Infrastructure Bill [HL]

Lord Tope Excerpts

Tuesday 15th July 2014 Grand Committee

Moved by

[Lord Tope]

84: Clause 21, page 22, line 21, at end insert “or GLA”

[Lord Tope (LD)]

Before I move the amendment, I wonder whether it would be appropriate to offer congratulations, in absentia, to the Minister who I thought would be replying to me today. We congratulate her on her escape from the Infrastructure Bill, even though she will no doubt miss all its excitement. It is a particular pleasure for me to welcome, rather unexpectedly, the noble Baroness, Lady Kramer, to answer here today, particularly in view of this amendment, which relates to the Greater London Authority, of which she has considerable knowledge and experience. I look forward to an even more favourable response than I was expecting.

In moving the amendment, I shall speak also to Amendment 85. They are two fairly simple and straightforward amendments that would add “or GLA”—the Greater London Authority—to this part of the Bill. I have tabled them because under the Localism Act 2011, the Homes and Communities Agency no longer has any remit in Greater London. That responsibility was devolved to the Greater London Authority and it is therefore logical that the powers going to the HCA, which will apply only to the rest of the country and not to London, should in this instance be passed to the GLA—hence my comment about the Minister who is now to reply having some knowledge and experience, not least of one of the major landowning parts of the Greater London Authority, namely Transport for London. Unless we make this amendment, there will be some vacuum in London as to what will happen. It will seem that the powers that the Bill seeks to give to the Homes and Communities Agency simply will not apply in Greater London, which makes no sense at all. Therefore, I genuinely look forward to a sympathetic response.

There is significant surplus public sector land in London, much of it indeed owned and put to good use by the GLA group. However, according to the Government in March this year, there are in London alone 75 surplus National Health Service sites, totalling 80 hectares, which could well be ready for development. I will not say that we are correcting an anomaly—no one would admit to drafting a Bill that contains an anomaly—but I hope we are filling a gap with this amendment, and that we will ensure that the GLA has the powers it needs to continue the very good work that it has done under both Administrations to make much better use of surplus publicly held land for housing. I do not need to stress again today the urgent need in London—perhaps throughout the country but nowhere more so than in London—to make the best possible use of land for additional housing.

In addition, it is the GLA that has the strategic planning role for Greater London, which fits together with this amendment. Finally, there is the issue of democratic oversight, provided by the Greater London Authority itself with its directly elected mayor and the elected London Assembly, but also by the—less well known but equally important in this context—Homes for London Board, which is a joint body with the GLA and the London boroughs and can oversee all this.

The noble Lord, Lord Best, has also put his name to my amendment. He has given me his apologies for being unable to be here today. He has recently been appointed chairman of your Lordships’ Communications Select Committee, which, unfortunately from our point of view, meets every Tuesday afternoon. He understandably feels that, as its newly elected chairman, he should be there. However, he has said to me, for the record:

“I understand the Homes and Communities Agency is not raising any objection to the idea of the GLA taking on this role for London: the HCA no longer operates within Greater London and it seems entirely sensible for the GLA to include this in their wider role—in partnership with the London Boroughs through the Homes for London Board; the housing association sector admires the leadership role which the GLA through the Deputy Mayor for Housing and Planning, Richard Blakeway, is pursuing, not least in arguing for Lifetime Homes accessibility standards, improved space standards and better performance by London’s private rented sector. I think the general view is that the GLA is a highly competent body on the housing scene and would make a success of this extra role”.

I think these amendments are necessary. They are clearly sensible and they future-proof against any further needs. I beg to move.

[Lord Jenkin of Roding (Con)]

My Lords, my noble friend will recollect that I raised this point at Second Reading on 18 June at col. 856. I will not repeat what I said on that occasion, or indeed on the very important points that my noble friend Lord Tope has just made.

The Minister was as good as her word and replied to the points that she did not have time for when she responded at Second Reading. She wrote to me on 1 July about the points I had raised, including this one, which she headed “Mayoral Powers”:

“Government officials and the Greater London Authority are in ongoing dialogue to agree suitable ways to transfer public sector land in London. If amendment of legislation is required, we will explore this at an appropriate opportunity in the future”.

