Case number: OIC-102999-R1G9B2
25 May 2022
This review has its background in this Office's decision of 19 June 2019 inCase No. 180291, which concerned the applicant's request to the Agency for regulatory assessment reports issued by it to seven AHBs. The Senior Investigator, Ms Dolan, decided to direct the release of the reports in the public interest. The Agency appealed the decision to the High Court and the parties later agreed that the decision would be set aside without remittal to this Office for fresh consideration.
The applicant made a fresh request to the Agency on 10 November 2020 for access to a list of AHBs that submitted Engagement Regulatory Returns (returns) to the Agency. She also sought copies of returns submitted since 1 January 2018. The Agency's decision of 16 December 2020 said that 2020 was the first year that such returns were submitted. It says that it held 19 returns for the year, which it withheld under section 35(1)(b) of the FOI Act on the basis that it owed a duty of confidence to the AHBs who submitted them. It said that it does not hold a list of AHBs that submitted the returns. However, it referred the applicant to correspondence with the Department of Housing, which it said was covered by another FOI request and noted the AHBs in engagement at that time.
The applicant sought an internal review on 5 January 2021. The Agency's internal review decision of 26 January 2021 affirmed its decision on the request. On 31 January 2021, the applicant applied to this Office for a review of the Agency's decision. During the review, the Agency sought to rely on further provisions of the FOI Act in relation to the records, including section 36(1)(b).
I have now completed my review in accordance with section 22(2) of the FOI Act and I have decided to conclude it by way of a formal, binding decision. I apologise for the delay in reaching this stage of the process. In carrying out my review, I have had regard to the above exchanges and correspondence between this Office, the Agency and the applicant. I have also examined the records at issue and had regard to the provisions of the FOI Act.
The scope of this review is confined to whether the Agency's refusal of the applicant's request is justified under the provisions of the FOI Act.
The purpose of the Act is to enable members of the public to obtain access to information held by public bodies and the mechanism for doing so is by accessing records held by those bodies. In other words, a person wishing to obtain information from a public body must make a request for records that contain the information sought. FOI bodies are, generally speaking, not required to create records in order to respond to an FOI request.
However, under section 17(4) of the FOI Act, where a request relates to data contained in more than one record held on an electronic device by the FOI body concerned, the body must take reasonable steps to search for and extract the records to which the request relates. These steps are those that would involve the use of any facility for electronic search or extraction that existed on the date of the request and was used by the FOI body in the ordinary course. Where these reasonable steps result in the creation of a new record, that record is, for the purposes of considering whether or not such a new record should be disclosed in response to the request, deemed to have been created on the date of receipt of the request.
This Office's Investigator invited the Agency's submission on whether the requested list exists in its own right and also on whether one can be produced further to the requirements of section 17(4) of the FOI Act. She asked if any such list was being released and otherwise invited the Agency's submissions on any relevant exemption provisions. Finally, she asked the Agency to clarify the position regarding the correspondence to which it had referred in its original decision.
The Agency's submission reiterates that the only extant list is contained in correspondence between it and the Department of Housing that is covered by another FOI request. It does not say whether the correspondence has been released and it does not address section 17(4). In the circumstances, I do not have sufficient information before me to decide on this part of the applicant's request. The only option open to me is to annul the Agency's effective refusal thereof and to direct it to make a fresh decision on it in accordance with the provisions of the FOI Act.
Having regard to the contents of the records, and the relevant arguments made by the Agency, section 36(1)(b) seems to me to be the most appropriate provision to consider first. I should also say that while this Office consulted with the AHBs in Case no 180291, I do not consider it necessary to consult with them in the circumstances of this case.
However, before I consider the application of section 36(1)(b), it is useful to set out some relevant preliminary matters and also to briefly describe the regulation of AHBs.
Preliminary Matters
A review by this Office under section 22 of the FOI Act is de novo in that it is based on the circumstances and the law as they apply on the date of the decision. It is worth noting that a decision made by this Office in one particular case does not necessarily create a binding precedent for other cases.
Section 18(1) provides, that "if it is practicable to do so", access to an otherwise exempt record shall be granted by preparing a copy, in such form as the head of the public body concerned considers appropriate, of the record with the exempt information removed. Section 18(1) does not apply, however, if the copy provided for thereby would be misleading (section 18(2) refers). The Commissioner takes the view that, generally, neither the definition of a record nor the provisions of section 18 envisage or require the extracting of particular sentences or occasional paragraphs from the remainder of such records for the purpose of granting access to those particular sentences or paragraphs.
