INCLUSIONS
40. The proposed Freedom of Information Act will
apply "across the public sector as a whole, at national,
regional and local level". The public sector is defined very
widely and covers to some degree very many private organisations:
privatised utilities; private companies providing services to
the public sector under contract; Training and Enterprise Councils.
It will also cover many voluntary and charitable organisations,
including many universities, schools, housing organisations. It
is not surprising that the breadth of the proposed Bill's scope
has worried some of the private organisations which will be covered.
Privatised utilities
41. In particular it is unclear how, exactly, the
privatised utilities will be treated under the proposed legislation.
Such organisations are not covered in other Freedom of Information
regimes.[63] As they
have represented to us, the term covers a range of organisations
operating in a variety of commercial and regulatory environments.
Few, if any, are any longer simple monopolies, dealing solely
in a regulated market. They may be subsidiaries of larger, unregulated
businesses, and themselves have their own subsidiary companies
operating an unregulated market; and in their regulated business,
they may be increasingly or almost completely subject to competition.
In addition, some of the regulated utilities which operate in
a monopoly, or near monopoly position, have never been in the
public sector (for example the smaller water companies), and therefore
would not appear to be subject to the Act. British Energy instanced
the independent power generators "who make up an increasing
proportion of the generating market".[64]
42. It is open to the Government to apply the Bill,
very simply, to all the privatised utilities, regardless of these
difficulties. Or it might seek to define the bodies, or functions
to which the Act applies in some other way. The White Paper says
that bodies carrying out statutory functions will be subject to
the Act. Could this definition be used to clarify the extent to
which privatised utilities are covered? It seems unlikely. Although
this might work for the water companies, it is less adequate for
others. PowerGen, though a privatised utility, "is not subject
to any statutory duty requiring it to generate electricity. Its
position is that of a manufacturer and wholesaler of a product
who competes with other manufacturers/wholesalers of that product
to sell it on to retailers".[65]
Eastern Group makes the same point: "it cannot be said that
the supply of electricity and gas in competitive markets is a
statutory function to which the Act should apply once the market
is fully open".[66]
It says that the only areas of operation of Eastern Electricity
which will have a continuing statutory function relate to the
provision of electricity lines and plant to enable a safe and
secure electricity supply to be offered.[67]
43. The White Paper does limit the application of
the Act to the public functions of those bodies subject to it.[68]
What is a public function of a privatised utility? Centrica, the
gas supply company, refer to the statement made in the House of
Lords during the consideration of the Human Rights Bill that the
definition of "public authority" and "public functions"
would be for the courts to decide. It may well result in very
little of the functions of some of the privatised utilities being
covered. Centrica say that
"The scope of a Freedom of Information Bill
might reasonably include the public (statutory) functions of the
regulated utility monopolies. But licensed gas suppliers (rather
than transporters) do not have any specific statutory duties under
the Gas Act. All gas suppliers are licensed by OFGAS, the industry
regulator. The purpose of licensing is to guarantee the suppliers'
technical competence and to provide for certain standards of service.
But licensing is also a feature of many non-utility markets (oil
and gas explorations, airlines [some of which were privatised],
radio and TV companies, Casinos)".[69]
44. The Centre for Utility Consumer Law provide some
suggestions to resolve this point. Its view is that Freedom of
Information should apply to companies which are licensed, appointed,
or obtain franchises in a number of "utility" sectors—airports,
electricity, gas, rail, telecommunications and water.[70]
This may result in some companies which are not privatised utilities
being brought within the scope of the legislation; we believe
that it would be acceptable if the scope of the Act's application
to the companies was reduced to those companies in a dominant
position—for example, those with more than 50 per cent of
the market. This may be difficult in practice, but market dominance
could be measured over a period of time. The definition of
the "privatised utilities" within the Act is one of
the least clear aspects of the proposed legislation. We believe
that the Bill should be made to apply more precisely just to companies
which are monopoly, dominant, or franchised suppliers in one of
the regulated, "utility" markets. This may bring
in companies which have not previously been in the public sector;
but that does not seem undesirable, considering that such companies
will have (ex hypothesi) a dominant market position.
Public service broadcasters
45. The public service broadcasters—the BBC,
Channel 4 and S4C will come under the Act. As the White Paper
says, "it might be regarded as anomalous for them to be within
the scope of the Freedom of Information legislation when the private
media ... would not". As the Guild of Editors say, their
inclusions raise some difficult questions in relation to their
newsgathering activities. (They may well argue that other information
they hold should be withheld on commercial confidentiality grounds:
this is dealt with below, paras. 58 to 66). It is unclear if sources
of information could be protected under any of the "specified
interests" in the White Paper.[71]
We recommend that the Government should make this point clear
in their response to this Report.
Application to Scotland
46. The proposals in the White Paper are meant to
apply throughout the United Kingdom. The White Paper says, however,
that "it will be for the Scottish Parliament to determine
the approach of the Scottish executive and other Scottish public
bodies to openness and freedom of information within devolved
areas in which it is competent to enact primary legislation".[72]
The Scottish Parliament will not assume its powers until July
1999 at the earliest. Freedom of Information is unlikely to be
among its first priorities. It may be some time until it enacts
legislation about Freedom of Information. The Lord Chancellor,
in evidence to the Committee, accepted this point;[73]
and we believe that the degree to which Freedom of Information
should cover Scottish authorities should not be left in such doubt.
The Scottish Consumer Council, in their submission to the Cabinet
Office on the White Paper, point out that there is a further source
of confusion in the fact that Data Protection (across all departments)
is a reserved matter, for which the Westminster Parliament will
continue to be responsible, while Freedom of Information (in relation
to non-reserved matters) is not.[74]
They also raised a concern that there might be differing provisions
in Scotland and in the rest of the UK: "it will clearly be
unsatisfactory if Scottish citizens do not have access to the
same categories of information on the same basis as citizens in
other parts of the UK". We do not regard it as unsatisfactory
for the Scottish Parliament to be able to introduce differing
provisions for Scotland to those of the rest of the UK; that is
the nature of devolution. The rights of the Scottish Parliament
to accept or to reject the provisions should be preserved. We
do believe, however, that there needs to be a system which can
be used to facilitate the application of the Act in Scotland as
soon as possible. We recommend that there should be provision
to ensure that the Act will be brought into effect in Scotland
in relation to devolved matters as soon as it comes into effect
in the rest of the UK, to ensure that there would not be a lengthy
period in which Freedom of Information will not apply to devolved
matters in Scotland.
63 Though see Esso Australia Resources Ltd v. Plowman
[1994-95] 183 CLR 10 for a decision of the Australian High Court
that information relating to contracts entered into by two public
utilities could be disclosed and was not protected by the duty
of confidence owed by the utilities to the company concerned. Back
64 Ev.
p.136. Back
65 Ev.
p.137. Back
66 Ev.
p.123. Back
67 Ev.
p.124. Back
68 para.
2.16. Back
69 Ev.
p.133. Back
70 Ev.
pp. 149-50. Back
71 Though
see Section 10 of the Contempt of Court Act 1981, which protects
sources of information which lead to a "publication",
including a broadcast. Back
72 para
2.1 Back
73 Q.
391 Back
74 Ev.
p.181. Back
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