Here is a look at events at HM Revenue and Customs leading to the statement on Tuesday.
MARCH 2007
A junior official at HM Revenue and Customs gives the National Audit Office a full copy of HMRC's child benefit data, in breach of security procedures. That information is later safely returned.
SEPTEMBER
Records of about 15,000 people's details go missing after being sent by HMRC to Standard Life. Also in September, a laptop containing around 400 ISA (individual savings accounts) customers' details is stolen.
18 OCTOBER
Child benefit data is again sent to the NAO by a junior official, using the courier company TNT, which operates the HMRC's post system. The package containing two CDs, containing details of 25 million individuals, is not recorded or registered and fails to arrive.
24 OCTOBER
The NAO tells HMRC it has not received the package. An HMRC spokeswoman said the official believed it may have been delayed by the postal strikes or in the NAO's office move and did not report it. A second copy is sent, again in breach of procedures, but this time it is sent by registered post and arrives safely.
8 NOVEMBER
Senior HMRC management are informed that the 18 October package is missing.
10 NOVEMBER
Alistair Darling is informed and tells Prime Minister Gordon Brown. Mr Darling orders an immediate investigation and searches of all premises where the package might be, as well as action to ensure it does not happen again.
12 NOVEMBER
Mr Darling is told by HMRC that evidence has been found which might help to find the missing package.
14 NOVEMBER
The chancellor decides the HMRC searches have failed and tells HMRC chairman Paul Gray to call in the Metropolitan Police.
15 NOVEMBER
The chancellor goes to Information Commissioner Richard Thomas, who agrees that remedial action must be taken before a public statement is made.
12-18 NOVEMBER
Mr Gray tells Mr Darling he feels he should resign. The chancellor seeks the advice of the Financial Services Authority and Serious Organised Crime Agency, while banks are alerted by HMRC.
20 NOVEMBER
Mr Gray resigns following an announcement that Mr Darling is to make a statement to the House of Commons. The chancellor outlines what has happened and announces an investigation of HMRC's security procedures by PricewaterhouseCoopers chairman Kieran Poynter, alongside the Independent Police Complaints Commission, which monitors the HMRC.
Alistair Darling 
British Chancellor of the Exchequer Alistair Darling announced to a shocked House of Commons today that two password-protected — but not encrypted — computer disks containing the entire Child Benefit database have been lost in transit between the offices of Her Majesty's Revenue and Customs (HMRC) in Washington, Tyne & Wear and the National Audit Office (NAO) in London, in what has been described as "one of the world’s biggest ID protection failures".

The database contains details of all families in the UK who receive Child Benefit — all families with children up to 16 years of age, plus those with children up to 20 years old if they are in full-time education or training — estimated to contain 25 million individuals in 7.25 million families. Among other items of information, the database contains names, addresses, dates of birth, child benefit and National Insurance numbers, and where appropriate, bank or building society account details.

The discs were created by a junior official at the HMRC in response to a request for information by the NAO, and were sent unregistered and unrecorded on 18 October using the courier company TNT — which operates the HMRC's internal mail system. When it was found that the discs had not arrived for audit at the NAO, a further copy of this data was made and sent — this time by registered mail — and this package did arrive. HMRC were not informed that the original discs had been lost until 8 November, and Darling himself was informed on 10 November.

The violation of data protection laws involved in the creation of the discs has led to strong attacks on the government's competence to establish the proposed National Identity Register, when all UK residents will have an identity card. Conservative Shadow Chancellor George Osborne described the loss of data as "catastrophic" and said "They the government simply cannot be trusted with people's personal information".

The Chairman of HMRC, Paul Gray, has resigned over the affair, and critics are calling for Darling to do likewise.

This is the third data embarrassment for HMRC in recent weeks — earlier this month it was reported that the details of over 15,000 Standard Life customers had been put on disk, and then lost en route from HMRC in Newcastle to Standard Life in Edinburgh — and last month a laptop containing the data of 400 people with high-value ISAs was stolen from the boot of a car belonging to a HMRC official who had been carrying out a routine audit.