Draft Freedom of Information (Designation as Public Authorities) Order 2015


The Committee consisted of the following Members:

Chair: Mrs Anne Main 

Bain, Mr William (Glasgow North East) (Lab) 

Burrowes, Mr David (Enfield, Southgate) (Con) 

Cunningham, Alex (Stockton North) (Lab) 

Evans, Mr Nigel (Ribble Valley) (Con) 

Hemming, John (Birmingham, Yardley) (LD) 

Hughes, Simon (Minister of State, Ministry of Justice)  

Metcalfe, Stephen (South Basildon and East Thurrock) (Con) 

Paisley, Ian (North Antrim) (DUP) 

Randall, Sir John (Uxbridge and South Ruislip) (Con) 

Ruddock, Dame Joan (Lewisham, Deptford) (Lab) 

Skinner, Mr Dennis (Bolsover) (Lab) 

Slaughter, Mr Andy (Hammersmith) (Lab) 

Spelman, Mrs Caroline (Meriden) (Con) 

Stephenson, Andrew (Pendle) (Con) 

Turner, Karl (Kingston upon Hull East) (Lab) 

Vickers, Martin (Cleethorpes) (Con) 

Wallace, Mr Ben (Wyre and Preston North) (Con) 

Watson, Mr Tom (West Bromwich East) (Lab) 

Annette Toft, Committee Clerk

† attended the Committee

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Seventh Delegated Legislation Committee 

Tuesday 10 February 2015  

[Mrs Anne Main in the Chair] 

Draft Freedom of Information (Designation as Public Authorities) Order 2015

2.30 pm 

The Minister of State, Ministry of Justice (Simon Hughes):  I beg to move, 

That the Committee has considered the draft Freedom of Information (Designation as Public Authorities) Order 2015. 

It is a pleasure to propose that the House of Commons agrees to this order. It was debated and agreed in the House of Lords yesterday, and I hope that we can agree it today. It is a significant piece of legislation. 

The purpose of the order is to extend the scope of the Freedom of Information Act 2000 to include Network Rail’s public functions. That is a significant extension, and it is the latest step by this Government to extend the reach of freedom of information legislation in the interests of the maximum transparency and accountability of public activities. 

The coalition agreement entered into in 2010 pledged that the Government would 

“extend the scope of the Freedom of Information Act to provide greater transparency.” 

We have been committed since then to achieving maximum openness and transparency so that the public can hold to account everyone who delivers public services that affect their day-to-day lives through the Freedom of Information Act, which is widely used, and through a wider transparency agenda, which includes publishing vast amounts of data about service delivery and public spending. 

We have already taken a number of steps to meet the coalition agreement commitment since May 2010. We have extended the 2000 Act to academies, the Association of Chief Police Officers, the Financial Ombudsman Service, UCAS and more than 100 companies that are wholly owned by more than one public authority. The order extends the Act to Network Rail and is an important step along the road. It would, I think, be of huge interest to most of our constituents throughout Great Britain, though it does not apply to Northern Ireland. 

Alex Cunningham (Stockton North) (Lab):  I wonder if the Minister looks forward, as I do, to the day when we can see the Freedom of Information Act extend way beyond these provisions to the private companies that have contracts with the Government, spend billions of pounds of our money and yet cannot be held accountable in the same way as public authorities. 

Simon Hughes:  The answer is yes. As a Liberal Democrat, I look forward to that day. Specifically, I believe that there are two areas of public life where people would

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value that. One is where there are contracts for public services to be delivered by either Government or local government. I had hoped that, before the end of this Parliament, we would be able to get the new code of practice and guidance in place that would require those contracts to comply with transparency levels equal to the Freedom of Information Act. We have not been able to get agreement across Government to bring that to the House. That has not been delivered, but I share the wish that it should be. 

Secondly, though it is not Government policy, I and my party are on record as saying that private sector bodies that are wholly-owned monopolies—for example, Thames Water, which supplies water to people in London—should also be open to the same transparency. I share the hon. Gentleman’s objective. Network Rail was not on the original list of bodies subject to freedom of information legislation when the Government started their work in this Parliament, following work done before by his Government. None the less, I hope that he accepts this as a significant addition to the list. 

