Land Registry

George Freeman Excerpts

Thursday 30th June 2016 Commons Chamber

[The Parliamentary Under-Secretary of State for Life Sciences (George Freeman)]

I congratulate the Backbench Business Committee on picking this debate. I did not get here by rebelling against the Government often, but I am proud that one of my early rebellions was in support of that Committee. It has done us a service by bringing this debate to the House. Strong views have been expressed from all parties, except UKIP, which does not seem to have a view on this, and the Liberal Democrats. I also congratulate the right hon. Member for Tottenham (Mr Lammy) on securing the debate.

I want to say something about what the Land Registry does and why it is such an important office in this country, and to touch on why it is right that the Government review the basis for investment and leadership in different parts of the public sector. I will deal with several of the issues raised by hon. Members and confirm the Government’s position.

The Land Registry, as colleagues on both sides of the House have highlighted, underpins an important role of the state in keeping a safe, reliable and independent register of landownership. As every speaker has acknowledged, that goes right to the heart of our property-owning democracy. The rights of ownership of land and property and our ability as a society to enforce those rights were hard won, are much regarded around the world and are not taken for granted here. That is why the debate is important.

The Land Registry deals with more than £4 trillion of assets, with £1 trillion of mortgages depending on that clarity of ownership. Its 4,500 members of staff, to whom I pay tribute for carrying out an important function in our society, lead and manage the organisation. Accounts show that in the last year it generated £295 million of income, incurred slightly less in costs, and paid back to the Treasury a £14 million dividend—each year, it more or less turns over, washes its face and returns a small surplus operating profit. It is currently addressing issues of digitisation and efficiency, including through the much-commended map search and property alert products. It carries out a vital role at the heart of our system.

Colleagues, particularly on the Opposition Benches, have talked about privatisation, so it is worth reminding the House why successive Governments have embraced a bold programme of privatisation and the rationale for so doing. I stand as a proud member of a party that achieved much through that programme in previous decades. You do not need me to remind you, Mr Deputy Speaker, but privatisation was driven by the need to introduce competition and choice into key services on behalf of consumers, users and taxpayers; to draw additional investment into those services at time when Governments were not able to make that investment; to introduce new management into sectors of our economy that were failing, such as British Leyland and British Telecom; and to take off the Government balance sheet chronic liabilities that they were unable to meet and deal with.

That last point was one of the original rationales for the transfer of council houses from a state that was unable properly to maintain them to the citizens, who then showed how to maintain them and have been grateful to us ever since. People forget that a large amount of money was recycled back into the housing association revolution, which led a huge boom in public housing, albeit perhaps not a big enough boom. That reform was made to deal with a serious liability and to transfer a major asset—in that case, council housing—into the hands of the people who were paying for it through their taxes, and indeed to increase tax revenues for the Government. Many people—

[Alan Johnson]

Will the Minister give way?

[George Freeman]

I need to crack on—I am sorry.

Many people, probably including many Opposition Members, would admit that it would be strange to have a society—[Interruption.] Oh, I have lots to say. Very few Opposition Members would today be calling for the return of British Aerospace, British Telecom, British Gas, British Petroleum, British Leyland, British Steel and British Airways. We have achieved much in recent decades. I am merely reminding the House of the arguments for privatisation made at the time. We will come shortly to decide whether they are appropriate in relation to the Land Registry.

[Alan Johnson]

I am grateful to the Minister for his fascinating history of privatisation. Can he explain why, when the rabid privatisers in the Conservative party were privatising all those things, they did not go anywhere near the Land Registry?

[George Freeman]

The right hon. Gentleman makes an interesting point. I was just setting out the reasons for dealing with sectors such as aerospace, telecoms, gas and other utilities, and British Leyland. Does anyone seriously think we should still have a car industry in the hands of the management of British Leyland? I doubt it. I merely remind the House that the reasons for those privatisations were to do with competition and choice, investment, management and the reduction of liabilities on the public balance sheet.

What would be the rationale were the Government to take privatisation of the Land Registry forward? Well, I can confirm that the Government have absolutely no plans for this. We have carried out the consultation and we are in the process of hearing, loud and clear, what is said. For those watching from the Gallery and wondering why it is even being considered, the rationale would be to create a basis on which the Land Registry, if it needed it, could raise substantial extra investment that the Government could not provide. It could be a mechanism to get a substantial injection of new leadership, to help the Land Registry to deal with the opportunities of globalisation—around the world, newly liberated and fast-growing economies and societies are looking to copy the UK model in many respects, and this might be one of them. And yes, it could be a mechanism to help us to tackle a still ongoing and chronic debt and deficit crisis, which has saddled the next generation of this country with debts. The Government look all the time at the public balance sheet, so those are the reasons why an institution such as the Land Registry might be worth considering.

