Decision
Mr X and Irish Water (IW)
From Office of the Information Commissioner (OIC)
Case number: 150057
Published on
From Office of the Information Commissioner (OIC)
Case number: 150057
Published on
Whether IW was justified in its decision to refuse access to records and parts of records comprising minutes of board meetings on the basis of sections 29(1)(a), 36(1)(b), 30(1)(b), 30(1)(c) and 40(1)(b) of the FOI Act
Conducted in accordance with section 22(2) of the FOI Act by Elizabeth Dolan, Senior Investigator, who is authorised by the Information Commissioner to conduct this review
The applicant made an undated FOI request to IW in 2014 seeking access to copies of minutes of all board meetings and copies of all reports presented to the board since July 2013. On 12 December 2014, IW refused access to the records on the basis of sections 29(1)(a), 36(1)(b), 30(1)(b), 30(1)(c) and 40(1)(b) of the FOI Act. The applicant sought an internal review of this decision on 17 December 2014 and IW decided to release some records and refuse access to parts of others. The applicant wrote to this Office on 21 February 2015 seeking a review of the decision.
Staff from this Office met with IW officials in June 2015 to discuss its handling of the request. I am glad to say that IW then reconsidered aspects of its decision and released additional records. However, the applicant wished to pursue the review in respect of the information for which exemptions were still claimed. Using the numbering system adopted by IW, the remaining withheld parts are records 2 (page 7), 3 (page 6, 8 and 9), 4 (page 4 and 9), 5 (page 7), 6 (page 3, 7 and 9), 7 (page 2 and 3), 11 (page 5), 12 (page 2, 5 and 6), 13 (page 5), 14 (page 3, 6, 7 and 8), and 16 (page 3). IW relied on sections 15(1)(f), 29(1)(a), 30(1)(b), 30(1)(c), and 36(1)(b) to refuse access to these records. Submissions have been received from IW, the applicant and relevant third parties who were consulted by this Office. I consider that the review should now be brought to a close by the issue of a formal, binding decision. In conducting my review, I have had regard to IW's decisions on the matter and its communications with this Office, as well as the applicant's communications with this Office and IW. I have also had regard to the submissions of the third parties, the provisions of the FOI Act and the contents of the records. While this decision does not address each and every element of the third party submissions, they have been considered and are dealt with insofar as they are relevant.
This review is concerned solely with whether IW was justified in refusing access to the records identified above on the basis of sections 15(1)(f), 29(1)(a), 30(1)(b), 30(1)(c), and 36(1)(b) of the FOI Act.
Section 25(3) of the FOI Act requires the Information Commissioner to take all reasonable precautions in the course of a review to prevent disclosure of information contained in an exempt record. This means that the description I can give of the withheld material is limited as is the detail I can include in my analysis and findings.
It is relevant to note that section 22(12)(b) of the FOI Act provides that a decision to refuse to grant a request under section 12 shall be presumed not to have been justified unless the head of the FOI body shows to the Commissioner's satisfaction that its decision was justified. This means that the onus is on IW to satisfy the Commissioner that its decision to refuse access to the records was justified.
I should also explain that a review 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. This approach was endorsed by the High Court in Minister for Education and Science v Information Commissioner [2001] IEHC 116. In The National Maternity Hospital and The Information Commissioner [2007] 3 IR 643, [2007] IEHC 113, the High Court (Quirke J) explained:
"The Commissioner was entitled to consider all of the material before her on the date on which she made her decision and to make her decision having regard to the circumstances which existed on [the date of her decision]".
IW's reconsideration of its refusal of access to many parts of the records having regard to the passage of time and further consideration of the exemptions in the light of the Commissioner's findings in other reviews is to be welcomed. However, it does mean that much of this decision is concerned with very small extracts from board meeting minutes so that, in effect, the relevant exemptions and arguments fall, for the most part, to be considered in the context of occasional sentences, references or figures.
