Land Registry

Roberta Blackman-Woods Excerpts

Thursday 30th June 2016 Commons Chamber

[Dr Roberta Blackman-Woods (City of Durham) (Lab)]

I thank my right hon. Friend the Member for Tottenham (Mr Lammy) for securing this debate. It is a pleasure to follow the hon. Member for Colchester (Will Quince), who made a powerful speech.

It is completely clear to me that privatisation is not the way forward for the Land Registry. Privatisation will damage the Land Registry’s reputation for independence. It could cause job losses in my constituency and elsewhere and, ultimately, cost the public money. The UK’s Land Registry is a model of good practice around the world. It gives advice to other countries about how to set up and run land registry services in an independent and impartial way. Its expertise is welcomed by many other countries.

Privatisation could seriously damage confidence in the Land Registry’s independence. As we have heard, the former Chief Land Registrar and chief executive of the Land Registry, John Manthorpe, has said:

“The Registry’s independence from commercial or specialised interests is essential to the trust and reliance placed on its activities. It would not be possible for actual or perceived impartiality to be maintained or public confidence sustained, if a private”

company

“were to assume responsibility for the…maintenance of a public register.”

As others have said, the consultation paper from the Government seems to show a lack of understanding of what actually happens with the register. The Government talk about the register as though it were a static document that is produced once and for all and can be handed over to somebody else, but it is very much a live document, as transactions are constantly added and updated. That means that there is enormous potential for a conflict of interest emerging from a private company running the register when information that might be placed on it could change on an hourly or daily basis. The Government’s consultation paper showed no acknowledgement of conflicts of interest that could arise or how they would be dealt with.

The Competition and Markets Authority has also raised concerns about privatisation, particularly that a private company running the Land Registry as a monopoly could weaken competition by making it harder to access the information it holds. As we have heard, an exemption from the Freedom of Information Act could mean that the sort of information found in the Panama papers would not be available for public scrutiny, which would be a great loss. The Government must seriously consider whether it is sensible to change a model that has a sound international reputation and a lot of trust, and that works so well and has real independence.

It is abundantly clear that there is no public demand for privatising the Land Registry. When privatisation was last suggested in 2014, the public consultation showed that 91% respondents disagreed with the idea that the services could be better delivered outside government. The hundreds of emails I have received from constituents opposing the Land Registry’s privatisation in just the past few weeks suggest to me that public opinion has not changed since 2014. I will quote just a few of my constituents who have written to me about this so that we can all hear how concerned they are. One wrote:

“The Land Registry is a self-financing public service which doesn’t cost the taxpayer a penny to run—so why is the government considering selling it off to companies with links to offshore tax havens?”

Another said:

“Experts from all backgrounds have been calling the government’s plans to sell the Land Registry short-sighted. The government’s own watchdog warned that it would threaten competition, and an expert from the World Bank said it would increase corruption.”

Another said:

“This government seems to be hell-bent on disposing of everything which we value, not to mention that

the Land Registry

“is actually a net contributor to the treasury.”

It is not only constituents who are concerned. Institutions from the Law Society, to the Public and Commercial Services Union, the Open Data Institute, the Co-Operative Group and very many small and large businesses have expressed their unease at the idea of privatising the Land Registry. That is for a whole variety of reasons that we have heard today: the registry has strong public confidence; there is ease of access; and it is trustworthy. Why are the Government so keen to go against the opinion of the public and experts? The Government’s decision again to raise the idea of privatisation, just two short years after they were forced to withdraw proposals in the face of massive opposition and a broad alliance of interests is, quite frankly, baffling.

Will the Government provide reassurances to my constituents working in the Land Registry office in Durham who fear that their jobs could be lost in the event of privatisation? The Land Registry is a major employer in Durham, providing hundreds of skilled jobs. Employees are understandably very concerned that privatisation could lead to job losses or even a full closure of the Durham office, which has existed for over 50 years. As this has been the only Land Registry office in the whole of the north-east since the closure of the York office some years ago, I would be concerned about not only my constituents’ jobs, but the impact that such a closure might have on the north-east’s economy.

When the privatisation of the Land Registry was last discussed in 2014, it was estimated that the Land Registry in Durham contributed £10 million per year to the local economy; I very much doubt whether that sum would have reduced in the past two years. Given the instability of our economy in the wake of the pro-Brexit vote, I would be extremely concerned by the prospect of further damage to the north-east’s economy.

The privatisation of the Land Registry would be bad not just for my constituents but for the public as a whole. The revenue brought in through the Land Registry each year would be lost. As a recent report from the New Economics Foundation made clear, in the long term, the sale of the Land Registry would result in a significant loss of income to the Treasury. In 19 of the past 20 years, the Land Registry has produced a surplus. It paid £120 million into the public purse last year. It is clear that the decision to review proposals to privatise the Land Registry is being driven by the Treasury’s desire to bring in revenue in the short term without looking at the long-term negative impact that that would have on public finances. The estimated £1.2 billion that could be raised from the sale will not stretch very far into the future.