[Bill Esterson]

The Minister is giving reasons why the Government might look at something. If the Government do not have a view, why was the consultation framed as it was—in terms of how to privatise, not whether to privatise? Does that not suggest a fundamental commitment to the privatisation?

[George Freeman]

I suggest that the best indication of our commitment is what I am saying at the Dispatch Box right now. I will comment in a moment on events going on outside this Chamber, which will determine how this is ultimately taken forward.

I was making the point that the Government have carried out a consultation. It is right that, as a responsible Government, we keep under review whether and how functions that are currently the monopoly responsibility of the state can be better financed and thrive more with new freedoms, and by so doing put the public finances on a stronger footing. I merely set out the rationale on which such matters have been addressed in the past and confirm once again that the Government have no plans. This is merely a consultation. We have received no bids; no decision has been made.

[Mr Lammy]

When the Minister says the Government have no plans, is he in fact pronouncing on the consultation? He has heard the House this afternoon: no one has risen to speak in favour of privatisation. Obviously, one is reflecting carefully on whether to test the strength of feeling by putting the matter to a vote. It is important to understand what the Minister is saying, because the real concern is that this is a Treasury-driven proposal—that was one of the reasons he gave. If that is the case, it probably is right that the House of Commons demonstrates to the Treasury that it probably would not get the privatisation through.

[George Freeman]

The right hon. Gentleman is a canny parliamentary operator. Let me continue my speech and deal with the various points that have been raised, because in so doing I may be able to reassure him that this Business Minister is listening and has heard what has been said loud and clear.

[Christian Matheson]

I am a little confused. If the Government have no plans to privatise the Land Registry, why hold the consultation in the first place?

[George Freeman]

I am glad the hon. Gentleman asks that. Let me explain.

It may have escaped the hon. Gentleman’s notice for the purposes of this debate that the present Government and our predecessors, the coalition Government, have had to confront a very serious crisis in our public finances on behalf of us all, but on behalf in particular of the young of this country, whose debts these are not and who did not make the decisions and are not responsible for incurring them, but who have entered a society and an economy mired in debt. That creates a situation that any responsible Government have to deal with. If the Opposition want to form an alternative Government, they will have to deal with this question, which sits at the heart of the reality confronting any serious candidate for Government. As a Business Minister in the present Government, I would not be doing my job properly if, with my colleagues, I did not keep under review the functions that we currently carry out within Government and ask whether there is a way to put them on a footing where they can raise the investment they need off the public balance sheet and attract stronger and better management—Whitehall is not always the best place to manage every function in the state. We have to be creative about how to generate more revenue, so that we can support higher quality services for UK customers, citizens and taxpayers. I do not think a modern Government would be doing their job if they did not ask those questions.

A Government also have to consider the points made by parliamentarians and take into account the issues that might arise from such a move in terms of the delivery of the service. That is what the Department is doing right now. We are considering the responses to the consultation and the submissions made today in this debate, which is why I thank the right hon. Member for Tottenham for securing it. Let me reply now to the points raised.

The right hon. Gentleman spoke about the public concern and questioned the motive for having the consultation. I hope I have dealt with that: there is no illegitimate motive. It is appropriate for a Government to ask the question. He made a really important point, which others have echoed, about transparency. The register sits at the heart of our democracy because it is a register of land ownership. It is important that it is transparent and interrogatable and that people can see that it is.

The right hon. Gentleman raised the need to ensure that the operating surplus is reinvested and to allow the organisation to grow and develop. The right hon. Member for Kingston upon Hull West and Hessle (Alan Johnson), who was very amusing in his summary of the quinquennial reviews that plague all Governments, asked the important question: what is the compelling case for this? I have tried to set out the bones of what a case might be; whether it is compelling or not, it is required to be considered alongside the other points that are being made.

My hon. Friend the Member for Harwich and North Essex (Mr Jenkin) made an interesting speech. As he pointed out, he is someone who one would normally expect to be on the barricades for more privatisation. Indeed, he was a great champion of it in decades past. He made the point that this is critical infrastructure and goes right to the heart of our ability as a society and a political economy to keep track of our land rights.

