Wakefield Council has refused to reveal details of its talks with a heavily criticised private contractor trusted to carry out services in 86 local schools.
The local authority said keeping all discussions with property maintenance firm ENGIE secret was "in the public interest", because council officers might not give their honest opinions if they were later published.
ENGIE, which also does school cleaning and catering, was handed a £200m contract in 2016 in the biggest privatisation deal in Wakefield Council's history.
But in September it was revealed that ENGIE was not carrying out its work to an "acceptable standard", having failed to meet 900 specific obligations since the start of the deal.
Council leader Peter Box said last week that the deal had saved the taxpayer £3m, but the authority has now refused a Freedom of Information (FOI) request asking for all written correspondence between itself and ENGIE over the summer.
In her response, interim city solicitor Liz Ogden said that the need to be "open and transparent" with the public was outweighed by a desire to keep talks in a "safe space". She added that some of the documents were "commercially sensitive".
She wrote: "It is important in live ongoing matters that those involved in considering and delivering advice and debating the issues should be comfortable in doing so and expressing their opinions freely without inhibition and to consider the options without restraint.
"The fear of disclosure of information may inhibit the making of fully informed decisions."
The decision was criticised by the leader of the Conservative opposition, Nadeem Ahmed, who asked about the state of the ENGIE deal at a full council meeting last week.
He said: "Obviously if information is commercially sensitive then it’s right that that is kept private.
"But everything else should be made available to the public. The whole point of democracy is that we are open and transparent about what we do.
"In this case I see no reason not to release that information."
Coun Ahmed said that despite suggestions the authority's deal with ENGIE may be terminated just two years into its 10 year life, the company should be allowed space to improve.
He added: "They are a reputable company. I do think they should be given more time.
"I think that a lot of the problems have really been caused by poor management.
"The whole point of outsourcing is that it should deliver savings for the council. If it can’t do that the service should be kept in house and run the way it was before."
In response to Coun Ahmed's comments, Ms Ogden said: "Like all local authorities we follow national guidance when considering Freedom of Information requests."