2016 Land Registry Consultation Response (1)

8/18/2019 2016 Land Registry Consultation Response (1)

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Consultation on moving

Land Registry operationsto the private sector

PCS Response11 April 2016

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Introduction

1. The Public and Commercial Services Union (PCS) is one of the tworecognised Trades Unions in HM Land Registry with well over 3,000members and represents the vast majority of staff.

2. HM Land Registry provides a quality, fully accountable and impartial systemof land registration that is entirely independent from the conflicting pressuresof the market. Service delivery is focussed on the quality and security of theLand Register and its associated data. The integrity of land data that a publicsector Land Registry provides directly underpins the confidence and stabilityof the property market and the wider economy.

3. HM Land Registry is no drain on the public purse, is entirely self-funding andhas returned a significant dividend to HM Treasury in all but one of the last20 years. In the year 2014-15 this amounted to £126m. HM Land Registry is

a high performing organisation that has embraced significant technologicaland digital development. As a result, it has consistently delivered year onyear efficiency gains.

4. Annex 1 below provides a selection of testimonies to the current success ofHM Land Registry, provided by Graham Farrant, HM Land Registry ChiefExecutive and Chief Land Registrar.

5. This consultation comes only two years after a previous public consultationon the introduction of a new service delivery company brought anunequivocal response to the government at that time against moving anypart of HM Land Registry into private ownership. The 2014 consultationresponse showed that 91% of respondents disagreed with the notion thatland registration services could be better delivered outside of government.Only 5% supported the notion of privatisation.

6. In our response we are setting out why any notion of privatisation (not solelythe government’s current preferred option) is entirely inappropriate for HMLand Registry.

7. To do this we have articulated a series of arguments and risks that

demonstrate that the rationale behind these proposals is extremelydangerous and not in the public interest. It should be noted that the38degrees petition (opposing a privatisation) has now attracted over 200,000signatures and continues to grow by the minute. It should also be noted thatthe vast majority of signatures were applied after publication of theconsultation document, in the full knowledge of the government’s rationale.

Contact/more informationMichael KavanaghPCS Land Registry Group PresidentTrafalgar House, 1 Bedford Park, Croydon, CR0 2AQ

[email protected] 006 3207 / 0797 180 9683



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Executive Summary

8. The current consultation sees a different motive to 2014. Whilst there is stillan ambiguous case for development of services, the (specified, at least)overwhelming goal is to sell HM Land Registry to contribute to national debt

reduction and/or to help finance the Chancellor’s announced infrastructurespending. This has absolutely nothing to do with what is right for the future ofHM Land Registry but is a purely political exercise. The risks involved in theproposals are real and significant.

9. The key point to note here is that there is no demand from anyone or anysector whatsoever, except the authors of the consultation, to considermoving HM Land Registry operations to the private sector.

10. In 2014 the government largely based their case around the notion thatprivate expertise could better deliver the digital transformation of HM Land

Registry services. The responses at that time raised many important issues,mainly that:

11. The proposed GovCo was just a stepping stone to outright privatisation.

12. HM Land Registry has been at the forefront of digitising and providingmodern and online services over many years – financing development fromits own resources as a trading fund.

13. We could continue to deliver a quality, trusted and impartial public service in-house, while fairly bringing in new revenue, without raising costs toconveyancers and the public; public service over private profit.

14. The 2014 consultation despite all of its obvious faults did, however,recognise that a relatively large number of staff (around 200) would need toremain in government as the Office of the Chief Land Registrar, to properlycarry out the statutory duties, ensure the state guarantee of title andindemnity worked properly and set fees etc. It is concerning that two yearslater the government (as explained to us by the Shareholder Executive)envisage a mere 5 to 10 staff, performing an unspecified contractmanagement role.

15. The consultation exercise asks for comments on moving HM Land Registryoperations to the private sector. We are concerned that the wording of theconsultation is very much focussed on “how” and not “if” HM Land Registryoperations should be moved to the private sector. Section 6.7.3 (paragraph89) states that the status quo is NOT an option being put forward as part ofthis consultation exercise. The reason for this is that this would not meet thegovernment objective of transferring HM Land Registry into the privatesector, and realising a receipt for doing so.

16. The Foreword by the Secretary of State asserts that through placing a

number of protections in place, the service will be maintained, fees willremain low and the receipts will assist the economic recovery. However, no



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risk assessment whatsoever has been undertaken. We believe this isbecause it would completely expose how meaningless the Minister’s‘assurances’ actually are.

17. The potential receipts pale into insignificance when viewed against either

structural deficit or planned infrastructure spending (or indeed both). TheOffice of Budget Responsibility has said; “Financial asset sales typicallybring forward cash that would otherwise have been received in futurerevenues, in the shape of mortgage repayments and dividends, so they onlytemporarily reduce the debt to GDP ratio.” When one considers the regulardividends provided to HM Treasury, the consultation rationale becomes evenmore absurd. The contribution of the sale to reducing the deficit and/orinvestment in infrastructure is minor in any context; it is not certain that thesale funds would actually be used for either purpose, and would be spreadover several years.

18. Now we need to examine the spurious short-term cash benefits against thevery real mid to long-term risks; something that government has absolutelyfailed (or worse, refused) to do. One can only speculate as to the realmotives. A basic ‘bow-tie’ risk analysis would illustrate a number of issues:

a) The risk in the proposals is to all users of the system, to any futuregovernment planned infrastructure build (such as HS2), to thehousing market, to the wider economy, and to the national interest asincreasing amounts of land are sold to (often unknown) overseasindividuals and companies. Just because the government denies thelevel of risk does not mean it goes away, only that that it is shiftedfrom government to users and citizens.

b) Furthermore, there is no assessment of 'downside' risk (the eventwhere it all goes wrong). This again would be devastating to allinvolved. It was the failure to build such ‘downside’ risk into decisionmaking that created the 2008 crash as bank lending became carelessand cavalier ... the same is true for this proposal.

c) The assurances on state guarantee and fees are not backed up byanything whatsoever. A private company, seeking to maximise profits,

would inevitably put up fees to achieve this. Various examples ofprevious privatisations demonstrate this risk, such as the energy andtrain operating companies.

d) The accountability and impartial role/scrutiny of the state would belost forever.

e) Purchase of HM Land Registry by a large financial institution wouldinevitably lead to a conflict of interest.

f) Once privatisation has taken place, there is nothing to prevent a

further sale (potentially to a hedge-fund or foreign company



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ownership) moving this vital public service further away fromgovernment control.

g) Private control could also lead to the leakage of personal data.

h) HM Land Registry data could be used in the public interest to helptackle the housing crisis by assisting with the planning and regulationof future land use. This would not appeal to a private provider.

i) As reported in the BBC “Panorama Panama - 'Tax Havens of the Richand Powerful Exposed '”, 4th April 2016, 100,000 properties have beenregistered by overseas entities in the UK to conceal their trueownership. As an impartial public organisation HM Land Registry is inthe perfect position to expand the use of its data to identify suchregistrations and to allow for government to regulate them. There is asignificant risk that a private organisation would have no incentive

and/or will to do so.

j) HM Land Registry further ensures the correct payment of Stamp DutyLand Tax on behalf of HMRC prior to applications being completed byregistration. There is a risk that a private company would not retainsufficient impartiality to exercise this function without potentialconflicts of interest, therefore threatening HMRC income.

k) HM Land Registry could take on further registers, for example, aregister of landlords, and assist in regulation. Again, this would not bea priority for a private provider with a profit motive.

l) The creation of a complete Land Register (a ‘Domesday Book’ for 21st century) would not materialise under a profit motive. The exposure ofinequality of land ownership and its rectification must be a priority.

m) There is a debate to be had on land value taxation. Again, a privateprovider would have no interest in assisting, whereas HM LandRegistry could simply be directed to provide the necessary data.

n) If privatised, HM Land Registry would not be subject to the Freedom

of Information Act and it would be easier to conceal who owns landand prevent the publication of datasets, such as the one that identifiesthe properties in London owned by non-domiciles.

