Telecommunications companies and internet service providers have received over £18m from the government in the past five years to cover the costs of collating databases of communications information, security minister Admiral Lord West revealed on Monday.
Speaking in response to a parliamentary question from Lord Northesk, West said that from January 2004 to the beginning of July 2008, the government spent over £18m on grants for the databases of customer communications information that ISPs and telecoms companies are compelled to maintain.
The figures were published on the UK Crypto mailing list by Cambridge University security expert Richard Clayton on Monday. The figures were not recorded in Hansard, but were confirmed to be correct by the Home Office on Wednesday.
A code of practice for the retention of communications data by ISPs was approved by Parliament in 2003. Data that is retained includes who is making and receiving phone calls, duration of call, geographical location of those having the conversation, text senders and recipients, date, time and geographical location of both parties.
Grants for ISPs and telcos to store this information were made available both under section 106 of the Anti-terrorism, Crime and Security Act 2001 (ATCSA), and under Data Retention (EC Directive) Regulations 2007.
In 2004 the government made five grant payments that came to a total of £84,582. This figure increased tenfold over the next three years: in 2007 the government paid 10 grants which totalled £8,346,495.
Clayton wrote on the UK Crypto mailing list that the reason the average grant size had increased from just under £17,000 per grant in 2004 to over £800,000 in 2007 was to do with the size of the ISPs that were receiving grants to retain communications data.
"What you're seeing is much larger entities obtaining money for data retention," Clayton wrote. "Note that this is in the run up to the time when the mobile companies and telcos had to move to retaining data for a year; whereas one might suspect that 2004 was all about tiny little ISPs."
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A Home Office spokesperson on Wednesday declined to specify which ISPs and telcos had received the grants, but said that it was a "mixture" of companies. The spokesperson also declined to comment on how Home Office proposals for a government-controlled centralised database of all citizen communications and internet usage, which caused protests from peers and civil liberties campaigners, would affect how much was spent on surveillance.
However, the spokesperson did say that the Home Office expected government spending on surveillance grants to increase.
"For future projections of [grants] under the EU Data Retention Directive, we're not expecting the figures to be wildly different," the spokesperson told ZDNet.co.uk. "Our guide is £9.5m for next year."
