Under the guise of Brexit, the government continues to consider a £1bn-plus sell off of the Land Registry despite public opposition.
The Conservative Party’s previous attempts at this policy was first blocked by the Lib Dems in 2014, and a current petition against the recent proposal has now hit 315,000 signatures.
What is the Land Registry?
Now over 150-years old, the Land Registry compiles and maintains the ownership data of over 24 million land and property titles in England and Wales, providing vital information about the ownership of 87% of land, worth an estimated £4 trillion – including £1 trillion in mortgages.
It is responsible for:
- Providing owners with a land title that is underpinned by the state.
- Protecting your property.
- Simplifying the transfer of interests in land.
- Providing a reliable record of information about ownership of and interests affecting land.
- Protecting your investments.
The company carries out its responsibilities with no aid from the government. In 2014/15 alone, the Land Registry cost almost £261m to run – but it also generated £297m of revenue from fees for the use of its services.
It finances itself through the collection of fees for title registration, data searches and providing international consultancy to other countries land registry offices.
In short, the Land Registry is a valuable public asset.
What are the Implications of Privitisation?
As with any private enterprise the main aim is to generate profit, and the Land Registry will feel enormous pressure to do so.
The first, and most obvious, option to do so would be increasing prices for services.
The second option is to cut costs. This would likely result in many nation-wide redundancies among the Land Registry’s 4,578 staff, who are based in 14 offices across England and Wales.
The third option is even more worrisome, criminality. Currently the Land Registry is governed by strictly observed anti-corruption measures, fighting against the key issue of money laundering in property.
Over 40,000 properties in London are already registered in the names of shady offshore ‘tax haven’ companies despite their best efforts. More than 60 MPs have signed a letter stating that privatisation would make it even harder to regulate shady companies buying up property, shielded from scrutiny and investigation. Potentially driving property prices up as a result, as no one actually lives in them.
How would the sale affect consumers?
On an individual level, the risks and information generated and maintained in the Land Registry has a documented and legally valid audit trail. Any compromises or out-right failings could lead to a mass-collapse in the property markets.
Having recently chaired a consultation on the proposals, the chair of the Public Administration and Constitutional Affairs Committee (PACAC) warned that a private company may not value long-term stability and continuity for the service.
Although he accepted the government’s argument that the Land Registry needed to become a more modernised and digitally based, he did not accept that this was “a clinching argument” for privatising the service. Instead, he said that “it might cost less for the government to keep it in public ownership and fund the changes”.
The Conveyancing Association have also announced their opposition to the proposals. They argue that the risks privatisation poses to buyers isn’t worth the potential gains. Instead, increasing the Land Registry registration fee and reversing a recent halving of fees for electronic registrations would ‘immediately’ double the Land Registry’s income, a relatively small price to pay.