While the Social Housing Regulation Bill (the Bill) is nearing the finish line before it receives Royal Assent, one important issue for registered providers to keep an eye on will be the new standard relating to transparency (the Transparency Standard), how it will be regulated by the Regulator for Social Housing (RSH) and what that will mean in practice for the sector.
There has long been a debate about whether registered providers should be covered by the Freedom of Information Act 2000 (FOIA) but despite various reviews, proposals and discussions over a number of years, they have yet to come into fruition. Instead, a new Transparency Standard has been proposed, leaving many to wonder how this will work, what will be required, and whether it introduces FOIA by the back door.
The Bill proposes a new Standard and powers for the Secretary of State to direct the RSH as to its requirements.This approach is similar to that taken for the Rent Standard where the directions of the Secretary of State provide most of the substance of the rent regime.
Whilst we currently have only limited information around the new requirements, can the FOIA regime give us any clues about what might be in store?
Here's what we know:
- Proactive publication: much like the publication schemes under FOIA which require routine publication of certain information, registered providers will also need to be proactive in publishing information about the way they operate. This will include information about how much its executives get paid, and financial details relating to organisation income, management costs and other expenditure.
- Requests for information: as currently drafted, the Bill differs significantly from the FOIA regime, which gives every person the right to request any kind of information held by a public authority. Instead, the Transparency Standard obliges organisations to make information available solely to its tenants, and only insofar as it relates to 'accommodation, facilities or services' provided in connection with social housing. Whilst a narrower scope of information that can be requested, and by whom, is welcome, it remains to be seen how this will work in practice and whether the statutory wording will be given a broad interpretation by the Secretary of State and the RSH.
Looking to the FOIA regime as a guide, what else can we expect?
- Time limits: in the detail of any proposals, we would expect organisations to be given a timeframe in which they must respond to tenant requests for information. Under FOIA legislation, the time limit is 20 working days from receipt of the request, which – similar to Subject Access Requests under the data protection regime – gives roughly a month to consider the request, locate the relevant information, and prepare it for disclosure. That time can go very quickly indeed.
- Exemptions: there are a number of exemptions to the provision of information under FOIA, which can significantly restrict the amount of information that needs to be disclosed. Crucially, we can see in the draft Bill that when setting the Transparency Standard, the RSH must "have regard to the desirability of registered providers being free to choose how to provide services and conduct business". It is likely that, similar to FOIA, an exemption will be available for withholding or redacting confidential information or commercially sensitive information insofar as disclosure would prejudice the commercial interests of the parties. These are two of the most commonly used exemptions under FOIA and will be incredibly important under the new regime. Likewise, we expect to see exemptions for providing personal data (which should be considered in line with the data protection legislation), information which is already publicly available or that which is covered by legal professional privilege.This last point may be particularly important for registered providers to consider when undertaking investigations that might potentially become the subject of litigation in order to protect that information from wide dissemination that might later prejudice the provider's position.
- Appeals: we would also hope to see some kind of review process in place before a tenant can complain to the RSH. Under FOIA, anyone unhappy with the level of detail provided in response to a request for information should seek a review of that decision from within the organisation before any complaint is made to the Information Commissioner's Office. We know that the RSH will be responsible for monitoring compliance with the Transparency Standard, so any complaints will be made to the RSH rather than the ICO, but a staged complaints process provides a useful filter before regulatory involvement.
- Enforcement: the current FOIA regime allows the ICO to issue notices requiring disclosure of information where a public authority has failed to properly deal with FOIA requests, but it cannot issue fines or award compensation for breaches of FOIA. Conversely, under the new Transparency Standard, the RSH will have recourse to its usual enforcement powers for failure to meet its standards, including issuing enforcement notices, levying (now unlimited) fines, or awarding compensation.
Registered providers will need to carefully watch any RSH publications on its developing thinking about consumer regulation, the consultations and decisions about the directions of the Secretary of State and the Transparency Standard together with any related formal guidance, to get a handle on how the new regime takes shape and how the enforcement powers may be exercised in practice.
There's lots for the sector to consider and we will be watching to see how this develops. In the meantime, working on an assumption that it will operate in a similar way to the FOIA regime may give registered providers a head start in getting geared up for these changes from a regulatory and operational perspective. Implementation of FOIA has had some significant impacts upon how local government and other public bodies operate and how they make decisions. It is yet to be seen whether these proposals will have a similar range of effects on private registered providers.
Whilst we await further detail of the new Transparency Standard and the associated consultation, registered providers may want to think now about key issues such as policies and procedures, ensuring consistency of approach with the involvement of key team members or dedicated oversight of the requests as they come in, and taking an early view on the risks associated with disclosure of certain types of information, particularly that which is confidential or commercially sensitive in nature.