Land Registry privatisation plans revealed in leaked document

Land Registry privatisation plans revealed in leaked document
Former chief land registrar and unions express concern about possibility of private firms having a say in granting of land rights



The Land Registry is headed towards privatisation, in a move which will give private firms a say in the granting of land rights, according to leaked minutes from a meeting of its board members.

Former executives from the body, which registers the ownership of land and property in England and Wales, say that a sell-off "beggars belief" because it will allow the private sector to adjudicate on what can be conflicting interests between sellers, buyers, lenders and neighbours.

Documents seen by the Guardian show that far from still considering public ownership of the 150-year-old body as a viable option – as ministers publicly claim – senior civil servants are deciding between a joint venture between the government and a private company, or letting a private company run it as a so-called Govco.

Michael Fallon, the business minister responsible, had stated that options would be put out for a public consultation before any decision was made – and this would include the option of retaining the Land Registry as an executive agency of government.

Conservative ministers are in favour of a joint venture, sources say. But the Guardian understands that Vince Cable, the business secretary, will block Tory moves towards a joint venture as he argues that the government must keep tighter control of any potential private sector partners.

The disclosures follow criticism over the Royal Mail sell-offand fears that the coalition is in a rush to privatise a number of assets.

Minutes show that civil servants believe the government could raise £1.225bn from entering a deal with a joint venture company, marginally higher than the £1.1bn GovCo evaluation and that the registry's board has appointed their head of legal services as a company secretary for a new venture but have not yet announced it.

John Manthorpe, the former chief land registrar, said that the minutes appeared to show that the board was going ahead with a policy of privatisation.

"Appointing a company secretary gives the game away that the consultation may be a sham. I am not aware of any government department having a company secretary. The registry board are thinking in company terms already.

"It is clear that the management board, which has negligible experience and understanding of land registration and its important role, are solely fixed on the privatisation of this important state asset without any regard to the practical, financial or legal consequences for the citizen and business," he said.

He said the government had recognised that the statutory powers of the Chief Land Registrar (CLR) could not be passed to the private sector and has therefore proposed a small "Office of the Chief Land Registrar", passing the major operational work where the legal decisions are made regarding land rights on every property transaction in England and Wales to a private company.

The minutes, on 10 pages of A4, were recorded at a four-hour board meeting on 25 March, days after an initial consultation on a new service delivery company had been closed.

The meeting was held in a hotel in Selsdon Park Hotel in Croydon, south London, away from Rregistry staff.

Ed Lester, its chief executive and former head of the Student Loans Company, whose tax arrangements were criticised for being paid through a service company, was also present.

Under the heading "business strategy", the board appeared to discuss a KPMG presentation on the possibility of a private sector partner. The minutes record how the capital return would be under three blocks and note that "NPV [net present value] equalling £1.225bn, marginally higher than the £1.1bn GovCO valuation".

The minutes also note that under option two – the joint venture company – there may be "insufficient risk transfer to the PSP [private sector partner]" as well as a "significant risk of industrial action."

But nowhere in the minutes does the board consider the possibility of keeping the body as an executive agency of government.

On 9 April, Fallon told parliament: "The proposals in the consultation on the introduction of a Land Registry service delivery company are being considered against the option of remaining as is, and no decisions will be taken until all responses have been considered."

Minutes show that the board congratulated legal corporate head Mike Westott Rudd for becoming company secretary at the registry, a new post created by the board. They show that Lester travelled with a colleague to Norway, a trip which cost more than £1,000, to meet representatives of Infoland, which is state-owned but is moving into a privatisation process. The minutes record that "it is possible that it could be easily transportable to the UK and we could use it to replace our portal".

Downing Street has expressed an interest in future Land Registry deals, the minutes show. "Norway are keen for us to global partner them. They are interested in Bangladesh, who have approached them, and No 10 want us to go to Tanzania", they disclose.

The Land Registry has a monopoly in the homeowner market as all property buyers have to use its services.

It made a surplus of £98.7m in 2012-13, up from £86.1m the previous year, while revenue slipped by 3% to £347m.

Critics have pointed out that when the original January consultation document was published, the government had not consulted the registry's principal professional customers: the Law Society, representing conveyancers, and the Council of Mortgage Lenders, representing banks and building societies.

Staff at the Land Registry are expected to announce a two-day strike over the potential privatisation after managers failed to give assurances over compulsory redundancies or office closures.

Mark Serwotka, the head of PCS union, said: "We are very concerned that, despite clear opposition from staff, lawyers and other professionals, the government is lining up the Land Registry for privatisation for purely political reasons."

A spokesman for the Department of Business, Innovation and Skills said a decision would be made shortly on whether to privatise the registry and that all options remained under consideration.

"The company secretary role is in connection with the existing Land Registry board. It is a newly created position in order to meet recognised best practice on board governance.

"For years, Land Registry's remit has included sharing knowledge and expertise with other countries to develop effective land administration systems and processes," the spokesman said. "Ed Lester's visit to Norway was in relation to their digital property portal and has nothing to do with considerations around commercial models."

http://www.theguardian.com/politics/2014/may/05/land-registry-privatisation-plans-revealed

Making sure their chums make as much money as possible before they are klcked out.

Well you are happy for the public sector unions to run the country. Now who do you think generates the money to run the public services?

hardly the point fred....

This SHOULD NOT be allowed...