Economic Interest in Co-Working Facilities

Summary

The requester asked for details on Department for Enterprise investments, subsidies, and financial support for co-working facilities on the Isle of Man. The Department disclosed information already published under the Enterprise Act 2008 and regarding Barclays Eagle Labs, but withheld specific details on other facilities citing economic prejudice.

Key Facts

• The request was received on 2022-06-21 and the response was issued on 2022-07-19.
• Information regarding Barclays Eagle Labs was disclosed as part of the response.
• The Department administers a Financial Assistance Scheme covering capital expenditure, rent, and employee relocation.
• Specific details on grants and investments for other co-working facilities were withheld.
• The Department argued that disclosure would provide competitor jurisdictions with a commercial advantage.

Data Disclosed

• 2022-06-21
• 2022-07-19
• 2505169
• section 6 of the Enterprise Act 2008
• section 30 of the Act
• last 10 years

Exemptions Cited

• Section 30 of the Freedom of Information Act (prejudice to economic interests, financial interests, or ability to manage the national economy)

Original Request

Please detail any and all DfE investment and any ongoing subsidy or financial support/incentive provided to co-working facilities on the Isle of Man. The list of co-working facilities should cover all such facilities on Island as shown on the the Locate website: https://www.locate.im/articles/shared-and-co-work-spaces-in-the-isle-of-man Information to include: 1) Any long term investments of any form in any co-working facility. This could include - shareholding, bond, loan or any other form of longer term capital investment (name of co-working facility, number of shares, type of shares, nominal value of shares, amount paid for shares, percentage of share capital held, when investment was made, description of bond/loan, value of bond/loan, bond/loan repayment schedule); 2) Any shorter term investments in co-working facilities together with their form, value, when the investment was made and the terms of repayment; 3) Any grants, subsidies or financial/tax incentives made to co-working facilities in the last 10 years (name of facility, type of grant/subsidy/incentive, date funds were provided, value of funds, the reason funds were provided and any terms and conditions for repayment);

Data Tables (1)

Full Response Text

Freedom of Information Co-ordinator 1st Floor, St Georges Court Upper Church Street, Douglas Isle of Man IM1 1EX

Telephone: (01624 686400) Website: https://www.iomdfenterprise.im/

Our ref: 2505169 19 July 2022

We write further to your request which was received on 21 June 2022 and which states:

"Please detail any and all DfE investment and any ongoing subsidy or financial support/incentive provided to co-working facilities on the Isle of Man. The list of co- working facilities should cover all such facilities on Island as shown on the the Locate website:

https://www.locate.im/articles/shared-and-co-work-spaces-in-the-isle-of-man

Information to include:

1) Any long term investments of any form in any co-working facility. This could include - shareholding, bond, loan or any other form of longer term capital investment (name of co-working facility, number of shares, type of shares, nominal value of shares, amount paid for shares, percentage of share capital held, when investment was made, description of bond/loan, value of bond/loan, bond/loan repayment schedule);

2) Any shorter term investments in co-working facilities together with their form, value, when the investment was made and the terms of repayment;

3) Any grants, subsidies or financial/tax incentives made to co-working facilities in the last 10 years (name of facility, type of grant/subsidy/incentive, date funds were provided, value of funds, the reason funds were provided and any terms and conditions for repayment);"

Our response to your request is as follows:

Qualified Exemption. In relation to some of the information you are requesting, beyond that information already published by the Department, namely the information released annually under section 6 of the Enterprise Act 20081 and information specifically relating to the

1 https://www.iomdfenterprise.im/enterprise-act-2008-annual-reports/

arrangement in respect of Barclays Eagle Labs, the Department is refusing to disclose information on the basis that a qualified exemption in section 30 of the Act is engaged and it would be contrary to the public interest if this information is disclosed.

Section 30(1) states that information is qualified exempt information if its disclosure would or would be likely to prejudice:

(a) the economic interests of the Island;

(b) the financial interests of the Island; or

(c) the ability of the government to manage the national economy.

Assessment of s30(1)

A disclosure of information under the Act is deemed to be a disclosure to the world rather than a disclosure to an individual requestor. Furthermore, requests for information should be treated on an applicant blind basis.

The Department administers the Financial Assistance Scheme which can provide a range of financial assistance to eligible businesses including capital expenditure, rent, first year expenses, marketing, energy efficiency and employee relocation incentives (where a business needs to relocate specialist off-Island workers).

In offering assistance under the Scheme the Department assesses the eligibility of the applicant, utilising information provided in a business plan, business financials, the management team structure and other information the Department may request in order to appraise the application.

The final appraisal takes into account any local competition considerations and also the indirect revenue that Government will receive as a result of the businesses relocating to the Island, including job creation, to ensure value for money and that all businesses add value to the economy.

