Electronic Conveyancing

HC Deb 09 November 2000 vol 356 cc111-40WH

Motion made, and Question proposed, That the sitting be now adjourned.—[Mr. Touhig.]

2.30 pm

The Parliamentary Secretary of State, Lord Chancellor's Department (Mr. David Lock)

I welcome everyone to the debate this afternoon on electronic conveyancing. Conveyancing is not usually a word to set the pulses racing, but a conveyancing system is an important part of the fabric of modern life. In fact, it is difficult to imagine a free, modern society without a secure and trusted conveyancing system. We have only to consider two facts to realise how large a proportion of the population use a conveyancing system. First, almost 70 per cent. of the population of England and Wales live in owner-occupied accommodation and, secondly, more than 1 million residential sales are registered at Her Majesty's Land Registry each year.

From that perspective, the possibility of a quantum leap in the ability of the conveyancing system to deliver a quicker, simpler and more cost-effective service is an exciting prospect. New electronic conveyancing services could directly affect millions of people and businesses each year and, for that reason, I am pleased to announce that I have decided to create an interdepartmental steering group of senior officials to oversee and co-ordinate the development of the electronic conveyancing programme. The steering group will draw in representatives from several Departments with direct interest in the conveyancing system, including the Department of the Environment, Transport and the Regions, the Department of Trade and Industry, the Inland Revenue, the National Assembly for Wales and the Law Commission. It will ensure that the best use is made of the opportunities offered by the introduction of electronic conveyancing.

Mr. Nick Hawkins (Surrey Heath)

I appreciate that the Minister is unlikely to give me an instant answer to my question, but would it not be wise to consider expanding the interdepartmental group to include representatives of the Institute of Legal Executives and those who specialise in conveyancing within the Law Society—bodies that are at the sharp end of such a process? In addition, it may be useful for the group to include someone from the Consumers Association or the National Association of Citizens Advice Bureaux.

Mr. Lock

E-conveyancing is all about giving instant answers to questions. Therefore, in the same spirit, I can give the hon. Gentleman an instant answer to his question. The next sentence that I was about to read from my brief says that the group will also provide a ready-made forum for consultation with outside stakeholders.

Mr. Andrew Miller (Ellesmere Port and Neston)

Those outside stakeholders should include estate agents. It could benefit both the consumer and estate agents if a common system were adopted that could create a common platform of information technology.

Mr. Lock

I agree entirely with my hon. Friend's observations. On Tuesday, I had the pleasure of speaking at a seminar on the subject in Birmingham, hosted by Wragge and Company. Among the audience was a large number of property agents, and their interest in e-conveyancing was made plain both by their attendance and by the fact that once the subject had been explained, they came up with many interesting, practical and relevant points that will have to be made to work if it is to operate in practice.

What then is electronic conveyancing? My working definition is that it is the result of crossing electronic commerce with conveyancing. There are therefore two elements to the definition. E-commerce needs little introduction and is in any case only the means to the desired end. Conveyancing may require a little more explanation. The Shorter Oxford English Dictionary gives two meanings of the word. The first is "a deceitful contrivance", which might have made an interesting subject and secured a slightly better attendance for our debate, but I am pleased to say that that is not the meaning that I have in mind.

Mr. Hawkins

That is the meaning of the next Labour manifesto.

Mr. Lock

Unlike the hon. Gentleman's observation, the second meaning, which goes back to 1714, is more to the point. According to that, conveyancing is the drawing of deeds and other instruments for the transference of property from one person to another; the branch of law which deals with titles and their transference. Putting aside the Dickensian shades of Tulkinghorn, Heep, Marley and Scrooge—a fine name for a firm of solicitors if ever there was one—suggested by the words "drawing deeds" and "transference of property", that definition conveys the essence of conveyancing. In plain English, conveyancing would be defined as something along the lines of "the process of buying and selling land".

What happens in a typical conveyancing transaction? The property in question might be a house or flat but could equally be a factory, a shop, a shopping centre or a farm. There are usually at least three sides to any such transaction—buyer, seller and lender. For simplicity and brevity, I will explain matters from the viewpoint of a buyer's conveyancer. Typically, the conveyancer will be a solicitor or licensed conveyancer, but may be a buyer in person. There are four stages to the process—investigation and report, exchange of contracts, completion and registration.

