Request for draft business plan

Commercial
Legislation:
Official Information Act 1982
Section 9
Legislation display text:
Official Information Act 1982, ss 9(2)(b)(ii), 9(2)(ba)(i), 9(2)(i), 9(1)
Agency:
Minister for State Owned Enterprises
Ombudsman:
Sir Brian Elwood
Case number(s):
W38050
Issue date:
Language:
English

Request to Minister for State Owned Enterprises for Timberlands West Coast Ltd draft Business Plan for 1997/98—information withheld on commercial grounds—some information released—detailed financial, business strategy, economic and marketing information withheld—State Owned Enterprises Act 1986

A request for Timberlands West Coast Ltd’s (TWC) draft 1997/98 Business Plan was refused by the Minister for State Owned Enterprises in reliance upon sections 9(2)(b)(ii), 9(2)(ba)(i) and 9(2)(i) of the OIA.

In support of that decision, the Minister explained that State Owned Enterprises’ (SOEs) Business Plans form the basis for open and frank discussions between the SOEs and the shareholding Ministers about the performance, direction and scope of business activities. Very detailed information is provided to the Ministers about the state of the company, the commercial environment and future strategies. The information is, therefore, highly commercial and sensitive, and the ability to keep such information confidential is crucial to the effective monitoring of the company’s performance by Ministers and officials and to the operation of the Crown’s commercial activities. The Minister considered that disclosure of TWC’s draft 1997/98 Business Plan would seriously impede its and the Crown’s ability to operate its commercial activities in a highly competitive market.

The State Owned Enterprises Act 1986 specifies certain procedures to be followed by SOEs and the shareholding Ministers in reaching decisions concerning the operating parameters of SOE companies. For example, the Board of each SOE is obliged to provide the shareholding Ministers with a draft Statement of Corporate Intent, an Annual Report, half-yearly reports and financial statements. The practice is also to provide shareholding Ministers with a draft Business Plan. That plan forms the basis of dialogue between shareholding Ministers and the company regarding the company’s performance and operational and strategic objectives.

However, not all the information in the draft Business Plan at issue in this case needed to be protected to avoid prejudice either to the interests identified in sections 9(2)(b)(ii), 9(2)(ba)(i) and 9(2)(i) or to any of the other interests the OIA seeks to protect. The Minister therefore released to the requester the information for which there was no reason in terms of the OIA to withhold.

The remainder of the information contained in the draft Business Plan included:

  • a detailed discussion of TWC’s financial and operational performance and forecast figures outlining the company’s financial and physical projections;

  • a detailed discussion of TWC’s present and future business strategies, including a discussion of the company’s planning, marketing, sales and operational strategies and objectives; and

  • an assessment of certain economic and market factors, and the impact these factors may have on the company’s performance.

After considering this information, the Minister’s views, as well as those of TWC, who was consulted as a third party likely to be prejudiced by the release of the information at issue, the view was formed that release of the information would enable commercial competitors to assess TWC’s financial performance and identify economic or market factors which might be a particular strength or weakness of the company. It would also provide competitors and customers with detailed information regarding TWC’s potential marketing and sales strategies which could be used to pre-empt such strategies to the detriment of the company. Such a result would be likely to unreasonably prejudice the commercial position of TWC in its day to day operations (section 9(2)(b)(ii)), as well as the ability of the Crown to carry on, without prejudice or disadvantage, commercial activities (section 9(2)(i)).

It was clear that the information at issue was provided by TWC to the Minister for State Owned Enterprises subject to an obligation of confidence. The supply of such detailed information regarding the company’s performance and commercial strategies is necessary if shareholding Ministers are to be able to monitor the company’s commercial activities and performance in an efficient and effective manner. Release of the information contained in the remainder of the draft Business Plan would be likely to prejudice the supply of similar information from TWC to the shareholding Ministers in the future. Such a result would be likely to impair the ability of the shareholding Ministers to effectively monitor the company’s performance and would, therefore, not be in the wider public interest (section 9(2)(ba)(i)).

It was then necessary to consider, pursuant to section 9(1) of the OIA, whether the withholding of the information at issue was outweighed by any other considerations which rendered it desirable, in the public interest, to make that information available.

The issue of indigenous logging on the West Coast is contentious from both environmental and economic standpoints. There is, therefore, a public interest in the release of sufficient information to enable the public and special interest groups to be well informed about the nature and the extent of the Company’s operations.

There is also a public interest in ensuring that the commercial position of TWC is not prejudiced by the release of information under the Official Information Act, and that shareholding Ministers are provided with accurate and timely access to both draft and final commercial information from SOEs regarding their strategic and operational plans.

In seeking to strike a balance between the competing public interests identified in the case, it was noted that the State Owned Enterprises Act 1986 requires that SOEs publish annually and table in the House of Representatives a Statement of Corporate Intent and an Annual Report outlining the company’s operations, objectives and performance. These publications go some way to meeting the public interest in the availability of information relating to the commercial activities and performance of TWC.

On this basis, the view was formed that the public interest considerations favouring the release of the particular information at issue did not outweigh the need identified in terms of sections 9(2)(b)(ii), 9(2)(ba)(i) and 9(2)(i) to withhold that information.

This case note is published under the authority of the Ombudsmen Rules 1989. It sets out an Ombudsman’s view on the facts of a particular case. It should not be taken as establishing any legal precedent that would bind an Ombudsman in future.

Last updated: