Housing Associations and Public Contractors: Freedom of Information

Clive Betts Excerpts

Wednesday 6th March 2019 Westminster Hall

[Daniel Zeichner]

My hon. Friend is far more of an expert than I am on the matter. He has made an interesting observation that might be worth pursuing further. He may well have a very strong point there.

To return to my quest that is now nine years on. In fact, it is probably more than nine years, because I know that my predecessors, Julian Huppert and David Howarth, pursued the matter. I fear it might go back as far as Anne Campbell’s time. As I have said, I made a pledge to Simon Lebus that we would try to resolve the issue before his retirement. Sadly, it has not been achieved. I fear it might have to wait for a Labour Government, which I am sure will be along soon.

Freedom of information is sometimes considered a slightly nerdy issue—no apologies to colleagues present—but it is an incredibly important mechanism to secure proper accountability and democratic oversight. It is disappointing that we have not yet had a proper Government response to the Information Commissioner’s report, although, to be fair to the Minister, she has said that they are considering it carefully and will respond in due course, which of course is wonderful civil service speak. We will await events. We cannot let private companies get away with always doing their dealings out of the public eye when their decisions have a serious impact on the lives of all our constituents. We need the tools to provide the checks and balances. Too often it seems to be a carry-on behind closed doors and it cannot continue.

[Mr Clive Betts (in the Chair)]

We will now move on to the Front-Bench speakers. The first is the SNP spokesman, the hon. Member for Edinburgh East (Tommy Sheppard), who will be pleased to know that it is not the Chair’s responsibility to sing him happy birthday.

--- Later in debate ---

[Christian Matheson (City of Chester) (Lab)]

It is a great pleasure to serve under your chairmanship, Mr Betts, and to follow the birthday boy, the hon. Member for Edinburgh East (Tommy Sheppard)—I wish him the best on his special day, and many more of them to come.

The debate, obtained by my hon. Friend the Member for Hammersmith (Andy Slaughter), follows on from his work on his private Member’s Bill, the Freedom of Information (Extension) Bill, as well as from work done by my hon. Friend the Member for Cambridge (Daniel Zeichner). It also follows the report from the Information Commissioner’s Office, which has been referred to. This is clearly not a case of the Information Commissioner making a power grab, or of mission creep. The report is based on evidence showing where the current situation is not working, or where the ICO does not have sufficient power to challenge bodies that undertake work on behalf of public authorities, such that the balance needs to be redressed. I pay tribute to my hon. Friend the Member for Hammersmith for his persistence on the matter, but I cannot help thinking that at some point the change he proposes will become inevitable.

I, too, received a briefing from the National Housing Federation, and I gave it a read. I confess that my response was similar to that of my hon. Friends: “Is that it?” The reasons given for not adopting the proposals seemed pretty thin. I wondered why such bodies might not want the change. Perhaps it is because of concern about a regulatory workload and burden. However, it is clear to me that, where freedom of information operates, there is a possibility of change in the culture of the organisations operating under its auspices. They realise that they can no longer hold on tightly to information or act in a secretive manner, and so they become more open to the people whom they exist to serve. Their manner of doing business, internally and externally, therefore becomes more open, and perhaps they become better and more efficient organisations as a result. That culture change should be embraced and welcomed.

My hon. Friend the Member for Hammersmith discussed occasions when freedom of information requests were denied, such as requests regarding the number of attacks at HM Prison Birmingham, and the number of prison staff there—figures that G4S declined to provide. G4S also declined to provide information on the number of complaints from the public against court security officers. My hon. Friend discussed television licences and Virgin Care providing NHS services—something that has recently happened in my area, where increasingly community health services are delivered by private sector contractors. That has been a deliberate policy of the Government, and we have a philosophical difference about that privatisation. However, as the hon. Member for Edinburgh East said, the law must be able to keep up with changes in the way society is structured.

I noted something that my hon. Friend the Member for Cambridge said about public money being used for public services. That is at the core of the issue, and there cannot be any real argument about it. Where public money is being used to provide a public service, there should be no hiding place, and neither should there be any desire to hide from the necessary and, I think, welcome scrutiny that freedom of information provides.

Under the current Conservative Government there has been a clear trend in favour of large outsourcing companies, which tend to operate with little accountability or public responsibility. Carillion, Interserve, Capita and G4S are names that we regularly see. The reach of those companies is huge. I think I am correct in saying that Interserve had construction contracts to build motorway junctions, and it was running the probation service. Those companies’ reach goes right across society. The Opposition believe that the lack of responsibility and openness can amplify the possibility of problems. As the companies in question have less responsibility to act openly, they tend to clam up—for want of a better expression—hunker down and try to conceal any problems. We are clear that public services need to be transparent and accountable to the people who use them, regardless of whether they are delivered by the public sector or by private companies. We were clear about that in 2017, when our manifesto stated:

“We will extend the Freedom of Information Act to private companies that run public services”.

That will also be in our next general election manifesto, whenever it is required. We shall also extend the Freedom of Information Act to cover housing associations and other social landlords, as well as tenant management organisations, and we will consider extending it to cover contractor-held information.