Disclosure of the information would provide competitor jurisdictions and their development agencies with a significant commercial advantage over the Island. The Department has not been able to find examples of this type of information being either publically available, or disclosed through a relevant Freedom of Information request. It is the view of the Department that disclosure of this information, would be likely to directly prejudice the economic and financial interests of the Island and the ability of government to manage the national economy for the following reasons:

• Disclosure of the information would be likely to prejudice the ability of the Island to attract new and retain existing businesses by providing competitor jurisdictions with a significant advantage of knowing the levels of incentives offered. Allowing other jurisdictions to effectively undermine the ability of the Department to attract relocating and retain existing businesses by offering greater incentives.

• This would undermine the national economy, either reducing the ability to attract new business and associated jobs, leading to economic stagnation or decline and damaging the ability to maintain a competitive market across multiple sectors, removing the ability to maintain sound public finances and an efficient tax and benefits system;

• Thereby impacting directly on the efficient administration of government finances in minimising the cost to the taxpayer, would be likely to increase the long term cost to the taxpayer and have significant impact on the Island’s population;

• Disclosure of the information would be likely to directly impact on the commercial interests of a business in receipt of financial assistance, thereby removing any commercial reason for remaining on the Island, leading to a relocation to another jurisdiction (whether offering incentives or not) and the impact this loss would have on the economy of the Island. Section 30(1) are qualified exemptions and therefore it is subject to the public interest test. The public interest must be something that is of serious concern to the public at large.

Factors in favour of disclosing the information include:

• That the release of this information would provide some insight into the one of the processes used to maintain the economic and financial stability of the Island, which may increase public confidence in the process;

• Disclosure would promote increased transparency and provide insight and better understanding of the cost of maintaining a stable economic footing in a small jurisdiction in what is a competitive marketplace. Factors in favour of maintaining the exemption include:

• The national economy of the Island is sensitive to small changes in the business market, disclosure of this information would be likely to impact on the Islands ability to incentivise inward investment, thereby impacting directly on new and potentially existing employment opportunities;

• Protecting the ability to offer incentives that are sufficiently attractive to allow relocation and retention of businesses, but are also value for money that are not available to competitors;

• Protecting the effective and efficient administration of government finances and minimising the cost to the taxpayer, by ensuring a vibrant and growing economic environment is maintained;

• Ensuring the Island continues to be able to provide a range of financial assistance, guidance and support to those businesses which are interested in relocating to the Island, and in turn the additional employment opportunities and exchequer benefit provided by such businesses.

In assessing the weight to be attributed to each aspect of these arguments the Department has considered that the information to which this request relates is still relevant to the economy and finances of the Island, disclosure would not only prejudice those areas, but also the ability of government to manage the national economy for the good of all Island residents.

Disclosure of the information will not assist any increased public understanding of the matter and there is no similar information already in the public domain, with the exception of the information previously disclosed in relation to support for Barclays Eagle Lab. The Department therefore concludes that the risk of harm from disclosure outweighs any benefit that could be gained by the general public by the information being disclosed.

The Department has previously responded to Freedom of Information requests in respect of the joint agreement between the Department, Isle of Man Chamber of Commerce and Barclays Bank relevant to the establishment of Barclays Eagle Lab (FoI Ref’s: 824965, 829565, 1507665 and 2281885). Given the nature of this agreement and the fact that support was provided by way of a financial guarantee over a period of 5 years, the Department views that there is a greater public interest in disclosing information relating to this arrangement and, therefore, a qualified exemption is not justified.

As such, the Department can confirm that to date, a total of £261,605.54 has been paid in financial support in respect of the establishment and ongoing operation of Barclays Eagle Lab.

Please quote the reference number 2505169 in any future communications.

Your right to request a review

If you are unhappy with this response to your freedom of information request, you may ask us to carry out an internal review of the response, by completing a complaint form and submitting it electronically or by delivery/post.

An electronic version of our complaint form can be found by going to our website at https://services.gov.im/freedom-of-information/Review . If you would like a paper version of our complaint form to be sent to you by post, please contact me and I will be happy to arrange for this. Your review request should explain why you are dissatisfied with this response, and should be made as soon as practicable. We will respond as soon as the review has been concluded.

If you are not satisfied with the result of the review, you then have the right to appeal to the Information Commissioner for a decision on;

1. Whether we have responded to your request for information in accordance with Part 2 of the Freedom of Information Act 2015; or
2. Whether we are justified in refusing to give you the information requested.
   In response to an application for review, the Information Commissioner may, at any time, attempt to resolve a matter by negotiation, conciliation, mediation or another form of alternative dispute resolution and will have regard to any outcome of this in making any subsequent decision. More detailed information on your right to a review can be found on the Information Commissioner’s website at www.inforights.im. Should you have any queries concerning this letter, please do not hesitate to contact me. Further information about freedom of information requests can be found at www.gov.im/foi.

I will now close your request as of this date.

Yours sincerely

Freedom of Information Officer