§ Mr. Gunnell
To ask the Chancellor of the Exchequer on what basis he excludes the files of individual tax-payers from his market testing of the Inland Revenue.
§ Mr. Dorrell
There is no basis for excluding the files of individual taxpayers. If activities involving the processing, handling or holding of tax information were to be transferred to a private sector organisation, the Inland Revenue would remain responsible for continuing to ensure proper standards of privacy and confidentiality for all citizens. In addition to contractual safeguards, the contracting organisation and its employees would be subject, in the same way as Inland Revenue employees, to the criminal sanctions—a fine or imprisonment or both —provided by section 182 of the Finance Act 1989 for unauthorised disclosure of taxpayer personal information.
Confidentiality is not a bar to market testing; a lot of highly sensitive Government work is done by the private sector. But the Inland Revenue would need to be sure that an outside contractor could replicate existing security procedures and conditions.