoked concerns from the UK Open Rights Group, which said it will treat “vulnerable people as potential criminals”, and from EU lawmaker Paul Tang, who said its data retention provisions could harm UK-EU trade.
Now Richard Burgon, an MP from the opposition Labour party, has submitted an “early day motion” (EDM) to parliament claiming that the planned legislation “would force banks to spy on the 23 million individuals in the welfare system”. It has garnered 30 signatures in support.
EDMs are motions that MPs submit for debate in the House of Commons when no specific day has been set aside. Only a small fraction of them proceed to debate, but even so, they can garner significant public interest and media attention.
Burgon’s motion highlights the reliance on artificial intelligence (AI), which it says would involve the mass data scraping not only of potentially vulnerable people, but also their associates including “partners, parents, landlords and other associates”.
The EDM, published on May 7, warns of a potential scandal akin to the Post Office Horizon case, in which innocent officials were prosecuted over gaps in their accounting caused by IT failures. The DPDI clause could similarly result in innocent individuals facing wrongful prosecutions, financial devastation and damage to their reputations, the motion says.
It further says that the DPDI bill represents a significant breach of an individual's right to financial privacy, and violates the fundamental principle of presumption of innocence, asserting that people should not be subjected to surveillance unless they are suspected by the police of wrongdoing.
The motion “calls on the government to remove these powers from the Data Protection and Digital Information bill”. The draft legislation is currently with the House of Lords, the unelected upper chamber, after which it will be returned to the House of Commons for its third and final reading.
Risk of delay
Nevertheless, the bill might not be approved before the next general election, which is required to take place by January and widely expected later this year. That election appears likely to return a large Labour majority, heralding a change of government and a dramatic shift in parliament’s balance of power.
As opposition to the bill grows, so too does the potential for delays and setbacks.
This would be bad news for some fintech and payments companies that support the DPDI Bill, such as TrueLayer, which has said that the legislation will enable government departments to “embrace open data”.
Open Banking Limited (OBL), the quango responsible for open banking standards in the UK, has also said that the DPDI is a “significant milestone towards creating a world-leading open data economy”.
In a post on its website, the OBL commented that the DPDI “is an essential piece of legislation that will help extend and build on the benefits already experienced by open banking users to date.”
Conservative MP John Penrose has previously hailed the DPDI bill as promising for open banking and payments in the UK.
“It has enormous implications not just for payments and Open Banking, but for a potential positive, mostly positive, disruption for huge areas of the UK economy and potentially the global economy as well,” he said in a keynote address at London’s Pay360 conference earlier this year.