Section 15(1)(f) - publication intended
In its submission letter of 10 July 2015, IW relied on section 15(1)(f) to refuse access to records 12 (page 2) and 14 (page 3). Section 15(1)(f) provides that access may be refused where the FOI body intends to publish the record and such publication is intended to be effected not later than 6 weeks after receipt of the request.
IW contended in July, 2015 that the figures redacted in the above records would be contained in its annual accounts due for publication in the following weeks. It did not claim this exemption in its original decision of 12 December 2014 or its internal review decision of 21 January 2015. It seems to me that IW is not entitled to apply the section 15(1)f) exemption where the planned publication of the records is outside of the 6 week period after its receipt of the FOI request. I find therefore that the records are not exempt under section 15(1)(f). In fact, the annual accounts of IW have now been published and nowhere in the accounts or in the link to a press release provided by IW can I find the exact amounts redacted in the records under consideration in this review. As it seems that this information has not been published, I will consider it under section 36(1)(b) below which was also claimed by IW in its decision to refuse access.
Section 29(1)(a) - Deliberative Process
IW refused access to records 6 (page 3), 7 (page 2) and 16 (page 3) under section 29(1) of the FOI Act. This provides that (a) an FOI body may refuse to grant a request if the record concerned contains matter relating to the deliberative process of an FOI body and (b) the granting of the request would be contrary to the public interest. For section 29(1)(a) to apply, the record must contain matter relating to the deliberative process and the process must be the deliberative process of an FOI body. Secondly, section 29(2) provides that section 29(1) does not apply in certain circumstances. For example, section 29(2)(b) provides that section 29(1) does not apply to a record in so far as it contains factual information. The exemption is subject to a public interest test and the public interest test is stronger than the public interest test in other provisions of the Act - it must be shown that the granting of the request would be contrary to the public interest.
A deliberative process may be described as a thinking process which informs decision making in FOI bodies. It involves the gathering of information from a variety of sources and weighing or considering carefully all of the information and facts obtained with a view to making a decision or reflecting upon the reasons for or against a particular choice. Thus, it involves the consideration of various matters with a view to making a decision on a particular matter. It would, for example, include some weighing up or evaluation of competing options or the consideration of proposals or courses of action.
Having examined the records, I note that record 7 (page 2) is a copy of 6 (page 3) and that some of the redacted parts contain factual information about IW's powers to which the deliberative process exemption cannot apply (section 29(2)(b) refers) . The remaining information concerns a proposed course of action. I can find nothing in the redacted portion which discloses any consideration of options or decision making process by IW. In any case, IW has not shown that releasing this information would be contrary to the public interest. I note that record 16 (page 3) refers to a proposed strategy by IW to prevent lead from entering the water supply. The information contained in the redacted part of this record is now in the public domain as it has been widely reported in various media including the internet. I find that section 29(1)(a) does not apply to exempt records 6 (page 3), 7 (page 2) and 16 (page 3).
Section 30(1) - Functions relating to Management
IW relied on section 30(1)(b) and 30(1)(c) to refuse access to records 3 (page 6), 4 (page 4), 6 (page 7) and 7 (page 3). Section 30(1)(b) provides for the refusal of a request if access to the record could reasonably be expected to have a significant, adverse effect on the performance by the body of any of its functions relating to management (including industrial relations and management of its staff). Section 30(1)(c) provides for refusal of access to a record where its release could "reasonably be expected to disclose positions taken, or to be taken, or plans, procedures, criteria or instructions used or followed, or to be used or followed, for the purpose of any negotiations carried on or being, or to be, carried on by or on behalf of the Government or an FOI body". Section 30(2) provides that this exemption does not apply if the public interest would, on balance, be better served by granting than by refusing the request.
Section 30(1)(b) is a harm based exemption. In arriving at a decision to claim the exemption, an FOI body must firstly identify the potential harm to the functions covered by the exemption that might arise from disclosure and, having identified that harm, consider the reasonableness of any expectation that the harm will occur. The test of whether the expectation is reasonable is not concerned with the question of probabilities or possibilities; it is concerned with whether or not the FOI body's expectation is reasonable.
