It's a sad fact..
We are a statistically driven society, before we do anything, politicians, business leaders and indeed charities like to know the statistics. In order to do that you have to gather information and process it. So if you want to target action positively or negatively against a group of individuals you need to know where they are.
The information ARCH are complaining about could let you identify an individual, but not always, if you are the only boy in an area with a criminal record, the Gender and Postcode is enough. But in some areas there may be several. The exact postcode is too much, but for statistics you need at least AANN N to have any value.
Also I wonder if ARCH have actually seen the contents of the upload, which may not go to street level, even if it does it is doubtful that it reports at that level. I suspect ARCH believe that no information should ever be reported on, but you can bet that this information also affects budgets for the offender management process., and amenity investment.