Contractors that deliver public services on behalf of government should be compelled to release information under Freedom of Information legislation in the same way as public bodies, the UK’s information commissioner has said.
In a report laid before parliament yesterday, Elizabeth Denham, the head of the Information Commissioner's Office, said the government should designate contractors that carry out public functions as public authorities, which would open them up to scrutiny under the FOI Act.
The act compels public bodies to release information that is deemed important to the public interest where requested, subject to some limitations. It is not possible to submit FOI requests to private companies unless they are designated as public authorities under Section 5 of the FOIA.
Denham’s report points to several examples where it has been impossible for members of the public to obtain information because it is being held by private companies on behalf of public bodies. The “most striking example” it gave was a case in which fire safety surveys produced by the now failed outsourcer Carillion on behalf of Wye Valley NHS Trust were not subject to the FOIA because they were held by the contractor rather than the trust.
To prevent this from happening, Denham said the government should use Section 5 “designate contractors regarding the public functions they undertake where this would be in the public interest, whether because of the scale, duration or public importance of the contracts”.
It should also designate “a greater number of other organisations exercising functions of a public nature, and do so more frequently and efficiently”.
As well as enabling members of the public to request information directly from these contractors, this designation would compel organisations to proactively disclose information through annual reports and other channels.
There are already some – largely voluntary – transparency initiatives in place for outsourcers, but the report said they have had “limited success”.
Increasing transparency among government contractors is critical because of the scale of work that is outsourced, according to ICO. Of the 169 children’s homes opened in 2017-18, for example, 86% were opened by private organisations.
"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," the report said.
"Access to information legislation is essential to democratic accountability and helps to create what we all want to see – better public service"
Last year the Institute for Government calculated that the government spends around £285bn a year – almost a third of its total spending – with external suppliers.
The proposals are the latest in a number of plans to improve transparency around outsourcing, which has included calls from the CBI business organisation for open book contracts, where contract terms and finances are published.
However, the CBI called the ICO's proposals “clumsily thought through”. Chief UK policy director Matthew Fell said that business had argued for greater transparency in public contracts to enable more scrutiny, improve quality and engender accountability. but the ICO recommendations "could deter smaller businesses from bidding for public contracts".
“Designating suppliers as public bodies will saddle firms with extra costs and bureaucracy. Importantly, it will also add confusion in determining accountability. Longer-term, harming competition could hamper the government’s objective of putting public private partnerships on a more sustainable footing,” he said.
“Providers of public services know they must be accountable for their performance and behaviours. But if the ICO’s efforts are to succeed in contributing to a more sustainable marketplace, its proposals require a radical rethink. It should begin by talking to business about what works, starting with greater use of standardised contract clauses and disclosing information proactively.”