Bifab Limited - £10 million secret restructuring loan facility

Mr Paterson made this Rhyddid Gwybodaeth request to Scottish Ministers

This request has been closed to new correspondence from the public body. Contact us if you think it ought be re-opened.

Roedd y cais yn rhannol lwyddiannus.

Dear Scottish Ministers,

Please provide all information held about the £10 million restructuring loan facility (with no fixed repayment prior to 2026) granted to Burntisland Fabrications Limited (Bifab) in 2018. This should include, but is not limited to (A) all internal memorandums and emails and (B) the loan agreement.

Please acknowledge receipt of my FOI request.

Yours faithfully,

Mr Paterson

Gadawodd Mr Paterson anodiad ()

Audit Scotland, September 2018
"In November 2017, the Scottish Government entered into an agreement to offer a commercial loan facility of £15 million to Burntisland Fabrications Limited (BiFab), a fabricator of oil, gas and offshore wind structures, to support the completion of two key contracts. On 17 April 2018, the former Cabinet Secretary for the Economy, Jobs and Fair Work informed the Scottish Parliament that the Government had provided BiFab with an expanded commercial loan facility as a result of increasing costs associated with the completion of contracts for the Beatrice Offshore Wind Farm. Included in the agreement with BiFab is a provision for the loan to be converted to an equity stake, not exceeding a 38 per cent shareholding in BiFab. A further £10 million loan was also made available to BiFab in April 2018 to support business restructuring following the completion of the contracts. The profile of BiFaB's drawdown of the borrowing facility is not in the public domain as the Scottish Government has maintained that the company needs to ensure commercial confidentiality whilst it is in the process of bidding for new contracts. It is important that the Scottish Government provides full transparency on the loans that it has provided to BiFab as soon as it has completed the current procurement process. The
Scottish Government plans to monitor options for when it will sell its shareholding but no decision has been made about when this will take place. "

Scottish Ministers

Dear Mr Paterson,

FOISA Acknowledgment of request

Thank you for your request dated 30 September 2018 under the Freedom of Information (Scotland) Act 2002 (FOISA) for regarding the £10 million restructuring loan facility to Burntisland Fabrications Limited (BiFab).

We received your request on 1 October 2018 and will respond in accordance with FOISA by 29 October 2018.

If you have any queries, please contact me quoting case number FoI/18/02772.

Regards

David Stevenson

dangos adrannau a ddyfynnir

Gadawodd Mr Paterson anodiad ()

24. Events after the end of the reporting period

On 13 April 2018 the Company issued a further 4 ordinary £1 shares at par.Loans made to the Company totalling £35million were converted to 109,128 ordinary £1 B shares between 17 April 2018 and 21 June 2018.The Company has obtained a Restructuring Loan Facility of £10million bearing interest at 18% per annum with no fixed terms of repayment prior to the final repayment date of 2026. As at the date of the Auditor's report, zero has been drawn upon under the Restructuring Loan Facility.

Dear Scottish Ministers,

Message for David Stevenson

Reminder - FOI response due

This is a reminder that a response to my FOI request "Bifab £10 million restructuring loan facility" is due. The legal backstop date for a response is 26 October 2018.

Yours faithfully,

Mr Paterson

Scottish Ministers

1 Atodiad

Dear Mr Paterson,

Please find attached a response to your recent FoI request under reference FoI/18/02771.

Regards

David Stevenson

dangos adrannau a ddyfynnir

Scottish Ministers

1 Atodiad

Dear Mr Paterson,

Please find attached a response to your recent FoI request under reference FoI/18/02772.

Regards

David Stevenson

dangos adrannau a ddyfynnir

Dear Scottish Ministers,

Message for David Stevenson

The response to FOI/18/2771 has been incorrectly recorded against this FOI/18/2772.

Please correct and apply response to FOI/18/2771.

Yours faithfully,

Mr Paterson

Dear Scottish Ministers,

Message for Kersti Berge, Director of Energy & Climate Change

Request for internal review – FOI/18/2772

The response to my FOI request is unsatisfactory. I request full disclosure in the public interest of transparency and accountability. I highlight the following matters:

1. Public interest argument for full disclosure: Maintaining and increasing public confidence in public institutions - such as the government and parliament.

Subjecting public money to scrutiny builds public confidence in public institutions such as governments and parliaments. Scrutiny - by parliament and by the general public - reduces both the possibility and public perception of corruption or other wrong-doing in government decision-making. It encourages both the efficient and effective use of public resources and supports collective learning by experience. It helps protect both public ministers and private contractors through processes which are seen to be above board. Conversely, secrecy with public funds damages and in the long-term undermines public confidence in public institutions.

