It seems the decision on whether or not to privatise the Land Registry, a notion which first stoked controversy in 2014, is one more issue the new Prime Minister will have to deal with. After a heated parliamentary debate on whether to prize the Land Registry out of state hands, it was revealed that no decision will be taken until later in the year.
Business minister George Freeman argued that a sale of the Land Registry “could raise substantial extra investment that the government could not provide”. Although he stressed that the government has no plans to take the privatisation forward at the moment, the idea has to be considered as a “mechanism to help us to tackle a still ongoing and chronic debt and deficit crisis”.
However, the idea met heavy opposition from bank benchers. David Lammy, Labour MP for Tottenham, accused the government of “looking to sell off the family silver to turn a short-term profit to try to make their sums add up”.
“As the most recent Budget showed, the Government’s plan to close the deficit is dead in the water, so now they are looking around for assets to cash in,” Lammy said.
Lammy argued that the Land Registry has turned a profit for taxpayers in 19 of the last 20 years, paying back £120 million to the public purse in 2015 alone. Satisfaction with the Land Registry, which has been recording the ownership of land and property in England and Wales since 1862, is currently at 96 per cent.
“The short-term profit derived from any sale will be dwarfed by the increased costs that are ultimately paid by all of us in the form of increased fees, and it will be dwarfed by the lost revenue to the public purse in the medium to long term,” Lammy said.
Lammy warned that “any privatisation of the Land Registry will have serious consequences for transparency and accountability in the UK property market and hinder efforts to crack down on corruption and money entering the UK property market via offshore jurisdictions”.
Will Quince, Conservative MP for Colchester, said that the government has misunderstood what the Land Registry is fundamentally about. “It is more than just a data provider or an authority for recording title,” he said. “The reliability of the register is vital to the property market, and any loss of confidence in the register would significantly affect the property and mortgage markets and, therefore, the economy as a whole.”
However, Freeman said that he would not be doing his job properly if he failed to review all the functions the government carries out, and ask if there is a way to raise investment 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,” he said.
However, in the face of such opposition, the likely conclusion seems to be that plans to privitise the Land Registry will be shelved once again. As Conservative MP Richard Drax said, “with all that is happening to this great country – with the wonderful opportunities that lie ahead and the far bigger fish that we will have to fry – [I urge the Minister] to ensure that this little tiny fish is left alone to swim in the sea for years to come, as it has done successfully.”