It is a long time since I have felt that I was pushing at a door that is not only half open but almost entirely open. I hope my noble friend will be able to give us a little more information this afternoon.

The need for housing, particularly affordable housing, in London is acute. There can be very few couples —potential homeowners—under the age of 35 or thereabouts who feel that without significant parental help, or whatever else might be available, they will ever be able to buy a house. Part of the reason for that is the shortage of building land within the Greater London area and in the area immediately surrounding it. The disposal of surplus public land has become a matter of huge urgency. I believe, as my noble friend has said—and he quoted the noble Lord, Lord Best—that the Greater London Authority has this whole issue very much in mind and on its whole agenda for the development of London. The case for it to be the body to initiate, promote and encourage this is very strong indeed and I hope my noble friend the Minister will be able to give us an encouraging answer this afternoon. I support the amendment moved by my noble friend Lord Tope.

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[Lord Tope]

My Lords, I am grateful to my noble friend Lord Jenkin and, in absentia, the noble Lord, Lord Best, on whose behalf I also spoke, and, perhaps particularly, to the noble Lord, Lord McKenzie, for pressing the point. I have to say that long experience in your Lordships’ House has taught me that moving a simple two-word amendment is no more likely to succeed than a two-page amendment. I have much sympathy with the point made by the noble Lord, Lord McKenzie, that it is a simple amendment that probably could have been accepted today without in any way inhibiting or preventing the discussions, which I am very pleased to hear are going on. I had no expectation that it would be accepted.

I am very grateful for what the Minister has had to say. I wrote down the splendid phrase “may be beneficial to exploring”, and I am pleased that discussions are going on with the GLA. I have no doubt that, in one form or another, we will return to this issue in three months’ time at the next stage of the Bill. Whether it is with a simple two-word amendment or a rather more complex two-page amendment, I will wait with interest to see. In the mean time, I beg leave to withdraw the amendment.

Amendment 84 withdrawn.

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[Lord Smith of Leigh (Lab)]

My Lords, in some ways the north-west is ahead of the game in handing over land to the HCA. When the NWDA was abolished by the Government, we had quite a large landholding for that agency, and the question was: what to do with the land? Rather than try to disperse it through a large number of local authorities, it was transferred to the HCA. That worked successfully, first, because these were pretty large-scale plots of land. They were originally designed for economic development and that was the purpose to which they were put. Secondly, the HCA operates on a local basis, so we were dealing with a local branch of the HCA; we were not dealing with any central bases in London. Thirdly, the HCA worked very effectively with local authorities. Therefore, any planning problems could be rapidly dealt with, and the HCA reported back to the North West Regional Leaders Board, which is a local authority leaders board, on what was left of the portfolio.

Therefore, I think that the principle of what the Government are doing is ideal. I do not think that the LGA—I must declare an interest as a vice-president of it—wants to undermine that, but it may be a case of horses for courses. There may be parcels of land which, by their nature, are small in scale and value and which would probably be better for the local authority to work with at its local level rather than the HCA, which operates on a regional basis.

I hope that, in replying, the Minister can reflect on what my noble friend said in introducing the amendment and can see whether there is a way forward on this matter.

[Lord Tope]

My Lords, the noble Lord, Lord McKenzie, said that this had been introduced as a probing amendment. I recognise that and will certainly be very interested to hear the response. I was particularly interested to hear the comments from the noble Lord, Lord Smith. I am quite prepared to accept that in this respect, at least, the north-west, or more particularly Greater Manchester, leads the way with the combined authority, which some of us think may well be part of the way forward for the rest of the country. The experience in Greater Manchester, to which the noble Lord, Lord Smith, has just referred, is certainly very interesting.