In support of the public interest argument for disclosure, I wish to draw your attention to criticism of and calls for greater transparency of these loan arrangements made by Audit Scotland, “Reporting of government accounts should be 'more transparent'” dated 27 September 2018. Please note the explicit reference to Bifab:

http://www.audit-scotland.gov.uk/news/re...

2. Public disclosure standards are a necessary part of contracting with the public sector

The Scottish Government should not lower its disclosure standards to those of commercial enterprises as this may be seen as a method of hiding information from public and political scrutiny. Instead, the Scottish Government should set expectations when contracting with third parties that public disclosure standards are to be upheld. If commercial organisations seeking commercial loans are unwilling to accept such standards then they should seek alternative arrangements with private sector organisations.

3. False use of section 30(c) ‘public affairs’ and section 33 (1) (b) ‘commercial interests’

While it may be argued that certain information could be withheld under section 30 (c) and section 33 (1) (b) this is very unlikely to apply to all the documentation that I have requested. There is no sinlge exception under FOISA for completely withholding information that I am seeking.

Please acknowledge my request for internal review.

Yours faithfully,

Mr Paterson

Scottish Ministers

1 Atodiad

Reissued.

David Stevenson

dangos adrannau a ddyfynnir

Scottish Ministers

Dear Mr Paterson,

I have reissued both FOI/18/02271 ( [email address] ) and FOI/18/02772 ([FOI #522674 email] ) under the correct email addresses.

Hopefully this resolves the misunderstanding regarding the reference numbers and will allow the Scottish Information Commissioner to flow the email traffic on the matter.

Regards

David Stevenson

dangos adrannau a ddyfynnir

Gadawodd Mr Paterson anodiad ()

Scottish Information Commissioner: "Where the authority considers that the commercial interests of a third party would (or would be likely to) be harmed, it must make this clear, and must indicate the nature of those commercial interests and how these interests would, or would be likely to, be prejudiced substantially."

Dear Scottish Ministers,

Message for Kersti Berge, Director of Energy & Climate Change

FOI/18/2772

Reminder: Please acknowledge receipt of my request for internal review dated 29 October 2018.

Please note that this reminder relates to FOI/18/2772 and not 2771.

Yours faithfully,

Mr Paterson

Scottish Ministers

Dear Mr Paterson

Acknowledgment of request for review of original responses

Thank you for your requests of 29 October 2018 for a review of our response to your original requests under the Freedom of Information (Scotland) Act 2002 (FOISA) to FoI/18/2771 and FoI/18/2772 for

(1) details of the £35 million investment in Burntisland Fabrications Ltd specifically Scottish Minister's assessment of the value of the investment:

(A) Immediately before the conversion of the £35 million loan to shares.
(B) Immediately after the conversion of the £35 million loan to shares.
(C) The latest available valuation of the shareholding (please give date of valuation); and

(2) You asked for all information held about the £10 million restructuring loan facility (with no fixed repayment prior to 2026) granted to Burntisland Fabrications Limited (Bifab) in 2018. This should include, but is not limited to (A) all internal memorandums and emails and (B) the loan agreement.

I have been asked by Kersti Berge, Director for Energy and Climate Change to carry out the review because I was not involved in handling your original request. I will be looking at the case afresh to establish whether the original response should be confirmed, with or without modifications as appropriate, or a fresh decision should be substituted.

We received your review request on 29 October 2018 so I will respond in accordance with FOISA by 26 November 2018. If you have any queries, please contact me quoting either of your case numbers highlighted in the above letter title.

Kind regards

Anna Kynaston
Unit Head Low Carbon

dangos adrannau a ddyfynnir

Dear Scottish Ministers,

Message for Anna Kynaston, Unit Head Low Carbon

Thank you for acknowledging receipt of my requests for internal review of these two FOI requests.

I accept your single acknowledgement of both requests. However, the responses to the internal reviews must be kept completely separate. This is necessary for, amongst other things, tracking purposes.

Yours faithfully,

Mr Paterson

Dear Scottish Ministers,

Message for Anna Kynaston, Unit Head Low Carbon

Thank you for acknowledging receipt of my request for internal review.

Please can I ask you to assess your objectivity in carrying out the internal review. You will be required, in all probability, to carry out the public interest test on information that may have been prepared by your line manager or for which your line manager is responsible. If you believe that you can not maintain objectivity in these circumstances please can you transfer the internal review to another individual or to a review panel where objectivity can be assured.