19. These are just a small example of the folly of privatisation. Trust,performance, impartiality and fees are the immediate concern. The risks arehuge. The recognition that a safe and secure system of land registrationunderpins the economy (and could do so much more) is irrefutable.

20. Privatisation could destabilise all that is held dear and lead to chaos andmayhem for the housing market for the sake of a short-term return for HM

Treasury. No valuation figure has even been quoted in the consultationdocument. Press reports and estimates from senior HM Land Registry



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management seem to range from £0.5 billion to £1.2 billion. The most basicrisk assessment would illustrate that the certain increase in costs to usersand particularly the progressive weakening in the integrity of the guaranteedLand register would outweigh the one-off cash receipt from a sale.

21. PCS rejects the proposal that HM Land Registry should cease to be atrading fund and move to the private sector, as part of any of the proposedmodels outlined in the consultation. We contest the notion that there is not acompelling case for keeping HM Land Registry in public ownership. TheLand Register forms part of the critical infrastructure of England and Wales.Its completion, integrity and the economy`s confidence in it, is reliant on theindependence of the organisation that delivers the day to day running of HMLand Registry and its services.

22. The consultation states that “Land Registry could have more freedom in the private sector to continue to evolve into a high performing, innovative

business delivering for customer and the wider market on a 21st century,digital ec onomy” . Why would the delivery of land registration by a newlyformed company allow "mo re freedom to evolve " than the current landregistration service provided under trading fund status? No answer is givenin the consultation document. There is nothing in the present trading fundstatus that impedes the current service of land registration; nothing that acompany could provide that is not already provided with maximum efficiency.

23. It is clear from the proposals that the new company would have to workwithin the current Land Registration Acts and rules and would be bound bygovernment checks and regulation, although there is no real detail as to howthis would work in real terms.

24. Given the complete and unrivalled success of HM Land Registry as a tradingfund – with absolutely no suggestion of any deficiencies (it currently has a95% public satisfaction rating), it is inconceivable that a commercialcompany could better the current service delivery of land registration underthe present trading fund structure. To this end, we have in this submissionscrutinised the Canadian model (mooted in the consultation) and providedevidence as to how it would represent a retrograde step if applied to landregistration in England and Wales. It would be wholly inappropriate.

25. We provide many sound and good reasons for HM Land Registry remainingas part of government within this response, including the lack of any financialburden on government as a trading fund and substantial dividends returnedto HM Treasury – in the year 2014-15 HM Land Registry paid an ordinarydividend (4.6% of the average capital employed) of over £26 million and aspecial dividend of £100 million. We have also raised concerns about thereal effect on the property market and wider economy if operations deliverywere not to remain in government.

26. This consultation is being run for political not economic reasons and it can,

therefore, only logically conclude that HM Land Registry (in its entirety) mustremain within government.



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Opening Comments

27. Her Ma jesty’s Land Registry is a government executive agency, trading fund

and part of the civil service. Its functions are not only to “keep” the LandRegister, as repeated in the consultation paper, but to complete applications,thereby “creating” titles and increasing the data held and the accuracy of theRegister, and to consider the transactions in land which lead to thecontinuous updating of the Register. It is the quality and consistency of thedecisions made at the application stage of this process that provide theaccuracy and integrity of the current Land Register.

28. As a trading fund it takes no money from the public purse whatsoever; i.e. itincurs no cost to the tax payer at all . As well as paying its own way, it hasturned in a surplus for all of the past twenty years, bar one. It regularly

returns this to the public – by money it gives to HM Treasury and byfrequently reducing the fees charged for the service of registering land andland transactions. In the last 2 years it has paid £246 million to HM Treasury.These payments have been against the backdrop of a huge transitionleading to increased digitisation, increased efficiency and a substantialreduction in fees for electronically lodged applications.

29. Under the current trading fund comes HM Treasury accountability. There arecontrols of surpluses (both statutory and Treasury controls) that serve aschecks and balances on trading funds – controlling both what surpluses canbe retained and what can be done with these surpluses.

30. It is clear from the consultation document that there has been no impactassessment carried out despite clear widespread implications for manystakeholders. It has been acknowledged within this document that HM LandRegistry is part of the critical national infrastructure. It is also clear thatchanges could have an effect on the housing market and the widereconomy. These proposals will have huge effects on the lending andconveyancing sectors, and also the search providers and local authorities(given the concurrent Local Land Charge Searches considerations).

31. Over the past few years, our members have continued to make a

fundamental contribution to the service of land registration, despite theunprecedented upheavals, and have constantly delivered change to benefitcustomers, exceeding the ever increasing targets that have been set. This isagainst a background of ever increasing volume of transactions, partially dueto an improving property market and partly due to previous ill-advised exitschemes, which have left HM Land Registry under-resourced. HM LandRegistry currently has an exceptional 96% customer satisfaction rate.

32. PCS continues to engage in extensive formal consultations with HM LandRegistry management over the future transformation of the organisation,

including the current Business Strategy and operational changes. PCS andHM Land Registry management have recently reached a formal agreement



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on the Business Strategy and staffing issues, which has now beenoverwhelmingly ratified by a vote of the PCS membership.

Disadvantages of delivering land registration via a commercial (profit) model

33. Land registration involves the granting of title to land and the guaranteeing oflegal interests and estates. This is not just of fundamental importance toevery home owner in England and Wales but is also an essentialrequirement for the functioning of the UK economy.

34. Since land registration began in 1862, all have recognised this as a servicewhich must be provided by a body that is both free from influence andimpartial in the face of commercial interests. This requirement, best summedup as the need for independence, is precisely why the public service of landregistration has always been a function of government, not commerce.

35. The current consultation exercise pays lip service to this fact - as it tries (butfails) to preserve the necessary independence by attempting to cleave anartificial distinction between “Land Register ownership” and a new companywhich “delivers Land Registry services” (either under contract or monitoredby a formal economic regulator).

36. “ Ownership of the register of title, and other registers connected or ancillaryto the main register of title, would be the ultimate responsibility of the Crown,but delivery of operations on a daily basis would be the responsibility of thenew, privately run, company.”

