Industry leaders have urged caution over proposals to make contractors on public schemes accountable to Freedom of Information (FoI) requests.
Earlier this week, Labour MP Andy Slaughter revealed plans to extend FoI powers to cover contractors working on public projects, as Carillion had been before its collapse in January this year.
Private sector firms are currently exempt from FoI requests, however the collapse of Carillion has given rise to calls for great public scrutiny.
Carillion had been engaged on several public engineering and construction schemes including High Speed 2. After its collapse, other private firms had to step in and pick up work to avoid schemes grinding to a halt.
Other outsourced services including housing associations, such as the Kensington and Chelsea Tenant Management Organisation which managed Grenfell Tower before the fatal fire on 14 June last year, would also be subject to FoI requests under Slaughter’s proposal.
Slaughter said: “The collapse of Carillion shows what happens when these contracts go wrong, with devastating job losses, money lost to the public purse and public infrastructure projects facing significant delays.”
However Slaughter’s proposals have divided opinion, with many claiming the industry would “resist’’ change.
Construction Industry Council chief executive Graham Watts said he was “strongly supportive” of Slaughter’s proposal in principle, but cautioned that any Bill would have to protect companies’ commercial rights.
He said: “The devil will, of course, be in the detail, which would need to be carefully considered to prevent companies having to disclose commercially sensitive information, which might be damaging to them; but, where matters of life safety are concerned the principles of FoI should apply to those carrying out work on behalf of the government.”
Civil Engineering Contractors Association chief executive Alasdair Reisner warned firms could rebel against any proposal which would make commercially sensitive information public, potentially damaging public projects if firms decided they did not want to take the risk to work in the public sector.
“Do I want my competitor to Freedom of Information Act my marketing strategy?” he said.
“The risk is, were this to go through, would people want to work for the public sector to the same extent they do now?”
Reisner added: “I think industry would resist it because of the potential for people to make inappropriate requests for things that really is the information of a business.
“But equally as an industry we shouldn’t be trying to hide information that there is a genuine public interest about in relation to public contracts. But the best way to achieve that is for the contracts to be written in a way where appropriate information is made available.”
On the other side of the fence, Specialist Engineering Contractors’ Group chief executive Rudi Klein welcomed the move, saying it was “about time this loophole was closed”.
He added: “Carillion was able to get away with so much for so long because there was so little public scrutiny of its actions. Now the public is paying a hefty price for winding up this monster of an organisation.”
Klein stressed outsourcing public works to private companies had reduced accountability, which the parliamentary inquiry into Carillion’s collapse has raised as a significant problem.
Independent watchdog Transport Focus head of policy Mike Hewitson added: “Anything that increases transparency is to be welcomed. Transport users should have the opportunity to see how and where money is being spent in their name.”