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The Office of the Ombudsman (and Information Commissioner) - Recent Significant Developments

Speech by Ombudsman and Information Commissioner Peter Tyndall at Meeting of Chartered Accountants andInternal Auditors Working in the Public Sector, 29 September 2015

Thank you for the invitation to speak to you here today. I took on the role of Ombudsman and Information Commissioner in December 2013 following the election of my immediate predecessor, Emily O'Reilly as European Ombudsman. Prior to my appointment I was Public Services Ombudsman for Wales from 2007.

In my presentation I want to give you an overview of recent significant developments in the Ombudsman’s area which have led to the widening of the remit of my Office and the strengthening of its powers. I also want to flag a number of issues which may lead to further changes in the foreseeable future not only within my Office but in the wider public administration landscape as a result of proposals I have put into the public domain. 

As regards FOI, I will provide a very brief overview of the changes introduced by the Freedom of Information Act 2014 and I will touch on some aspects of FOI which I think may be of particular interest to you as accountants and auditors.

Put at its simplest, the role of the Ombudsman is to examine complaints about the administrative actions of the bodies under his or her remit, known in the legislation as reviewable agencies. If the Ombudsman finds in any given case that the complainant has been treated unfairly or improperly and has been adversely affected as a result then he or she will suggest an appropriate redress to remedy, mitigate or alter the adverse affect suffered. In dealing with and resolving individual complaints the Ombudsman will strive to bring about improvements in administration based on lessons learned from individual complaints.

The basic legislation which underpins the work of my Office is the Ombudsman Act 1980. The 1980 Act has been the subject of many minor amendments over the years but the legislation was changed significantly following the enactment of the Ombudsman (Amendment) Act 2012. It is the Department of Public Expenditure and Reform (DPER) which is responsible for overseeing the Ombudsman legislation. However, in this regard I want to acknowledge the significant efforts made by Emily O'Reilly to ensure that the amending legislation was brought forward. Once DPER recognised the need for the amendment it also committed time and resources to facilitate the passing of the 2012 Act.

That Act marked a major step forward in the development of the office. It saw an extension of our remit to cover the administrative actions of around 200 additional reviewable agencies who are now subject to examination by the Ombudsman, including all publicly funded third level education institutions, and VECs (now known as Education Training Boards), and Student Universal Support Ireland (SUSI), bodies such as FAS (now known as Solas) , HIQA and the National Transport Authority, and certain functions of some agencies such as the Legal Aid Board  and the Courts Service.

The relationship between an Ombudsman and Parliament is pivotal and it is important that that relationship is clearly defined in statute. Under the 1980 Act I am obliged to report annually to the Houses of the Oireachtas on the carrying out of my functions. I can also lay investigation reports or Special Reports before the Houses of the Oireachtas as I see fit. A Special Report is laid when a public body does not, in the opinion of the Ombudsman, give a satisfactory response to an Ombudsman recommendation contained in an investigation report. This rarely occurs, in fact in the 31 years that the Office has been operating only 4 Special Reports have been published. However, a weakness in the 1980 Act was that the Act was silent on what can or should happen after the laying of a Special Report or other reports.

Importantly, under the 2012 Act the Ombudsman's relationship with Parliament was greatly strengthened by a provision whereby the Minister Public Expenditure and Reform can designate a committee of the Houses to receive Ombudsman reports. This ensures that there is follow up action when the Ombudsman considers that a public body has not responded satisfactorily to an Ombudsman recommendation. The Committee on Public Service Oversight and Petitions (PSOP) fulfils this role at present. In my time as Ombudsman I have not found it necessary to publish a Special Report but my immediate predecessor laid two Special Reports before PSOP because the Motorised Transport Grant Scheme and the Mobility Allowance Scheme were in breach of Equal Status legislation. PSOP called in senior officials from the Department of Health, the then Minister for Health and senior officials from the Health Service Executive and a number of public hearings were held. Arising from this new legislation is being planned to replace the illegal schemes.

