On Monday the UK government accepted an amendment to its Finance Bill proposed by Caroline Flint MP (see her article explaining it here). The amendment means the public reporting of ‘country-by-country reporting of taxes paid by multi-national corporations’ in the UK. Amendment 145 had cross party support from 60 MPs (you can see the debate here) and was accepted without a division. Interestingly, the government also promised to champion the issue at ‘multi-national’ level elsewhere, following on from David Cameron’s championing of Beneficial Ownership and Extractives Transparency.
As Caroline Flint pointed out (see Column 134), she had originally proposed the amendment in June but the government were concerned that ‘introducing my amendment at that time might put UK multinationals at a competitive disadvantage for reputational reasons’. The idea had considerable backing
The backing I received spurred me on to try to amend the Finance Bill in June, gaining the support of eight parliamentary parties: Labour, the SNP, the Liberal Democrats, Plaid Cymru, the Social Democratic and Labour party, the Ulster Unionist party, the United Kingdom Independence party, the Green party, the independent hon. Member for North Down (Lady Hermon), and a number of Conservative MPs, too. Oxfam, Christian Aid, Save the Children, ActionAid, the ONE campaign and the Catholic Agency for Overseas Development joined our efforts, adding an important and necessary dimension to the argument for public country-by-country reporting.
It was also supported by high profile investigations in 2016 by the Public Accounts Committee that called for country reporting.
The new transparency will help with the closing of loopholes and ‘clever manipulation of [tax] rules’ that she likens to ‘trying to catch jelly’ around the ‘legal and moral difference between tax evasion and tax avoidance’:
Companies often rightly defend themselves on grounds of working within the rules, but politicians and civil servants are often caught out by clever manipulation of those rules. That is not illegal but cannot be said to be in the spirit of what was expected.
This change fits with the push to tax fairness, symbolised by the recent EU decision over Apple:
Around the world, people and their Governments are questioning the loopholes and convoluted legal arrangements that create inaccurate descriptions of multinationals’ trading activities in individual countries. The problem is not confined to tech firms such as Google, but their massive global presence has exposed the fault lines of an old-fashioned tax structure that has not kept up with today’s online business world. Many of today’s high-tech household names were not always so big or so profitable.
She concluded that such reporting was not a magic bullet but would help:
I have no illusions about having a perfect tax system. Keeping one step ahead is a never- ending task for modern tax authorities…Tax policy is not easy. Once one tax loophole is closed, another one opens up [but] transparency is an important ingredient in ensuring that the rules we apply have some bite.
From European Union Committee 1st Report of Session 2016–17 HL Paper 33
Scrutinising Brexit: the role of Parliament (full report here):
‘Confidentiality and transparency
Worthy, Ben, The Impact of Open Data in the UK: Complex, Unpredictable and Political (March 5, 2015). Public Administration 93 (3): 788-805, 2015.
Paper Available here : http://ssrn.com/abstract=2806876
Brexit, as we now know, means Brexit. But what does it mean for open government in the UK? On the surface, nothing changes. Almost all the legislation, from Freedom of Information to Data Protection, is bound up in UK law. The Open Data agenda will also continue to move along. Even the EU initiated laws lie Public Sector Re-use will be kept or, if anything is reversed, will somehow be preserved. There are three areas, however, where the tone or direction of open government may change: through new policies, the influence of the new Prime Minister and the Brexit process itself.
Looking across the UK’s 3rd OGP National Action Plan the top three commitments around Beneficial Ownership, extractives transparency and anti-corruption are all very much David Cameron’s personal agenda. Some of them are also very much in process, as the first Beneficial Ownership release last week shows (see this great analysis here of the first batch of data).
Theresa May’s speech in Birmingham has already indicated that she wants to continue in this general direction, with a commitment to ‘more transparency, including the full disclosure of bonus targets and the publication of “pay multiple” data’ and support for Cameron’s anti-tax avoidance drive. The wider open data agenda is still ongoing. The FOI Act is also relatively safe (for the time being). Since it came into force in 2005 there has been an attempt to amend the law every 18 months or so. However, the FOI Commission’s clear endorsement of the Act and the sheer scale of the resistance to change has probably called a halt to any attempt to limit it in the near future-indeed the 3rd NAP proposed greater publication of data and some minor improvements.