37. The level of confusion here is alarming. The Land Register is ever evolvingand changing, maintaining the Register is not simply an administrative orautomatic IT function. HM Land Registry grants new registers of title andcreates and takes decisions on the transfer of ownership and legal interestssuch as charges (mortgages), easements (such as rights of way) andleases, to name but a few examples, in order to update and maintain thecurrent Register.

38. HM Land Registry staff therefore exercise a quasi-judicial function on behalf

of the Chief Land Registrar where they make their decisions governing theaforementioned rights to land; as part of the civil service, this takes placewith fu l l independence from commercia l inf luence , which is the verybackbone of the system.

39. Moreover, confidence and trust in HM Land Registry, from public andcustomers, is high, and this depends entirely on the independence,impartiality and freedom from even the possibility of a conflict of interestwhen granting title and guaranteeing legal interests and estates. This wouldinevitably cease were the activities of land registration to become a functionof a service delivery company.



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40. No amount of assurances, regulation, or otherwise, will put people’s minds atrest that a privately run company of such economic importance can ever besubject to the proper controls required from simple audit measures or ‘KeyPerformance Indicators’ (KPIs), all of which take a retrospective approach tomanaging service delivery rather than focussing on getting things right on an

ongoing daily basis as is the case under the current trading fund model.

41. It is also true that by delivering HM Land Registry functions as a tradingfund, its activities are rightly subject to democratic parliamentary and publicscrutiny and accountability.

42. At present, controls over HM Land Registry are statutory. Under the newproposals, the controls over delivering the service of land registration wouldbecome contractual, not statutory, and will be subject to all the bargainingthat comes hand in hand with commercial contracts and risks any number ofdetrimental changes at a later date.

43. This can be illustrated by the attempt to reassure the public that personalinformation will not be mishandled. See “Data Issues and Access toinformation” below.

We will deal with the ‘protections’ offered in the consultation paper for thecustomer and the wider economy

44. Before we go into the detail of each assurance given, we must point out thatany assurance given is only as sound as the details in the contract thatdelivers them. The Land Register comprises ‘r eal time’ details of ownershipand rights that need to be up to date and correct at the point of any search orapplication. There has to be a single point of truth and this is an essentialcondition of the Land Registration Act in terms of legal priority, the integrityof the Land Register and the data used by the wider conveyancingcommunity.

45. Contractual KPIs and retrospective regulation will simply not deliver therequired levels of assurance needed to underpin part of the criticalinfrastructure of England and Wales. This is crucial, not only in protecting

extremely sensitive private data but also in the provision of data and usercosts. If we look at other regulated areas, regulation is not timely enough tobe used in an area such as land registration. It is the regulation route thatwould determine any KPI fails, being purely reactive months after the event.

46. It is also clear from examples of regulation in the energy and transportsectors that regulation fails to protect users from price increases anddeterioration in service quality.



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Register ownership (6.4.1 Paragraph 44)

47. It is imperative that the Land Register remain in public ownership. It isimportant to recognise that the “Register” as defined is the end point of theconsiderations made by HM Land Registry. Quasi-judicial considerations

have to be made on most applications and “keeping” the register is notsimply an administrative function. Under a private sector model, what wouldbe lost from government is the role of gatekeeper.

48. The accuracy of each registered title, and the initial registration of the titleitself, has always been entrusted to the Land Registrar and his/her staffthrough their work as independent scrutineers. This scrutiny is exercised atevery level and at every stage of subsequent applications and, vitally, beforethey proceed with completing any application which would see anamendment made to the Land Register.

49. Whilst the end state Land Register may still be held in public ownership thevital components that determine the content and accuracy of the Register(the processes and operations) will not. We, therefore, must question thefuture quality of the Register; we cover the service quality and contractualissues below.

Service quality (6.4.2 Paragraphs 45 - 47)

50. HM Land Registry currently works to a set of agreed KPIs and has beenextremely successful in meeting these. Whilst some of the KPIs are met orfailed as part of usual business practices, such as the number of applicationsprocessed and the average time taken to complete applications, others, suchas counter fraud initiatives, require a great deal of time and expertise inorder to successfully reach and maintain standards.

51. We have huge concerns about how fraud protection would work under aprivate sector model, which we cover below.

52. The current auditing and monitoring procedures are undertaken at greatexpense to HM Land Registry and this is deemed appropriate in order to

maintain the level of integrity and accuracy of the Land Register. PCS hasgrave concerns that when a profit motive is introduced under a private sectormodel, this will create a conflict of interest, and these considerations andprocesses will inevitably be watered down in the drive for efficiencies.

53. As stated above the Land Register needs to be available and accurate in‘real time’. This underpins the Land Registration Act, not only in terms of thequality of data, but more importantly in terms of legal priority. This isparticularly important in relation to borrowing and the securing of debt.Retrospective KPI checks and regulation will simply not be adequate enoughin terms of the day to day application of the Land Registration Act.



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54. The housing market itself is thoroughly reliant on the Land Register in termsof data and the protection of priority. It is inconceivable that the market willbe unaffected by the additional burden of contractual bureaucracy betweenthe Land Register and any new company. It is also naïve to assume that anew company will not have its own set of demands in terms of service

delivery and financial considerations.

55. The consultation document indicates that the role of an independentregulator will be considered under certain models. However, we have seenhow the ineffective regulation of privatised public services has time andagain led to worsening services and soaring costs for customers, whilst theprofits of service delivery companies continue to rise. In particular, this hasbeen true of the energy and rail companies.1 2 It is clear that regulation hasnot worked in this industry and there is no evidence to suggest that it wouldwork for a privatised monopoly Land Registry.

56. If a future Land Registry raised prices significantly, the integrity of the LandRegister was compromised, or service levels deteriorated, then this mayinfluence the decisions made by land owners and others in respect ofproperty transactions. A progressively unreliable land register wouldincrease the problems met by purchasers, lenders and their conveyancers ingoing safely through to contract and completion. Additional complicationsand delays would almost certainly mean higher overall conveyancing costs.

57. As already mentioned the other key concern with regulation is that it can bea reactive and retrospective process that only identifies failings after theevent and then attempts to put measures in place to resolve them. Theproblem with this approach is that it accepts that failures can be made ratherthan preventing them from happening in the first place. Once again, this hasthe potential to undermine confidence in the Land Register with a seriousresulting impact on the property market and economy.

58. Currently, integrity and quality are built into the ethos, training andoperational procedures of HM Land Registry as an organisation, withassurance an inbuilt process that is audited on an ongoing basis.

59. It is only HM Land Registry, with its statutory adjudicatory powers that can

grant title and provide the guarantees on which the property and mortgagemarket depend.

60. For a private company to be able to make changes to land registers of otherprivate companies, of citizens, financial institutions, local and centralgovernment and the Crown does not stand up to scrutiny. The impartialityand freedom from conflicts of interests, which is the foundation of themaintenance of a public land rights system, could not be sustained if aprivate owner was free to authorise changes to land registers.