The 2012 Act now places a duty on reviewable agencies to provide reasonable assistance and guidance to the public to ensure that they are dealt with fairly and impartially, and to provide information on any rights of appeal or review they may have, including their right to go to the Ombudsman if they are unhappy about a decision of a reviewable agency. The Amendment Act also provides that I can now apply, through the Circuit Court, for an order directing that a reviewable agency provide information or documents to the Ombudsman – previously there had been no legal obligation to do so. The Ombudsman may also now seek clarification on the interpretation of questions of law from the High Court where it is considered necessary, for example, if a certain provision is unclear or if a public body’s interpretation differs from that of the Ombudsman.

A further important provision in the 2012 Act enables the Minister for Public Expenditure and Reform to declare by Ministerial Order that an entity should become a reviewable agency if that entity is publicly financed wholly or partly, directly or indirectly. The Minister used that power for the first time in recent months when he issued SI 300 of 2015 which declared private nursing homes to be reviewable agencies. My Office already had jurisdiction over public nursing homes. Almost all private nursing homes get public funding through the Fair Deal scheme which enabled the Minister to issue the SI. This means that any resident of a private nursing home, or persons acting on their behalf, can complain to my Office. I can only deal with complaints regarding actions which occur on or after 24 August 2015. There are almost four hundred and thirty private nursing homes throughout the country with over 22,000 residents.

The SI prevents me from looking at complaints against private nursing homes where the action complained of relates solely to a clinical judgement decision. This replicates a similar exclusion which applies in the case of public nursing homes and hospitals. I should say that I have argued that this constraint should be removed and I understand that the Minister for Health is undertaking a review of this matter in consultation with the Department of Public Expenditure and Reform and other interested parties. The Northern Ireland Ombudsman, the UK Parliamentary Ombudsman and many other Ombudsman Offices have unfettered jurisdiction in the area of clinical judgement.

Private nursing homes operate their own local complaints systems under a statutory framework. However, in an effort to promote best practice and a consistent approach to local complaint handling my Office has rolled out a model complaints system for private nursing homes. This system underpins and complements the statutory framework. In recent weeks my Office has also run briefing sessions for private nursing homes throughout the country to explain the role of my Office and how the model complaints system should operate. I plan to roll out the model in other sectors over time.

A further remit related matter has also been the subject of some considerable public debate is the disputed question of my Office's jurisdiction in the area of asylum and immigration.

A provision in the 2012 Act, which mirrors a similar more general constraint set out in the 1980 Act, prevents my Office from examining complaints about actions taken by the Department of Justice in (and I quote) "...the administration of the law relating to immigration or naturalisation...". Precisely what this constraint should or should not encompass in has been a matter of dispute between my Office and the Department of Justice over the years. For instance, if a resident in a direct provision centre complains to my Office about the standard of accommodation being provided am I legally prevented from taking such a complaint or not? In my view I am not at present precluded from taking such complaints but this is disputed by the Department. A similar dispute has arisen between the Department and the Office of the Ombudsman for Children. My Office is one of the few Ombudsmen Offices in Europe whose jurisdiction is restricted in the area of asylum and immigration matters. In my view this restriction is unwarranted and the full range of administrative actions in this area should be subject to unambiguous examination by my Office. The lack of such truly independent oversight serves to diminish the rights of direct provision residents and makes them more isolated and vulnerable compared to other members of the public who can come to the Ombudsman to complain about other public bodies when they believe they have been treated unfairly or improperly.

There has been some significant developments around this issue. Firstly, towards the end of 2014 in a High Court judgment by Mr Justice Colm Mac Eochaidh he was very critical of the current local complaints systems operating within the direct provision system and said there was no compelling reason why the Reception and Integration Agency (which oversees the direct provision system) must be the final complaints handling body for residents. He considered the current complaints process to be illegal.

Earlier this year, the Department of Justice and Equality set up  a Working Group on the Protection Process and the Direct Provision System under the chairmanship of Mr Justice Bryan McMahon. I met with Justice McMahon, along with the Ombudsman for Children and senior officials from both our offices. We also made a joint submission to the Working Group. The Working Group has recommended that the two Ombudsman Offices should have the remit over complaints relating to services provided to residents of direct provision centres, including transfer decisions following a breach of the House Rules governing such centres. A Task Force has been put in place to examine the implementation of some key aspects of the Working Group Report.

