Access to Information on Incorporated Public Services (FI0025)

To secure open and transparent decision-making the access to information principle will be widened to apply also to those public services that are produced in a company format.

3. Widening the access to information principle to public services that are incorporated.

Language of the commitment as it appears in the action plan:

“To secure open and transparent decision-making the access to information principle will be widened to apply also to those public services that are produced in a company format.”^{[Note : Finland National Action Plan 2017-2019 (in English), https://www.opengovpartnership.org/documents/finland-national-action-plan-2017-2019-all-languages/.]}

Start Date: Not identified             

End Date: Not identified

Context and Objectives

This commitment seeks to ensure open and transparent decision-making in cases in which public services are produced in company format, as opposed to public services that are produced by government-run agencies. The pilot plans for Regional Government, Health and Social Services Reform include elements that indicate an increase in the role of public-private partnerships in the production of public services, making this commitment timely. This commitment addresses real concerns surrounding efficacy in the use of public funds, openness, and transparency.^{[Note : Satu Grekin, Head of Business and Competition Affairs, The Federation of Finnish Enterprises. Email interview 11.02.2019.]} In 2013, the Finnish government approved amendments to the so-called municipal (HE 32/2013)^{[Note : Finlex, HE 32/2013, https://www.finlex.fi/fi/esitykset/he/2013/20130032.]} and competition (HE 40/2013) laws^{[Note : Finlex, HE 40/2013, https://www.finlex.fi/fi/esitykset/he/2013/20130040.]} with the aim of improving competitive neutrality, in other words, to level the playing field between state-owned and private businesses. The amendments were prompted by two remarks by the European Commission in 2006 and 2010 concerning the distorting effect on free market competition that municipal enterprises like Destia (road and rail construction) and Palmia (food, real estate, cleaning, security and office space services) were causing in Finland. The amended municipal law obligates municipalities to incorporate their activities when said activities are conducted in a competitive market. The term “to incorporate” means the formation of a new corporation, which in turn means that its activities come to be conducted under the Limited Liability Companies Act. Because of this, the transition created new problems regarding transparency in the use of public funds. In 2016, a municipally owned construction company Länsimetro Oy did not disclose documents relating to a major expansion of the Helsinki Metro, invoking trade secret privilege, meaning that public officials did not receive up-to-date information on major delays and overspending.^{[Note : Länsimetro salaa raportin kustannuksista ja viivästyksistä – taustalla oikeusoppineiden varovaisuus. 13.4.2017 https://yle.fi/uutiset/3-9565887. Kirsi Väätämöinen, Lawyer, SOSTE Finnish Federation for Social Affairs and Health. Email interview 19.02.2019.]}

The access to information principle^{[Note : 12.4. Access to Information principle, http://lainkirjoittaja.finlex.fi/12-yleislait-ja-eraat-yleiset-saantelyt/12-4/.]} obliges Finnish public administration to make meeting minutes and documents relating to decision-making both publicly available and accessible. However, the access to information principle is currently interpreted as encompassing only government administration activities, and it does not consider incorporated activities. The conducting of government activities through or within limited liability companies “diminishes the transparency required for the use of public funds as well as the transparency of decision-making.”^{[Note : Ministry of Justice, consultation 6.3.2017, p. 30, https://avoinhallinto.fi/assets/files/2017/06/Lausuntoyhteenveto-III-toimintaohjelma.pdf.]} Therefore, the commitment seeks to extend the access to information principle beyond its current scope to cover at least some company-format actors that produce public services.^{[Note : “Social and health reform enterprises to be part of the access to information law.” YLE News, published 13.8.2016, accessed 13.11.2018, https://yle.fi/uutiet/3-9091215.]}