1 The Telegraph - 16 March 2015 - http://www.telegraph.co.uk/news/earth/energy/11475989/Big-Six-energy-

companies-profits-increased-tenfold-since-2007.html 2 Department of Energy & Climate Change Quarterly Report September 2013 – Chart 2.2

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/244580/qep_sep_13.pdf

http://www.telegraph.co.uk/news/earth/energy/11475989/Big-Six-energy-companies-profits-increased-tenfold-since-2007.htmlhttp://www.telegraph.co.uk/news/earth/energy/11475989/Big-Six-energy-companies-profits-increased-tenfold-since-2007.htmlhttp://www.telegraph.co.uk/news/earth/energy/11475989/Big-Six-energy-companies-profits-increased-tenfold-since-2007.htmlhttp://www.telegraph.co.uk/news/earth/energy/11475989/Big-Six-energy-companies-profits-increased-tenfold-since-2007.htmlhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/244580/qep_sep_13.pdfhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/244580/qep_sep_13.pdfhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/244580/qep_sep_13.pdfhttp://www.telegraph.co.uk/news/earth/energy/11475989/Big-Six-energy-companies-profits-increased-tenfold-since-2007.htmlhttp://www.telegraph.co.uk/news/earth/energy/11475989/Big-Six-energy-companies-profits-increased-tenfold-since-2007.htmlhttps://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&ved=0ahUKEwiivKXjwf_LAhUExRQKHSQiDCIQjRwIBw&url=http://www.pcsatabw.org.uk/Competition/SitePages/Home.aspx&psig=AFQjCNF6t1HjPeKb8K0Ou6je1KxkA6rIkQ&ust=1460221112885896


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The state-backed guarantee of ownership (6.4.3 Paragraphs 48 - 51)

61. We agree that the state guarantee and payment of indemnity is a majorplank of land registration, underpinning the conveyancing and lending sectorand, therefore, the economy. Whilst the suggested proposal states that the

principle of no fault indemnity will continue, the paper fails to provide anydetail around how this principle would be delivered.

62. The current Land Registry Act clearly regulates the indemnity process. Theapplication and operation of Schedule 8 lies under the control of the LandRegistrar, subject to any legal proceedings that may result.

63. So once again we are brought to the key issue – what will be the status ofthe Land Registrar?

64. Clearly if that function is devolved to a company it clearly gives rise to a

conflict of interest: on the one hand impartiality and integrity and on the othercommercial expedience and a desire for profit. Such a conflict of interestcannot be covered by contract assurances.

65. Paragraph 51 of the consultation indicates that the government would seekto agree a mechanism to transfer an appropriate share of financial riskassociated with indemnity to the privatised organisation, and crucially thatthis would not affect the assurance to customers that, should their proof ofland ownership or interests ever be subject to challenge, they will have thebenefit of a state guarantee should they suffer loss as a result.

66. Beyond this vague statement no such mechanism has been defined and webelieve there would be no power to compel a private organisation to abide bysuch principles.

67. Without proper legislation backed safeguards in place first, the reality wouldbe that tax payers would be exposed to the very real risk of having to beliable financially for any improprieties by a private organisation that gave riseto indemnity claims.

68. Given the lack of control any new company will have on fee income and data

use, this commitment to use private financial reserves for a public stateguarantee will further restrict the capital available to the company. This willonly force efficiencies by any new company to be found elsewhere.

69. Public state indemnity that is subject to contractual agreement with the newprivate company will add financial, reputational and, in our view, a very realrisk to the integrity of the Land Register and the wider economy.

Customer fees (6.4.4 Paragraph 52)

70. The consultation document states that customer fees would continue to beset by the Secretary of State. What this statement does not give is a



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commitment to fee stability or against any fee increases. What theconsultation fails to mention is that these future considerations will be setagainst the backdrop of contractual considerations and financialcommitments to the new company.

71. Under current guidelines, HM Land Registry as a trading fund must set feesin relation to income and expenditure to deliver the best possible deal forservice users. HM Land Registry has, as a result, seen a reduction in its feesin recent years.

72. As set out below, the experience of the Canadian model is contrary to thisand we believe that any private sector model would inevitably lead to anincrease in fees.

73. Any short term contractual agreement on fees would not secure the mediumto long term stability in the property and borrowing markets nor, therefore,

contribute to the government’s long term economic plan.

74. The commitment on fees only covers the core statutory functions. It fails toaddress other services that HM Land Registry is involved in and currentlyprovides for free. It also fails to commit to new areas of work or data that thenew company may provide in the future.

75. HM Land Registry provides a variety of services that are free to itscustomers.

76. Estate Plan Approval and Draft for Approval are two services that benefitcustomers dealing with large developments, both residential and industrial,and provide a streamlined method of dealing with associated applications.

77. These services require much time and effort by HM Land Registry staff,including surveying work contracted to Ordnance Survey, which HM LandRegistry funds with no financial gain.

78. HM Land Registry rejects very few applications from its customers; instead atrained caseworker will consider an application and raise requisitions tocover any omissions. This can involve consideration by senior technicians,

up to and including qualified lawyers. All of this is included in the fee paid forthe application.

79. HM Land Registry is one of the few institutions where reference to a lawyerdoes not include any additional costs to the customer. It would be unlikelythat a private company would be prepared to continue to bear theseadditional costs.

80. Any changes to these arrangements would have an impact on conveyancerswho submit these applications and would lead to increased administrativecosts for the applicant.



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Disputes and complaints handling (6.4.5 Paragraphs 53 - 54)

81. This is an area where government thinking has radically changed. In the2014 consultation exercise the government introduced comprehensiveproposals to introduce the Office of the Chief Land Registrar (OCLR).

82. Government placed utmost importance on certain critical functions thatshould be retained either in whole or as shared functions with any newcompany. The OCLR proposals were costly but deemed essential in terms ofassurances in areas of regulation and enforcement. It was clear in thoseproposals that the OCLR would need to have day to day involvement in theenforcement of the Land Registry Acts and Rules, including dealing withdisputes, unresolved objections and the responsibility for indemnity.

83. The issues identified by government in the previous exercise are now silentand nothing in the consultation document has convinced us how these huge

issues have been overcome between 2014 and now. We can, therefore, onlyassume that government have taken the decision that these are nowacceptable risks; we disagree.

84. The current consultation document makes great play on customers havingaccess to the First Tier Tribunal (the Tribunal). This service is the ultimatereferral point for a disagreement between two parties after a considerableamount of work and advice has already been sought. Current figuressuggest that HM Land Registry staff deal with and refer a large number ofvery complex disputes to the Tribunal, with many more ‘groundless’ objections being disposed of by HM Land Registry staff.

85. In their day-to-day casework role, HM Land Registry staff are frequentlyalerted to disputes over interests in land, either through applications orcorrespondence directly relating to the dispute, or through their experience inassessing and interpreting other information presented to them as part ofcasework processing. The information and guidance they provide, whilecomplying with HM Land Registry's published advisory policy, often helps tofacilitate the early resolution of a dispute, without the need for referral to theTribunal.

86. The Ministry of Justice announced in its January 2015 Scoping Study itsintention to look for improvements to the existing adjudicatory procedures forboundary disputes, promote the use of mediation and enhance theavailability of information. Work by HM Land Registry in achieving the earlyresolution of disputes is clearly in the public interest and saves escalationcosts, but is nevertheless a costly and time consuming operational burden inthe short term that is unlikely to be continued under a privatised model.

