Latest privatisation/corruption plan is halted as government reluctantly scraps Land Registry sale

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bis, business, Conservative, consultation, Democrat, Department, Infrastructure Bill, innovation, land registry, Lib Dem, Liberal, Mike Sivier, mikesivier, PCS Union, petition, privatisation, privatise, Queen's speech, skills, The Guardian, Tories, Tory, Vox Political

Still in public ownership: According to reports, the sale of the Land Registry has been cancelled.

A little-known plan to sell off one of the government’s best-performing and self-financing organisations has been scrapped – not because of fears that a new system would be prone to corruption but apparently because it was “too complicated” and would have necessitated “new legislation”.

The change of heart – for whatever reason – has been taken by the PCS Union as a victory for its campaign against the sell-off, which included a two-day strike against the privatisation proposal, which members described as “secret”.

Commentators including Vox Political pointed out that the public consultation process received hardly any publicity at all and was closed before most of us even knew it had taken place.

Among the Land Registry’s many functions are quasi-judicial decisions on ownership and transfers, granting title and, crucially, guaranteeing legal rights on behalf of the state. This is not just of fundamental importance to homeowners, but an essential feature of our economy. The backbone of the system is its freedom from outside influence and commercial interest,” the article stated.

In its article on the subject earlier this month, Vox Political warned that, clearly, privatisation would put the Land Registry entirely under threat of outside influence and dominated by commercial interest.

It quoted a report in The Guardian stating: “The agency is also currently bound by government policy on procurement, designed to assist small and medium-sized businesses to compete against the oligopoly of large suppliers. But BIS [The Department of Business, Innovation and Skills] has identified this as a problem, claiming greater flexibility in the private sector to buy goods and services. In a truly astonishing move, a government agency faces being changed into a commercial company so it can avoid the very controls the government brought in to protect small businesses.”

The article also warned of “massive job losses and office closures” and said the government had “flatly refused” to publish and fully consult on these plans.

And the plot thickened considerably when it was revealed that the Infrastructure Bill announced in the Queen’s Speech would transfer responsibility for the local land charges register to the national Land Registry – away from local councils. This means it would profit from the sale of the information – while councils fear they would still have to employ staff to do the work.

All in all, the sale was shaping up into a plan to put big business – the ‘This is Money’ article suggested private equity firms and outsourcing companies – in control of a system that had been freed of any obligation towards small and medium-sized businesses, and whose work would be done by local authorities – at a cost to the council, not the Land Registry.

For any new shareholder, it would have been a licence to print money.

The PCS has already declared its delight that the sell-off has been called off. A statement released yesterday (June 29) reads: “This would be a victory for the thousands of Land Registry staff who campaigned with industry professionals against the plans, and very welcome news for millions of people who rely on it to provide a reliable, impartial and hugely important public service.

“We want the Land Registry to work with us on our proposals to strengthen the agency in future, but serious questions must be asked of senior officials and ministers who tried to push through what would have been a very damaging and totally unnecessary sell-off.”

Indeed. First among these would be: Who paid them to do it?

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Did the Tories tell anyone at all they were privatising the Land Registry?

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38 degrees, bis, business, Conservative, consultation, Democrat, Department, Infrastructure Bill, innovation, land registry, Lib Dem, Liberal, PCS Union, petition, privatisation, privatise, Queen's speech, skills, The Guardian, Tories, Tory

Did you know about this?

According to a petition on the 38 Degrees website, the government closed – closed – a public consultation on proposals to privatise the 152-year-old Land Registry on March 20 this year.

“There has been no publicity or attempt to inform the public of this radical change to an organisation that is vital to the UK property market,” the text of the petition states.

While this is not strictly true, it would be accurate to say that the plan has not been well-publicised. Not at all.

The government put out a press release on January 23, saying a consultation was taking place on plans “to help Land Registry deliver more efficient and modern services”. That’s no way to announce a privatisation – and the plan to create a private company was only revealed several paragraphs into the text.

Why is this important?

Well, the Land Registry is one of the largest property databases in Europe, guaranteeing title to registered estates and interests in land, recording the ownership rights of freehold properties and leasehold properties where the lease has been granted for longer than seven years.

