LONDON: The much publicized débacle of two 'lost' computer disks, containing personal information on 25 million taxpayers, has caused huge embarrassment to the Brown administration and its recently merged Revenue & Customs department.

But it's not all bad news.

This extraordinary example of bureaucratic incompetence has also afforded a window of opportunity to UK data watchdog, the Information Commissioner's Office, to demand (and get) an increase in its powers.

The Brown administration had hitherto refused to extend the ICO's remit; but last week's revelation, that personal and financial details of child benefit claimants and their families have 'disappeared' in the interdepartmental post, has forced a rethink.

The ICO, headed by Richard Thomas will now be allowed to carry out spot checks and audits on government and local government departments.

In addition, the ICO has called for powers to inspect private companies; also for a change in the law to make major security breaches a criminal offence.

Says Thomas: "The law needs to be changed urgently so that people's personal details are properly protected.

"The onus is now on every organisation to take privacy far more seriously. Alarm bells must ring in every boardroom. Data protection safeguards must be technically robust and idiot proof."

Data sourced from Brand Republic (UK); additional content by WARC staff