87. Offering continued access to the Tribunal by way of an assurance on disputehandling shows a complete misunderstanding of the current dispute processand the requirements of citizens involved in a dispute.



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88. Any dispute with HM Land Registry itself has to go to ‘judicial review’; it isunclear how this process would work with a move to a privatised operation.

89. It is also unclear whether the removal of land registration operations from thecivil service would have an effect on the scope of protection provided by The

Parliamentary and Health Service Ombudsman, or whether government willstill provide an Independent Complaints Reviewer?

ITC security (6.4.6 Paragraphs 55 - 56)

90. Paragraph 55 details the current ITC security environment that has servedHM Land Registry and, indeed, all government secure sites well. There havebeen no major instances of significant data loss as have been experiencedby many major private sector organisations.

91. Paragraph 56 gives a bold assurance that these standards will continue withany change of ownership, but no details are given as to how this will beachieved or ensured.

92. Any private organisation will be required to maintain a private cloud behind avery strong firewall in order to maintain the required standards, and this willconstitute a major investment.

93. The consultation document does not make clear how the ongoing securityregime will be assured or tested, and what level of influence governmentCommunications Headquarters (GCHQ), Communications ElectronicsSecurity Group (CSEG) and the Office of the government Senior InformationRisk Owner (SIRO) will have; nor does it specify that any potential privatebuyer will need ISO 27001 accreditation.

94. It is vital that all of the above remain in place to ensure that this significantelement of the Critical National Infrastructure remains adequately protected.

Data issues and access to information (6.4.7 Paragraphs 57 - 61)

95. This exempts information that has to be made available to the public underlegislation.

96. What protects the public against unlawful misuse of personal data (such asthe selling of names, addresses, mortgage lender details, etc.) is, therefore,not the Data Protection Act 1998 but the fact that land registration isregulated by statute and delivered by the statutory governed independentand autonomous civil service.

97. If this is changed, so that a non-statutory governed company handlespersonal data, there is nothing in law to prevent the company selling on

personal data to those who would purchase this information.



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98. The Data Protection Act 1998 itself considers such principles to be soimportant as to merit specific mention in the primary legislation in section 11:

11 Right to prevent processing for purposes of direct marketing.

i. An individual is entitled at any time by notice in writing to a datacontroller to require the data controller at the end of such period as is reasonable in the circumstances to cease, or not tobegin, processing for the purposes of direct marketing personaldata in respect of which he is the data subject.

ii. If the court is satisfied, on the application of any person whohas given a notice under subsection (1), that the data controllerhas failed to comply with the notice, the court may order him totake such steps for complying with the notice as the courtthinks fit.

[F1(2A) This section shall not apply in relation to the processing of such data as are mentioned in paragraph (1) ofregulation 8 of the Telecommunications (Data Protection andPrivacy) Regulations 1999 (processing of telecommunicationsbilling data for certain marketing purposes) for the purposesmentioned in paragraph (2) of that regulation.]

(3) In this section “direct marketing” means the communication (bywhatever means) of any advertising or marketing materialwhich is directed to particular individuals.

Access and provision of data (Paragraph 60)

99. The consultation document states that the government is committed tomaintaining current open data products, releasing more open data andexploring further free public access to HM Land Registry data.

100. Although a commitment is given that current open data products will bemaintained on the same (or better) basis as at present, no detail is given

about how a private company will be obligated to provide additional free dataor how any such additional data will be funded; clearly there is an ongoingcost associated with producing such datasets.

101. It is unclear whether this will incur additional charges for government and theconsultation document does not indicate who will ultimately own these newdata products. We are, therefore, concerned that any further costs that arisefrom providing this additional data will either be absorbed by government(eating into the expected capital receipt achieved through the sale of HMLand Registry) or will be passed on to customers and/or through cost savingmeasures that could impact on the jobs or terms and conditions of our

members. The current model where HM Land Registry is part of the civil



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service ensures that these datasets are made available at no cost to thepublic purse.

102. There is a likely to be a strong conflict of interest within a private sectororganisation between the government drive for free and open access to an

increasing number of datasets, and the right for the private company to sellthat data for profit. The consultation document is silent as to how this conflictwill be resolved, and what, if any, mechanism will be introduced to compelthe private operator to publish such free datasets.

New commercial protections (6.4.8 Paragraph 62)

103. In order for data to be used for the benefit of the whole economy and societythe Land Register has to be complete. It is, therefore, incumbent on HMLand Registry to register the remaining unregistered parts of England and

Wales. This is likely to involve relatively complex registrations such as largeor unusual estates and landholdings, including land which has remained inthe same long-term ownership and has yet to be subject to any trigger forcompulsory registration, or for which the title deeds are lost.

104. The remaining registrations will by their very nature be complex, timeconsuming and, therefore, relatively expensive to process.

105. A publically own Land Registry will be able to invest time and resource, at astandard advertised cost to the customer, in order that all applicationsregardless of size or complexity are completed in order to create a fullycomprehensive Land Register.

106. A privately owned company in search of profit margin will have no suchcommitment to this work.

107. HM Land Registry should also be looking to take on other areas of work andregisters. We are currently amidst the grip of a housing crisis and HM LandRegistry is in a prime position to use the information it collects to createadditional datasets to assist wider government and local authority policy. Additional HM Land Registry involvement could be in areas such as planning

and land use, landlord regulation, a register of landlords and short termtenancies, and in relation to flood prevention.

The Canadian model

108. Paragraph 73 of the consultation document refers to the Canadian model asa successful implementation. When looking at the Canadian model we needto consider the example of Teranet, which in 1991 was established as aPublic-Private Partnership with the Province of Ontario to convert andautomate Ontario's land registration system. The government of Ontario then

sold its 50 percent stake in Teranet to a consortium of private sectorinvestors in 2003, it then becoming a wholly private company.



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109. The context and circumstances of the Ontario Title Office at the point of itstransfer to the private sector in 1991 differ considerably to that of HM LandRegistry in 2016.

110. HM Land Registry’s current digital capability has been developed in-houseover many years allowing continuous transformation of the organisation astechnology has evolved.

111. Importantly, this technology has been developed to ensure that HM LandRegistry’s statutory requirements are fulfilled alongside delivering improvedefficiencies, with performance currently at record levels. Looking at internalperformance indicators, HM Land Registry has reduced the cost per unit ofwork from £29.13 in March 20103 to £19.29 in March 20164.

112. HM Land Registry customer satisfaction is currently running at an

exceptional 96%, significantly higher than in the Canadian model.

113. Experience of the Canadian model also demonstrates that although feeshave been capped they have risen significantly and continue to rise in linewith inflation. From 2 Nov 2015, new fee structure changes were introducedfor Land Registration services in Ontario. The fees were increased by 50%of inflation based on the Consumer Price Index (CPI) for each year andsubject also, where applicable, to a 13% Harmonized Sales Tax (HST)5.

114. In Ontario the passage of the Electronic Land Registration Services Act 2010(ELRSA) subsequently allowed the government a free hand to allow thirdparties to charge fees in addition to the prescribed government fees andgives a chilling premonition as to what could happen in England and Wales ifthe government follow the Canadian model.