I was not terribly clear whether he was supporting the amendment of the noble Lord, Lord McKenzie, or supporting the probe, or saying that it is something worth exploring. It is certainly worth exploring. I hope that the Minister will agree to take it back and look not at why we do not need it or why it is not necessary, but whether and to what extent it would add to the available permissions for doing this. I think it is true that most local authorities, of whatever political persuasion and in whatever part of the country, are now keen to get on and make their contribution to meeting the severe housing need throughout the country. If an amendment or addition of this sort does anything to add to that, it must be desirable, even if it is not strictly necessary. I hope that on that basis, the Minister—although I suspect that she is not about to accept this amendment—will at least agree to take it back and give some positive consideration to how such an amendment or alteration might add one more weapon to the armoury.

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[Lord McKenzie of Luton]

My Lords, there will be a subsequent debate in respect of Clause 24 so I will speak generally to both clauses and pick up any further points in the subsequent debate. Clause 23 transfers responsibility for local land charges to the Land Registry, while Clause 24 confers additional powers on the Land Registry. Neither of these propositions can be divorced from the parallel proposition for a new model of a Land Registry delivery company, which is widely believed to be a step along the way to privatisation of the service.

Just yesterday the Government pulled the plug—at least for the time being and, I am bound to say, not with good grace—by recognising that they would have to give further consideration to the complexity of their proposed new business strategy, including moving complex applications online and automating processes. There were high levels of disagreement anyway with the suggestion that an arm’s-length model would enable operations to be more efficient and effective or that such models would have the right checks and balances to protect the integrity of the registry. While reaffirming that they are moving ahead with the digital transformation, the Government have stated,

“at this time, no decision has been taken to change Land Registry’s model”.

While we should not be under the misapprehension that the threat has gone away, we should recognise that the news, unnecessarily delayed as it is, will come as some relief to the staff and to those who campaigned against the folly which privatisation would represent.

Mr John Manthorpe, a former Chief Land Registrar, has stated in a letter:

“The Land Registry is a successful and highly regarded department of government with a 150 year history. It makes no call on the exchequer and has a 97% customer satisfaction rating … It conducts its business impartially and free from any conflicts of interest. It grants and guarantees title on all transactions so providing the security of tenure and conveyancing machinery on which a stable society depends and without which the property, transfer and mortgage markets could not function”.

I could rest my case for this clause and Clause 24 not remaining part of the Bill at this point. If the Government have to hold back on their proposed plans for the Land Registry because they need to revisit the model to deliver their new business strategy, it is difficult to see how it could possibly take on responsibility for local land charges and more, largely unspecified, powers relating to that. There are some 20 million local land charges registered, with 65,000 updates every month.

There are further detailed arguments that deserve to be heard. For a start, the consultation on wider powers and local land charges was flawed. It was conducted by the Land Registry itself, which clearly had an interest in the outcome. There were concerns that it was overly focused on what would add value to the Land Registry, and that it was undertaken with at least half an eye to privatisation.

The Land Registry proposal is to take over the maintenance and searches of the register of local land charges. It argues that this is necessary because of a perceived lack of consistency and standardisation in the provision of local land charges. The World Bank ease of doing business survey marked the UK down on the ease of registering a business, including the speed of registering and transferring commercial property. This was also prayed in aid of the proposal.

However, the Law Society, in its submission to the consultation, expressed the view that in recent times local authorities and other providers have been producing search results in a timelier and more consistent manner and at a predictable cost. Indeed, the impact assessment noted that there had been annual productivity gains of 2%. The Law Society expressed the view that while there is merit in seeking to create a single local land charge and CON29 service, most practitioners would not regard it as a priority for the Land Registry to address. It says:

“Having more consistent processes for discharging charges … could markedly improve and de-risk the process”.

Dealing with searches is just part of the conveyancing process. The Law Society’s conclusion is that the research conducted by the Land Registry does not demonstrate that there is a problem that needs to be resolved.

It is suggested that the speed of service conducted by local authorities is causing a problem in the conveyancing market. This is despite a recent survey indicating that the turnaround time for 96% of searches that involve only local land charges is less than 10 days, with three-quarters being returned within five days. Searches involving local land charges and CON29 have slightly less speedy performance but, as it is proposed that the latter stay with local authorities, it does not seem that overall search turnaround times will improve.