It is self-financing; its income generated by registration and search fees. You pay to access certain information.

Last month, 3,000 PCS Union members went on a two-day strike over the “secret” privatisation proposal. A report in The Guardian said the government had failed to explain what problem is was trying to fix, or what benefits would be gained by privatisation.

“Key among the organisation’s many functions are quasi-judicial decisions on ownership and transfers, granting title and, crucially, guaranteeing legal rights on behalf of the state. This is not just of fundamental importance to homeowners, but an essential feature of our economy. The backbone of the system is its freedom from outside influence and commercial interest,” the article stated.

Clearly, privatisation would put the Land Registry entirely under threat of outside influence and dominated by commercial interest.

Also: “The agency is also currently bound by government policy on procurement, designed to assist small and medium-sized businesses to compete against the oligopoly of large suppliers. But BIS [The Department of Business, Innovation and Skills] has identified this as a problem, claiming greater flexibility in the private sector to buy goods and services. In a truly astonishing move, a government agency faces being changed into a commercial company so it can avoid the very controls the government brought in to protect small businesses.”

The article also warned of “massive job losses and office closures” and said the government had “flatly refused” to publish and fully consult on these plans.

Prepare for a thickening of the plot: The Infrastructure Bill announced in the Queen’s Speech last week would transfer responsibility for the local land charges register to the national Land Registry – away from local councils. This means it would profit from the sale of the information – while councils fear they would still have to employ staff to do the work.

The petition states that “another consultation on giving the Land Registry wider powers in the control of data essential to the sale and purchase of property closed earlier with the majority of the public not being aware if it’s existence.”

It seems our attention is being directed away from another Tory-led plan to sell one of our best-performing and most efficient public services off to create more profit for private business – most notably big business, at the expense of small and medium-sized enterprises – while forcing the public sector to do all the work for nothing.

It isn’t too late to register your disgust at this proposal. Sign the petition right now.

And for goodness’ sake, tell everyone you know.

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Employee ownership: Has the government actually done something right?

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bis, Busines, business, buy-out, buyout, capital gains, Co-operatives UK, Coalition, company, Conservative, consult, Danny Alexander, Department, economy, Ed Mayo, employee, Employee Ownership Association, firm, government, Income Tax, innovation, Labour, Liberal, Liberal Democrat, Mike Sivier, mikesivier, National Insurance Constribution, Nick Clegg, NICS, owner, people, politics, relief, skills, stake, tax, Tories, Tory, Vince Cable, Vox Political, work

Long live co-operatives: At long last, it seems the government (or at least the Liberal Democrat side of it) is offering support to the most successful and supportive business model available – and we can hope that Labour will do the same. But where are the Conservatives in all this?

Today, July 4, is officially Employee Ownership Day – did you know that?

Employee ownership means all employees of a business have a significant and meaningful stake in it. This could include financial participation but must include provision of access to organisational structures. Where financial participation does take place, there is currently no set rule on what percentage of issued shares is a significant and meaningful stake, and this is something that I believe should be changed to ensure it is worthwhile.

Employee ownership can generally take one of three forms:

• Direct employee ownership – employees become individual owners of shares in their company;
• Indirect employee ownership – shares are held collectively on behalf of employees, normally through an employee benefit trust; and
• Combined direct and indirect ownership – a combination of individual and collective share ownership.

The Employee Ownership Association estimates that UK-based employee-owned companies had a turnover of more than £30 billion and employed more than 130,000 people in 2011. Employee-owned businesses enjoy greater staff retention, innovation and motivation than non-employee owned businesses and, in turn, these deliver wider economic benefits including increased productivity, profitability and more resilience to economic shocks.

The sector has grown by more than 20 per cent since the start of the recession in 2008; while 65 per cent of conventional businesses survive their first three years, 90 per cent of co-operatives remain in business; and 37 per cent of directorships in co-operatives are held by women, compared with 13 per cent in leading UK companies (this last point should not be relevant in this day and age, but the gender gap is quite clearly still there, so it is).

All of the above is from a government press release issued today, but eerily resembles comments made on this blog in the past – like this one or this.

