UK businesses and the government are facing a bill of more than #1 billion to comply with newly published data protection legislation from the European Commission.
A spokesman for the UK Home Office said the EC Data Protection Directive - designed to provide the public with greater access to personal information stored on computer and in manual files - could cost industry alone more than #836 million in initial start-up costs, followed by a #630 million annual bill.
But Phil Jones at the Data Protection Registrar?s Office believes the figures are grossly exaggerated. ?I am very sceptical, these figures seem to have been plucked out of the air. As long as people are complying with the present legislation I can?t see that they are going to have to make any significant or expensive changes to comply with the new bill.?
When asked whether the government would provide any assistance for companies to meet the costs, the Home Office was non-committal but said: ?It is important to bear in mind that the government is utilising a provision of the directive that allows a period of up to three years to comply with the law, so any costs will be spread out.?
The Confederation of British Industries believes this will ease the situation. Although concerned about the cost, it admitted that, because the new bill will be phased in over three years, its members are "not ringing their hands with worry quite yet."
But another body representing UK companies, the Institute of Directors - while applauding the new bill - was not reassured about the potentially massive costs involved.
?It is difficult to be opposed to anything that gives people greater access to information about them, but this new legislation is going to be costly to businesses," said a representative.
Under the bill, which replaces the existing 1984 Act, the public will have the right to know if personal information on them is being gathered in any form, for what purpose it is being used and to whom it is being circulate. This tightens the regulations governing data held electronically and extends them to some types of manual data.
According to the Home Office only highly structured data, such as information in complex filing systems, will be subject to the new Act. But Elizabeth France, the data protection registrar, believes that there is still some confusion over the issue and there should be a "clearer definition of those manual records that will be covered by the new Act".
France also criticised the proposals for giving the government too much power to exclude data for law enforcement and tax raising purposes. ?A democracy that properly respects the privacy of its citizens should be wary of providing for such a blanket exemption from its rules designed to ensure the fair and lawful processing of personal information.?
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