In a first stage response to a 28-month review of the effectiveness of the Prviacy Act and related laws, conducted by the Australian Law Reform Commission, the Cabinet Secretary and Special Minister of State, Senator Joe Ludwig, yesterday said the government would take steps to reform Australian privacy laws.

Deacons Sydney chairman and partner Nick Abrahams and his colleague, partner Alison Deitz, have issued warnings to clients, including specifically form the financial services and the health sectors, about the changes. 

While the proposed reforms are the first step towards full national consistency in privacy legislation, they warned "they may in time require organisations to update and enhance their privacy processes and procedures to ensure compliance with the law and potentially expose them to civil penalties for serious or repeated breaches of privacy law".

The legal experts said part of the Government's response to the ALRC recommendations include introducing comprehensive credit reporting in Australia. 

It accepts the ALRC's recommendations that the use and disclosure of credit reporting information for electronic identity verification under anti-money laundering legislation should be authorised. "The proviso to this is that adequate privacy protections are put in place, and the Attorney-General's Department has undertaken consultations as to how to implement the recommendation whilst enhancing privacy."

Another element of the Government's response revolves around the ALRC's recommendations addressing a range of health privacy issues, thereby affecting health clients. This includes access to and transfer of health records, the lawyers said. 

The Government will now prepare exposure draft legislation to implement the proposed changes to the Privacy Act and related laws, which will be released in early 2010 for further consultation.