We are repeatedly asked about potential conflicts of interest within Harrogate Borough Council (HBC) regarding the Harrogate Spring Water Limited (HSWL) planning application. HBC is of course planning authority and landowner. It also reported that the council has a continued financial interest in terms of revenue linked to turnover.
The majority of information is deemed to be confidential but what we know as below.
The lease between HBC and HSWL was taken out on 4th July 2002 for 125 years backdated to 25th March 2002. The price stated to have been paid on 7 November 2005 was £1,130,000. A copy of the lease can be downloaded as below.
Income to HBC
There is very little public information available and despite a number of FOI requests by a number of parties HBC will not share any details. There have been various mentions to branding fees, extraction fees but it is clear there is a payment made based on turnover of HSWL tothe council as confirm via a Freedom of Information Request (FOI).
We do know the Ground Rent revenue received by Harrogate Borough Council from Harrogate Spring Water Limited is around £13k per annum (2016 figure).
In relation to the “Turnover Rent Revenue”, Harrogate Borough Council holds this information. However, this information has been exempt from disclosure under sections 41 and 43 of the FOIA by the council.
A 2016 council briefing note on HSWL can be downloaded below.
Section 41 exemption – disclosure of the Turnover Rent revenue would be an actionable breach of confidence by Harrogate Spring Water Limited due to the confidentiality obligations set out in the lease arrangements. The provisions of the lease arrangements state that Harrogate Borough Council “…may not disclose the Turnover or any other information obtained….”
Section 43 exemption – disclosure of the Turnover Rent revenue would be likely to prejudice the commercial interests of Harrogate Spring Water Limited as the information requested is directly linked to its financial performance. Harrogate Spring Water Limited operates in a very competitive market and any information which is not normally available and would not be available from any private landlord could be commercially advantageous to its competitors and prejudicial to its own interests.
Disclosure on Negotiations
As expected negotiations between HSWL and HBC are continuing regarding the lease of the additional land and as can be expected details are currently not being shared. The council have made the following statements over recent months.
‘The council’s position on the commercial side of things has been throughout that as the disclosure of the negotiations around the lease are commercially sensitive both to ourselves and our tenant and as such we cannot disclose them.’
“It’s anticipated that once we have a form of agreement with HSW that any decision taken by the Council will be subject to public consultations taking place both for the ACV and the proposed disposal of Public Open Space. With no provisional agreement yet being in place with HSW, I do not have any projected dates for these consultations. As and when they do take place though, you will have an opportunity to make your representations.”
“We are under a common law duty of confidence obliged to protect the information as part of the negotiations. The information you request is not in the public domain nor is it trivial in nature. The withheld information consists of information which is of commercial value and, if disclosed, may impact the council’s ability to negotiate and harm the legitimate interest of the Council, putting it in a commercially disadvantageous situation. The exception being applied is - Environmental Information Regulation 12(5)(e) – Confidentiality of commercial or industrial information.”
We of course will continue to share information when made available.