Freedom of Information?

The Treasury, it seems, is still intent on playing their cards close to their chest about what Ministers are being told to do about Northern Rock. Witness the following letter, a response to an FOI request put in back in July which has had a response yesterday (the footnotes were on the letter from the Treasury, with the formatting edited to make them easier to read here):


Freedom of Information Act 2000: Northern Rock

Thank you for your two enquiries dated 10 July, which we received on 16 July, requesting information under the Freedom of Information Act 2000 (‘the Act’).

2. You asked for information covering –
- the final advice to Ministers on the potential job losses at Northern Rock following its restructuring, and any prospects to ameliorate the effect of job losses on the north east economy.
- the final advice to Ministers on the timing and potential valuation of Northern Rock’s return to the private sector following restructuring and the repayment of Government/Bank of England support.

3. Regarding your second request, the timing and potential valuation of Northern Rock’s return to the private sector following restructuring and the repayment of Government/Bank of England support is something that would need to be addressed in the circumstances of the time at which a return to the private sector was considered and no final advice has been given. Therefore we do not hold information regarding this request.

4. The Treasury does hold information falling within the scope of your first request. Regarding this request, in the period of temporary public ownership the company is being run at arms length from Government and on a commercial basis. The day-to-day relationship between the Treasury, as the shareholder, and the company is set out the Northern Rock Shareholder Relationship Framework document [see note 1]. This states that Government as shareholder:

“determines the high level objectives that the [business] Plan is designed to achieve and agrees the [business] Plan with the Board”

5. Ministers have been provided with advice on and approved the Northern Rock Board’s plan. An executive summary of the Provisional Northern Rock Restructuring Plan was published on 31 March 2008 [see note 2]. The plan sets out the basis for the removal of financial support provided by HM Treasury and the Bank of England through the creation of a smaller, more focused and financially viable mortgage and savings bank that will be returned in due course to the private sector. The plan addressed the specific question you raise regarding potential job losses. It envisaged:

“about a one-third reduction in staff levels over the next three years based on projected business volumes with the majority of the reduction occurring in the first year. The timing and nature of the proposed downsizing, including any redundancy arrangements, will be subject to consultation with representatives of Unite and other employee representatives;”

and stated:

“Northern Rock is committed to open communication with staff and to providing them with substantial support during the restructuring. The Bank will continue to work closely with Unite, One NorthEast and other agencies and stakeholders to minimise the impact of the proposed downsizing on staff and local communities; this includes providing outplacement services to help staff obtain alternative employment in the region”.

6. The Treasury judges that the remaining information it holds that falls within your request falls under the exemption in Section 35 (1)(a) of the Act, which covers information related to the formulation and development of government policy. This is a qualified exemption and requires us to consider the balance of public interest for and against release of the information.

7. We recognise that there is a broad public interest in knowing the advice given to Ministers in relation to Northern Rock whilst it is in temporary public ownership. However there is also a strong public interest in effective policy-making. In order to develop government policy it is necessary that officials have the space to freely give full and frank advice to Ministers on Northern Rock’s plans and performance during its period of temporary public ownership. Our judgement is that it is not in the public interest to release the information we hold at this time.

8. If you have any queries about this letter, please contact me. It will be helpful to us if you remember to quote the reference number above in any future communications.

Ashley Britten
Information Rights Unit

1 Some details on a Treasury website
2 Some details on the Northern Rock Website