Home Secretary David Blunkett has pulled the plug on plans to dramatically increase the state's ability to watch our every move.
The draft order published by David Blunkett had already been dubbed the Snooper's Charter before an unlikely coalition of civil liberties groups and Tory peers forced the Government to backtrack.
The proposals would have given public bodies the right to demand records of phone calls made and received, emails sent and received and web sites visited - by anyone.
Using mobile phone location data, the bodies would have been able to track a person's whereabouts at any given time to an accuracy of a few hundred yards.
The Government was due to put the order to extend the already controversial Regulation of Investigatory Powers Act (RIPA) before Parliament yesterday.
However, at the last minute the Home Secretary said he had made a mistake.
Now the plans will not go before MPs, in a redrafted form, until the autumn.
Mr Blunkett wanted to give seven Whitehall departments, all local authorities, and 11 other bodies, ranging from the Environment Agency to the Food Standards Agency, the power to demand records without a court order.
The Home Office insisted the powers were needed to fight terrorism and crime in an age when communication increasingly takes place by computers and phones.
Civil liberties groups, however, were outraged at the huge increase in the number of bodies able to spy on individuals.
Another group which lobbied vigorously against the order were newspaper editors, who said there would be nothing to stop any of the bodies using their new powers to reveal the source of any critical story written about them.
Simon Bradshaw, editor-in-chief of The Argus, wrote to Mr Blunkett to object to the RIPA extension before the proposal was withdrawn.
He said: "Such an extension would have increased the propensity for misuse of power and hampered investigative journalism.
"Sources of information could have been seriously inhibited by the prospect of identification under the powers the Government was seeking.
"The position of journalism should be recognised and properly protected if the order is reintroduced.
"Judicial scrutiny before authorisation and collection of information is needed, even in cases of national security and serious crime.
"The proposed extension could have seriously inhibited journalism across the whole of the media and especially local papers such as The Argus."
In theory, the bodies should only be able to find out who a person had contacted by phone or email in connection with criminal investigations.
Brighton and Hove City Council and East and West Sussex county councils' trading standards departments, for example, might try to track the movement of counterfeit goods using phone or internet records.
However, because the bodies would not have had to ask the courts for permission, there was concern the system would have been open to abuse.
John Wadham, director of the civil liberties pressure group Liberty, said the draft order would have extended the state's powers beyond any justification.
Before Mr Blunkett withdrew the plan, he said: "It won't be just the police that have access to people's communication records. Practically every public servant will be able play this game.
"The Government assured people, when they decided that communications service providers should be made to keep these records, that only the police would have access to them in pursuit of terrorists or serious criminals.
"In reality, thousands of bureaucrats across the country would be able to snoop still deeper into anyone's private information."
He said the organisations should at the very least have to apply to a judge to prove there was suspicion of crime before they were given a warrant to search records.
Within the police, any officer of superintendent rank or above can demand an individual's records.
All that would be needed for any of the bodies listed in the extension order to demand information is for one of their own officials to authorise it.
The draft order had not indicated how senior an official would have to be to ask for the information.
Government departments listed in the draft order included: The Department of Environment, Food and Rural Affairs; the Department of Health; the Home Office; the Department of Trade and Industry; the Department of Transport; and the Department of Work and Pensions.
Organisations outside Whitehall included: The Environment Agency; the Financial Services Authority; the Food Standards Agency; the Health and Safety Executive, the Office of Fair Trading; and the Postal Services Commission.
In addition, all local authorities in England and Wales would have had the same right of access to personal information.
Lewes MP Norman Baker, a leading House of Commons opponent of the increase in snooping powers, said: "Lewes District Council is not going to pick-up a case of terrorism. This is just a cavalier attitude to civil liberties.
"It is a wholly unwarranted and excessive intrusion of the state on people's private lives.
"If there is a suspicion of terrorism, then the police already have the powers to monitor that."
Conservative peers said the order would have a tough passage through Parliament if it was reintroduced unchanged.
They said they supported the war on terrorism and efforts to tackle serious crime but were opposed to councils being given snooping powers.
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