The housing point is important because of the dreadful example discussed by my hon. Friend the Member for Hammersmith: the tragedy at Grenfell Tower. We shall never know whether openness might have prevented the tragedy. The public inquiry under way at the moment will consider those issues. We know, however, that residents were battling for several years beforehand to try to find information that was consistently denied to them—I will say no more, because the matter is currently under consideration by the inquiry.

The Freedom of Information Act does not generally apply to information held by contractors about the public service they provide to local and central Government—for example for social care, health, public transport, school inspections and privately run prisons—and that is because of a loophole in the system. Section 3(2) of the Act states that information held “by the public authority” also includes information

“held by another person on behalf of an authority”.

The information that a contractor holds on behalf of a public authority is therefore within the scope of a freedom of information request, even if the authority never physically holds that information as its own hard copy or electronic files. However, that does not include all information that may be held by the contractor in connection with the performance or proposed performance of a contract.

The kind of information that has been withheld from the public includes some examples that have already been mentioned, such as the cost of TV licence prosecutions. As my hon. Friend the Member for Hammersmith reminded us, not even the BBC is allowed to receive that information, even though it always takes a battering from the general public for prosecutions undertaken by Capita.

The Freedom of Information (Extension) Bill contains provisions to ensure that all information about the provision of public service under contract could be obtained via an FOI request to the relevant authority. It seeks to provide legal certainty on the position of contractors and subcontractors by requiring all contracts between a public authority and a contractor to be deemed to include a provision that all information held by the contractor or sub-contractor in connection with the performance, or proposed performance, of a contract is held on behalf of the public authority and therefore lies within the scope of the Act. My hon. Friend the Member for Hammersmith stated at the time:

“The general public has a right to know as much about Carillion or Serco when they are given public contracts or providing public services as we do about public authorities doing the same work. My Bill would bring freedom of information into line with the way public services are now being delivered in 2018”.

The report by the Information Commissioner’s Office states:

“In the modern age, public services are delivered in many ways by many organisations”—

the point made by the hon. Member for Edinburgh East—

“yet not all of these organisations are subject to access to information laws. Maintaining accountable and transparent services is a challenge because the current regime does not always extend beyond public authorities and, when it does, it is complicated. The laws are no longer fit for purpose.”

The ICO recommended that private contractors should be FOI-able where that is in the public interest,

“whether because of the scale, duration or public importance of the contracts”.

The report continues:

“Without information to understand how public services are performing, how levels of service compare and how problems are tackled, the public will be left in the dark about the operation of public services. Access to information legislation is essential to democratic accountability and helps to create what we all want to see—better public services”.

In the case of Carillion, that lack of transparency prevented small businesses from making informed decisions as to whether to enter into contracts with it, at a time when it was financially risky to do so.

A recent TUC report recommended a number of steps to improve transparency in outsourcing. Those included, among other things, the creation of a so-called Domesday Book for all contracts. A new public body would be set up to operate at arm’s length from central Government, and it would have statutory powers to require both commissioners and contractors from across the public sector to supply it with data. It should maintain a Domesday Book for all contracts, including performance on the outsourcing of services. At the moment there is no centralised place to find a list of contracts for a specific company. I tried to find a list of contracts for Capita, but that information seemed to be fractured and diffuse across Government.

Tenants and the public have the right to information about councils under the Freedom of Information Act, but not about housing associations, which provide the same essential housing services and receive significant public investment. In my area almost all public housing is provided by three or four housing associations, and they were stock transfers previously owned by Chester City Council. The previous Labour Government and the Conservative-led coalition proposed that the legislation should cover housing associations, but that has not yet been achieved. Obtaining information from contractors, including on fire safety, can prevent a problem, and my hon. Friend’s Bill seeks to correct that serious omission by making housing associations public authorities for the purposes of the Freedom of Information Act.

Public authorities are suffering from the difficulties of austerity and cuts, and they will find it onerous to provide responses to freedom of information requests. However, the 2000 Act does contain provisions to prevent mischievous or repetitive requests from the same residents. Perhaps that has given public contractors a sense that they do not want to take on the same burdens, but if they are happy to take on public contracts they should surely be happy to take on the responsibilities of being a public contractor.

We have seen in the Government’s approach to public contracting what I believe to be a form of reverse redistribution that takes large amounts of public money and puts it into the pockets of big public contractors. From there it goes into the pockets, bank accounts, or indeed—dare I perhaps inject an unwelcome political element into the debate?—the offshore bank accounts, that belong to some of the owners of those public bodies.

Listening to the contributions from my hon. Friends, it seems that when public money is being spent on delivering public services, there can be no reason why the same public scrutiny should not be applied. It is a matter of time. Let us hope that it is only a matter of minutes, while the Minister responds, but if it does take longer to introduce such a measure, that will be achieved when the next Labour Government take office.

[Mr Clive Betts (in the Chair)]

I call the Minister. I hope that she will allow a couple of minutes at the end for the hon. Member for Hammersmith (Andy Slaughter) to wind up the debate.