Although I am obliged to give reasons for my decision, section 25(3) requires all reasonable precautions to be taken in the course of a review to prevent disclosure of information contained in an exempt record. Accordingly, the extent to which I can describe the records in my analysis and reasoning is limited.
Finally, the release of records under FOI is, in effect, regarded as release to the world at large given that the Act places no constraints on the uses to which the information contained in those records may be put.
AHBs are independent legal entities that own, lease and manage social housing. They independently source housing on the open market. They compete with each other and also with private developers and/or landlords in bidding processes for houses and land for the provision of housing. They acquire units through leasing and management arrangements. They make competitive bids to the Agency and local authorities where these have set up competitive processes for the development of housing and invited AHBs to make bids.
In February 2018, the Central Statistics Office and Eurostat reclassified 14 Tier 3 AHBs to the Local Government sector. In general terms, this means that their debts could be moved onto the State's balance sheet. Eurostat considered that the AHBs concerned are controlled by government having regard to such matters as the low level of private sector funding, the exposure of government to certain financial risks and the AHBs' non-market nature (e.g. their aims of relieving housing needs, the requirements not to distribute surpluses, profits etc. to members, the types of rent charged, etc.)
Voluntary regulation (the Code)
In 2013, the relevant Minister launched the AHB Voluntary Regulation Code (the Code). The Code notes that Government housing policy places AHBs at the heart of social housing provision in the coming years. It describes itself as a stepping stone to a legally binding statutory regulatory framework and provides a context in which AHBs can sign up to voluntary regulation and oversight. It sets out key governance, management, measurement and financial requirements applicable to all AHBs to some extent and classifies AHBs as Tier 1, 2 or 3 depending on levels of risk. AHBs are required to sign up to the Code and to meet certain requirements before they are eligible for certain types of public funding as provided by bodies other than the Agency.
The Agency's function is to work with AHBs and others in the delivery of housing, planning and related services. It is also the interim regulator of AHBs under the Code until such time as the functions of the statutory regulator come into effect, which is anticipated in 2022. The Agency says that 287 of the 495 AHBs in the state have signed up to the Code.
Section 36(1)(b) -“ commercially sensitive information
Section 36(1)(b)
Section 36(1)(b) requires the refusal of access to records containing certain types of information whose disclosure could reasonably be expected to result in material financial loss or gain to the person to whom the information relates, or could prejudice the competitive position of the person in the conduct of his or her profession or business or otherwise in his or her occupation. The essence of the test in section 36(1)(b) is not the nature of the information but the nature of the harm which might be occasioned by its release.
The harm test in the first part of section 36(1)(b) is that disclosure "could reasonably be expected to result in material loss or gain". This Office takes the view that the test to be applied is not concerned with the question of probabilities or possibilities but with whether the decision maker's expectation is reasonable.
The harm test in the second part of section 36(1)(b) is that disclosure of the information "could prejudice the competitive position" of the person in the conduct of their business or profession. The standard of proof to be met here is considerably lower than the "could reasonably be expected" test in the first part of this exemption. However, this Office takes the view that, in invoking "prejudice", the damage which could occur must be specified with a reasonable degree of clarity.
The Agency says that the returns comprise an account of the progress made by the particular AHBs towards meeting the required standards. It says that the records concern matters such as governance, financials, performance, strategic, funding, operational costs, oversight, growth strategies, targeted funding sources, and the service performance management of existing and future units. It says that disclosure of these details could prejudice and impact upon the competitive processes between AHBs themselves and between AHBs and private housing operators. It also says that disclosure of financial information regarding AHBs' capacity to buy units could result in developers only working with AHBs that could pay the highest price.
The applicant's correspondence with the Agency refers to the decision in Case No 180291. This Office's Investigator invited comments from the applicant on the application of section 36(1)(b) in this case; however, no submission on this matter has been received to date.
At the outset, the matter of whether the records contain information that might be exempt under section 35 (i.e. confidential information or information subject to a duty of confidence) is not relevant to my consideration of any aspect of section 36 of the FOI Act.
