“This is an attempt to nationalise a competitive marketplace as a precursor to then privatising it which in our eyes is bizarrely corrupt.”
A lack of clarity, unsubstantiated claims over improved delivery, potential consumer detriment and a total disregard for the loss of jobs and impact on the property market recovery are cited as the key concerns.
The Government is currently undertaking two consultations; one to consider the restructuring of the Land Registry (which CoPSO believe is a fast track to privatisation) and the second, which ends on 9th March, setting out plans to centralise the LLCR and expand the Land Registry’s regulatory powers.
Costs and search times set to rise
The Land Registry claims that centralising the LLCR will speed up the process and introduce a consistent pricing structure. However, according to CoPSO its members already offer national pricing and searches are consistently delivered within 7 days. In fact by centralising the LLCR in the way the Land Registry proposes costs could rise and searches take longer.
James Sherwood-Rogers, chairman of CoPSO says:
“Turnaround times for searches will increase if centralisation goes ahead as they will simply be adding another layer in the process. The land Registry will still require Local Authorities (LAs) who currently maintain the LLCR to input data, but the Local Authorities will no longer be remunerated for doing this. From a budgetary perspective LAs will have to make staff cuts and thus the timeliness of data being input to the Register is likely to suffer. The further concern is that experienced and knowledgeable employees who currently undertake the quality assurance will go and the Land Registry will not have the competence or local knowledge to undertake this function.
Under the new plans, the Land Registry will only digitalise records back to 1999 which in one fell swoop will ignore the listing of thousands of homes, conservation areas and environmental issues. At the present time LAs will routinely examine data that goes back to 1926 meaning that homebuyers are fully informed about a property. One wonders what cost there may be for consumers if they buy a property in blissful ignorance of its history. Further what are the implications for the legal profession who are likely to be sued under their PI insurance policies?”
Consumer will be left “high and dry” with no clear redress
The Land Registry also proposes to give itself powers to make changes to the register data, but bizarrely they are suggesting that LAs will still be liable for any problems with the information that the Land Registry provides. The likelihood is that there will be endless squabbles between the Land Registry and LAs when something goes wrong and this will leave the consumer “high and dry” with no clear pathway for redress. The Land Registry have said they will introduce protocols and service level agreements with LAs but CoPSO questions how they will be enforced across 348 authorities and by whom and at what cost to the consumer.
Sherwood-Rogers adds:
“There is no good reason why around half of the £26m earmarked for this centralisation should not be channelled into improving the structure that is already in place. This would enable the 30 per cent or so of local authorities currently with non-digital records to convert these at a far lower cost to the public purse. In this way the Government’s ‘digital by default’ agenda could be delivered without all the risks that the Land Registry plans entail.
There is another very worrying factor - the Land Registry has entirely omitted any reference to the potentially disastrous impact on the property market this centralisation may have during the several years they plan to take undertake the centralisation process. There have already been instances of LA employees fearful for their jobs quitting on mass resulting in huge delays for homebuyers in those locations. In Leicester this happened recently slowing up the search process to over 38 days. It is a known fact that the single biggest cause of transaction failure is delays in the process and with search times increasing dramatically this will happen.”
Misleading facts used to support move to centralisation
The consultation document itself cites reasons for this project which are either misstatements of fact or at the minimum misleading. The Land Registry Advisory Council (LRAC) to which they attribute the original proposal to centralise from its meeting in June 2010 did not do so for the simple reason LRAC did not exist in June 2010. Further to support its case it references a World Bank Report to show that the UK has a poor ranking on the transfer of property. What it fails to point out is that this report refers to commercial property and not residential property.
Further, CoPSO points to the supposed support of the centralisation agenda by lawyers as being misleading or at the least overstated. A Local Land Charges Institute (LLCI) survey and an open survey undertaken by CoPSO revealed that only 9% and 25% of those surveyed are in favour of centralisation. Neither the LLCI nor CoPSO paid lawyers to participate in this research, in contrast to that undertaken by Ipsos MORI for the Land Registry.
Sherwood-Rogers comments:
“The purpose of a consultation is to obtain views from the public and other interested parties on an issue. At the risk of acting outside their statutory powers the relevant minister needs to review the case with an open-mind taking into account all relevant facts. However, a ministerial statement in the House of Commons on 27th January 2014 indicates that the Government has already reached a decision on this issue despite the consultation, assuming that the centralisation will go ahead.
The Land Registry currently achieves a 98% customer satisfaction level contributing £98m to the treasury at no cost to the taxpayer. It is good at doing what it does, but previous attempts to venture outside of its core business have been disastrous. The projects that they have undertaken and then abandoned in recent years include the Chain Matrix system, e-conveyancing and the e-charges project at a combined cost to the taxpayer of £87million. Who is to say that a centralisation project might go the same way, but this time with much more than money at stake?”
There are also serious questions about the manner that the Land Registry has gone about this consultation and CoPSO will consider instituting legal action should the Minister not heed the call for the Consultation to be withdrawn.
Sherwood-Rogers concludes:
“This is an attempt to nationalise a competitive marketplace as a precursor to then privatising it which in our eyes is bizarrely corrupt. The consultation is being hurried through to try and ‘fatten up’ the Land Registry which could end up in disaster for consumers and the property market.”
