Millions of pounds worth of fines could be dolled out to companies who lose confidential data.
The Information Commissioner has been given new powers to punish companies or indeed government departments who, "deliberately or recklessly" lose personal information.
The announcement was made by Jack Straw, the justice secretary.
Although the level of the fines has yet to be decided, the national newspapers say that they could run to millions of pounds.
The Guardian is reporting that Jack Straw is also considering banning the sale of information from the electoral register following on from more than 1,600 complaints to the information commissioner.
The Guardian stated: "They included a police officer whose family's name and address, along with a map to their house, appeared on a website, along with details of somebody who had been a victim of identity fraud".
The Government has been forced to act because of the amount of data being lost every week. In fact, new figures suggest that there is a serious breach or loss of private information every day.
"These include 80 relating to the private sector, 75 from within the NHS and other health bodies, 28 by central government, 26 by local authorities and 47 by other public sector bodies", says The Guardian.
Straw said: "The changes we propose today will strengthen the information commissioner's ability to enforce the Data Protection Act and improve the transparency and accountability of organisations dealing with personal information. This is very important if we are to regain public confidence in the handling and sharing of personal information".