In 2014, the Land Registry expanded to include services relating to local land charges. I said at the time that I thought the Government were doing that in order to fatten the registry up for privatisation, and it seems I might have been right. Once again, the Government are pushing for privatisation, so I think my fears were not misplaced. The Government’s responsibility must be the long-term health of the economy, and it is clear that the money that can be raised from privatisation will not offset the long-term costs of having no revenue from the Land Registry.

This Government have failed before to get the best deal for taxpayers when privatising services, most recently in the case of Royal Mail, in which shares were tragically undersold at the cost of millions of pounds to the taxpayer. How can we be confident that the Government will get the best deal for the British public with the privatisation of the Land Registry? Without them being able to guarantee a good deal, would it not be better, for that reason alone, to keep the Land Registry in public ownership? We have been through many of the other reasons why privatisation should not happen.

I end by quoting the words of another of my constituents who wrote to me about this issue:

“The Land Registry is working well, it’s not broken—there’s no need to fix it. In fact, it’s successful, profitable and part of a vital data infrastructure that our country needs.”

I completely agree with my constituent and ask the Government to drop any idea they might have about privatising the Land Registry.

--- Later in debate ---

[Bill Esterson]

Yes, I rather thought the hon. Gentleman might say that— [Interruption.] The Minister correctly points out that was an opportunity for mischief that could not possibly be missed.

My hon. Friend the Member for Llanelli (Nia Griffith) made an excellent speech. She talked about the petition containing 300,000 names that was handed in to the Department for Business, Innovation and Skills. I was there with her on the day, as were a number of our hon. Friends. She rightly asked what on earth we are doing here just two years after the last attempt at a privatisation, at which time very clear and widespread opposition to it was demonstrated.

[Dr Blackman-Woods]

Does my hon. Friend agree that when many of us, with a whole range of organisations and unions, including the PCS, turned up at the Department, it would have been really helpful if the Minister had come out to meet some of the people who wished to hand over that huge petition? [Interruption.]

[Bill Esterson]

The Minister, from a sedentary position, points out that that would not have been him. Perhaps we can take that as him agreeing that the Minister responsible should have been there to meet us all on that day. He can choose whether to respond to that point when he replies to the debate shortly.

The hon. Member for Telford (Lucy Allan) made a point about the importance of the Land Registry’s success to her constituency. That is true for each and every one of us in every constituency in the country.

The Land Registry has existed for 150 years. Currently it does not cost the taxpayer a penny. It makes a significant profit and delivered a surplus in 19 of the past 20 years. A one-off fee from its sell-off is no strategy for deficit reduction, as Conservative Members have acknowledged. It would allow for only a one-off reduction of debt. This is not an economically coherent approach to Government finances. Worse, it is cynical to pretend to taxpayers that the proposal constitutes the responsible management of the economy. I am afraid that, driven by the Treasury and the Chancellor, privatisation is exactly what the Government appear to be trying to do.

The consequences of selling off the Land Registry are far wider and more dangerous than losing a profitable public sector enterprise. Having a trusted impartial register of land underpins our economy. I do not need to repeat to Members the uncertainty and danger that has been caused by the Brexit decision that was taken a week ago. We have seen that uncertainty in the markets and it is spreading to the real economy, with job losses already announced. That uncertainty applies right across our economy, as well as to the role the Land Registry plays.

Any house that families or companies buy or sell relies on the Land Registry granting and transferring title deeds. It is the only proof of title or ownership recognised by law for £3 trillion of UK property. By virtue of it, every property sale, purchase, repossession and mortgage in the UK is carried out transparently and in confidence by the seller, buyer and lender. The Land Registry’s independence is fundamental to the trust that homeowners, mortgage lenders and solicitors place in it. How could that trust remain if the very basis of that trust—the knowledge that the Land Registry is utterly impartial—is removed? How could the Government maintain that its impartiality will remain if it is taken over by private interests?

Let us look at the potential buyers who are showing an interest. Of the private investment firms reported last month by The Times to be interested in running the Land Registry, all have links to offshore tax havens. That makes a mockery of the Government’s claims of being serious about clamping down on tax avoidance and tax evasion. Canadian pension company OMERS, American private equity firms Advent International and Hellman & Friedman, and General Atlantic each have links to such jurisdictions, not least the Cayman Islands. When the Minister responds, will he tell us if he agrees that the Land Registry’s absolute transparency and independence from private interest is fundamental to the trust placed in it by homeowners and mortgage lenders? Does he also agree that this trust would be fundamentally undermined if such firms took over? That is what people up and down the country can see happening.