Yours faithfully,

Mr Paterson

Scottish Ministers

Good morning Mr Paterson

Thank you for your email.

Please let me reassure you that I am in not conflicted by line management in terms of reviewing these cases. I work in an entirely separate, and independent, Division (area) within the Energy and Climate Change Directorate and have no previous knowledge of the preparation of the FOI responses in this case.

As previously advised I will provide a formal response to you by 26 November.

Yours sincerely

Anna Kynaston

dangos adrannau a ddyfynnir

Dear Scottish Ministers,

Message for Anna Kynaston, Unit Head Low Carbon

Thank you for your assessment of your objectivity and I look forward to receiving a high quality demonstration of the public interest test (if applicable) in due course.

Yours faithfully,

Mr Paterson

Dear Scottish Ministers,

Message for Anna Kynaston, Unit Head Low Carbon

FOI/18/2772: BiFab - £10 million loan

This is a reminder that a response to my request for internal review is due.

Please note again that all information was withheld in the first response to my request and there is no exemption available under FOISA for this.

I look forward to receiving a high quality response shortly.

Yours faithfully,

Mr Paterson

Scottish Ministers

1 Atodiad

Dear Mr Paterson

Please find attached a response to your FOI review request of 29 October 2018 relating FoI/18/02772.

Kind regards

Anna Kynaston

dangos adrannau a ddyfynnir

Gadawodd Mr Paterson anodiad ()

Appeal to the Scottish Information Commissioner: 26 November 2018

Dear Scottish Ministers,

Message for Anna Kynaston, Unit Head Low Carbon

FOI/18/2772: BiFab - £10 million loan

Thank you for your response. I class your response as unsatisfactory and have referred the matter to the Scottish Information Commissioner.

Yours faithfully,

Mr Paterson

Dear Scottish Ministers,

Message for Anna Kynaston

£10m Restructuring Loan

The disgraceful charade continues. Some information is already in the public domain - see Burntisland Fabrications Annual Report 2017 which you 'forgot' to reference:

"The Company has obtained a Restructuring Loan Facility of £10million bearing interest at 18% per annum with no fixed terms of repayment prior to the final repayment date of 2026. As at the date of the Auditor's report, zero has been drawn upon under the Restructuring Loan Facility."

I look forward to discussing this further with the SIC.

Yours faithfully,

Mr Paterson

Scottish Ministers

7 Atodiad

Dear Mr Paterson

 

Please find attached a response and supporting documents to your FOI
request (ref: FOI180772).

 

Best wishes

 

Andrew Young

 

Andrew Young | Energy Supply Chain Policy Officer

Energy and Climate Change Directorate | Scottish Government
5 Atlantic Quay, 150 Broomielaw, Glasgow, G2 8LU
T: 0131 244 1932  M: 07881837699

[1]cid:image001.png@01D2EC03.B1C991C0

 

 

 

 

 

dangos adrannau a ddyfynnir

 

References

Visible links

Scottish Ministers

3 Atodiad

Dear Mr Paterson,

 

Please find a further response in relation to FOI/18/02772, having
reflected on earlier disclosures of information.

 

(This is 1 of 2 emails)

 

Regards

 

David Stevenson

 

 

 

dangos adrannau a ddyfynnir

 

Scottish Ministers

1 Atodiad

Dear Mr Paterson,

 

Please find a further response in relation to FOI/18/02772, having
reflected on earlier disclosures of information.

 

(This is 2 of 2 emails)

 

Regards

 

David Stevenson

 

 

 

dangos adrannau a ddyfynnir

 

Scottish Ministers

4 Atodiad

Dear Mr Paterson

 

REQUEST UNDER THE FREEDOM OF INFORMATION (SCOTLAND) ACT 2002 (FOISA)

 

I am writing regarding your appeal to the Scottish Information
Commissioner in relation to your request for:

 

‘All information held about the £10 million restructuring loan facility
(with no fixed repayment prior to 2026) granted to Burntisland
Fabrications Limited (Bifab) in 2018. This should include, but is not
limited to (A) all internal memorandums and emails and (B) the loan
agreement.’

 

Having given further consideration to the information previously withheld
under sections 30(c) and 33(1)(b) during the course of this investigation,
we have determined that some of the information previously withheld under
these exemptions can now be disclosed. I have enclose a copy of this
information.

