According to Schedule 2 (6)(1) of the Data Protection Act 1998 the
data controller is entitled to process data if such processing is
necessary for the purposes of legitimate interests pursued by the
data controller..., except where the processing is unwarranted in
any particular case by reason of prejudice to the rights, freedoms
or legitimate interests of the data subject.
In the case of a student who leaves the University in debt it would
seem that the data controller has a legitimate (contractual) interest
to pursue and that this would not prejudice the rights, freedoms or
legitimate interests of the debtor student (who has received
services from the University without paying for them).
However, it would seem fair to highlight to students what the
possible consequences of non-payment of debts are from the
outset.
Hope this is helpful.
Deborah Webb
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