In the decision of this Office in Case No 180291, the Senior Investigator noted that AHBs essentially form part of the State's response to the delivery of housing units. I share this view. I also agree that AHBs compete with other parties in certain respects and on this basis, I accept that section 36(1)(b) can apply to information that would impact on AHBs in this regard.
The records in the case at hand comprise returns made by the AHBs and therefore are comprised entirely of information provided by the AHBs to the Agency. I also consider the records to be quite detailed and sensitive. By way of some examples, I note details regarding the AHBs' rent and income management, financial viability, debt profile, growth plans etc. Furthermore, the information is relatively current: as already stated, the Agency's decision says that returns were submitted for the first time in 2020.
Having considered the records carefully along with the Agency's arguments, I accept that release of information regarding the various AHBs' progress towards meeting the required standards could have reputational impacts on those entities. Furthermore, I accept that other harms could arise from disclosure of the records. For instance, it seems to me that the details in each report at issue could be of use to other AHBs (whether regulated or unregulated) in competitive processes for the development of housing. It appears to me that release of the reports would give those other AHBs insights that they would not otherwise have into the operations, plans, strengths and weaknesses of the particular AHB the subject of each report. I also accept that the reports could be of use to private developers, who could analyse their contents to identify and select the most financially viable AHBs with which to work. This could prejudice the competitive position of some AHBs in the relevant processes and in my view could also raise the prices that AHBs generally might otherwise pay.
Having considered the Agency's arguments, the content of the records at issue and the circumstances of this case, I accept that disclosing the records could prejudice the competitive position of the AHBs to which they relate. I find that the records are exempt under section 36(1)(b). I should also say that, in their own right, some small excerpts of the records may be in the public domain and/or may not qualify for exemption under section 36(1)(b). However, I do not consider it practicable to identify the relevant details. In any event, directing the release of such small details would not be in keeping with the Commissioner's approach to section 18 of the FOI Act.
Section 36(2) - exceptions to section 36(1)
Section 36(2) provides for the release of information to which section 36(1) is found to apply in certain circumstances. I am satisfied that none of the circumstances identified at section 36(2) arise in this case.
Section 36(3) - the public interest
Having found that section 36(1)(b) of the FOI Act applies in respect of the records, I shall now consider section 36(3) of the FOI Act, which provides that subsection (1) does not apply where the public interest would, on balance, be better served by granting than by refusing to grant the FOI request.
On the matter of the public interest, I have had regard to the comments of the Supreme Court in The Governors and Guardians of the Hospital for the Relief of Poor Lying-In Women v The Information Commissioner [2011] 1 IR 729, [2011] IESC 26) ("the Rotunda case"). It is noted that a public interest should be distinguished from a private interest.
I also wish to emphasise that in carrying out any review, this Office has regard to the general principles of openness and transparency set out in section 11(3) of the FOI Act. In summary, section 11(3) recognises the need to enhance public scrutiny and accountability of government and public affairs, particularly the activities and decision making of FOI bodies. However, on the matter of the type of public interest factors that might be considered in support of the release of the information at issue in this case, I have had regard to the findings of the Supreme Court in The Minister for Communications, Energy and Natural Resources v The Information Commissioner & Ors [2020] IESC 57 (the ENet judgment). In her judgment, Baker J. indicated that the public interest in favour of disclosure cannot be the same public interest as that broadly stated in the Act. She said the public interest in disclosure must be something more than the general public interest in disclosure and the reason must be found from the scrutiny of the contents of the record. The test is whether the public interest that might be gained or lost by the release of the specified documents having regard to their content, might for reasons relevant to the document and the record and their contents be better served by either release or refusal. She said there must be a sufficiently specific, cogent and fact-based reason to tip the balance in favour of disclosure. I consider the comments of the Supreme Court to be relevant to the consideration of public interest tests generally.
The Agency says that the AHBs have furthered the public interest by voluntarily submitting to regulation (notwithstanding that this might also serve their private interests) and in so doing have provided commercially sensitive information to the Agency. It says that the receipt by AHBs of even significant amounts of public monies does not mean that it is in the public interest to release commercially sensitive information that could impact on such entities' legitimate interests. It says that it has not identified anything in the records that is strongly in the public interest to reveal and that it cannot identify any specific public interest that would be served by such release. It says that, in any event, such a public interest would be outweighed by that in upholding the rights and legitimate interests of the AHBs in relation to their commercially sensitive information.