Some new policies are very likely. New governments often promote openness to set a tone. This may be especially important for Prime Minister without a mandate facing the complications of Brexit. Openness represents an easy win to a new leader and is, perhaps, something that could help offset concerns over May’s rather, shall we say, less open actions as Home Secretary. Self-consciously ‘reforming’ administrations in the UK in 1997 and then in 2010, the US in 2009 and Italy in 2013 all made transparency a priority. It ‘signals’ a whole set of messages: that a government is prepared to be open and ‘democratic’ and is prepared to be monitored or overseen by the public.
New Prime Minister?
Political leaders set the tone and send out signals about the openness of their governments. Here’s my quick summary of how the U’Ks last three Prime Ministers did and to what extent they tried to pushback (i.e. limit) or extend openness.
UK Prime Ministers and Openness 2005-2016
|Tony Blair||Fees mooted (2006), (tacitly) supported attempt to have Parliament excluded (2007)||Passed FOI Act in 2000|
|Gordon Brown||Cabinet exclusion mooted, Excluded Monarchy from FOI (2010)||Extension of 30 year rule (2009) and slight extension of FOI to new areas|
|David Cameron||FOI commission (2015-2016)||OGP especially Open Data agenda (2010 onwards) and Beneficial Ownership transparency (2013)|
[N.B. this table doesn’t include a series of extensions of the FOI (Scotland) Act in 2012 and 2015-16]
While Tony Blair passed FOI then regretted it, Gordon Brown and David Cameron made strong speeches in favour of openness and pushed various transparency reforms. Cameron was especially committed to make his government the most open in the world, though in 2015 he set up an FOI Commission to restrict the Act and described the law as a ‘buggeration factor’.
So how about new Prime Minister May?
On the plus side, May as Home Secretary has supported and pushed the transparency within the UK anti-corruption agenda and was a key supporter of the long running Hillsborough campaign that exposed police corruption in the late 1980s. On a personal level she was quick to publish her own tax details. She has also extended FOI to the Police Federation and opened up police disciplinary hearings (though a cynic could argue that it is always easy to be transparent about your opponents).
On the minus side, May has been in the Home Office. Historically, the Home Office sunk many plans for greater openness. Recently it seems to have come a rather high third or so in the worst performing departments for FOI. This may, in part, be due to the often difficult and sensitive nature of some of the Home Office’s work.
May herself also has a less than liberal stance on various issues that runs against the idea of more openness: critics could well discern an authoritarian streak. She hasn’t always been transparent or accountable, seeking to hide Border Force cuts from Parliament in 2016 and, more famously, deflecting blame onto officials in 2011.
By far the biggest concern is over the repeated attempts on her watch to pass Investigatory powers legislation (aka ‘the Snoopers Charter’) that has led to ‘controversy around encryption, bulk data and hacking’and the right of various security services to carry out mass surveillance on the public. Serious privacy concerns have been raised by Parliament with the UN warning it not compliant with International law. May’s refusal, in response to an FOI request, to release her own internet search history led to a backlash from MPs.
Brexit and Beyond?
Brexit itself will soon become a huge transparency issue. There is an interesting debate about how much ‘information’ there was flowing in the referendum campaign itself, as this great blog post discusses. However, once negotiations begin there will be unprecedented pressure and scrutiny. Prime Minister May and the other 27 countries will probably argue for some secrecy in the delicate process but there will be a powerful case for more open door negotiations and, on a practical level, more leaks than you can imagine.
Here is the crux of the tricky debate between openness and closure. This fascinating study of the European Council of Ministers found openness can be good at regulating behaviour in negotiations but can encourage posturing or unnecessary ‘signalling’ to domestic audiences. Keeping discussions confidential will need to be balanced by a very difficult environment where the Leavers fear being ‘sold out’, Remainers hope for a messy compromise and the press and public demand to know what’s being done.
Looking further into the future, the impact of Brexit could get more complicated. Devolved bodies have already begun to innovate with their own openness policies, as the last NAP recognised. A set of devolved ‘plus’ institutions could easily make some very interesting regional variation in openness across the UK (if, of course, they all stay in the UK).
“Academic Days on Open Government Issues
Journées universitaires sur les enjeux du Gouvernement ouvert”.
December 5 & 6, 2016 – Paris, France
Under the direction of
Irène Bouhadana William Gilles
Call for Papers
On December 5 & 6, 2016, the University Paris 1 Panthéon-Sorbonne and IMODEV organize an international conference entitled “Academic Days on Open Government Issues”. This international event, under the direction of Irene Bouhadana and William Gilles, will be the 17th edition in a series ofIMODEV international conferences on the Law and Governance of the Information Society.These academic days will be organized during the week dedicated to the theme since France, as chair of Open Government Partership, will host the Open Government Global Summit in December 2016.