According to the government, not only will this successful model of business be easier to understand and quicker to set up after Vince Cable publishes new guidance today, but the government is also consulting the public on the possibility of providing two new tax reliefs to help indirect employee-owned businesses get themselves set up.

To my way of thinking, this seems spectacularly useful, but this is the Coalition government so there must be a catch. Right?

It seems the Department for Business, Innovation and Skills will be publishing:

• Guidance for employees who want to request a move to employee ownership;
• Model documentation on a move to employee ownership with accompanying BIS and HMRC guidance;
• Guidance from the Employee Ownership Association explaining the different models of employee ownership; and
• Guidance from Co-operatives UK on how co-operative principles and ways of working can be implemented into employee-owned businesses.

“The government is committed to supporting this business model and will today launch a consultation on providing two new tax reliefs to encourage employee ownership,” according to the press release.

“This sector has the potential to benefit the wider economy, therefore the government is seeking views from people both inside and outside the employee-ownership sector to ensure the reliefs are supportive and effective.

“The Employee Ownership Association, in conjunction with the government, has helped to organise a number of events in the UK where employee-owned businesses are opening their doors to showcase the benefits of their business model.”

Nick Clegg actually said something I can support: “The benefits of employee ownership are clear. Staff who have a stake are more motivated and are rewarded for thinking in the long-term. That’s good for business and good for families, as it means lower absenteeism and lower levels of staff turnover.” This is something I have been saying for many months; it’s as though he has been reading this blog.

He said the government has set aside £50 million per year, starting next April, to give businesses and employees an incentive to adopt employee-owned models, and will be providing Capital Gains Tax relief for those who sell a controlling stake in a company to their staff.

It will be interesting to see how many firms take up the offer; from that information we can work out whether the greed that increased bosses’ pay by 700 per cent over the last 10 years – while employees got a miserly 27 per cent rise – is still rampant.

There is also a question over whether this is the right time – the middle of the longest economic slump in recent history.

It could be!

Cable reckons “there has never been a more important time to support different ways of running a business”.

He said: “The evidence is clear that employee-owned businesses not only help us build a stronger economy, but boost the retention, innovation and motivation of their employees.”

Co-operatives UK Secretary General Ed Mayo said his organisation would be supporting today’s events by launching its own publication, Simply Buyout – an essential guide to employee buyouts and becoming a co-operative employee owned business.

The consultation on the two new tax reliefs can be found online here. This stage of it will run until September 26 this year. The government will publish a summary of the responses in the autumn, and they will help to inform draft legislation.

The first is a Capital Gains Tax relief which would apply when the controlling share of a business is sold into an indirect employee ownership structure, and the government hopes it will encourage individuals wishing to sell their business to consider it.

The second tax relief is an Income Tax and National Insurance Contributions (NICs) exemption, that would allow indirectly employee-owned companies to pay employees a certain amount every year that is free of Income Tax and NICs. There would also be an employer NICs exemption for the company.

The government announced in the March Budget that it would provide £50 million annually, from 2014-15, to support employee-ownership models and to incentivise growth of the sector.

The press release features a quote from yet another Liberal Democrat – Danny Alexander – who said: “We want to encourage greater use of employee ownership in UK businesses and want to ensure that we provide reliefs that are supportive and effective. Views are invited from both people inside and outside the employee ownership sector.”

So that’s three high-ranking Liberal Democrats speaking up for it, and no Conservatives. Interesting. Do the Blue Meanies have nothing to say in favour of the proles part-owning the firms where they work?

And what about Labour? Does the Party of the Workers support this activity? This Party member hopes it does.

It will be hard to tell from the press coverage, however.

At the time of writing, there hasn’t been any.

Our upstart politicians have an important lesson to learn: Respect.

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Sometimes events coincide to create a coherent pattern, apparently by accident.

So it seemed today, with publicity surrounding the legalised corporate theft of all our images on the Internet, the part-privatisation of the government unit that has been carrying out illegal psychometric experiments on jobseekers… and the publication of my letter to the local newspapers, deploring a previous missive from a Conservative politician who was determined to parrot disproved assertions from his superiors in London, rather than treat us like intelligent creatures and try to connect on an equal footing.

