Ministers sought yesterday to avoid the blame for last week's loss of a memory stick containing data on thousands of prisoners.
Names, addresses and expected release dates of all 84,000 prisoners in England and Wales were on the portable USB memory lost by PA Consulting, a Home Office contractor. The lost files also contained data on up to 40,000 repeat offenders, and the initials of people on drug-treatment programmes.
It is the latest in a series of government data blunders, following the loss of 25 million child benefit details last year, and the Ministry of Defence's admission that around 600 of its laptops had been stolen in the past four years.
Jacqui Smith, the Home Secretary, said PA Consulting had broken rules on handling sensitive data.
PA Consulting refused to comment on whether it could now be open to compensation claims. "We are collaborating closely with the Home Office on this matter," a spokesman said.