• Home
  • About
  • Subscribe
  • Conference
  • Events Calendar
  • Webcast151
  • MOTB
  • Log In
  • Register

Room 151

  • Treasury
  • Technical
  • Funding
  • Resources
  • LGPS
  • Development
  • 151 News
  • Blogs
    • David Green
    • Agent 151
    • Dan Bates
    • Richard Harbord
    • Stephen Sheen
    • James Bevan
    • Steve Bishop
    • Cllr John Clancy
    • David Crum
    • Graham Liddell
    • Ian O’Donnell
    • Jackie Shute
  • Interviews

Information Commissioner deals LOBO blow to councils

0
  • by Colin Marrs
  • in Treasury
  • — 10 Dec, 2015

LOBO and COITwo councils have been ordered by the information watchdog to reveal details of contracts signed with banks for Lender Option Borrower Option (LOBO) loans.

The Information Commissioner’s Office (ICO) has ruled that Cornwall Council and Swansea City Council were wrong to withhold details of their LOBO loans in response to freedom of information requests by campaign group Debt Resistance UK.

The ICO has given both councils 35 days to release the information, which the councils had argued was commercially sensitive.

Joel Benjamin, campaigner at Debt Resistance UK, told Room151.co.uk: “It is pleasing that the ICO has ruled that the public interest weighs heavily in favour of disclosure. If councils want to make the argument that LOBO loans were taken out in the public interest that is fine, but they need to be transparent about it.”

The campaign group made the requests – which include copies of contracts between councils and lenders – as part of its campaign against LOBO loans, which it claims has cost local authority millions of pounds in unnecessary interest payments.

In its report on Swansea, the ICO said: “In this case the council has not supplied any cogent evidence to support the contention that disclosure of the requested information in this case would be likely to prejudice any party’s commercial interest, beyond stating that it would.”

The council “chose not to provide specific answers to the commissioner’s questions”, and only said that its lenders had objected to the disclosure of the information.

“However, despite requesting the evidence of the views of all the lenders concerned, the council only provided the commissioner with the views it received from one of them,” the ICO said.

Cornwall Council had argued that disclosure of the information “could create a false consumer expectation of the commercial terms the lenders are able to offer”.

“It is argued that the impact of disclosure would be to harm their ability to conduct LOBOs in the future and result in a distorting of the market,” according to the report.

In addition, the council said that its own working relationships with lenders would be prejudiced and that favourable rates would be more difficult to achieve.

In this case, the ICO accepted that disclosure of the information could cause some harm to the commercial interests identified.

It ruled that these factors were outweighed by the public interest.

The report said: “The commissioner is mindful that LOBO loans have been the subject of national scrutiny and concern.

“Particular concerns have been expressed about the size of local authority debt they involve and the high interest rates and lengthy schemes authorities find themselves locked into at a time when local government spending is subject to significant cuts.

“The commissioner considers that these factors provide strong public interest weightings in favour of transparency and facilitating public engagement and scrutiny.”

Benjamin said Debt Resistance UK had lodged further appeals against decisions to withhold information against a number of other councils with decisions expected shortly. A number of councils had agreed to provide details of LOBO contracts immediately in response to the initial requests, he added.

Get the Room151 Newsletter

Share

You may also like...

  • Troubled Northamptonshire makes ‘unprecedented’ in-year turnaround Troubled Northamptonshire makes ‘unprecedented’ in-year turnaround 15 May, 2019
  • ‘Strategic shift’ sees B&NES pay down debt ‘Strategic shift’ sees B&NES pay down debt 18 Jul, 2013
  • Election result means low interest rates for longer and further cuts for councils Election result means low interest rates for longer and further cuts for councils 14 May, 2015
  • MEPs vote for MMF compromise MEPs vote for MMF compromise 26 Feb, 2015

Leave a Reply Cancel reply

You must be logged in to post a comment.

  • Register to become a Room151 user

  • Latest tweets

    Room151 1 day ago

    How can local government ‘build back better’?: Beverley Gower-Jones looks at the options for driving small business entrepreneurship in clean technologies. Innovation is essential for local authorities to save money and reduce emissions, it is the… dlvr.it/RtT3nS pic.twitter.com/bSMB6OG70t

    Room151 2 days ago

    Helen Randall: Spelthorne report places spotlight on ‘controls’: Fresh criticism of Spelthorne Council raises the question of what “good” controls look like when negotiating a property deal. Spelthorne Council’s continuing debacle over property… dlvr.it/RtSPhy pic.twitter.com/9uCOJgBcH6

    Room151 2 days ago

    Step-out strategies: Hitting the sweet spot between liquidity and ultra-short duration: Sponsored article: Jemma Clee describes how an ultra-short duration strategy can help local authorities enhance returns. Despite the expectation of a low, and… dlvr.it/RtSPZb pic.twitter.com/pdXPpv5lcN

    Room151 3 days ago

    What role will climate change have on the pricing of government bonds?: Sponsored article: Kerry Duffain finds that “vulnerability and resilience to climate change” have a significant impact on the cost of government borrowing. Ardea Investment… dlvr.it/RtNKv7 pic.twitter.com/wDjT31x4Yt

    Room151 3 days ago

    ESGenius: Slashing emissions will fuel green growth for decades: Sponsored article: Velislava Dimitrova argues that a big enough investment could mean transition to a low, or no, carbon economy can become a reality. The world needs to slash carbon[...] dlvr.it/RtKZJp pic.twitter.com/cd8S3ijERl

    Room151 3 days ago

    Prudential code: “Not perfect, but its heart is in the right place”: The new Prudential Code offers revised rules for borrowing. Nikki Bishop is sceptical it will work while Gary Fielding offers his support. Nikki Bishop I have been asked to give[...] dlvr.it/RtKZFh pic.twitter.com/OriN28lXcb

    Room151 4 days ago

    Tremendous report from @MarkSandford3 citing @room_151 no fewer than six times (despite what the @lgcplus fact checking/counting dept might tell you) #localgov commonslibrary.parliament.uk/research-brief… 1/5

    Room151 2 weeks ago

    Dan Bates: Capitalisation directions are not the only tool for rebuilding finances: Dan Bates argues deep seated problems are contributing to a rush for capitalisation directions. For some time now we have been reading that a number of councils are in… dlvr.it/RspKff pic.twitter.com/xRRsgVim9u

  • Categories

    • 151 News
    • Agent 151
    • Blogs
    • Chris Buss
    • Cllr John Clancy
    • Dan Bates
    • David Crum
    • David Green
    • Development
    • Forum
    • Funding
    • Graham Liddell
    • Ian O'Donnell
    • Interviews
    • Jackie Shute
    • James Bevan
    • Jobs
    • LGPSi
    • Mark Finnegan
    • Recent Posts
    • Resources
    • Richard Harbord
    • Stephen Fitzgerald
    • Stephen Sheen
    • Steve Bishop
    • Technical
    • Treasury
    • Uncategorized
  • Archives

    • 2021
    • 2020
    • 2019
    • 2018
    • 2017
    • 2016
    • 2015
    • 2014
    • 2013
    • 2012
    • 2011
  • Previous story Bournemouth council shuts down bank project
  • Next story London boroughs launch high-tech campaign to beat fraud

© Copyright 2021 Room 151. Typegrid Theme by WPBandit.