The District Councils’ Network has expressed concerns at the proposed separation of land charges to be undertaken by Land Registry from CON29 searches, which will remain the responsibility of local authorities. It considers that this fragmentation creates a risk of inconsistency, with the potential for errors and omissions. It says that insufficient weight has been given to the local knowledge that resides with local authorities, which are still generally the originators of the data. Local authorities will still incur costs in collating and supplying data, in maintaining a database and, presumably, for indemnity insurance—when there is no income stream from search fees. It also instances that many local authorities have made recent investments in digitalisation, for which no recovery is promised by the Land Registry.

As the Local Land Charges Institute points out, the original intention of the Land Registry was to take over and maintain the database for local land charges and CON29. However, having studied the proposition for over a year, it decided to abandon the idea. Therefore, as things stand, Clause 23 would mean a fragmented service, with no credible alternative being offered. The Council of Property Search Organisations—CoPSO—offers the view that the sector is currently operating well, with healthy competition. It says that the claimed postcode lottery is illusory and that there is no real problem to fix. Moreover, it suggests that the threat to local authority jobs could result in increased waiting times for searches, with consequent detriment to the housing market.

The Local Land Charges Institute argues: that the perceived problems with the land charge function has been overstated; that such problems as there are can be resolved more simply and with less cost; that the demand for the Land Registry takeover has been overstated; and that the Land Registry has failed to demonstrate a clear understanding of the processes and risks involved in the local land charge function and is proposing a worse service. It says that the Land Registry has failed to demonstrate how it will actually provide the service and that the Land Registry has proposed a number of unsatisfactory business models over the past three years and now proposes to take over only half the service, providing less information to customers than local authorities currently do, leaving local authorities to undertake the more complex work and providing a fragmented service to customers.

The LGA expresses opposition, in particular making the point that the proposals will leave councils with the expense of adjusting systems, breaking existing contracts and paying redundancy costs. It says that over the longer term the costs to councils of compiling, checking and verifying data have not been properly accounted for in the analysis.

The opposition is glaringly obvious from the Government’s own consultation: 94% of respondents do not think that the Land Registry has considered all feasible options and 95% do not support the Land Registry taking over the local land charge function from local government. It is time to think again, as even the Government have recognised on their delivery company. It is time to remove the clause from the Bill.

[Lord Tope]

My Lords, I confess to relative ignorance on the subject of the Land Registry, so I have been trying to understand better. Naturally, I wish to support my Government, and particularly want to support my noble friend the Minister, who has to reply to this. I have a number of concerns, some of which the noble Lord, Lord McKenzie, set out very fully when making his points. Like him, I, too, have had representations from the Local Land Charges Institute and from the Law Society, which have made a number of points to which I am sure the Minister will reply.

Certain things increase my concern. First, of course, this takes functions away from local authorities and centralises them. There are two things that instinctively trigger me as a localist, and I find them difficult. I therefore need to understand better than I currently do, not just what the problem is that we are trying to fix, but what the scale of the problem is, as the Government see it, that makes it necessary to take these functions away from local authorities and centralise them. Throughout history, the experience of centralising does not necessarily automatically lead to greater efficiency, nor does it seem immediately to be in keeping with the Government’s commitment to localism.

On a similar and related point, I have seen several times the awful phrase “postcode lottery” used with reference to the current situation. I hate that phrase; if we put it rather differently, so-called postcode lotteries mean we recognise that different factors apply in different areas and that local people—local authorities, in this instance—are able to determine their priorities, their way of doing things and, for that matter, what charges they wish to set for local services. If that is called a postcode lottery then I am all in favour of it but I would prefer to call it real localism.

My next point was raised by the noble Lord, Lord McKenzie. He referred to the results of the consultation, which came out significantly against the Government’s proposals. That has been dismissed as self-interest. In a sense, that is true; it is pretty obvious that the Local Land Charges Institute has an interest. You can call it a self-interest if you like, but I have to say that the responses to most consultations come from organisations or people with what could be called a self-interest. It just so happens that that self-interest means that they usually know very much more about the subject than most of us do. The fact that they have a self-interest—or, as I would put it, a greater knowledge—certainly does not mean that they are by definition wrong or that their views should be dismissed. Certainly, the context should be recognised.