It does not just take a reflection back to the beginning of this year, when London Bridge in my constituency and many other places were significantly disrupted, to know that the public will have a huge interest in what Network Rail does, exactly what its contracts deliver and what its employees are paid. I will come back to the details, because we anticipate a large number of requests as a result of this, but I share the hon. Gentleman’s general objective. 

I believe that there is a powerful case for the further extension of freedom of information. There is a list of quite small bodies to which we would like to apply the Freedom of Information Act as well. However, today is the biggest fish that we have been able to catch in this Parliament. I hope that people will welcome that. 

The Government have recognised the case for extending the Freedom of Information Act. We consulted on the possible inclusion of some other bodies in 2011. We have analysed those bodies and looked at the responses received. We then paused the implementation of that—although we always have to analyse which are the public and non-public functions—because we did post-legislative scrutiny of the legislation as a whole. 

At the beginning of the year, we celebrated the 10th anniversary of the Freedom of Information Act 2000 coming into force, and there were worthwhile events marking that. Although the last but one leader of the Labour of the Labour party said that introducing that Act was the biggest mistake he ever made, some of us think that it was a good thing that the previous Labour Government did, and are keen to extend it. I hope that that is the mood in the Committee. 

In 2013, once we had done the post-legislative scrutiny, we decided to look at larger bodies with a more significant impact on public life. The then Housing Minister suggested that housing associations ought to be included. I personally support that and there is no objection in Government to consulting on that. DCLG has not yet signed it off, but it is certainly understood that it is appropriate to take it further. We will not have time to do that before the general election, but it is important to subject housing associations to FOI because many of our tenants live in properties that used to be council-owned and were then handed over to arm’s length management organisations, but which are effectively council property. 

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The Chair:  Order. I am sure that the Minister is not going to go on too far about his wish list. 

Simon Hughes:  No. And there are others such as the infrastructure companies, but I will come back to the central purpose. 

Mr David Burrowes (Enfield, Southgate) (Con):  The list of Network Rail’s network services functions includes weed-killing and removal of obstructions. In my patch, it is not just a case of commuters wanting to get to work on time. Residents are concerned about their environmental responsibilities, not least on the embankments. 

As of this week, in Palmers Green to Winchmore Hill, 100 trees—they are not weeds—are being culled. There is a concern in my constituency that environmental responsibilities should be taken seriously. Network Rail has environmental responsibilities. Freedom of information may well help, particularly when constituents feel that those responsibilities are as important as the normal community responsibilities. 

Simon Hughes:  I welcome my hon. Friend’s intervention. It is exactly the intention that, other than those activities of Network Rail that are private sector contract activities—for example, the activities of Spacia in letting arches for private businesses—everything should be covered. Although, as I will explain in a minute, it is slightly technical as an organisation because it has three companies, effectively all of Network Rail’s public functions will, with effect from the implementation of the order and before the end of this Parliament, be subject to FOI legislation. The good added bonus, in my view, is that they are retrospective entitlements, so people will be able to ask not just about things from March this year onwards, but about any decision that might have been taken by Network Rail in Enfield or anywhere else last year or since it came into existence. That is extremely welcome. 

Network Rail was reclassified last year as part of the public sector, which made it a much more obvious candidate for inclusion as a result of the section 5 order, which is what we are considering today, rather than through primary legislation. We believe that Network Rail meets all the requirements, now that it is in the public sector, for the presumption that all its main public activities should be included. I will deal with them in summary so that everybody is clear about the extent of the order. 

We are designating Network Rail under section 5(1)(a) of the Act. Under section 7(5), we have to specify each of the body’s functions that appear to the Secretary of State to be of a public nature. They are the functions that are subject to the Act. As I indicated to my hon. Friend the Member for Enfield, Southgate, Network Rail is not a single legal body, but is made up of a group of companies, which is why there are three companies on the list. 

The companies affected are Network Rail Ltd, Network Rail Holdco Ltd, and Network Rail Infrastructure Ltd. In practice, Network Rail Infrastructure Ltd is responsible for the day-to-day delivery of Network Rail’s public functions. Its parent company, Network Rail Holdco Ltd, and the umbrella company for the group as a whole, Network Rail Ltd, are legally responsible for the same functions as Network Rail Infrastructure Ltd and

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so are listed too. Network Rail will, however, handle all requests as if it were a single organisation, which is what the public perceive it as. 

