1 Horse Guards Road London SW1A 2HQ
Information Rights Unit
Tel: 0207 270 4558
Paul Perrin
Fax: 0207 270 4861
www.hm-treasury.gov.uk
By email: request-5683-
[email address]
[email address]
Ref: 9/21
25 March 2009
Dear Mr Perrin
Freedom of Information Act 2000: Recession
Thank you for your email dated 21 February, requesting an internal review of the
decision in our letter of 5 February. Your prior email of 8 February had registered
your dissatisfaction, so we were already treating that as grounds for internal review; I
am sorry that we did not confirm as much. I am writing to inform you of the outcome
of that review.
2. You had requested copies of all Government/Treasury documents containing
predictions as to the duration (and/or end) of the current recession. We replied,
referring you to the 2008 Pre-Budget Report (PBR).
Additional points in your review request
3. You reacted, saying that you were aware of the PBR material, which you
described as only a summary. You said you had wanted to elicit any related work
that had not been published, including predictions that may have been made,
considered and rejected etc.
4. You also complained about the advice in our response, which said that the Act
provides a right to information, rather than to documents. You suggested this was
condescending and not in the spirit of the Act. I apologise for any unintended
offence. The point is that where information is repeated in a number of places in the
documents we hold there is no need to provide the different documents where the
same information appears. Unless the nature of the request made it crucial where
and in what order the information appeared, we would consider it appropriate only to
release one copy of such information. The comment was intended to be helpful in
being transparent about the way we were addressing your request. But I recognise
that the point of this was not fully explained in our response and we have reviewed
the wording we use to avoid it being taken the wrong way in future and I am therefore
grateful to have had your feedback.
5. For our part, the point in your complaint that we would take issue with is the
comment that the PBR was only a summary. This analysis was central to the PBR
report and the dedicated topic of Annex A, which itself ran to some 40 pages. We
return to this point later in terms of the public interest.
The review
6. The review was led by an official from a different Directorate to that which
produced the original response, so as to ensure a fresh look at the matter. The
findings of the review have been endorsed at Director level.
Review conclusions
7. The review found that, whether your request was addressed in terms of
documents or information, there was indeed relevant material that was not published.
However, that conclusion needs some context.
8. There is a strong interpretive element to your request. ‘Prediction’ is not a word
that most economists would use, because it implies too much certainty. The word
used in the publication is ‘forecast’. In the current circumstances of global volatility,
the forecast is subject to more uncertainty than usual as is acknowledged in the PBR
documentation. In particular, the forecast is explained in terms of key underlying
assumptions and the forecast is a range forecast. The key sentence at A.65 of the
PBR is thus best characterised as the government’s judgement of the most likely
scenario, rather than a prediction, with all the certainty that that word seems to carry.
9. To be helpful, I will explain something of the process that goes to produce such
forecasts.
• Officials carry out ongoing monitoring and analysis of the economy; some of
this could have predictive implications.
• In the run-up to the PBR and Budget the Treasury macro-econometric model
will be run; this is not a question of turning the handle and watching the
forecast tumble out; model runs can have a diagnostic intent rather than
predictive intent, where for instance we wish to test the sensitivity of various
assumptions in the round.
• A key consideration is that government interventions are themselves part of
the economic picture that has to be modelled; so there is a feedback loop
going on, with government putative responses to economic prospects in
being incorporated in further model scenarios.
• It is not until the statement to Parliament that the package can be considered
final, with the various scenarios crystallised to form the government forecast.
• Even when finalised, the ‘forecast’ remains subject to underlying assumptions
that cannot be fully modelled, or else are inherently unpredictable.
10. These comments go some way to justify the stance taken in the first response. In
passing, it is perhaps worth commenting that a different requester might not have
been familiar with the PBR documentation, and in that case the pointer we provided
could have been just what was wanted. However, you were dissatisfied with our
stance and we are grateful for the comments you made which served to amplify the
intent behind your request.
