Ian Taylor, the former minister responsible for pioneering the UK's controversial plans to allow tapping of encrypted messages through "trusted third party" rules, now says his decision was wrong.
Taylor, who launched the plan while IT minister in March 1997, told Computing last week: "I'm beginning to think I was wrong when I brought in the idea of trusted third parties."
Taylor's admission has been hailed as significant by the growing band of business and political opponents of the controversial scheme to regulate encryption, which remains government policy.
The government is shortly to publish a consultation document that will decide whether or not to stick with the policy in advance of a bill due at Easter.
Caspar Bowden, director of think tank The Foundation for Information Policy Research, said: "This is clearly very significant. The former minister has done a complete about turn."
Trusted third parties are the bodies that the government wants to be responsible for storing copies of users' personal encryption keys.
At the request of law enforcement agencies, the third parties would turn over the keys, allowing agencies to eavesdrop on individuals' and companies' encrypted communications. This is known as key escrow.
Opponents of the scheme, including Microsoft and high street banks, say it is costly and complex to implement, not technology neutral, and out of step with international developments - points now recognised by Taylor.
"There has been a change in encryption. Not all of it is public and private key now. We may well need to separate out security and look at it entirely separately," he said.
A DTI official said last week there is a "50 per cent chance" that the electronic commerce consultation document will be published this month.
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