As regards section 30(1)(c), it does not contain a harm test and it is sufficient that access to the record concerned could reasonably be expected to disclose negotiation positions, plans etc. The Commissioner accepts that negotiation includes the FOI body trying to reach some compromise or mutual agreement and that, generally speaking, proposal type information relating to IW's negotiations would also be exempt under section 30(1)(c).
Record 3 (page 6) consists of part of a sentence from 2013 which IW contended is the subject of ongoing negotiation with the unions representing Local Authority staff. It claimed that its performance of its management functions could be significantly adversely affected if information on efficiency and transformation initiatives is prematurely disclosed. The part of the sentence redacted in this record is very general and cannot be said to disclose information on efficiency and transformation initiatives. Neither does it disclose any position taken or any plans concerning negotiations. I consider that IW has not justified its reliance on section 30(1) for the redactions in this record.
In record 7 (page 3) - board minutes from 18 December 2013- two paragraphs were redacted. The same information, also in two paragraphs, is included in the board minutes of 10 December 2013, record 6 (page 7). However, in the latter record, the second paragraph was released without redaction. The remaining paragraph which is redacted in both records concerns service delivery models. IW contended that the matter is likely to be the subject of ongoing negotiation involving IW and other parties. The redacted portion of the record does not provide much detail although I accept that it could be relevant to the performance by IW of its functions relating to management, including industrial relations. Some of the information is already known (including from the context of parts of records already released) and no particular options are identified or analysed. In considering the section 30(1)(b) exemption, I have to make an assessment of the degree of importance or significance attaching to the adverse effects claimed. In this regard establishing "significant adverse effect" requires stronger evidence of damage than the "prejudice" standard of section 30(1)(a). In other words, not only must the harm be reasonably expected but it must also be expected that the harm will be of a more significant nature than that required under section 30(1)(a). In the circumstances, including the extent to which the content is known, I am not satisfied that release of the information at this time could reasonably be expected to have a significant, adverse effect on the performance by the body of any of its functions relating to management (including industrial relations and management of its staff).
As regards section 30(1)(c),while I accept that the information discloses a general or "high level" view, its release could not reasonably be expected to disclose any negotiation plan, position or procedure. Having regard to its content, I am not satisfied that release of this part of the record could reasonably be expected to disclose positions taken or to be taken for the purpose of negotiations carried on or to be carried by IW or the Government or an FOI body.
Record 4 (page 4) comprises part of a paragraph concerning waste water compliance which IW claims is the matter of ongoing negotiation with the Environmental Protection Agency and the European Union. It claims that release of this record would disclose IW's proposals in respect of wastewater compliance strategy. However, much of the information redacted in this record is publicly available at this stage and is on the IW website in its Water Services Strategic Plan. I am not satisfied that the expectation of the harms claimed is reasonable or that IW has justified its claims for exemption.
In summary, I find that section 30(1)(b) and 30(1)(c) of the FOI Act do not apply to exempt records 3 (page 6), 4 (page 4), 6 (page 7) and 7 (page 3) from release.
Record 11 (page 5)
In its original decision IW refused access to record 11 (page 5) on the basis of section 30. This comprises board minutes from March 2014. Two paragraphs redacted in this record sets out the details of IW's negotiations on a particular Waste Water Treatment Plant and Sewerage Scheme. Taking account of section 25(3), I cannot describe further the content of this record except to say that the positions to be taken in the negotiations do not appear to have been put into the public domain. Having examined this record, I am satisfied that release could reasonably be expected to disclose positions to be taken in IW's its negotiations with a third party. Accordingly, I find that record 11 (page 5) is exempt from release on the basis of section 30(1)(c) subject to consideration of the public interest below.