We’ll start with the Enterprise and Regulatory Reform Act 2013, which received Royal Assent last week. Under this act, any image that does not contain information identifying the owner (or has had that information stripped away) will become available for exploitation by commercial organisations.

These so-called “orphan works” are placed into “extended collective licensing” schemes. Any user wishing to, say, put that silly photograph you uploaded to Facebook onto a T-shirt, only has to perform a “diligent search” for the owner which, when it comes up with a blank, will allow them to proceed with impunity. And they won’t have to pay you a single penny for the use of your work.

What can you do about it? Nothing, unless you can afford costly and cumbersome legal action – despite the fact that, previously, ownership of your creation has been automatic, enshrined in the Berne Convention and other international treaties where it is still considered to be a basic human right.

Would you like to know how the Department for Business, Innovation and Skills describes the changes? Like this: “For the first time orphan works will be licensed for use; these are copyrighted works for which the owner of the copyright is unknown or can’t be found.”

That makes it seem like a good thing; in fact, it’s quite the opposite – as you’ll soon find out.

Meanwhile, we see that the government’s Behavioural Insights Team – otherwise known as the Cabinet Office’s ‘Nudge Unit’ – is being part-privatised after causing immense embarrassment to the government when it was revealed that a psychometric test it had devised for the Department for Work and Pensions to use on jobseekers was not only fake but, in fact, illegal.

The team was established after the 2010 election to – according to the government – find ways of getting people to make better choices themselves, rather than through state intervention.

But the psych test foisted on jobseekers by Iain Duncan Smith’s Department for Work and Pensions was the exact opposite of this. Firstly, workless people have been forced to take the test or lose their benefits. Next, the results have been proven to be a sham – it seems you get the same set of personality results, no matter what answers you enter – so there is no possibility of personal choice. Finally, it turns out that the whole exercise is illegal according to both UK and EU law, as “informed consent” is required before anyone takes part in a test of this kind. This is because the test has been presented as research – a “randomised control trial” (see that use of the word ‘control’? Dodgy!) according to a Cabinet Office blog.

As fellow blogger Steve Walker stated in his Skwawkbox blog on the subject earlier today (which I have reblogged), “the test itself is not the point – what is being trialled here is the supposed effect of going through it on the subjects of the trials – the unemployed people being made to participate”.

Informed consent must be given before people take part in such trials, according to the law. A person cannot be pressganged into it; they must freely make a decision to take part – written, dated and signed – after being informed of its nature, significance, implications and risks.

There is also a data protection issue.

Apparently a competition is to be held to find a business partner for the Nudge Unit. It might be hard to envisage many reputable firms seeking to collaborate with an organisation that is known to have been acting illegally, but even worse is the possibility that this will be the first of many instances where parts of the publicly-owned, operating for the benefit of everybody in the country, civil service will be hived off into private, profit-making ownership by a government of privateers who can’t wait to get their hands on all that lovely moolah – that should belong to the people, not them.

Finally, the letter I wrote last week, in answer to one from the local Conservative Parliamentary candidate, was published today in the local newspaper. It responded, with evidence-based information, to a series of groundless assertions about the bedroom tax, the benefit cap and Employment and Support Allowance, that had clearly been handed down to him from Conservative Central Office. Particularly incendiary was the parroted claim that 900,000 people dropped their claim for ESA rather than take the work capability assessment. This had been disproved and ridiculed on the same day Grant Shapps originally came out with it!

It takes a special kind of contempt for your intelligence to repeat, as fact, a claim that we all know is false. The Coalition government seems to be trying to make a living out of it.

The attitude that we see, time and time again, is “oh, they’ll take what they’re given. As long as we put a nice spin on it, they won’t even notice what’s happening to them”.

What’s happening is, of course, that our freedoms are being stolen from us, and all we’re getting in return is meaningless soundbites.

There is an election tomorrow (as I write this). You can see that certain politicians, currently in office, have no respect whatsoever for you, your opinions or your freedoms. You can’t shift them out yet.

But you can – those of you who are voting tomorrow – send a message to them and, if you have any self-respect, you will.

I hope you get the representatives – and the respect – you deserve.