The functions considered of a public nature are those relating most directly to the development and operation of the rail network. Network Rail’s network services function covers its ownership of the rail network and activities relating to the network that it is licensed to carry out under section 8 of the Railways Act 1993. That includes the full range of activities carried out by Network Rail that enable our railways to operate, from large-scale projects relating to the construction or improvement of lines to more locally focused work on individual stations, bridges or level crossings. It also includes the provision of information about train movements to train operators to enable them to meet their own information obligations to the public. 

Network Rail owns all the railway stations in the UK, other than those in Northern Ireland. Questions about all railway stations will therefore be subject to the Freedom of Information Act. It also operates a number of major railway stations, such as London Bridge in my constituency, under a further licence issued under section 8 of the Railways Act 1993. That is a public function and is covered by the “station services” function listed in the schedule to the order. 

Finally, Network Rail’s provision and operation of light maintenance depots for the purpose of providing services, including the refuelling and cleaning of trains, also constitutes a public function and is covered by the order. In some ways, the order is technical but, importantly, it covers all matters of rail safety in connection with the networks, stations and depots, as well as information about the entire management of Network Rail, such as pay, pensions and staff. 

Ministers have concluded that all of those functions are of a public nature. The judgment is weighed; it is not imperative or inevitable that that is the judgment reached. The factors in this include the extent to which the activity is in the public interest. In this case, it is hugely so, as Network Rail provides the railway service throughout Great Britain. Another factor is how important the activity is to the public. In this case, that importance is obviously huge because Network Rail is a carrier of millions of people every day. Other factors are the extent to which Network Rail receives public funding, which is obviously significant, as well as the degree to which Network Rail is subject to Government control and is accountable to it and Parliament, which is also significant. 

Network Rail provides a variety of other services that do not constitute public functions and are therefore not capable of being covered by the order. As self-funding commercial services are provided in a competitive market environment, rather than as a monopoly provider of a public service in the public interest, they are not included. I indicated one example of that to my hon. Friend the Member for Enfield, Southgate, which was the letting of arches through Spacia to private companies. Those activities are not able to be included under section 5 of the Freedom of Information Act. 

Article 2(2) intends to give clarity about the services that are not within the scope of the order. With the exception of permitting train companies to access and use stations and tracks, the order does not cover services for which Network Rail charges fees or receives other

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consideration. The provision of consultancy or of property services—for example, the letting of shops, arches and advertising space—that are not directly related to the operation of the railways are not considered public functions. 

Mr Andy Slaughter (Hammersmith) (Lab):  Will the Minister explain why that is the case? Is the distinction between commercial transactions that have a direct impact on the railway and those that are ancillary to it? Even if they are ancillary to it, it is still a public company undertaking certain works that will perhaps run into millions or even billions of pounds in the cases of some developments. Should they not also, subject to commercial confidentiality, be discoverable? 

Simon Hughes:  The hon. Gentleman answered his own question in a way, and I think he understands the distinction. If the function is to support the operation of the railways and if it is connected with the running of the railways, it is clearly a public function; he and I would agree on that. If it is an ancillary extra that it chooses to do but does not have to, that is a commercial activity and is not the public function that comes with the obligatory Network Rail activity. That is not conducted in the public interest, necessarily or primarily. That is why the distinction has been made. 

Of course, it would be possible—not under the order, I am advised—to extend the Freedom of Information Act to all activities of Network Rail. However, it could not be done under an order that allows us to apply it only to public services or public functions. The hon. Gentleman may want to come back on that, but that is what I understand. I think that people understand the distinction. 