In a separate development, in May of this year, PSOP published a comprehensive and hard hitting report on the direct provision system in Ireland and called for unambiguous remit to be granted to my Office in this area. I am hoping that these developments will lead to the appropriate amendment to my jurisdiction and I plan to engage directly with the Department of Justice and Equality about the matter.

Freedom of Information

I will turn now to Freedom of Information and to my role as Information Commissioner.  As Information Commissioner I review decisions made by FOI bodies under the Freedom of Information Act.  I also keep the operation of the Act under review and I may, at any time, carry out an investigation into the practices and procedures of FOI bodies.  I am independent in the performance of my functions. 

2014 Act Changes

As you may be aware, the FOI regime was changed significantly last year by the passing of the FOI Act 2014.  This Act repealed and replaced the FOI Acts 1997 and 2003. 

The 2014 Act has extended FOI to a range of new bodies including, for example, bodies such as Student Universal Support Ireland (SUSI).  A number of bodies are now partially included under FOI, for example, the Central Bank, the NTMA  and NAMA. 

The new Act has also reversed many of the amendments which had been introduced in 2003 and which had seriously curtailed the 1997 Act.  Up-front fees are no longer payable at the time an initial request is made to an FOI body.  They are now payable only with regard to an application for internal review and an application for review to my Office and those fees are themselves reduced. 

The FOI Act 2014 also imposes an obligation on all FOI bodies to create and maintain a publication scheme.  The purpose of the publication scheme is to encourage public bodies to proactively publish as much information as possible and thus to reduce the number of FOI requests made by already having the information publicly available.  As Minister Howlin noted in a recent press release:

“FOI bodies should publish as much information as possible in an open and accessible manner on a routine basis outside of FOI, having regard to the principles of openness, transparency and accountability as set out in the Act.”

The publication scheme is intended to incorporate the old provisions of sections 15 and 16 of the 1997-2003 FOI Act which included publishing information such as the description of the organisation; the classes of records it held; how those records could be accessed; who to contact for such access; the address at which such requests could be made; review procedures; the rules, practices and procedures of the body and appropriate information about its administration.  A draft model publication scheme for use by all FOI bodies is currently being prepared by DPER and is now available for public consultation.

The Act also specifies that FOI bodies must have regard to certain matters in performing any of their functions under the Act.  It expressly refers to the need to achieve greater openness in their activities and to promote adherence to the principle of transparency in government and public affairs; the need to strengthen the accountability and improve the quality of decision making of FOI bodies; and the need to inform scrutiny, discussion, comment and review by the public of activities of FOI bodies.  No doubt, words like “accountability”, “transparency” and “scrutiny” are words with which you are very familiar.

I would mention another interesting provision of the newAct.  Section 15(1)(g) provides that an FOI body may refuse to grant a request where it intends to publish the record not later than six weeks after receipt of the request.  Again, this points to the possibility of a more proactive approach to the publication and release of information by FOI bodies.

Exemptions Most Likely to be Relevant to the Audit/Accounting Sector

Most of the exemptions in the FOI Act which are likely to be of the greatest relevance in relation to accounting and audit records have not changed substantially with the passing of the 2014 Act. 

Section 30(1)(a) of the 2014 Act provides that access to a record may be refused where access could reasonably be expected to prejudice the effectiveness of tests, inquiries or audits conducted by an FOI body or on its behalf.  This exemption is known as a harm-based exemption – in other words, it is based on the expectation of a prejudice or harm arising from disclosure.  It is also subject to a public interest test, or what is sometimes referred to as a public interest override – that is, that the exemption does not apply where, on balance, the public interest would be better served by granting the request than by refusing it.  This is the exemption which, on the face of it, would relate most directly to audit records and it has remained largely unchanged under the new Act. 