Section 30(2) -the public interest
Section 30(1)(c) is subject to a public interest test as set out in section 30(2) of the FOI Act. Section 30(2) provides that a record to which section 30(1) is found to apply may still be released if the public interest would, on balance, be better served by granting than refusing to grant the request. Section 30(1)(c) makes no distinction between disclosures which have the potential to prejudice current or future negotiations or cause other harm and disclosures which do not. However, such a distinction should be made in applying the public interest test. Given that the matters withheld in the record have apparently not yet been settled, I think that it is reasonable to conclude that the release of the information would be likely to expose IW to some disadvantage in its negotiations with the third party. This is a matter which must weigh heavily in the application of the public interest balancing test. Whilst there is a public interest in openness in the workings of an FOI body such as IW, I consider that in the particular circumstances this is outweighed by the public interest in protecting the positions to be taken by IW in its negotiations. Accordingly, I find that the public interest would, on balance, be better served by refusing this part of the request (record 11 (page 5)) rather than by granting it.
Section 36(1)(b)
Irish Water relied on section 36(1)(b) to refuse access to parts of records 2 (page 7), 3 (pages 8 and 9), 4 (page 9), 5, 6 (page 9), 12 (pages 5 and 6), 13 (page 5) 14 (pages 6, 7 and 8). Section 36(1)(b) protects information whose disclosure could reasonably be expected to result in a material financial loss or gain to the person to whom the information relates or could prejudice the competitive position of that person in the conduct of his or her profession or business or otherwise in his or her occupation. In effect, this section provides for the protection of commercially sensitive information subject to certain exceptions and a public interest balancing test.
For section 36(1)(b) to apply, it is not sufficient that the information at issue comes within the description of information in the exemption, it is also necessary that the relevant harm test is met. The essence of the test 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 subsection 1(b) is that disclosure "could reasonably be expected to result in material loss or gain ". The Commissioner 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, the Commissioner takes the view that , in invoking "prejudice" the damage which could occur must be specified with a reasonable degree of clarity.
In the High Court case of Westwood Club v The Information Commissioner [2014] IEHC 375 Cross J. held that it is not sufficient for a party relying on section 36(1)(b) to merely restate the provisions of the section, list the documents and say that they are commercially sensitive. A party opposing release should explain why disclosure of the particular records could prejudice their financial position.
Tenders and Commercially Sensitive Information
In an early decision (Case number 98188 - Mr. Mark Henry and the Office of Public Works- available on www.oic.ie), the former Commissioner summarised his views on release of records relating to a tender competition as follows:
1. FOI bodies are obliged to treat all tenders as confidential at least until the time that the contract is awarded.
2. Tender prices may be trade secrets during the currency of a tender competition, but only in exceptional circumstances would historic prices remain trade secrets. As a general proposition, however, he accepted that tender documents which would reveal detailed information about a company's current pricing strategy or about otherwise unavailable product information could fall within the scope of section 36(1)(a) of the FOI Act even following the conclusion of a tender competition.
3. Tender prices generally qualify as commercially sensitive information for the purposes of sections 36(1)(b) and (c) of the FOI Act. Depending upon the circumstances, product information can also be considered commercially sensitive under section 36(1)(b).
4. When a contract is awarded, successful tender information loses confidentiality with respect to price and the type and quantity of the goods supplied. The public interest also favours the release of such information, but exceptions may arise.
5. Other successful tender information which is commercially sensitive (for example, details of the internal organisation of a tenderer's business, analyses of the requirements of the public body, or detailed explanations as to how the tenderer proposed to meet these requirements) may remain confidential. Disclosure in the public interest ordinarily would not be required, unless it were necessary to explain the nature of the goods or services purchased by the public body.
6. Unsuccessful tender information which is commercially sensitive generally remains confidential after the award of a contract, and the public interest lies in protecting that information from disclosure.
The Commissioner stressed, however, that no tender-related records are subject to either release or exemption as a class; therefore, each record must be examined on its own merits in light of the relevant. I adopt his views in considering the prices and other details redacted from the records in this case especially since these relate to companies who were awarded contracts by IW.