115. In Ontario, the property market has evolved into a golden goose which hasbeen tapped at whim for more and more money. From 1 April 2016, whenlawyers register land transfers for property purchases, four separate chargeswill be electronically collected by Teraview (the software developed byTeranet).

116. Therefore, it follows that having a government capped fee does not offerland owners in England and Wales any guarantee that fees will not increasesignificantly in the future6.

3 Land Registry Annual Report 2009/10 (P14)

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/248013/0251.pdf 4 Land Registry Annual Report 2014/15 (P30)

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/443249/Land_Registry_Ann

ual_Report_2015_7_7_15_small.pdf 5 Bulletin 2015-03-fees, Ministry of Government and Consumer Services, Regulatory Services Branch

https://www.ontario.ca/land-registration/2015-03-fee-harmonization 6

thestar.com - Saturday 26/03/2016 http://www.thestar.com/life/homes/2016/03/26/fee-for-land-transfer-registration-amounts-to-tax-on-a-tax.html

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/248013/0251.pdfhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/248013/0251.pdfhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/443249/Land_Registry_Annual_Report_2015_7_7_15_small.pdfhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/443249/Land_Registry_Annual_Report_2015_7_7_15_small.pdfhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/443249/Land_Registry_Annual_Report_2015_7_7_15_small.pdfhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttp://www.thestar.com/life/homes/2016/03/26/fee-for-land-transfer-registration-amounts-to-tax-on-a-tax.htmlhttp://www.thestar.com/life/homes/2016/03/26/fee-for-land-transfer-registration-amounts-to-tax-on-a-tax.htmlhttp://www.thestar.com/life/homes/2016/03/26/fee-for-land-transfer-registration-amounts-to-tax-on-a-tax.htmlhttp://www.thestar.com/life/homes/2016/03/26/fee-for-land-transfer-registration-amounts-to-tax-on-a-tax.htmlhttp://www.thestar.com/life/homes/2016/03/26/fee-for-land-transfer-registration-amounts-to-tax-on-a-tax.htmlhttp://www.thestar.com/life/homes/2016/03/26/fee-for-land-transfer-registration-amounts-to-tax-on-a-tax.htmlhttps://www.ontario.ca/land-registration/2015-03-fee-harmonizationhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/443249/Land_Registry_Annual_Report_2015_7_7_15_small.pdfhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/443249/Land_Registry_Annual_Report_2015_7_7_15_small.pdfhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/248013/0251.pdfhttps://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&ved=0ahUKEwiivKXjwf_LAhUExRQKHSQiDCIQjRwIBw&url=http://www.pcsatabw.org.uk/Competition/SitePages/Home.aspx&psig=AFQjCNF6t1HjPeKb8K0Ou6je1KxkA6rIkQ&ust=1460221112885896


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117. Under a regulator-based approach, the consultation document states thatfees would be controlled by the regulator. The implication of accepting aprivate sector model, and in particular one along the lines of the Canadianexample, is that the cost to customers will increase. Regardless of whether

fees are set by a regulator, rather than passing on efficiency savings to thecustomer by the way of fee reductions, it is likely that fees will be based onthe financial and organisational requirements (and the profit motive) of theprivate sector company.

Fraud

118. It is alarming that assurances on property and identity fraud do not feature atall in this consultation.

119. Both government and the HM Land Registry Management Boardacknowledge that property and identity fraud is increasing and becomingever more elaborate. The open register, advances in digitisation and thechanges in requirements for sight of original documents mean HM LandRegistry and its staff need to be increasingly vigilant.

120. Conveyancing and land law is too complex for HM Land Registry to relysolely on IT solutions. It will always be an integral part of the role of acaseworker at HM Land Registry to use their experience and technicalknowledge to identify fraudulent applications.

121. There is, therefore, a clear need for effective risk management andinvestigations by HM Land Registry staff in the course of their day-to-daycasework. This is currently factored into all technical considerations made byHM Land Registry staff.

122. In addition, where there is a suspicion of fraudulent activity, the application ofmore refined analytical tools and data sharing between governmentagencies is essential, particularly in respect of the increasing risk presentedby identity theft.

123. Will such information sharing arrangements remain possible outside of

government under a private sector Land Registry?124. In relation to identity checks, it is also essential that HM Land Registry is

subject to all appropriate public safeguards; for example, through ensuringthat information is stored securely, is not made publicly accessible and is notused for purposes other than the prevention of fraud. The necessaryabsolute assurance in this regard can surely only be given within a publicsector Land Registry.

125. We referred above (see the state-backed guarantee of ownership) to theconsultation's complete lack of clarity as to the future arrangements andliabilities for the indemnity fund. This is all the more concerning in relation to

fraud, given that the HM Land Registry’s liability for indemnity payments isuncapped. This creates a real risk of catastrophic loss, ultimately



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representing a general risk for all tax payers not dissimilar to the recentbanking crisis.

126. In that respect, the rise in property values over past decades means that thefinancial consequences of fraud have also very significantly increased.

127. The current Law Commission consultation paper on updating the LandRegistration Act 2002 [Law Commission Consultation Paper No.227, paragraph 14.31, 31 March 2016 ] reports that "... fraud also accounts for asignificant proportion of sums paid through indemnity. Since 2008 - 2009,fraud has accounted for at least 50% of indemnity payments made each yearwith the exception of 2012 - 2013. In 2012 - 2013, however, the figures aredistorted by a single large payment of £5.1 million in relation to the mistakenremoval of the burden of an easement from the register. If that payment is put to one side, then fraud accounted for approximately 75% of all otherindemnity claims.

The provision of an indemnity is a response to fraud, but it is not a solution toit. It is important that the fact an indemnity is payable is not seen as a reasonto reduce efforts to prevent and combat fraud. It would be wrong as a matterof principle to do so. It would also overlook the fact that for many claimants afinancial payment will not fully compensate the distress and inconveniencecaused by being a victim of fraud. However, as we have noted above thosewho may be in the best position to detect fraud may not be incentivised todevelop best practice as the cost of fraud does not fall to be met by them."

128. The same paper goes on to reveal that for the year 2014 - 2015, out of atotal indemnity pay-out of £8.4m, some £5.9m (or 70%) resulted from fraud.

129. The effective combating of property fraud is vital if the indemnity fund andtax payer's interests are to be protected. Just as important, both public andprofessionals alike must have trust in both the Land Register and HM LandRegistry if the property market and wider economy are to function properly.

130. We do not believe that a privatised Land Registry, keen to reduce costs andmaximise returns, will continue the significant investment of staff resourceneeded to combat fraud.

131. The failure of the consultation to even begin to address this issue and

provide the necessary assurance is a most serious and fundamentalomission.

Short term and interim transformation

132. The consultation relates to the transformation that HM Land Registry is set toundergo. It says that there will be a cost to conveyancers regardless of thechosen option (including “do nothing”) as HM Land Registry moves to amore digitised service.

