Members of the team running mySociety’s freedom of information website WhatDoTheyKnow.com also campaign for improvements to freedom of information law.

Volunteer John Cross has been drawing his MP’s attention to a major loophole in the UK’s Freedom of Information Act which means that a company wholly owned by one local authority is subject to the act but a company owned by two local authorities is not. John’s MP, Peter Bottomley, has been convinced that this anomaly in the law does not make sense and has submitted an Early Day Motion calling for the loophole to be closed. The EDM also highlights the fact that currently a company owned 95% or even 99.5% by a single public authority is not subject to the provisions of the act, as only companies owned 100% by a single authority are currently covered.

The text of the motion states:

“That this House notes that section 6 of the Freedom of Information Act 2000 with certain exceptions makes companies wholly owned by the Crown or by a single public authority subject to the Act; further notes that a company wholly owned by two or more public authorities or 95 per cent. owned by a single public authority will be outside the scope of the Freedom of Information Act 2000; and calls for the closure of this loophole and for companies owned 90 per cent. or more by any number of public authorities to be subject to the Freedom of Information Act 2000.”

The motion is currently open for other MPs to sign-up to and show their support. If you would like to help increase the number of public bodies that are covered by Freedom of Information legislation please consider writing to your MP, asking them to add their name to the current signatories.

There are many situations where public authorities working together or even setting up jointly owned companies is commendable. Such arrangements can lead to savings though economies of scale and avoid duplication; we may see more such companies set up as a response to economic pressures. What is problematic though is the loss of accountability which currently occurs when public bodies come together and set up these companies without requiring them to follow the highest standards of openness, transparency and accountability.

Examples of Companies Which Would Be Made Subject to FOI if the Loophole was Closed:

• Connexions Nottinghamshire Limited – provides support services to young people and is jointly owned by Nottingham City Council and Nottinghamshire County Council.
• Coventry and Solihull Waste Disposal Company – owned two thirds by Coventry City Council and one third by Solihull MBC
• G-Mex Limited – Through its ownership of Destination Manchester Ltd and investment in Modesole Ltd, Manchester City Council has a 95% shareholding in G-Mex Limited
• Higher Education Statistics Agency (HESA) – this company is the official agency for the collection, analysis and dissemination of quantitative information about higher education.
• Manchester Airport PLC – the Manchester Airport Group is owned by the ten local authorities of Greater Manchester
• The Russell Group – is owned by, and represents 20 of the UK’s largest universities, the company’s aims as set out in documents filed on incorporation included “to influence and make representations to stakeholders and legislators”

Many housing associations, purchasing consortia, representative bodies and urban development companies are among the organisations which would be required to operate in a more transparent manner should this loophole be closed.