Records 4 (page 9), 12 (page 5) and 13 (page 5) contain amounts of budgets approved in relation to contracts awarded by IW. It is clear from the records already released that insurance services, sewerage and water schemes contracts involving several companies are at issue. The names of the companies have already been released. IW contended that release would (i) create the risk of suppliers and sub-contractors to the main contractor increasing their prices with the risk of consequential loss to IW, (ii) create the risk of contractors' suppliers and sub-contractors increasing their prices for similar future works with the risk of consequential loss to IW and (iii) reveal the price tendered for the type of works involved would impact on future competitiveness.
I note that disclosure of the information on contracts awarded in the records listed above would reveal nothing about the successful contractors' pricing strategy other than the price itself. Disclosure would not, for example, reveal anything about the contractor's pricing policy or how it arrived at the quoted prices for the particular contract. It appears that one of IW's arguments is that disclosure of the information would allow the successful contractors' competitors an unfair advantage in future competitions. In Case Number 98049, Henry Ford & Sons Limited, Nissan Ireland, Motor Distributors Limited and the Office of Public Works, the former Commissioner dealt with the argument that release of the tender price will impact negatively on the ability of the successful tenderer to compete for similar business in the future. He concluded, in that case, that knowledge by future tenderers of the price quoted by an earlier successful tenderer does not automatically give them a significant advantage over the previously successful party. Once a competition is over, the tender price and the tender awarded become historic, pertaining as they do to a single transaction, and it seems to me that knowledge by other tenderers of the price accepted in an earlier tender does not of itself allow those parties to deduce with any certainty the price which will be offered in a later competition.
In relation to the argument that contractors might increase their prices for future tenders if they were aware of previous prices with the result that IW would suffer losses through having to pay more for goods and services, I consider that this would not be the case in respect of "once-off" expenditure on fit out and on particular projects. Given the passage of time and the variables associated with each tender competition, I do not accept that it is reasonable to expect the harms identified to occur as a result of disclosure of the information in these records.
This Office sought the views of the various contractors and, of those who replied, all objected to the release of the amounts involved. One argued that release of the information would make it readily available to competitors and therefore put the commercial viability of the company under threat. I do not see how disclosure of total budgets at this stage could damage the competitive position of successful tenderers in the future. I can see no exceptional circumstances to support a finding that this kind of information qualifies as commercially sensitive when it relates to contracts already awarded. I consider that IW has not justified its position in relation to the harms envisaged in section 36(1)(b) in respect of the redacted parts of records 4 (page 9), 12 (page 5) and 13 (page 5) and I find that these parts are not exempt.
Records 3 (pages 8 and 9), 5 (page 7), 12 (pages 2 and 6) and 14 (pages 3, 6, 7 and 8)
Page 9 of Record 3 identifies the lease term, rent and fit-out costs of the IW offices . Records 3 (page 8), 12 (page 2) and 14 (page 3) contain general statements on IW's financial position including loss and expenditure projections. Record 5 (page 7) identifies general areas of underspend without detailing amounts. The redactions in page 6 of record 12 and in pages 7 and 8 of record 14 are of figures associated with claims settlement and with "minor capital programmes". Page 6 of record 14 comprises a list of the major benefits of establishing meter reading services. The identities of the successful preferred vendors have already been released.
IW is of the view that release of these portions of records would adversely affect and compromise its competitive position. It said that it operates in the commercial marketplace and some records should be afforded the same degree of confidentiality as exists in all commercial organisations. I am not clear as to how IW operates in a competitive environment in that it would appear to have a monopoly in its core business of providing and managing water and wastewater services. However, I accept that it operates in a commercial environment insofar as it buys services and goods. Much of its high level budgetary and other planning is, I note, set out in its published Business Plan. Having examined the content and context of the redacted material, I am not satisfied that IW has justified its claim for exemption under section 36(1)(b). For example, it has not identified the harms that might reasonably be expected to result from release of such details as its office lease and fit out costs, budget projections, areas of underspend and maximum amount approved to settle final accounts. In some cases, capital budgets and "multi- suppliers" are involved and contractors or other third parties have not been identified. It has not explained how release of such general details could reasonably be expected to result in material financial loss to IW or any other party. Neither has it explained by reference to the records' content how the competitive position of any person could be prejudiced by release of the amounts and other details at issue here. Therefore, I find that IW was not justified in refusing access to the records identified above on the basis of section 36(1)(b) of the FOI Act. I have to say that, even if this type of information qualified as commercially sensitive information under section 36, the fact that much of the redacted information involves the expenditure of public monies would, I believe, weigh heavily in favour of release in the public interest under section 36(3).