Lord Kennedy of Southwark yesterday asked Lord Faulks a question about which other companies were not included. Lord Faulks gave a list of some of them, and if it is helpful—it will take me about 60 seconds—I will list them, so that there is no doubt. The ones that are not included, which are subsidiaries of NRIL are Network Rail (High Speed) Ltd; Doddle Parcel Services Ltd—not a company I had previously heard of; Network Rail (Vy1) Ltd and Network Rail (Vy2) Ltd; Network Rail Certification Body Ltd; Network Rail Consulting Ltd; Network Rail Development Ltd; Network Rail Insurance Ltd; Network Rail Pension Trustee Ltd; the Solent Group; the Station Office Network LLP; Victoria Place Shopping Centre Ltd; and West Hampstead Square LLP. Then there are two that are not trading: Railway Safety & Standards and Railway Safety. There are also six, which are subsidiaries not currently trading and which do not perform functions of a public nature: Network Rail (Assets) Ltd; Network Rail (Projects) Ltd: Network Rail (Spacia) Ltd; Network Rail (Stations) Ltd; Network Rail Property Limited; and Spacia (2002) Ltd. 

I assure the Committee that all the general activities about which the public are exercised daily—the operation and safety of the railways and the maintenance of track and the open area—are covered. The intention is for maximum provision of maximum information, rather than many opportunities for exemptions. 

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Network Rail has been consulted about the companies and functions covered in the order and is positive about its inclusion under the Act. It anticipates thousands of applications. We are not making extra public money available. It must and will provide for that in its budgeting. We welcome the constructive way in which it has engaged with the Ministry in the drawing up of the order. I made it clear to Network Rail that I was determined that the order should be passed before the end of the Parliament, as it will be. It will come into effect next month no later than the week of 23 March. There is no risk that it will be lost between now and dissolution. 

Network Rail already publishes large amounts of information proactively and responds to information requests on a voluntary basis. That is commendable, and demonstrates the considerable steps that it has taken to become more transparent. The big difference is that once the order is agreed by Parliament there will be a legally enforceable right to request information. I hope that hon. Members will agree with the Government that the order is an important measure in opening up public activity to public inquiry. Our constituents will use the new power regularly, I have no doubt, and they will have rights to information that they did not previously have. I hope that the Committee will give the order unanimous support. 

2.48 pm 

Mr Slaughter:  It is a pleasure to be here under your chairmanship this afternoon, Mrs Main. We support the order and are happy it is here at last. Nevertheless, I have four points to make, or questions to ask the Minister, by way of admonition. 

First, the order is late. I think I am right to say that the redesignation or reclassification of Network Rail happened in December 2013, although it was not until September last year, as the Minister said, with the publication of the framework agreement, that the change was announced. It is now five months later. If one were suspicious-minded, one might think that because the order concerns a substantial public body, some of whose actions have been controversial, the Government left things late enough to mean that there would not be that much effective scrutiny before the election, given the time it would take for the order to come into operation, for requests to be made, and so on. One might be even more suspicious and say that there have been some rather embarrassing incidents recently, particularly over the Christmas period, which it would have been very interesting to find out more about through freedom of information requests. Now, of, course, that may also be delayed to beyond the election. 

It is not unreasonable to say that there was a wholesale breakdown in communication between Network Rail and the train operating companies. There was a failure of hardware and scheduling; there was a failure to employ sufficient drivers and other staff to operate the network; and there was chaos over that period of time to which the Government—and the Secretary of State in particular—were very slow to react. It would have been interesting and I am sure a number of passenger organisations would have liked to interrogate further, but that has not been possible because of the delays. If the Minister can shed any more light on why it took 15 months, or whatever it was, to introduce those changes, I am sure we would all be grateful to hear that. 

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The second point, notwithstanding their self-congratulatory tone, is that the Government’s approach to freedom of information has been nugatory. The explanatory memorandum lists the other bodies which over the five years of this Parliament have been brought within the ambit of the Act. The original 2000 Act and subsequent extensions by a Labour Government meant that tens of thousands of public bodies would be subject to freedom of information, to which this Government have added the Association of Chief Police Officers, the Financial Ombudsman Service, the Universities and Colleges Admissions Service and now Network Rail. That is not a very impressive additional list. 

I have looked to see what the coalition agreement said about this. Interestingly, when I tried to access it, I was told that it had been archived. 

The Chair:  Order. I am sure the hon. Gentleman is not going to spend too long on things that are not in the order and have been archived. 