During the consultation period of the action plan, several CSOs remarked that the commitment lacks a responsible institution, information on a working group, and a clear schedule.^{[Note : Summary of comments on Finland’s third national action plan submitted during the consultation period 2 February –3 March 2017, p.30-38, https://avoinhallinto.fi/assets/files/2017/06/Lausuntoyhteenveto-III-toimintaohjelma.pdf.]} If implemented, the commitment could have a high potential impact in preventing corruption and the misuse of public funds. However, although the commitment is timely, it does not directly address situations in which public services are outsourced to privately owned companies.^{[Note : Kirsi Väätämöinen, Lawyer, SOSTE Finnish Federation for Social Affairs and Health. Email interview 19.02.2019.]} A representative of Transparency International Finland was also concerned that the access to information principle would still not prevent companies from invoking trade secret privilege to conceal their procurement processes.^{[Note : Tommi Niinimäki, Chairperson of Transparency International Finland, consultation 3.3.2017, ibid. p. 31.]}

It should be noted that due to the uncertain status of the Regional Government, Health and Social Services Reform, the ultimate impact of this commitment is difficult to assess.^{[Note : Kirsi Väätämöinen, Lawyer, SOSTE Finnish Federation for Social Affairs and Health. Email interview 19.02.2019.]} Whether the implementation of this commitment requires a change in law is currently under review by the Ministry of Justice.^{[Note : Johanna Nurmi, Ministerial Adviser, Ministry of Finance (Finland). Email interview 26.02.2019.]} This review was scheduled to be completed by the end of 2018, but the Ministry of Justice had not completed it as of February 2019.^{[Note : Ibid.]} Applying the access to information principle to company-format publicly owned companies could place publicly owned companies at a strategic disadvantage in the marketplace if privately owned companies lack similar standards of accountability as providers of outsourced public services. This might violate competition neutrality.^{[Note : Kirsi Väätämöinen, Lawyer, SOSTE Finnish Federation for Social Affairs and Health. Email interview 19.02.2019.]}

Next steps
Due to the likely increase in company-format public services caused by the upcoming Regional Government, Health and Social Services Reform,^{[Note : For more information on the Regional Government, Health and Social Services Reform, please see
https://alueuudistus.fi/en/frontpage.]} the commitment’s aim to expand openness and transparency for these operators is well timed. The government could identify the responsible institution and deadline for this commitment to improve its specificity.

The IRM researcher recommends that:

• The government ensure that the review by the Ministry of Justice is carried through;
• The government provide clarification as to whether outsourced public services produced by privately owned businesses are included in the scope of the commitment;
• Due to a likely increase in public-private partnerships and company-format public services in the production of public services Regional Government, Health and Social Services Reform on the way in which public services are to be provided, it might be worth extending this commitment to cover several action plans.

3. Widening the access to information principle to public services that are incorporated.

Language of the commitment as it appears in the action plan:

“To secure open and transparent decision-making the access to information principle will be widened to apply also to those public services that are produced in a company format.” [20]

Start Date: Not identified

End Date: Not identified

This commitment aimed to address an accountability deficit caused by the increase of public-private partnerships in the provision of public services by extending the so-called access to information principle beyond its current scope. The access to information principle (Act on the Openness of Government Activities, Section 1) obliges Finnish public administration to make documents relating to decision making publicly available. This commitment sought to expand this principle to cover public services that are produced by corporate entities owned or controlled by the public sector, as opposed to services that are produced by public agencies themselves, which already fall within the ambit of the access to information principle. [21]

This commitment was not completed during the implementation period, as the implementation required legislative change. In June 2019, the Ministry of Justice published a 214-page report regarding the expansion of the Act on the Openness of Government Activities. [22] The report outlines three possible models to amend the Act to meet the aims of this commitment (narrow, basic, and extended models). In June 2019, the Finnish government committed to assessing “whether the scope of application of the Act should be broadened to cover legal entities owned or controlled by the public sector”. [23]

Whether this commitment will result in concrete changes in government practice cannot be determined at this time. The publication of the government report and the partial inclusion of this commitment in the government program mark positive but limited steps. Because these measures do not amount to changes in legislation or government practice, the commitment did not open government during the implementation period.