I find that the section 36(1)(b) exemption does not apply to these parts of the records listed above.
Record 2 (page 7) - Water Metering Programme
Record 2 (page 7) details the capital budget for the Water Metering Programme. This page also contains Board approval of the transfer of metering contracts between the various contractors and Bord Gais to IW. It identifies four contractors and an amount of money in respect of each contract. The contractors' names have already been released. It is worth noting once again that only sums of money are at issue here; no other operational or other details from the tender process are to be found in the redacted parts of record 2 (page 7). It is not clear from the minutes if these amounts are the total or part amounts as it seems that what is recorded is the approval of the transfer of the contracts to IW in respect of each of eight regions.
When contacted for their views by this Office, three of the four contractors responded and objected to the release of the contract amounts. It was explained to the contractors by this Office that the information at issue was in the 2013 and 2014 board minutes and that further details of the context of what had been redacted from the minutes could be had by contacting IW. The contractors said that release of the figures would compromise their business, staff safety and job security. Some submissions referred to adverse publicity and the possibility that figures would be misconstrued. Some said that they would be put at a disadvantage for future tender opportunities if the information was readily available to competitors. One of the contractors stated that there is no overall price or contract sum for installation of domestic water meters. Instead, according to the submission made, the price quoted by IW is based on a predetermined notional quantity of water meters and boundary boxes to be installed. It said that the contract is a schedule of rates; therefore, there is no tender price/contract sum and that there are effectively two rates in force - the rate to install a water meter and the rate to install a boundary box. According to the contractor, using the tender evaluation price and the IW predetermined notional assessment criteria, it is a simple mathematical exercise to determine the unit tender price per property. It contended that it would clearly be an advantage to its competitors to be aware of the unit price of installing the water meter and boundary boxes and that it would result in a material financial loss to the company.
One of the contractors referred to a "non-disclosure agreement" and argued that release of the figures at issue would be a breach of a duty of confidence owed to it by IW and that the exemption at section 35(1)(b) should apply. It further stated that the amounts were trade secrets to which section 36(1)(a) should apply and that section 36(1)(c) also applied because disclosure could prejudice the conduct or outcome of contractual negotiations.
The detailed points argued by the contractors in relation to the nature of the contracts and the determination of the unit prices were not, in the main, put forward in the IW submissions in support of its decision in relation to this record. Neither did IW identify or rely on the provisions of any duty of confidence owed by way of an agreement or otherwise. It said that release of the figures would create the risk of suppliers increasing prices with consequential loss to IW and would have implications for the successful contractors' future competitiveness.
As regards the nature of the harm envisaged should the redacted parts of the record be released, it seems to me that a major concern of some of the companies is the possibility that release of any information concerning their relationships with IW could have an adverse effect on them and on their staff. The possibility that information would be misunderstood or misrepresented in the media is also identified as a harmful consequence of release. I cannot see how such arguments can justify refusal of access to the figures at issue here under section 36(1) the FOI Act . The FOI Act clearly does not provide for the exemption from release of IW records as a class and the fact that the companies are contracted to IW for certain works is already in the public domain. I do not accept that public bodies and other entities are incapable of explaining their records to the public or presenting information in a way which will allow any objective observers to draw balanced conclusions. The Commissioner has no function in restricting or controlling the way in which information, once released, is subsequently used.