Mr Slaughter:  I am certainly not going to spend a lot of time on the coalition agreement. If the Government are so embarrassed that they have archived it, I certainly do not want to disinter it. The point I am making—I am quoting directly from the explanatory memorandum—is that the list of which they are proud includes only four or five bodies. I will not pursue this point either, but the form of wording in the coalition agreement—we will 

“extend the scope of the Freedom of Information Act to provide greater transparency”— 

did not make any recommendations about which bodies should be in there. The Minister is right; the Liberal Democrats now say that they support our policy, which is to extend freedom of information to private sector bodies delivering public services, but there has been no sign of that happening over this period of time either. 

I turn to the extent to which Network Rail has been brought within the ambit of the Act. I am slightly puzzled why, notwithstanding the Minister’s answer to my question, so many bodies have been excluded. There is a raft of exemptions within the Freedom of Information Act, a major one of which is commercial confidentiality. If there are concerns that Network Rail is engaged in commercial transactions or commercial operations which should not be subject to freedom of information, that is dealt with in the ordinary ambit of the Act. I would be quite interested to see what Network Rail (High Speed) Ltd is up to, not least because a large part of its operation is going to be in my constituency. A large part of that redevelopment, which will be debated in two days’ time in Westminster Hall, if anybody wishes to attend, will be ancillary commercial development. 

I am afraid that public sector bodies have a pretty poor reputation in terms of their commercial operation. Another Bill going through the House at the moment is the Transport for London Bill. This is again a complete change of commercial practice by Transport for London which indulges in what I think are some very dodgy commercial joint ventures with some rather spurious companies. 

I am sure that the Minister will say that that should not be within the ambit of freedom of information, because these are commercial transactions. But those commercial transactions support the activities of Transport

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for London or, in this case, of Network Rail. They may be doing a good job. They may be keeping fares down by disposing of land or property or by entering joint ventures, but they may be cutting very poor deals. They may not be doing deals that should be done or they may be going too far. The public should know about that. That is just as relevant to the activities of Network Rail as disposing of a station or a ticket office. I do not know whether they are going to follow the Mayor of London in closing ticket offices as well. 

I cannot see either in respect of the named and listed companies or of the named and listed functions of these bodies such as the consultancy and property services or the letting of shop units and so on, why there should be these exemptions and exclusions and why the necessary commercial protections cannot be given through the Act as originally drafted. Having got to this stage after five years with this body, which was promised long ago, it looks as if the Government are still reluctant and unwilling to unveil the secrets of Network Rail more than they absolutely have to. That is another matter which the Minister will wish to address in his response. 

Finally, there is nothing in the order or the explanatory memorandum about the manner in which Network Rail will deal with inquiries. We had a debate on freedom of information about a year ago in Westminster Hall. A lot of the concern raised by Members was not about which bodies are within the ambit of the Act but about how those bodies responded. Some respond well, take the Act seriously and are diligent. Some, frankly, manipulate the rules to delay responding for not just months but years, especially on disposal of property, the relationship between public sector bodies and developers, and the viability studies relating to deals of that kind. I am sure that the Minister is probably aware of examples from his own constituency experience. Could the Minister assure us that Network Rail is properly geared up to deal with this, and will enter into not just the letter but the spirit of the Act in doing so? 

2.57 pm 

Simon Hughes:  I am grateful to the hon. Gentleman for raising a set of matters that it is perfectly proper to refer to in this debate. 

He cited the example of the disruption at Christmas and new year, which we in the south-east know well about. There are two obvious points. First, the disruption at King’s Cross, Paddington and London Bridge stations was clearly unacceptable, and Network Rail has apologised for that. It has published reports on the incidents and has indicated its determination to make sure that lessons are learned to prevent a reoccurrence. The Government expect that Network Rail will take the necessary steps to ensure that recommendations are followed and any further measures recommended by the regulator, the Office of Rail Regulation, are adopted fully and quickly. There was a debate in Westminster Hall recently, in which the railways Minister, the Under-Secretary of State for Transport, my hon. Friend the Member for Scarborough and Whitby answered one of my parliamentary neighbours, the hon. Member for Lewisham East (Heidi Alexander), about the unacceptable disruption in south-east London and London Bridge after Christmas. Government are continuing to monitor that; we are not just leaving Network Rail to get on with it. The situation is improving—although not at the speed we would

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like—because Southern has implemented a small number of timetable changes to morning and evening peak train services, which is helping to deliver and improve rail services, in conjunction with the better linking with Network Rail which is rebuilding the stations, as some colleagues will know. The Government are determined to improve the performance of Network Rail across the railways, and MPs are certainly determined that Government should do that. There is a lot of investment to bring the infrastructure up to modern standards, and London Bridge station is one of those schemes. 