133. It is true that the HM Land Registry Business Strategy looks to transform theservice to include digital delivery. We envisage that the digital agenda will



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include self-service and wider use of the online application service. Withingovernment and providing a public service, HM Land Registry would beobliged to consider all users. It would be forced to consider ‘assisted digital’ channels for lodging casework and for alternatives to online services.

134. As a public service HM Land Registry is forced to consider the costs oncustomers when introducing any new electronic registration systems. Thesecosts could include initial set up costs of any new system and the ongoingrunning costs, including licence fees. It would also have to consider the factthat the citizen has the ability to lodge applications and represent themselvesin property matters and transactions.

135. In our view a private company would not necessarily consider the needs ofthe full range of service users. IT solutions and expensive licencing coulddrive small and medium sized companies out of the conveyancing sectoraltogether. Under a private model, mandation of electronic channels is also

more likely with paper based channels becoming increasingly expensive touse. This could also have a detrimental effect on the ability of the citizen tohave full access to all land registration services and to deal with their ownproperty matters.

Digital transformation

136. Paragraph 26 refers to the next stage of HM Land Registry’s transformation‘to become a truly digital organisation, reducing the need for clerical andadministrative staff’.

137. PCS believe that there is a fundamental mistake in this paragraph, whichleads to the set of erroneous assumptions made in the subsequent section.

138. Firstly, HM Land Registry is predominantly already a digital organisation. AllLand Register information has been held digitally for decades, as has thevast majority of the map data. Furthermore, the last two to three years haveseen a massive shift away from applications to HM Land Registry beingdelivered on paper, to the vast majority (72.6%) now coming in via digitalchannels. Additionally, HM Land Registry has introduced a ‘virtual post room’

system that means that, other than First Registrations, paper basedapplications and their supporting documentations are scanned into a digitalformat and then processed electronically.

139. Secondly the vast majority of HM Land Registry staff are neither clerical noradministrative – although HM Land Registry management are activelyconsidering re-introducing casework staff at clerical grades, which theyremoved in 2010 to process some of the less complex cases. It should benoted that even this work requires the individual caseworker to exercise judgement, and to refer any questionable matters to a higher authority.

140. So, at the current time, 95% of applications to HM Land Registry are alreadyprocessed digitally.



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141. The First Registration work that is not processed digitally at the moment isamongst the most complex that HM Land Registry deals with. It is dependenton large amounts of source documentation and does not (and is unlikelyever to) lend itself to submission via a digital channel.

142. Paragraph 28 implies that in order to deal with the additional one millionhouses that the government is committed to build by 2020, HM LandRegistry needs to ‘modernise and digitise’, yet no evidence is provided forthis assertion. This government commitment represents about 250,000registrations per year, roughly a 5% additional transactions, and equivalentto HM Land Registry’s current work backlog. It should also be noted that HMLand Registry consistently exceeds its customer satisfaction KPI, althoughthis has dipped slightly since 2015, with the extra day delay introduced intoprocessing paper applications by the introduction of the ‘virtual post room’.

143. Paragraph 29 notes some of the ‘successes’ of HM Land Registry’s own ITdevelopment staff; however, it ignores the fact that HM Land Registry hasbeen involved in a continuous and ongoing digital transformation fordecades. The staffing reduction statistics quoted in Paragraph 26 have onlybeen possible due to the introduction of new and improved IT systems anddigital workflows, all of which have been developed in-house, self-funded byHM Land Registry, without being a drain or burden on the public finances.

144. Paragraphs 29 -30 refer to a ‘digital transformation’, which is defined asdigital by default. However, as demonstrated above, HM Land Registry isalready digital by default, although consistent with the government policy of‘assisted digital’ it continues to offer a non-digital alternative.

145. We assume that what this section is aspiring to is a modernisation of HMLand Registry’s existing digital channels into a newer format, possibly withthe introduction of more validation and intelligence behind web-based forms,thus eliminating some of the checking and validation that is currentlyperformed by HM Land Registry’s skilled casework professionals. This isoften referred to as self-service, and would shift the balance of validation andchecking away from independent HM Land Registry staff to conveyancers.

146. Although some conveyancers favour this approach, the 2014 consultationcame out heavily against it. It is also likely to increase the cost of landregistration to the citizen, as on average conveyancer charges are higherthan HM Land Registry’s fees, and this work is currently carried out as partof the land registration process.

147. HM Land Registry’s computer systems are necessarily complex – they havegrown and evolved to reflect numerous Land Registration Acts and over 150years of land registration custom and practice. PCS accepts that any ITsystem can be improved, and that it would be possible, and maybedesirable, to process the simplest of applications with less caseworker

involvement. More radical changes would require primary legislation andcould well undermine the integrity of the Land Register.



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148. HM Land Registry has a proven record of transforming its systems, and doesso from within the income it generates from fees, whilst still maintaining areturn on investment which is paid annually to HM Treasury, and contributespositively to the public finances.

149. Would a private owner be prepared to make the massive financialinvestment required to rewrite HM Land Registry’s proven computer systemsduring future transformation? PCS believes that they would not be preparedto do so at their own expense; therefore the cost would need to beunderwritten by either increasing the fees charged by the provider or byincreasing the amount that the government will pay to the private company.Either way, how would this be of benefit to the public finances?

150. HM Land Registry has already demonstrated that it can develop andmaintain high quality digital services as part of the public service and from

within a combination of fee income and reserves, at no additional cost to thepublic finances. This will not be the case for a private organisation, who willwant additional payments from government to undertake the task of thetransformation of HM Land Registry systems, which will further underminethe long term economic justification for HM Land Registry privatisation.

Local Land Charges Register

151. In 2014 HM Land Registry launched its successful "Land Registry, WiderPowers and Local Land Charges" consultation. This essentially gave HMLand Registry scope to provide additional services. One such service is inrelation to Local Land Charges (LLC). This was highly controversial at thetime of consultation with local authorities and search companies opposingthe plans.

152. This consultation is silent on the concurrent considerations being made onthe future LLC service. The LLC consultation has guaranteed a dramaticallyreduced and standardised search fee and has promised to deliver completedigitisation and reduce the time taken to complete LLC searches. Thisservice will be run on a cost recovery model underpinned by very substantial

HM Land Registry investment in the early years.

153. It is extremely unclear as to whether this model for LLC will continue andwho will bear the cost of this investment work and associated risk.

154. We have every sympathy for the LLC search providers, who have seen theirbusiness removed, nationalised, and now potentially sold to a largeconglomerate (before the nationalisation has even taken place). We believethe initial consultation would have produced even more opposition had thereal outcome of a large privately owned monopoly been clear from theoutset. It is also silent as to whether the commitment to fee reduction can be

sustainably delivered in the long term. It is inevitable that the further this



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service is removed from government, the greater the risk of increased cost tothe public.

Impact on staff

155. The consultation document recognises that current HM Land Registry staffare critical to delivering and improving land registration services.

156. Land registration is not simply an administrative task; staff are highly trained,skilled and extremely experienced. Staff retention is critical to servicedelivery.

157. The consultation states that it is expected that most staff will transfer to anynew company in compliance with employment law.

158. Such law does not deliver long term protections for staff. This is a complexarea of legislation and is dependent on many factors. Contractual issues andpossible re-negotiations on terms and conditions, etc. will all need to beconsidered.