The applicant says that the public interest requires the disclosure of the records because AHBs are licenced by the Government and "most are in receipt of public funds, either State funding or publicly donated funds or both". She says that, in such circumstances, the public has a right to know how such funds are spent, regardless of whether the organisations are voluntarily or mandatorily regulated. She says that there is no legally binding confidentiality agreement in place that prevents publication of the returns. She also refers generally to section 11(3) of the FOI Act as referred to above.
Generally speaking, the Commissioner takes the view that the FOI Act was designed to increase openness and transparency in the way in which FOI bodies conduct their operations, consistent with section 11(3) of the FOI Act. The same principle does not apply to the operations of private enterprises who are not FOI bodies. However, it is not the case that all contacts between an FOI body and a third party business should as a matter of course be required to be withheld. When having regard to section 11(3) of the FOI Act, it is appropriate to distinguish between information that relates purely to the business of a non-FOI body and information which relates to the activities of an FOI body e.g. the exercise of its regulatory function. I note that the records in this case do not reveal anything about the Agency's performance of its functions, such as how it operates the assessment process or the nature and thoroughness of those assessments. Rather, they are entirely concerned with information about the AHBs' current and planned operations.
As noted earlier, while AHBs are private entities operating in commercial spheres, Government has adopted a policy that makes them part of the State's response to the delivery of housing. In addition, access to certain public funding is limited to AHBs that have signed up to the Code and meet certain requirements, while Eurostat has decided to reclassify 14 Tier 3 AHBs to the Local Government sector.
Arguably, the release of the requested information discloses the capacity of such AHBs to perform the role envisaged for them by Government and enables a partial assessment of the overall State response to the housing crisis. At the same time, however, I am satisfied that in respect of these records the public interest would, on balance, be better served by refusal. The information in question is current, detailed and sensitive and its release could have reputational impacts on the AHBs, as well as prejudicing their competitive positions when seeking to carry out the role expected of them by Government.
I note the applicant's argument that there is a public interest in knowing how public funds are spent. To a certain extent, the records concern the expenditure of monies by AHBs. For instance, they contain details regarding management and maintenance costs and as noted already, they also contain information about finances, debt profiles etc. However, I note that the applicant seems to consider the term "public monies" as including publicly donated money as well as State funding, whereas the term is generally understood to relate to funding from the Exchequer. In any event, the records do not distinguish between the expenditure and/or management of public versus private monies. Therefore, they seem to me to disclose information about the expenditure and/or management of public monies to a very limited extent, if at all. Furthermore, the records in this case are not of themselves concerned with decisions to award public funding to AHBs.
Having regard to the above, I am aware of no public interest factors in favour of release of the records that, on balance, outweigh their protection. I find, therefore, that section 36(3) does not apply. In the circumstances, there is no need for me to consider the other arguments made by the Agency.
Case No 180291
Although each case is considered on its own merits, it may be useful to distinguish the circumstances and findings on section 36 in this case from those in Case No 180291. In considering the public interest, it should be noted that the Senior Investigator's decision issued before the ENet judgment and did not have the benefit of its guidance as summarised above.
The records at issue in Case No 180291 concerned the Agency's regulatory assessment reports of the AHBs for 2014 and 2015. They comprised not only information provided by the AHBs to the Agency but also the Agency's views on the information concerned and its ensuing recommendations. Details of the AHBs' commercial plans had been excluded from the review, which means that the records at issue differed considerably from the records at issue in the present case.
Having carried out a review under section 22(2) of the FOI Act, I hereby vary the Agency's decision. I annul its decision on the list of list of AHBs that submitted returns and I direct it to make a fresh decision on this part of the request in accordance with the provisions of the FOI Act. I affirm its refusal of the copies of returns submitted since 1 January 2018 on the basis that section 36(1)(b) of the FOI Act applies to them.
Section 24 of the FOI Act sets out detailed provisions for an appeal to the High Court by a party to a review, or any other person affected by the decision. In summary, such an appeal, normally on a point of law, must be initiated not later than four weeks after notice of the decision was given to the person bringing the appeal.
Deirdre McGoldrick
Senior Investigator