“An operator who has not been designated as the operator of an electronic communications network or service according to section 34 of the Communications Act 2003; or whose service has fewer than 50,000 subscribers, shall not be required to comply with a retention notice under section 78 of this Act.” —

This new clause excludes the providers of rural or community access communications services and small service providers from the obligation to collect and retain data.

Brought up, and read the First time.

I beg to move, That the clause be read a Second time.

The new clause relates to part 4 of the Bill, in particular clause 78, and to the retention of communications data. It would exclude the providers of rural or community access communication services and small service providers from the obligation to collect and retain data, which I believe would be in accordance with policy statements made by the Home Office. I am indebted to William Waites, Duncan Campbell and Adrian Kennard for drawing our attention to the need for this new clause and for assisting in its drafting. I can do no better than remind hon. Members of the statement submitted by Mr Waites on behalf of his organisation, HUBS CIC—document 53 in the written evidence submitted to the Committee—in which he explains:

“I am a founder and director of HUBS CIC, a Scottish Community Interest Company whose purpose is to facilitate broadband provision in rural and remote parts of the country outwith the reach of the large, well-known carriers.”

Hon. Members will be aware of this issue, which has been debated elsewhere in the House in this Session. The statement continues:

“HUBS’ members are small Internet Service Providers typically with tens to hundreds of individual end-user subscribers each. Together they provide the only available Internet service in large swathes of the West Highlands and the South of Scotland…HUBS does not provide service to end-users but instead makes bulk Internet services available to its members that would not otherwise be obtainable due to their small size.”

The members’ concern about clause 78

“is about how the data retention requirements…in particular, and the new obligations and duties on Telecommunications providers in general relate to service providers operating in the environment of HUBS’ membership…A typical member’s entire network infrastructure will cost on the order of tens or hundreds of thousands of pounds. It is optimised for lightweight, energy efficient operation. There are no data centres or indeed cabinets that have adequate physical security for safely storing the most intimate records of individuals’ on-line activities…Indeed it is recognised in general that keeping sensitive data secure is so important, that the best way to meet this obligation is simply to not record it.”

Therefore,

“Constructing facilities in each of these service providers to extract, record, securely store and make available any ‘Internet Connection Records’…would cost at least as much as their entire infrastructure…HUBS, though it is designed to enable the micro ISPs to benefit from economies of scale, cannot help here because it does not know the individual end users…Due regard should also be given to the social dynamics. If an ISP has a couple of dozen subscribers, two or three of which are actively involved in operating the network, data retention has a very different flavour.”

That is very often the position in rural and far-flung communities. It is like asking neighbour to spy on neighbour. I am sure that is not what the Government intend, but the new clause would spell that out. It would give providers of rural or community-access communication services and small service providers the reassurance they require in the Bill.

To put it shortly, the provisions in clause 78 are clearly designed for a very different environment from that which I have described, so those who operate within that environment are keen to have the Government’s assurance that they will be excepted from the requirements of the clause.

I think I can deal with this very briefly, because there are only two points to make. First, the amendment is flawed. The Department for Culture, Media and Sport tells us that the suggested designation is no longer used, if ever it was. That is a fundamental problem, but that is not a good enough argument alone. A better argument—my second point—is that restricting a retention notice to only large operators could result in large geographic gaps in capabilities or indicate to criminals that they should use only small providers. It is understandable that the hon. and learned Lady wants to defend the interests of small providers, but the provision could have unintended consequences of the sort I do not think she means.

Finally, the Joint Committee said:

“We believe that the definition of telecommunications service providers cannot explicitly rule out smaller providers without significantly compromising the data retention proposals as a whole.”

I appreciate the hon. and learned Lady’s intent, but I am not sure the form of the amendment is adequate or the arguments sufficient to be persuasive.

I am not sure what the Minister is saying. Is he saying he could look at the amendment and make it better, or that the principle underlying it is not acceptable?

I am saying that it is not wise to designate providers based on their size. There will be niche market providers who may provide a particular function exclusively and there may be others providing in a particular area. Taking them out of the system would contradict the purpose of the legislation. Let me see if I can compromise. We have said throughout, and when we were debating an earlier group of amendments, that we understand that some smaller providers will face a significant challenge. I have also said that it is important to recognise that while large providers will have mechanisms to implement readily the changes we expect of them—

Order. The Minister is intervening on Ms Cherry.

Sorry, Mr Owen, I have lost my train of thought. The concern behind the amendment is that although certain assurances have been given, I have tried to explain that, without a guarantee that requirements will be placed on such providers, they may simply grind to a halt. Is there any way round that? That is the purpose of the amendment.

Let me try to make a more pithy intervention. Of course we understand that we need to support providers in meeting their obligations and we will take the steps necessary to do that. What I do not want to do is to exclude them in the Bill from the requirement because that would have consequences that the hon. and learned Lady does not intend.

I am sure the last thing the denizens of the west or the south of Scotland want is some mass influx of terrorists to start using their small internet service providers. On the other hand, they do not want their hard-won and hard-fought-for internet access to be completely compromised by unreasonable requirements being put on it. They are concerned that, although assurances have been given, there is nothing in clause 17 to prevent the Government from putting what would be practically and financially crippling requirements on them. That is the purpose of the amendment.

Ms Cherry, are you moving the new clause or withdrawing it?

The arithmetic is inevitable, Mr Owen. I would like to think carefully about what the Minister has said, and go back to the organisations concerned and discuss it with them so I will withdraw the new clause for now.

Clause, by leave, withdrawn.

New Clause 25