Secondly, nothing on the timetable of implementation, which I shall come back to, will prevent the asking of questions about what happened at King’s Cross, Paddington or London Bridge. The events are subject to inquiry. The fact that they happened in December and January does not preclude them from being the subject of an investigation, and I am sure that colleagues will want to ask questions. 

On the broader point, there is and has been absolutely no intention to delay the implementation of this order. When I was appointed to the Department, I made it clear that we should move as quickly as possible to bring Network Rail under the freedom of information legislation. That could not be done finally until the final cross-Government agreement that Network Rail should become a public company. That agreement was reached in August and came into effect in September, as the hon. Member for Hammersmith reminded us. Although the process had been initiated when the Office for National Statistics designated Network Rail as a public authority some months earlier, it did not happen until September. Once it happened, I insisted that we move as quickly as possible to draft this order, and I assure him that that is what happened. We have laid the order before both Houses at the first available moment, and we have made it clear that the order must come into force this Session, and it will—as I indicated, the order will be in force from next month. I assure him that my colleagues and I have insisted on there being no delay. The process has taken longer than expected, but that was not due to any delay in the Department. 

The hon. Gentleman’s next point was on the length of time there has been in this Parliament to introduce the order. I hope I have indicated that the order was not on the list at the beginning; it joined the list as a candidate in 2013, and we have moved as quickly as possible. 

May I correct one thing that the hon. Gentleman said on the number of bodies that have been included in the Act? He listed a couple of specific bodies that were indeed added, but he did not mention all the companies that are wholly owned by public authorities. One hundred of them have been added to the Act so, in addition to ACPO, UCAS and the FOS, 100 other bodies are now subject to FOI, and that is before Network Rail. The Home Secretary has indicated that she wishes the Police

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Federation to be covered by FOI, which requires primary legislation and cannot be done through a statutory instrument. 

On the substance of the hon. Gentleman’s second point about why so many commercial activities are not covered, the summary answer is that, if we are to use the current legislation and the order-making power that it provides, we can address only public bodies or bodies carrying out public functions—I am using lay language, not technical language. If we wanted to include other activities of a commercial nature that may or may not have a bearing on the working of the public functions, we would have to do that, in all probability, through primary legislation, rather than by using the order-making power. That is why, having gone through it very carefully, all key public activities related to running the railways are covered, but the ancillary activities that are not central to the public running of the railways are not covered. HS1 is not covered because it is a private company that is not getting public money, but HS2 is a public company getting public money, so it is covered. There is a very clear division. 

I am sympathetic with the hon. Gentleman’s last point. Different public bodies perform differentially well or badly in delivering their freedom of information obligations and, to be fair, that applies differentially across Government Departments, Government agencies and others. I cannot stand here and give an undertaking that Network Rail will be the top performer in terms of speed, but I have talked to the Information Commissioner about these issues, and he is focused on ensuring that we get maximum compliance with the legislation. A timetable is set out in law and an application for information is meant to be answered in a set number of days. I assure him that my colleagues and I always monitor compliance with the legislation, and the Information Commissioner chases those who fall back and do not act properly. 

I agree with the hon. Gentleman that we need maximum compliance with maximum speed and maximum turnaround. The benefit of FOI is not just that the public can get information but that they can get it in a timely way. Organisations that are subject to FOI should not seek to exempt themselves by playing the exemption card; they should seek to be positive about complying. Yes, freedom of information is an obligation and, yes, it will mean that a lot of people have to do extra work, but that is in the interest of our railways being run in a more accountable way. Today’s prize is that we will have a much more accountable national railway structure, and I hope that that is something that commends itself to everyone. 

Question put and agreed to.  

Resolved,  

That the Committee has considered the draft Freedom of Information (Designation as Public Authorities) Order 2015. 

3.5 pm 

Committee rose.  

Prepared 11th February 2015