The Andrews government intends to sell Victoria’s land titles registry to private interests for an expected $2 billion – a mere detail in the May budget.
This is no ordinary asset sell-off: land is the single largest asset class in Australia and the central public register of who holds what is arguably the raison d’etre of government.
Land holding in Australia is a legal contract between individuals and government – usually described as The Crown to emphasise its ultimate sovereignty.
Registering who holds which parcel of land matters – for individual financial protection, and for lenders like banks. Making land titles opaque and therefore more risky will impose staggering costs on the victims of fraud – and upon lenders.
Under Australia’s globally-admired Torrens Title system, government provides an unlimited guarantee to all land holders against fraud and abuse. Will this still apply if the register is simply sold to the highest bidder? Consider the legal battles and erosion of trust that will arise over any error by the private provider.
The UK recently offered its poor tax system as an excuse to attempt a similar sell-off. UK land valuers forced the Conservative government to withdraw the idea after observing it would oblige a private entity to adjudicate on the conflicting interests of sellers, buyers, lenders and neighbors.
Closer to home, the Federal government’s initiative to privatise ASIC’s registry function was abandoned after strident objections from investors and business. They successfully resisted the certainty of higher fees: the private provider would need to recover from users the cost of buying the registry plus their desired profit margin.
We see a murkier agenda behind this: what if the promoters of this change actually wanted to hide who owns the land? This is the case in Scotland where despite strenuous efforts that began with the Registration Act of 1617 and accompanying Register of Sasines, the owners of only 26 per cent of the Scottish land have ever been identified.
Unrecorded title, also known as Alloidial Title, exempts holders from public scrutiny, land tax, capital gains tax and the land use rules that reconcile our competing interests. It would end Government’s ability to act in the public good.
Selling off the NSW land registry proved very unpopular – key landholder groups like the Property Council of Australia NSW and the Real Estate Institute of NSW were vehemently against it.
The most telling critic was the Law Society of NSW:
“Our opposition to the sale is not grounded in any vested interest and serves no commercial value to lawyers. Nor do we have any ideological opposition to privatisation. Rather, our roles as lawyers afford us an objective appreciation for the innate value of the LPI (land registry) as an independent public asset, one that underpins over $1.2 trillion in real estate and $130 billion in economic activity every year.
“It is not an understatement to say the LPI is the foundation upon which the NSW economy rests. The integrity of LPI and the public’s confidence in the registry fortifies those foundations, preserving the wealth of hundreds of thousands of homeowners and investors across the state.
Prosper Australia loathes the idea of a private land registry: land holding ceases to be a matter of public record and it creates yet another private monopoly to bleed us all. This can only heap additional costs on every landholder.
Andrews should end this foolishness before an irreversible mistake is made.