I have some difficulty in reconciling the argument that only notional quantities of meters are at issue so that the tender evaluation price does not reflect the contract value with the contention that release of the figures would put the successful tenderers at a disadvantage vis a vis their competitors. Records already released by IW indicate that "discreet [sic] packages of work are issued on a continuous basis ....to the successful contractors, allowing Irish Water control over the rate of expenditure, but also the ability to terminate at any point to limit its liability under the contracts." As outlined above, I adopt the position of the previous Commissioner in considering the applicability of section 36(1)(b) to successful contract prices following a tendering process. I consider that knowledge by future tenderers of the price quoted by an earlier successful tenderer does not automatically give them a significant advantage over the previously successful party, given that future tenderers (in the absence of any collusion in the market) cannot predict the behaviour of competitors. However, I am prepared to accept that, in the particular circumstances of this case, a prejudice to the competitive position of the successful tenderers for water metering installations could arise by virtue of the fact that the tenderers put forward their prices in the expectation, however ill-founded, that these would not be disclosed. In this regard, it appears that most, if not all, of these particular contracts were executed prior to IW being made an FOI body. Competitors who, for one reason or another, had not tendered, would not suffer the same difficulty in any future tender process for the same type of installations and in this sense, disclosure could prejudice the competitive position of the parties whose prices are disclosed. I would distinguish these contracts from the contracts for insurance, sewerage and water schemes dealt with earlier in this decision primarily on the basis of the specific arguments made by contractors in regard to rates for installing meters and boundary boxes.
I find that section 36(1)(b) applies to the redacted figures in record 2 (page 7) relating to the companies involved. Therefore, it is not necessary for me to consider the arguments put forward by one of the companies that section 36(1)(a) - Trade Secrets or section 35(1)(b) - Duty of Confidence also apply to exempt this material.
As regards the redaction of the figure for the capital budget for the Water Metering Programme including VAT and a 10% contingency. which also appears in record 2 (page 7), I find that IW has not justified its refusal of access to this part in that it has not shown how disclosure of this figure could reasonably be expected to result in material financial loss or gain or that disclosure could prejudice the competitive position of any person.
Record 6 (page 9) - Over the Counter Services
The information redacted on this page refers to a forecasted value of the contract over five years for three suppliers of over the counter services. The contractors argued that the three suppliers competed in a tender in which they were provided with estimates of the number of bills IW expected to issue and that if the estimated total spend is disclosed it will be easy for the competitors to work out the average unit price. It was submitted that the forecasted value of the contract had been based on confidential negotiations between the companies and IW. They said that the figures are based on assumptions and are subject to change depending on internal and external market factors. They submitted that harm could arise if other customers became aware that the price offered to them was not in line with prices offered to IW. The contractors also stated that the three suppliers compete for contracts regularly and disclosure could cause financial loss to them in that there will be "no incentive" to compete for provision of IW services. It could, according to one company, lead to all three charging prices equivalent to the highest unit price charged by any one of the suppliers. Further, it stated that disclosure of the pricing information would damage competition generally in the market for over the counter services supplied to public bodies and that this is not in the public interest as it could lead to higher prices for consumers.
One of the companies expressed concern that release of the figures "out of context" could lead to prices being misrepresented and misunderstood. It argued that forecasted figures did not provide a clear understanding of the contract price. As I have commented above in the context of other contractors, neither the risk of misrepresentation or misunderstanding are harms to be taken into account in applying the section 36(1) exemption.
IW argued in relation to all of the redactions for which the section 36(1)(b) exemption was cited that release of the details would result in a risk of loss to it due to contractors increasing prices and that revealing prices tendered had implications for future competitiveness.
It seems that three companies (named in the released records and described as "preferred vendors" in a "multi-party framework" ) were awarded the contract in this case arising from a 2013 competition and are effectively the successful tenderers. Although the amounts are forecasted only, the companies have indicated that, due to knowledge of the market share of each of the three involved, it would be possible to estimate the unit prices of each. I find it hard to see however that this would necessarily result in higher prices in any future competition after the five year contract period (with an option to extend for a further two years at the same price) has expired. There is also the possibility that labour costs and other overheads will have changed by the time of the next contract, that one or more companies would cut margins in an attempt to win or retain the business, that IW might change its requirements or framework and, indeed, that other suppliers might have entered the market in the meantime. Nonetheless, I accept that having regard to the low level of proof required and the submissions of the affected parties that, in the particular circumstances of this case, a prejudice to the competitive position of the successful tenderers could arise so that the section 36(1)(b) exemption can apply.
