Impact of LIBOR on Leeds PFI contracts?

Joel Benjamin made this Rhyddid Gwybodaeth request to Leeds City Council

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 Leeds City Council,

On 03/04/2007 Leeds City Council signed up to a £113.5m Private Finance Initiative (PFI) contract for BSF Phase 1 in conjunction with Amber Infrastructure, Mott MacDonald and Barclays.

Subsequently it has emerged that Barclays have been engaged in the rigging of the LIBOR rate between at least 2005 to 2012, to which the PFI contacts and underlying swaps and derivatives positions are benchmarked.

Please note: Barclays representing LIBOR as an 'honest benchmark' within the PFI contract, whilst simultaneously manipulating the rate may equate to misrepresentation under contract law, and I trust council are seeking independent advice in this regard.

Please provide:

1. The original BSF Phase 1 business case, including full details of any relevant embedded or stand-alone swaps and derivatives contracts applied to this PFI deal.

2. Please provide copies of all internal or external financial and
legal advice Leeds City Council has received in relation to LIBOR, and
its actual or potential impacts on council, and specifically PFI
finances.

3. Please outline any action Leeds City Council has taken to determine
actual or potential losses arising from LIBOR manipulation, or
intends to take in future to determine and/or recover public losses
arising from this fraud, including annulment or renegotiation of PFI contracts under UK contract law.

Yours faithfully,

Joel Benjamin

DPFOI, Leeds City Council

Dear, Joel Benjamin,

 

Freedom of Information Request: Private Finance Initiative BSF Phase 1
Information

 

Thank you for your request for the above information which was received on
30 November, 2013.

Your request is being dealt with in accordance with the Freedom of
Information Act 2000 and you can expect a response to your request within
the appropriate statutory time limit. 

Please remember to quote reference number FOI/11130 in any future
communications. 

If you have any queries about this letter, please feel free to contact me.

 

Regards

 

Erin Francis Long

Admin Assistant

Corporate Information Governance

Leeds City Council

Tel: 0113 395 2732

[1][Leeds City Council request email]

[2]www.leeds.gov.uk

 

 

dangos adrannau a ddyfynnir

 

References

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1. mailto:[Leeds City Council request email]
2. file:///Documents%20and%20Settings/00700945/Application%20Data/Microsoft/Signatures/www.leeds.gov.uk

DPFOI, Leeds City Council

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    LCC AND EDUCATION LEEDS BUILDING SCHOOLS FOR THE FUTURE OBC APPENDICES zipped.ZIP.zip

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Dear, Joel Benjamin,

 

Freedom of Information Request: LIBOR Rate and PFI Contracts

 

I am writing regarding your request for information, which I received on
30^th November 2013.

 

On 03/04/2007 Leeds City Council signed up to a £113.5m Private Finance
Initiative (PFI) contract for BSF Phase 1 in conjunction with Amber
Infrastructure, Mott MacDonald and Barclays.

 

Subsequently it has emerged that Barclays have been engaged in the rigging
of the LIBOR rate between at least 2005 to 2012, to which the PFI contacts
and underlying swaps and derivatives positions are benchmarked.

 

Please note: Barclays representing LIBOR as an 'honest benchmark' within
the PFI contract, whilst simultaneously manipulating the rate may equate
to misrepresentation under contract law, and I trust council are seeking
independent advice in this regard.

 

Please provide:

 

1. The original BSF Phase 1 business case, including full details of any
relevant embedded or stand-alone swaps and derivatives contracts applied
to this PFI deal.

 

2. Please provide copies of all internal or external financial and legal
advice Leeds City Council has received in relation to LIBOR, and its
actual or potential impacts on council, and specifically PFI finances.

 

3. Please outline any action Leeds City Council has taken to determine
actual or potential losses arising from LIBOR manipulation, or intends to
take in future to determine and/or recover public losses arising from this
fraud, including annulment or renegotiation of PFI contracts under UK
contract law.

 

The BSF Phase 1 outline business case is appended to this response. The
Contractor entered into a fixed interest swap product at financial close
to provide the necessary finance for the contract. The senior lenders were
SMBC, and Barclays were involved as an equity investor. The precise terms
of the transaction are commercially confidential under the terms of the
contract and so is exempt for release under Section 43 of the Freedom of
Information Act (2000) Commercial Interests.

 

In terms of PFI finances, Leeds City Council has not commissioned any
specific external or internal legal or financial advice in relation to
LIBOR.

 

Leeds City Council had no borrowings linked to the LIBOR rate. It did hold
some investments with links to the LIBOR rate. Pending conclusive advice
in due course as to what the impact on interest rate levels has been, the
Council will assess the financial impact on its investments and determine
what steps it will take to redress the situation.

 

If you have any queries about this letter, please contact me. Please
remember to quote the reference number above in any future communications.

If you are unhappy with the service you have received in relation to your
request and wish to make a complaint or request a review of our decision,
you should write to:

 

Freepost RLZR-ELTX-RUEH

Leeds City Council

PO Box 657

LS1 9BS 

 

If you are not satisfied with the outcome of your complaint, you may apply
directly to the Information Commissioner’s Office (ICO) for a decision. 
Generally the ICO cannot make a decision unless you have exhausted the
complaints procedure provided by Leeds City Council. 

 

The Information Commissioner can be contacted at: The Information
Commissioner’s Office Wycliffe House, Water Lane, Wilmslow, Cheshire, SK9
5AF.

 

Kind regards,

 

Erin Francis Long

Admin Assistant

Corporate Information Governance

Leeds City Council

Tel: 0113 395 2732

[1][Leeds City Council request email]

[2]www.leeds.gov.uk

 

 

dangos adrannau a ddyfynnir

 

References

Visible links
1. mailto:[Leeds City Council request email]
2. file:///Documents%20and%20Settings/00700945/Application%20Data/Microsoft/Signatures/www.leeds.gov.uk