Section 40 concerns the financial and economic interests of the State and provides that access may be refused where it could reasonably be expected to have serious, adverse effect on the ability of the Government to manage the national economy or on the financial interests of the State.  The exemption may also apply where premature disclosure is expected to result in undue disturbance of the ordinary course of business generally.  The 2014 Act introduced a new provision in this exemption which provides that access may be refused where it could reasonably be expected to have a negative impact on decisions by enterprises to invest or expand in the State, on their research activities or on the effectiveness of the industrial development strategy of the State, particularly in relation to the strategies of other states.  Section 40, like section 30, is again a harm-based exemption and is subject to a public interest test.

Another exemption which has sometimes been invoked in relation to records of this nature relates to the deliberations of FOI bodies, now section 29 of the FOI Act 2014.  It provides that access may be refused if the record contains matter relating to the deliberative processes of an FOI body.  This provision is now similar to (although not the same as) the original provision in the 1997 Act (section 20 of that Act) but is significantly different from section 20 after it was amended in 2003.  Importantly, it will only apply if granting access would be contrary to the public interest. 

Other exemptions in the Act may possibly be relevant depending on the facts and circumstances of the case.  For example, there are exemptions for information obtained in confidence (section 35), for commercially sensitive information (section 36) and for personal information (section 37).

I should, of course, also mention that section 42 of the Act provides that the Act does not apply to a record relating to an audit, inspection, investigation or examination carried out by the Comptroller and Auditor General other than a record that was created before the commencement of the investigation, audit, etc or a record relating to the general administration of his Office.  This is similar to the exclusion from the Act which existed previously for C&AG records.

It is also important to bear in mind that records held by a service provider are deemed to be held by the FOI body in so far as they relate to the service.  Indeed the FOI Act states that there shall be deemed to be included in the contract for the service a provision that the service provider shall, if requested by the FOI body, give the record to the FOI body for retention by it for a reasonable period. This is not a new provision.  However, the 2014 Act has introduced within the definition of ‘service provider’ that a ‘contract for services’ includes an administrative arrangement between an FOI body and another person.

Some of my Decisions which may be Relevant

I will now turn to some decisions of my Office which may be of particular interest to you all here today.  Both I and my predecessors have had occasion to review decisions of public bodies concerning the granting of access to records which related to audits, inquiries and reviews.  Many of you will probably be familiar with the approach that my Office has taken to such records and, for example, to records relating to tender competitions. 

As you will recall from my earlier reference to it, section 30 of the Act provides that access to a record may be refused where access to the record could reasonably be expected to prejudice the effectiveness of tests, inquiries or audits.  The key issue for an FOI body to understand in this regard is that, if it is relying on this exemption, it should identify the potential harm to the relevant function that might arise from disclosure and, having identified that harm, it should consider the reasonableness of any expectation that the harm will occur.  It is important for FOI bodies to realise that they should explain how and why release of the record could reasonably be expected to result in the harm envisaged.  Any argument should be made in light of the contents of the particular record concerned and the relevant facts and circumstances of the case.  Thus, in the context of section 30, a claim for exemption which is class-based is not sustainable, for example, a claim for exemption for ‘any’ audit report. 

It may be helpful if I give a few examples of what I mean here by ‘identifying the harm’.  In an early decision by the first Information Commissioner, Kevin Murphy, the Revenue Commissioners identified the potential harm envisaged as a reduction in the effectiveness of its selection process for audit cases which would make it less likely that the process would achieve its purpose of identifying cases where there was a higher probability than normal of an incorrect return.  My predecessor found that this would constitute prejudice to a method employed for the conduct of audits.  (Case 99199).

I might also mention another Revenue case, this time as an example of how Revenue showed that the harm could reasonably be expected to occur.  The records related to a Revenue audit and opinion and Revenue had identified the harm as prejudice to the effectiveness of other investigations then in progress.  While Revenue accepted that the investigation in relation to the applicant for review had concluded, it was engaged in the investigation of about 100 other parties involving broadly similar tax arrangements.  The records contained information which showed how the Revenue carried out its investigations in the case of the applicant, strategies for carrying out its enquiries and internal discussions or observations on the outcome of such enquiries and the identification of potential courses of action.  My predecessor found that the records contained information which would be of significant assistance to taxpayers subject to similar investigations, allowing them to predict the likely trend of Revenue enquiries and to prepare themselves in advance to deal with such enquiries.  He found that putting such taxpayers in this advantageous position could reasonably be expected to prejudice the effectiveness of the investigations involving them.  (Case 99232).