These Academic days aim to bring together all of academia concerned with issues related to open government by favoring a broad and multidisciplinary dimension. One of the goals of the open government process is to promote greater transparency and encourage citizen participation and collaboration in government decision-making, but also to promote government accountability. In this perspective, it is important to emphasize the role of citizens, civil society and stakeholders in decision-making to improve government policies.
see the details CFP long EN v7
Appel à contribution – Call for Papers
Les 5 et 6 décembre 2016, l’Université Paris 1 Panthéon-Sorbonne et l’IMODEV organiseront une conférence internationale intitulée « Academic Days on Open Government Issues – Journées universitaires sur les enjeux des gouvernements ouverts ». Sous la direction d’Irène Bouhadana et William Gilles, cette manifestation à caractère scientifique sera la 17e édition des conférences internationales de l’IMODEV sur le droit et la gouvernance de la société de l’information.
Ces journées universitaires seront organisées au cours de la semaine pendant laquelle la France accueillera le Sommet mondial 2016 sur les gouvernements ouverts. Cet événement a pour objectif de réunir l’ensemble du monde universitaire concerné par les enjeux relatifs aux gouvernements ouverts en privilégiant une dimension large et pluridisciplinaire.
L’un des objectifs du processus des gouvernements ouverts est de promouvoir une plus grande transparence, d’encourager la participation citoyenne et la collaboration dans la prise de décision gouvernementale, mais aussi de favoriser la responsabilisation du gouvernement. Dans cette perspective, il importe de mettre l’accent sur le rôle des citoyens, de la société civile, et des parties prenantes aux processus de décision pour améliorer les politiques gouvernementales.
On the 12 May the government launched its third open government National Action plan for the OGP. It’s an interesting mixture, so here’s a quick overview of what’s ongoing, what’s new and what’s not there:
Continuing: despite David Cameron’s own difficulties over tax, his push over international tax transparency and anti-corruption continues. Perhaps the most high profile reform from the last national action plan was over Beneficial Ownership, a plan to make UK registered businesses open up data about who (really) owns them through a public register. We shall all be able to see this data very soon.
The new plan extends this principle to foreign companies who are either (i) buying property (ii) bidding for public contacts in the UK-see commitment 1. This is partly about tackling ‘dirty money’ in the UK property market and also about reacting to the Panama Papers.
The devil here is, as ever, in the detail. The consultation paper admits that finding effective sanctions for foreign businesses may be difficult. Opening up tax is truly a global struggle and how the reform fares may also depend on others. David Cameron admitted the US needed to be part of his ‘coalition of the committed’. Closer to home it seems some of the UK’s own tax haven territories and overseas dependencies have been less than enthusiastic about linking up their own registers-the Caymans called it pointless. It remain to be seen whether super-rich foreign property investors will all flee London when the data appears.
It’s not the only policy to be carried over from the last NAP. Extractives Transparency and anti-corruption initiative are also still a part of the new plan. This series of international issues in the NAP may well be labelled David Cameron’s legacy policies.
Start: there are some new developments not seen in the last plan. Changes to the Freedom of Information Act, rather oddly absent last time round, are now included, with the new plan incorporating some of the recommendations from the Independent Commission on FOI, covering publication of data on FOI use and greater transparency over senior public sector salaries.
A rather nice ‘do they not do that already’? idea is commitment 7 to ‘develop a common data standard for reporting election results’. This could fit with some of the crowd-sourcing projects like Out for the Count that asked techy savvy election watchers to crowd-source the local and devolved election results in May 2016.
Stop: some areas are left untouched from the last plan. This table shows the commitments pushed by civil society and their status-the civil society network points to ‘open budgeting, lobbying transparency and transparency of surveillance’ as outstanding missing commitments. For me the lack of anything on surveillance is disappointing, while the seemingly never-to-be-resolved issue of lobbying and party funding transparency remains stuck. There’s no apparent movement on police records, despite recent controversy over the Hillsborough verdict on South Yorkshire police. However, all is not lost. The plan does offer new commitments that can to be added as it goes along: it is a ‘rolling action plan’ with the capability to ‘add commitments and milestones…over the next two years’.
Other welcome news is that Commitment 13 of the plan commits to ‘ongoing collaboration’ with local government and devolved bodies. The Northern Irish, Welsh and Scottish governments have already been pushing ahead with their own Open Data agendas while local government (and some soon to be local government powerhouses) such as Greater Manchester have been pushing a series of experiments. Perhaps the most positive part of the new plan is not what is happening but who will be involved.