Land Registry privatisation vetoed by Vince Cable

Tony Gosling tony at
Wed Jul 16 23:05:55 BST 2014

Land Registry privatisation vetoed by Vince Cable

The service employs 4,500 civil servants and made 
a surplus of £98.8m in 2012-13
Syal - 
Guardian, Friday 11 July 2014 19.45 BST
Plans to privatise the Land Registry have been 
abandoned by the government after business 
Cable vetoed the scheme following a series of 
rows between Tory and Liberal Democrat ministers.

It had been hoped that a sell-off would raise at 
least £1.2 bn for the Treasury, with ministers 
deciding on the appropriate structure, such as 
creating a deal with a joint venture company.

But this week, ministers will tell parliament 
that the planned move has been suspended 
indefinitely. The Conservatives had been in 
favour of a partial sell-off via the creation of a joint venture.

The cancellation comes a day after Cable's 
department and its City advisers had to face a 
highly critical parliamentary report over their 
handling of the sell-off of Royal Mail. MPs found 
that by undervaluing the Royal Mail, it had cost taxpayers up to £1bn.

The shelving of the plan has a political 
dimension with Lib Dems keen to distance 
themselves from 
Conservatives before next year's general election 
– and it will come as a blow to several private 
equity firms and outsourcing companies that were 
interested in buying into a highly profitable agency.

But the move will be praised by solicitors and 
unions who have campaigned against the privatisation.

The Land Registry for England and Wales, which 
employs 4,500 civil servants, has had a monopoly 
on recording land and property information in 
England and Wales since 1862. It is the country's 
most comprehensive source of house prices as all 
buyers have to use it to register ownership of property.

It made a surplus of £98.8m in 2012-13, up from 
£86.1m the previous year, while revenue slipped by 3% to £347m.

The ministry, headed by Cable, had been examining 
privatisation proposals for several months and 
City firms had been approached and asked for 
their advice. It had also looked into the 
possibility of setting up a joint venture between 
the government and a private company to take 
charge of the Land Registry together.

The Department for Business had also been 
considering a plan to turn the Land Registry into 
a state-owned company that could then be sold 
off. Another option was to let a private company 
run the body as a so-called "GovCo".

Michael Fallon, the Tory business minister, was 
in favour of a joint venture company while Cable 
had doubted whether it needed to be sold off to be modernised..

A public row over the agency's impending 
privatisation began after minutes disclosed by 
the Guardian showed that civil servants believed 
the government could raise £1.225bn from entering 
a deal with a joint venture company, marginally 
higher than the £1.1bn vaulation placed on the GovCo scheme.

They also showed that in March, the registry's 
board appointed their head of legal services as a 
company secretary for a new venture but had not yet announced it.

Under the heading "business strategy", the board 
appeared to discuss a KPMG presentation on the 
possibility of a private sector partner. The 
minutes also warned that if a joint venture 
company were to be created, there might be 
"insufficient risk transfer to the PSP [private 
sector partner]" as well as a "significant risk of industrial action."

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

A major campaign involving the PCS union and the 
Law Society was launched against the 
privatisation. Thousands of union members at the 
Land Registry walked out in protest at the 
privatisation plans in 14 locations across England and Wales on 14 and 15 May.

Mark Serwotka, general secretary of the PCS, 
said: "This is a hugely significant victory for 
our members and the industry professionals who 
ran a fantastic campaign, together exposing the 
emptiness of the government's case. It's also a 
victory for businesses and the public who need 
the Land Registry to remain in state hands, free 
from any profit motive and conflict of interest."

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