Northern Rock not covered by FoI Act

The Government is attempting to exempt Northern Rock from the Freedom of Information Act with a clause in its draft legislation to nationalise the stricken bank.

The legislation states: "Article 18 deems Northern Rock not to be a publicly-owned company for the purposes of the Freedom of Information Act 2000."

The Freedom of Information Act says nationalised companies in Northern Rock's situation should be subject to freedom of information requests. Other publicly-owned companies such as Royal Mail, Scottish Water and the Tote are subject to the Act.

Shadow Chancellor George Osborne says the clause is an attempt to prevent the public obtaining information about how the institution is managing public funds and claims it "flies in the face of the Act itself". He said: “The public is now paying for this bank. We are entitled to know what it is doing with our money. It is completely unacceptable to exempt it from the Freedom of Information Act. The Chancellor of the Exchequer has been incompetent and now he’s trying to cover his tracks.”

But the Treasury says Northern Rock would be at a disadvantage to other banks if it were subject to the Act.

A spokesperson says: "Northern Rock will carry on being run as a commercial bank and, as no other commercial banks are subject to Freedom of Information requests, this clause keeps it on an even keel. This is not an attempt to hide anything, we have been transparent throughout this whole process."

Gov wants Northern Rock exempt from Freedom of Information enquiries (Money Marketing, 19 February 2008)

The government faced a backlash in the House of Lords tonight over its attempts to "rush through" the nationalisation of Northern Rock.

Peers condemned the timetable for the emergency legislation, which the government hopes will be passed by the end of the week.

Lord Newby, the Liberal Democrat spokesman on the Treasury, called on the government to bring the Granite fund, which his party claims holds 40% of Northern Rock's best assets, under public ownership.

He said Granite was included in the audited accounts of the bank and could not "be wished away as though it has no relevance to the asset base of Northern Rock."

But Lord Davies of Oldham, who was presenting the bill in the Lords, said: "That [Granite] is entirely separate from Northern Rock and has no claim upon the assets of Northern Rock."
Earlier today, the Tory leader, David Cameron attacked the government for trying to exclude Northern Rock from the Freedom of Information (FoI) act, saying the move "would make Fidel Castro proud".

Under the emergency legislation being rushed through by the government to nationalise the ailing bank, Northern Rock will not be bound by the provisions of the act despite being a public body.

The Conservative peers De Mauley and Lord Hunt of Wirral have laid an amendment to the banking (special provisions) bill which, if moved, would see Northern Rock subjected to the FoI like other publicly owned companies.

Peers criticise rush on Northern Rock bill (The Guardian, 20 February 2008)