Issues were raised about integrity, stability and the importance of open data and transparency. I am the Minister who, with other responsibilities, is in charge of ensuring that the country is able to use our health data to modernise the NHS, to attract the investment we need in new medicines, and to make the NHS and the UK world leaders in developing new medicines. We are absolutely clear that, in doing that, one of the things that we will not do is sell any state or private data. We are building databases on which industry can work with us to interrogate the conditions for new diseases, but we are seeking to take royalties and rights from commercialisation to put that money back into providing additional services. However, we are absolutely clear that it is a reference library, not a lending library. That principle of not selling core data is important. We want data to be open and used to support innovation and greater research. I know that my hon. Friend cannot be here for my speech; he did give me his apologies—he had to be somewhere else.

My hon. Friend the Member for Carlisle (John Stevenson), a solicitor himself, who has used the Land Registry and indeed relied on it, was pretty powerful when he referred to this as a privatisation too far. My hon. Friend the Member for Colchester (Will Quince), who has been a property lawyer—once a property lawyer, always a property lawyer—made a similar point and echoed the concerns, referring to this as potentially anti-competitive and said that he would have concerns on those grounds.

My hon. Friend the Member for South Dorset (Richard Drax) raised a chuckle or two when he referred to his belief that every Englishman’s home is his castle. He referred to this as quasi-judicial, which may be a reference to the name of the new Lord Chancellor in the next Administration, but he talked powerfully about the Government having bigger fish to fry. He is right that any Government formed to deal with the scale of the ongoing crisis, which is affecting this economy and others across western Europe, with ageing societies, the need to reform and update our public services, and to get rid of deficits and to pay off the debt, will face substantial issues, and this is one small part of looking at how we can refresh and modernise our approach to 21st century Government.

My hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) made a powerful point about this debate being something of a symptom or an emblem of a new politics and mentioned our late, much lamented and respected colleague Jo Cox, whom I suspect would have spoken in the debate with her much respected blend of passion and local responsibility. She would have spoken for her constituents. My hon. Friend made the point that if any reforms were to be put in place, it would be important not to make the mistake of creating a private sector monopoly. That is partly why I repeated the rationales for those early privatisations. They were never about creating private monopolies; they were about choice and competition where those would be advantageous for the consumers and users of the service. My hon. Friend the Member for Telford (Lucy Allan) powerfully endorsed those points.

I am conscious that the House’s time is precious. Although I would love to stand at the Dispatch Box all afternoon and talk about how we might embrace more interesting, bolder and innovative models for delivering private and public sector innovation, I am conscious that colleagues are distracted by events beyond this Chamber. [Interruption.] I assure Members that whoever it is, is not behind me, in more ways than one.

I confirm that the Government have merely consulted in the last few weeks and months on this question; for the avoidance of any doubt, I also confirm that no decision has been taken and that Ministers are listening carefully to the views that have been expressed. As a Government we have a serious responsibility to ensure that we constantly keep under review the arrangements we have in place for the delivery of services such as these.

As my hon. Friend the Member for Colchester said, we were elected on a mandate to balance the books. That requires some careful judgments about the timing and the way in which we do it. My ministerial portfolio is all about driving a different model of innovation between private and public, working together and ending the apartheid of private productive and public not; I do not think that that is appropriate or sensible for 21st Government. We need to find ways of working together. It is right that we constantly look at these issues. Colleagues have touched on a range of different models. Were one to look at taking forward a way to put the Land Registry on a footing that allows it to invest faster, to develop new services and new leadership and to tap into global markets, one could consider a range of models, including mutualisation and the new structures that are being developed.

We have heard the concerns expressed in the House loud and clear. Others elsewhere, in those other rooms I referred to, will determine in due course what the Government will decide to do in this case later in the year. I am aware, as all of us painfully are on the Government Benches, that the majority is 12. It does not require many people to take a different view from the Government of the day in order for us to assess the likelihood of getting a measure through. I have no idea what those currently looking to form the new Administration will want to do when they are in office, but anyone listening to the debate will have heard loud and clear the view of those who have spoken on both sides of the House. If anything is to be done to look at the future of the Land Registry, it will need to be clearly focused on solving particular problems that exist today and dealing with specific issues that need to be addressed. I think it was one of the Members on the Opposition Benches who said, “If it ain’t broke, don’t fix it.” The right hon. Member for Kingston upon Hull West and Hessle called for clarity on what the case would be. I hear him loud and clear. We would need to set out clearly the problem that we were trying to solve to take the matter forward.

I hope that I have addressed the points that have been raised. I again thank the right hon. Member for Tottenham for securing the debate.