 

Yours Sincerely

 

Andrew Young

 

Andrew Young | Energy Supply Chain Policy Officer

Energy and Climate Change Directorate | Scottish Government
5 Atlantic Quay, 150 Broomielaw, Glasgow, G2 8LU

[1]cid:image001.png@01D2EC03.B1C991C0

 

dangos adrannau a ddyfynnir

 

References

Visible links

Scottish Ministers

2 Atodiad

Dear Mr Paterson

 

With reference to my email yesterday which provided some further
information following your appeal application and further correspondence
with the Scottish Information Commissioner regarding your request for:

 

‘All information held about the £10 million restructuring loan facility
(with no fixed repayment prior to 2026) granted to Burntisland
Fabrications Limited (Bifab) in 2018. This should include, but is not
limited to (A) all internal memorandums and emails and (B) the loan
agreement.’

 

I have enclosed a revised version of the Grant Thornton report in relation
to pre-drawdown diligence dated 16 May 2018 as one figure of 1.92 million
was redacted from the top of page two of this additional release in error.
I apologise for this oversight.

 

Yours Sincerely

 

Andrew Young

 

Andrew Young | Energy Supply Chain Policy Officer

Energy and Climate Change Directorate | Scottish Government
5 Atlantic Quay, 150 Broomielaw, Glasgow, G2 8LU

[1]cid:image001.png@01D2EC03.B1C991C0

 

dangos adrannau a ddyfynnir

 

References

Visible links

Dear Scottish Ministers,

Message for the FOI Unit

FOI/18/02772

The Scottish Government has a commitment to publish information released in responses to FOI requests on the same day as it it released to the respondent. Please ensure that information released in relation to the above case is promptly disclosed on the Scottish Government's website. It is public information after all.

Yours faithfully,

Mr Paterson

Scottish Ministers

Dear Mr Paterson

 

Thank you for your email.

 

I can confirm we have the information released in response to this request
and will publish it as soon as possible. 

 

Kind Regards

Sarah

 

Sarah Walkinshaw | Lead Caseworker | Freedom of Information Unit |
Scottish Government | 2W | St Andrews House | Regent Road | Edinburgh |
EH1 3DG

 

 

dangos adrannau a ddyfynnir

 

Scottish Ministers

Dear Mr Paterson
The final response on the FOI case below has now been published.
https://www.gov.scot/publications/foi-18...

Kind regards

M Bruce

dangos adrannau a ddyfynnir

Dear Scottish Ministers,

Message for M Bruce

Thank you for publishing the information on the SG website.

I must ask though why everything is subject to manipulation as it shows a complete lack of integrity (this is not a personal criticism but a criticism of organisational culture). The disclosure should be marked "FOI Appeal" in accordance with SG established practice and to correctly inform information users that Scottish Information Commissioner intervention was required - not "FOI release" as it is currently marked. I understand standard practice should be to mark information as "FOI Appeal" "FOI Review" or "FOI Release" to reflect the stage at which information is released.

The information was only released after intervention by the Scottish Information Commissioner (no information was released at the initial response and review stages) and represents information that would not lead to the significant probability of substantial prejudice of the company concerned.

Yours faithfully,

Mr Paterson

Scottish Ministers

Dear Mr Paterson

As you know, the Scottish Government is under no statutory obligation under the Freedom of Information (Scotland) Act to publish information released in response to FOI requests, but does so in order to make that information more widely available and to improve our transparency. We do normally include, in the title, the stage at which information was released, but sometimes this is unintentionally overlooked. We have amended the title to reflect this was an appeal.
I can assure you this is not “subject to manipulation” and in this case, the FOI reference on our website now clearly states 'FOI/18/02772 Appeal'.

M Bruce
 
 

dangos adrannau a ddyfynnir

Dear Scottish Ministers,

Message for M Bruce, FOI Unit

Thank you for amending the disclosure of information in this case from "FOI Release" to "FOI Appeal".

My experience has taught me that there is wide scale manipulation when it comes to FOISA and FOISA disclosures (this FOI case alone shows that) and this led me to conclude the incorrect labelling was further manipulation.

An objective person observing this FOI release for the first time needs to be able to work out what has happened and the circumstances of this case. They are unable to do this if there is incorrect labelling - and the initial response and response to internal review are not disclosed on the website.

Yours faithfully,

Mr Paterson

Gadawodd Mr Paterson anodiad ()

** Key FOI for background on BiFab **

Gadawodd Mr Paterson anodiad ()

"BiFab lashes out at Scottish Government’s claims"

http://www.hebrides-news.com/bifab-hits-...

Gadawodd Mr Paterson anodiad ()

The loan was increased to £16.3 million prior to the company entering administration

Administrators Proposals & Statement of Affairs published

https://find-and-update.company-informat...