159. Given the very narrow areas for income being offered to any new companyas part of this consultation, the only means of maximising profits would be‘efficiencies’ in service delivery. We fear that cuts to office overheads andstaffing costs, coupled with unrealistic work pressures, would be used todrive an increase in profits.



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Annexe 1

Quotes from Graham Farrant, HM Land Registry Chief Executive and ChiefLand Registrar`s Blogs

“I was fortunate to be shown some of the other work carried out at Durham by ateam which is clearly dedicated and passionate about maintaining the integrity of theRegister! I am very grateful for the huge support and for their organisation of the two-day visit”

“I am yet to find an office that doesn’t have its own unique character and vibrancyand I have yet to come across a team that are not immensely proud of the work thatthey do”

“I was very impressed by the professionalism shown by the team in Hull, but also

their passionat e commitment to the city of Hull,”

“It was another rewarding visit, reinforcing the impression I had gained from my previous time there of a vibrant office full of enthusiastic and skilled people across all parts of the organisation”

“I also met with E lizabeth Cook who heads the First Tier Tribunal (PropertyChamber) and Siobhan McGrath to get their perspective on Land Registry as anorganisation which supplies cases to their Tribunal. They were very complimentaryabout the professionalism of the administration provided by Land Registry and theyhad no criticisms of our preparation whatsoever”

“One notable quote which sticks in my mind from a previous speaker who was presenting a paper on trends in conveyancing transactions across the market was,when comparing sources of data “Land Registry is more trusted than the DailyMail”. Talk about damned with faint praise…”

“It is worth reflecting on our successes at this point – two civil service awards in twoyears, both for digital products”,

“As I have said before, I can assure you that throughout this work I will continue to

put the assurance that we provide to those who have an interest in land and propertyand the integrity of the Register at the heart of considerations.”

“Government is going to consult on options and whatever one thinks about the political objectives of this Government, no decision has been taken and no decisioncan be taken until the consultation has been completed and views considered”

“I know that the integrity of the register is dependent on having an experienced, welltrained workforce, and therefore in emphasising the integrity of the register, we alsoneed to ensure that we protect experienced and skilled staff.”

“My starting point within Land Registry is one where I believe that I was mis-sold the job! Arriving on 1 June I found an organisation that was much more proactive and



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thinking about efficiency and change than I had expected. The professional prideand our focus on the assurance that we provide to those that have an interest in landand property and maintaining the integrity of the register is absolutely clear but doesnot get enough profile externally.”

“On Wednesday morning I set off on the (only 5 ½ hours door to door) train journeyto the Wales Office where I planned to work for a couple of days and took theopportunity to meet with a number of people and teams. I was particularly impressedwith the positive culture of the office and their can do attitude.”

“I have spent my entire career working in, or alongside, the public sector, mostlylocal government, so I understand the ethos of our services well and I believe passionately in the need for us to provide high quality services at the lowest possiblecost”

“Having already visited the Croydon Head Office and Nottingham before starting, I

was not surprised, by the supportive nature of the comments but it was useful to seethe emphasis on the importance of maintaining the integrity of the register, which is afundamental building block for me”

“It was another hectic week last week, culminating in visiting the PeterboroughOffice. I was very impressed with the atmosphere in the office, with excellent participation and staff appear to be well managed and engaged”

“I was also impressed by the undoubted enthusiasm of all of the teams there and thein-depth knowledge of the specialists dealing with large and complex infrastructure projects.”

“There does appear to be a lack of belief that the Board’s actions and wordsnecessarily reflect the local strength of feeling about the integrity of the Register andassurance being at the heart of everything that we do.”

“I am even more convinced that the future of Land Registry as an organisation lies inus becoming more modern and more efficient but building on the strong heritage andhistory that comes from the last 153 years and putting the integrity of the register andthe assurance that we provide back at the heart of everything that we do.”

“Once again though, I was impressed by the dedication and expertise of that coregroup of staff carrying out Voluntary First Registrations and in particular their in-depth knowledge of their subject. It is a good reminder of the degree of expertiseand judgement which is applied by our teams on a daily basis.”

“I have to say the Durham Office exceeded my expectations in terms of theorganisation and the welcome that was given to all of us over the two days.”

“For now, our focus should be on continuing to provide the excellent services you alldo on a daily basis, putting the assurance that we provide to people who own aninterest in land and property, and the integrity of the Register, at the heart of our

work. “



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Consultation Questions: Annexe 2

1. Do you agree that the ownership of the Registers should remain ingovernment?☐Yes ☐No ☐ Not sure

Comments:The whole of Land Registry m ust remain in government.

2. What steps should government take and what safeguards should it put inplace to ensure continued and improved access to high-quality and reliableLand Registry data?

Comments:The service mu st remain in gov ernment. No safeguards could p revent

the undermining of the protect ion offered by the current publ ic sector

model .

3. How could government use this opportunity to improve the quality andaccessibility of data produced by Land Registry for all sectors of theeconomy?

Comments:

Please see paragraphs 112-116 in terms of add it ion al use of and

accessib i l i ty of HM Land Registry data whic h demonstrates why a

com plete land register is essent ial and can on ly be del ivered w ith in

government.

4 On what basis should government manage the relationship with a privatelyowned Land Registry to ensure Land Registry meets, as far as isreasonable, the data quality and availability requirements of allstakeholders?

Comments:I t is sim ply not p ossib le to do th is. Previous privat isat ions and

too thless regu lation have failed to deliver eff icient, reliable services in

the private sector

5 Do you agree that the suggested safeguards should be included in anymodel?

Comments:

This is a bogus quest ion, as no s afeguards have been put fo rward inth is c onsu ltation. The fact is th at the further away HM Land Registry



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mo ves from governm ent, the less co ntrol there wil l be on fees and

quality.

6 Are there any other safeguards that you think should be included?

Comments:I t is not enoug h for the gov ernment to cla im that retain ing ow nership of

the land register prov ides the securi ty and co nf idence needed to

reassure the pu bl ic. This makes no sense at all whi lst a private

com pany is free to m ake changes to the Land Register. The Register

and its m aintenance mus t remain in the pub l ic sector. 153 years of

accumulated experience in maintain ing a world class land t i t les system

could be lost . A fundamental cornerstone of the property and mo rtgage

markets and the wider economy wou ld be sacri f iced for a very short

term s ale pric e.

Privat isat ion sho uld sim ply no t take place.

7 Do you agree with the preferred option? No

Comments:Please see summary and main text of respons e. HM Land Registry

mu st remain in government.

8 What are your reasons for your answer to question 7?

Comments: Please read summary and subm ission.

9 Do you think an alternative model would be better and why? Yes

Comments:Status quo m ust be maintained to prevent problems o ut l ined in

summ ary and m ain text .

10 Are there other key costs and benefits that you think we might have missed?

Comments:Many costs are apparent ly not u nderstood by go vernment. Extreme

risk that housing market could co l lapse.

Do you have any other comments that might aid the consultation process asa whole?

Please see main text.

Documents

2016 Land Registry Consultation Response (1)