11. The review concluded in the light of your challenge that any advice to senior
management and ministers that included a GDP trajectory on par with the one
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published at A.65 of the PBR should have been deemed in scope, together with the
underlying analysis.
12. The review went on to identify such material and consider whether it should be
disclosed. It concluded that the information engaged the exemptions at section
35(1)(a) and 29(1)(a) of the Act; the material is core fiscal policy formulation and the
government’s economic management is key to the nation’s economic success.
Those exemptions are qualified ones, meaning that, even though they are clearly
engaged, we have to judge in all the circumstances of the case whether the public
interest in maintaining the exemption outweighs the public interest in disclosure.
13. In favour of disclosure, the review recognised that there is a public interest in the
Treasury being accountable for judgements about the economy, to demonstrate that
these are soundly based and free of bias. Disclosure also stands to assist public
understanding and engagement. Because the judgement is in this case so central to
economic management and because that issue has such important ramifications for
all citizens, these factors are heightened accordingly.
14. However, the review concluded that the above factors in favour of disclosure
were mitigated by the amount of information already published. The PBR and Budget
vehicles are in place specifically to ensure that there is regular formal democratic
scrutiny of the government’s economic management. Treasury Economic forecasts
are rigorously examined by Parliament, by markets, and by the press and other
commentators. The National Audit Office also formally audits key assumptions to
check that they are both reasonable and cautious. The amount of supporting
information published around the Budget and PBR is, therefore, more than sufficient
to address the public interest in transparency. Further disclosures of internal
documents, far from being helpful, would require further commentary and could be
confusing.
15. In favour of maintaining the s.35(1)(a) exemption, the review recognised that the
exemption is class-based, rather than requiring a demonstration of prejudice arising
from disclosure; however, since it is not an absolute exemption it has to be that in
some circumstances the public interest in disclosure would outweigh the public
interest in maintaining a private space for ministers and officials to formulate and
develop policy free from premature scrutiny. The review concluded that the
arguments advanced above in mitigation of the factors for disclosure meant that this
was not such a case. Moreover, it noted that the enormous difficulty of the
judgements in question meant that the arguments for preserving the private space
weighed more heavily than usual. And it concluded that such a stance was in
keeping with commentary in recent decisions coming from both the Information
Commissioner and the Information Tribunal in cases where this exemption was in
play.
16. The review found that similar arguments come to bear in favour of maintaining
the S.29(1)(a) exemption. That exemption is prejudice-based, so that the onus is on
the authority to demonstrate that the likely harm from disclosure outweighs the
damage to accountability from maintaining the exemption. The principal argument
here is that the Government’s audience is the markets as well as the wider
electorate. Because market perceptions of economic management matter, the public
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interest is in allowing the Government to make as clear and coherent presentation of
its strategy as possible. Forcing disclosure of half-formed analysis and forecast
material would push market confidence lower. This could undermine confidence
more widely, compromise economic recovery, and add to the costs of government
borrowing. Against that, the review noted again that the value of disclosures in terms
of accountability was, at best, slight.
17. I hope the above explanations help your understanding of our initial stance in
response to your request. I understand that the outcome of the review is unlikely to
be entirely to your satisfaction, but I hope this account goes some way to
demonstrate that your complaint has received appropriate consideration and that we
have taken a proper, fresh look at all the circumstances of the case.
18. If you are not content with the outcome of this internal review you have the right
to apply directly to the Information Commissioner for a decision. The Commissioner
can be contacted at: FOI/EIR Complaints Resolution, Information Commissioner's
Office, Wycliffe House, Water Lane, Wilmslow, Cheshire, SK9 5AF. The
Commissioner’s website provides further guidance and a template for complaints at
the following link:
http://www.ico.gov.uk/complaints/freedom_of_information.aspx
Yours sincerely
Rosemary Banner
Head of Information Rights Unit
HM Treasury
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Document Outline