Turning to some more recent cases, I would mention a case decided last year which concerned internal audit reports of the Department of Justice and Equality.  Some of the records in that case included information which related to payroll overpayments and salary recoupment.  The case was dealt with under the old Act and the Department claimed that, what is now, section 40(1)(a) applied  -  this exemption provides that access to a record may be refused if access "could reasonably be expected to have a serious adverse affect on the financial interests of the State.....". The onus was on the Department to identify any potential serious adverse effect on the financial interests of the State. The number of incidents of overpayments reported was 100. However, other information available showed that the relevant number of staff being paid by the Department was over 6,000. The information demonstrated that overpayments arose in a very small proportion of cases and that the overpayments and reasons for them were identified and, therefore, steps could be taken to recover the overpayments.  My delegated officer could not see how the release of this information would give rise to a "serious adverse affect on the financial interests of the State" and she found that the exemption did not apply to this information.  (Case 120202)

The Department also claimed in the same case that release of information on control processes and any weaknesses identified in the report could be used to further breach controls and weaken financial and audit processes and bring loss to the State. However, my delegated officer found that the fact that weaknesses were identified and the report made it clear that steps were being taken to address any such weaknesses was evidence that the control processes work and that any breaches were rectified.

On the other hand, in a case decided in July of this year my Office considered certain records relating to a review carried out by the HSE.  A service provider to the HSE was under a contract for service and in July 2013 the HSE discontinued funding. According to the HSE, it received allegations about misappropriation of monies provided from exchequer funds and also other management issues involving members of the service provider and its staff. The HSE appointed two external investigators to carry out a review. 

Some of the information in the records was found to be personal information about individuals and was found to be exempt under the relevant exemption for personal information. 

The HSE had also relied on, what is now, section 30(1)(a) which I referred to earlier – it allows a public body, subject to consideration of the public interest, to refuse to grant a request for records if access to the record concerned could reasonably be expected to prejudice the effectiveness of tests, examinations, investigations, inquiries or audits conducted by or on behalf of the public body or the procedures or methods employed for the conduct thereof.  According to the HSE, the review of the governance and structures of the service provider was not completed due to the inability of the reviewers to interview certain people individually.  Despite the passage of time, it appeared that the HSE intended to pursue investigations or audits into irregularities.  It also contended that the subject matter was sensitive with potentially serious implications for some individuals and it claimed that people were very reluctant to come forward with information.  It was the view of the HSE that releasing any information about the concerns identified by the reviewers might result in parties seeking to obstruct the process of investigation and that releasing this information could result in difficulties in data gathering for future reviewers or potentially, an Garda Síochána.   My delegated officer found that some, but not all, information, if released, could reasonably be expected to prejudice the effectiveness of the HSE's investigation or audit. She also found that, on balance, the public interest would not be better served by granting access to that information.  (Case 140099).

As you will, no doubt, gather from this discussion here today, the issues are not black and white.  There are no easy answers.  Decisions in cases dealt with by me and my Office will always depend on the particular facts and circumstances.  Any FOI body relying on what is known as a harm based exemption in a case before my Office should identify the potential harm that might arise from disclosure and, having identified that harm, consider the reasonableness of any expectation that the harm will occur.  It is important to remember, particularly with regard to the expenditure of public money that transparency and accountability are key public interest factors.  At the end of the day, this is tax payer’s money.

All of the decisions in the cases I have mentioned may be found on the website of my Office – www.oic.gov.ie.  I would also mention that I am in the process of preparing a set of Guidance Notes in relation to various provisions of the FOI Act.  The Notes give a short commentary on my interpretation and application of the Act and are intended to provide a brief summary of the relevant issues relating to the provision.  A number of these are already available on my website, including a Guidance Note on section 30 which I have referred to earlier.  Further Notes will be published shortly. 

Further information:

Office of the Information Commissioner, 18 Lower Leeson Street, Dublin 2

communications@ombudsman.gov.ie