As I have found that section 36(1)(b) applies to record number 2 (page 7) and record 6 (page 9, part) as identified above, there is no necessity to address any other exemptions. I am, however, required to consider the application of the public interest test contained in section 36(3) which provides that the exemptions in section 36(1) do not apply where the public interest would, on balance, be better served by granting than by refusing to grant the request.
Section 36(3) - the Public Interest
Section 36(3) of the FOI Act provides that the exemptions contained in section 36(1) do not apply in relation to a case "in which, in the opinion of the head concerned, the public interest would, on balance, be better served by granting than by refusing to grant the FOI request .....". I take the approach that, in considering the public interest in cases of this kind, I must consider the interests of each party. There is a significant public interest in ensuring the maximum openness in relation to the use of public funds. Such openness is a significant aid to ensuring effective oversight of public expenditure, to ensuring that the public obtains value for money, to preventing fraud and corruption and to preventing the waste or misuse of public funds. There is also a strong public interest in the proper administration of public contracts, in ensuring the integrity of public body tender competitions and in ensuring that value for money is obtained in relation to public contracts.
I must balance those considerations against the public interest in companies being able to protect their competitive position. I accept that there is a legitimate public interest in persons being able to conduct commercial transactions with public bodies without fear of suffering commercially as a result and it is this public interest that section 36(1) seeks to protect. The Act also recognises, both in its long title and in its individual provisions that there is a significant public interest in government being open and accountable. As the former Commissioner observed in Cases 98114, 98312, 98164 and 98183 (Eircom Plc & Department of Agriculture and Food & Others), the public interest in openness about the expenditure of public funds is not absolute; for example where the effect of disclosure would be to totally undermine the business of the company and thereby deter public bodies from transacting business with the State.
I have not found any exceptional circumstances that apply in this case such as to override the need for transparency. As discussed above, there is no information in the redacted parts which would give competitors details of the internal organisation of the tenderers' business, analyses of the requirements of the public body or explanations as to how the companies planned to meet those requirements. Neither, as implied in some of the submissions, can I find any linkage between the release of the figures at issue and threats to job security or safety of staff. For the reasons outlined earlier, I do not accept that the financial information contained in the records would automatically benefit future tenderers to the extent that the business of the successful contractors from 2013 would be totally undermined. In my view, the companies involved were successful in a tender process involving the supply of goods and services to a public body funded by the tax payer and there should be maximum transparency around this type of transaction.
Furthermore, I am mindful that section 11(3) of the FOI Act requires public bodies to have regard to the need to achieve greater openness in their activities and inform scrutiny, discussion, comment and review by the public of their activities. I consider this to be relevant here in that it is a public interest which equates with "a true public interest recognised by means of a well known and established policy, adopted by the Oireachtas, or by law " as referred to by Macken J. in Rotunda Hospital v Information Commissioner [2011] IESC 26
Having considered the matter, I find that, on balance, the public interest in granting the applicant's request in relation to the withheld parts of records 2 (page 7) and 6 (page 9) outweighs the public interest in refusing those parts of the request.
Having carried out a review under section 22(2) of the FOI Act, I hereby vary the decision of IW. I affirm the decision to refuse access to record 11 (page 5). I annul the decision to refuse access to the remaining withheld parts of records and direct their release.
A party to a review, or any other person affected by a decision of the Information Commissioner following a review, may appeal to the High Court on (a) a point of law arising from the decision, or (b) where the party or person concerned contends that the release of a record concerned would contravene a requirement imposed by European Union law, on a finding of fact set out or inherent in the decision. Such an appeal must be initiated by the applicant not later than eight weeks after notice of the decision as given , or by any other party not later than four weeks after notice of the decision was given.
Elizabeth Dolan,
Senior Investigator