HC Deb 29 November 1988 vol 142 cc570-1
15. Mr. Turner

To ask the Secretary of State for Defence if he will reconsider the way his Department places a valuation on publicly owned land to be disposed of.

Mr. Sainsbury

No. Before disposing of surplus property we obtain professional advice either from within the MOD, from the district valuer or from commercial consultants. They prepare valuations of surplus property on the basis of full open market value, taking account of existing or established uses and, when appropriate, development potential.

Mr. Turner

Does the Minister agree that Royal Ordnance land has been sold on the cheap and that public assets have been given away? It is an absolute scandal. In addition to the hundreds of millions of pounds that have been given away on the land, there has been cheating on the property rights, which have also been given away.

Mr. Sainsbury

I remind the hon. Gentleman that Royal Ordnance was sold as a company with all its obligations and all its assets. Furthermore, that sale was the result of a satisfactory competitive tendering process on the open market and the highest bidder succeeded in obtaining the company. I remind the hon. Gentleman that we obtained an open market value, including development potential, of the property about which he is expressing so much concern, and that the figures were extremely low—so low that we did not reveal them to the prospective purchasers because we thought that they would have a more optimistic assessment.

Mr. Ian Bruce

Will my hon. Friend consider the speed at which we can sell land and property which is empty, particularly in the south-east, and certainly in my constituency, because there is a housing crisis in that area and the MOD seems to be hanging on to rather a lot of land and property that could be better used in the private sector?

Mr. Sainsbury

I assure my hon. Friend that we in the MOD are extremely anxious to make the best use of land assets and, where land is surplus to requirements, to release it for alternative use as soon as possible. If he has any particular case that he would like to bring to our attention I should be grateful if he would write to us, and we shall certainly look into it.

Mr. O'Neill

Was not a reason for selling the Royal Ordnance factories the surplus capacity, with the obvious follow-on that the land would become available for sale because the company would not require it? Did the MOD valuers and surveyors at any time take into account not only alternative uses, but the ease with which outside planning permission for other activities could be obtained? Is that not the reason why the property and land were sold at such a knock-down price and taxpayers were denied a sizeable income, which they could have had if a proper assessment had been made?

Mr. Sainsbury

In his last remark the hon. Gentleman seemed to be assuming that certain rumours in the press and speculative valuations that have originated in the City must necessarily be true. He may like to take some independent advice on that. I assure him that the chartered surveyors came to the Department with a valuation of the land that was included in the sale of the company—the company was sold as a whole—which took into account the factors to which he referred. The report on one valuation stated: The land is within the Metropolitan Green Belt and redevelopment would be resisted. Our valuation assumes primarily agricultural or recreational use but with hope value of obtaining limited industrial or warehouse consents over a period.