The High Court has upheld the decision of the Administrative Appeals Tribunal to deny The Australian access to politically delicate documents in a three-two decision this morning.

Freedom of Information Editor Michael McKinnon sought to obtain information on matters including personal taxation bracket creep and the number of wealthy Australians claiming the first home buyer’s grant.

His request was denied by Treasurer Peter Costello, who personally issued a conclusive certificate preventing their release and declared that producing the documents would be contrary to the public interest.

McKinnon argued that the AAT should have considered competing aspects of the public interest in making its decision. The High Court has ruled that the Tribunal is not permitted to do so but instead was required to find if there were reasonable grounds for the claim that disclosure would contradict the public interest.

The case has major ramifications for FOI – and the insights it provides into government decision-making.

Labor accountability spokesman Kelvin Thomson told Crikey the decision confirms the Government has “successfully strangled FOI in Australia”. He says the only way FOI can be resuscitated is through legislative change, including the specific abolition of conclusive certificates.

Thomson says the timing of the judgement is ironic.

The Democrats accountability spokesman Andrew Murray warns there is a danger that Cabinet will use the decision as “an imprimatur for further unwarranted secrecy and concealment”.

He, however, sees a small silver lining. “The fact that the verdict was a 3-2 split decision shows that the appeal had considerable merit, and the principles could therefore be revisited at a future date,” Murray says. And he has praised The Australian for pursuing the matter to the highest court in the land. “I sincerely hope that the fourth estate will not give up their efforts to preserve the freedom of the press and the right to know.”

The reaction of the fourth estate could be crucial.

Peter Costello is safe for now, but he has scored a Pyrrhic victory. He has used up much of his capital with the media – and we all know how the Gallery helped another ambitious treasurer reach the Lodge.