Executive Summary (excerpted)
We strongly recommend keeping the Land Registry in public hands and against privatisation on the following grounds:
- Privatization will undermine current and future open information programs that are making essential, public-interest information about land title and pricings available to the UK public.
- The Land Registry performs an essential public task which privatization puts at risk. It maintains and provides information of major public importance on land ownership and transfers. In its role, the Land Registry must balance two different goals: maintaining a high quality of service (being effective) and keeping costs low (being efficient). Privatization clearly risks prioritizing cost minimization over quality of service.
- Benefits of privatization for efficiency or the Exchequer are negligible — or even negative. Efficiency benefits of privatization have generally been over-estimated and are likely especially low in this case where: a) significant efficiencies have already been realized e.g. through digitization) b) there is a clear conflict between cost minimization… In terms of benefits to the Exchequer, privatization involves receiving a fixed payment today in exchange for payments in the future (or sacrificing future incomes). Governments have traditionally undervalued public assets and this is likely here especially as HMG appears anxious to raise capital and eager to pursue privatization. It would be helpful to have sight of the cost model used by HM Treasury to evaluate this privatization.
Should the Land Registry privatization go ahead in spite of objections we recommend the following:
- The creation of an independent regulator (similar to OfCom) with a clear and powerful public interest mandate that includes provision and promotion of open public access to Land Registry data. (These tasks could be assigned to an existing regulator if an appropriate one exists. However, it should not go to the ICO as they have a different focus around privacy).
- Strong protections for quality of data and service. The regulator must be able to mandate the collection of specific information and that the information be made open.
- Consultation with stakeholders: The regulator should consult regularly with key user groups to ensure that appropriate quality of service and data are maintained.
- Clear rules exist that prevent a privatized Land Registry from undermining or evading requirements to make all data openly available in bulk.
- As a state-regulated monopolist a privatized Land Registry should have special transparency requirements that including detailed publication of cost and performance information.
On 24 March 2016 UK Government launched a consultation on privatizing the land registry:
- Press release: https://www.gov.uk/government/news/consultation-launched-on-land-registrys-future-operating-model
- Consultation: https://www.gov.uk/government/consultations/land-registry-moving-operations-to-the-private-sector
Consultation closes on 26 May 2016
Risk to Open Information
Land registry holds essential public interest data about property ownership and prices. Much of this data has been made open data over the last five years thanks to efforts by Open Knowledge and others.
Privatization may put this at risk. The government states they will retain ownership of the register itself. However, we can anticipate strong commercial pressures in a private company to generate revenues and returns and to do this from data services by charging for access to the data and cutting off existing open data provision.
Except from Press Release
Business Secretary Sajid Javid today (24 March 2016) announced the launch of a consultation document setting out the options on moving Land Registry operations into the private sector.
The government is proposing that the Crown will still retain ownership of the Land Register. Government will also continue to offer key protections to customers. This includes fees being set before Parliament and the continuation of the state-backed guarantee when a loss is incurred as a result of a mistake in the register.
The preferred model being proposed is a privatisation of Land Registry consisting of a contract between government and a private operator, with all the core functions transferred out of the public sector, but with key safeguards for Land Registry customers and government being maintained.
Excerpt from consultation document
Paragraph 16 states:
This Government believes that it is important that the Registers continue to be owned by government, and this proposal would not change that. The data within the Registers is protected by Crown copyright and database right as material created by a public body. Land Registry has delegated authority from the Controller of Her Majesty’s Stationery Office in the National Archives to control and licence the database and copyright in its work and register data. This would not change going forward and the copyright of the Registers would remain under the ownership of
ED: but what about commercial pressures post privatization? Even if the government retain IP in the register, what would happen if, for example, the new owner would not start providing “advance access” to data for a fee? What enforcement mechanism would there be? What happens if the new owner creates new datasets, perhaps using the data they have? Would the Gov retain IP in these and be able to openly license them?
Paragraph 41 lists Government’s priorities for the change:
Subject to meeting these preconditions and delivering value for money any change would be assessed against the Government’s objectives to:
- Maximise upfront proceeds for the Exchequer …
- Allow classification of the new service delivery organisation to the private sector.
This would allow certain freedoms and incentives appropriate to a private sector organisation to help transform the service.
- Deliver a modern, digitally-based service that benefits Land Registry customersas well as taxpayers as a whole.
There is no mention here of the the value of the open information assets that the Land Registry provides. Paragraph 44 following reiterates that gov retains IP ownership of the registers. However, other than cutting costs the only way for a new owner to generate value is to generate revenue from data services. This would naturally bring them into conflict with the open data approach. Thus, the government desire to maximize profit from the sale will naturally put them in conflict with preserving maximal level of open data going forward.
Concern here is all the greater given the prior experience with the Post Office privatization where any hope of the Post Office opening up its postcode database was extinguished once the Post Office went into the private sector.