The first stage, investigation and report, is the "subject to contract" phase. That means that, although heads of agreement have been set, each party remains legally free to withdraw. The buyer's conveyancer considers the information supplied by the seller's conveyancer and carries out searches with various bodies to obtain information on the property. The number of searches will vary depending on the nature of the property and its location. For example, if the property is in an active or former coalfield, a mining search is usual. In the Cheshire plain, a brine search may be wise. In my constituency of the Wyre Forest, which has the River Severn running through it, information on whether the property is on the flood plain might be sought. A commons registration search, which I am pleased to say has nothing to do with declarations of interest, would be wise if there were a hint of common land or a village green. A comprehensive list of all the possible searches would fill a small book—and indeed, to the relief of many legal practitioners, has done so.

Typically, the principal documents for consideration by a buyer's conveyancer at that stage will be a draft contract identifying the buyer, seller and the property to be sold. It will also include details of any obligations that the seller is to impose on the buyer—and, in the fullness of time, vice versa—and replies to the inquiries about the property from the buyer's conveyancer. The answers will give information about disputes, third-party rights, fixtures and fittings, damp and timber guarantees and a host of other matters. The local authority search gives information, among other things, about highways, drainage and sewerage, planning and building regulation matters. A copy of the title register and filed plan of the property issued by the Land Registry sets out the name of the owner, a description of the property and the rights to which it is subject, and may refer to other documents that may also have to be inspected.

The object of that stage of the exercise is to enable the conveyancer to find out who owns the property, what people have rights over it, what rights it has over other property, what it may be used for or not used for, and so on, giving the conveyancer full knowledge of the nature of the property that the buyer is to buy.

Mr. John Burnett (Torridge and West Devon)

When the Minister's Department considers the important matter of e-conveyancing, will it consider contractual provisions that vendors' solicitors often impose in order to extricate their clients from any liability in matters of title and of easements to property? In other words, in such matters it should be the duty of vendors to make full disclosure and not contract out.

Mr. Lock

I am grateful to the hon. Gentleman for that suggestion. E-conveyancing is essentially about turning the existing conveyancing process into one which can be done much more efficiently in a world of electronic communications. It is a different policy issue to try to shift the balance in a conveyancing transaction between caveat emptor, disclosure and easements. The policy ramifications of shifting that balance are profound. Although a debate on that would be legitimate, it is not the same debate as the one that we are having today on the electronic transference of the existing process.

Mr. Burnett

I fully agree with the thrust of the Parliamentary Secretary's comments. I do not want to interfere with people's opportunities and abilities to make their own contracts. Does the hon. Gentleman agree that the process might be rather swifter if there was some sort of convention, perhaps of the Law Society, of full disclosure of title, easement and covenant matters?

Mr. Lock

I am grateful to the hon. Gentleman for his suggestion, the germ of which contains part of the answer. The matter should not necessarily be pursued through legislation, but might be pursued through a Law Society code of practice. Having spent several years dealing with property litigation, I am conscious that disputes often arise over rights over property that the property owner either did not know that he had, or was not aware that he was subject to. Therefore a duty to provide disclosure of easements over a property of which the seller is unaware would have to be treated with some caution.

Mr. Miller

My hon. Friend refers to turning the existing process into an electronic one. I hope that by that he does not mean simply replicating an existing process electronically. It would be a shame if that were so. The steering group should investigate much more widely how greater efficiencies might be gained from the opportunities created by its deliberations.

Mr. Lock

If my hon. Friend will allow me to make some progress, most of his anxieties will be dealt with later in my speech.

Gathering the information from its disparate sources takes time. Inevitably, the buyer will have to wait while the information is collected, interpreted and reported. A good deal of time can therefore be taken up waiting for someone else to do something, and the process can resemble a slow courtly dance. The length of the "subject to contract" period was identified as the source of most of the main problems in residential conveyancing in the extensive research carried out for the Government in 1998.

The second phase is exchange of contracts. Exchange is the moment when a legally binding contract to buy and sell land is created. Usually, a deposit is paid and a completion date fixed. Except in certain circumstances, such as a public auction, the contract must be in writing and signed by the parties involved. In arranging an exchange, co-ordination is the name of the game, especially in residential conveyancing, where chains of several dependent sales and purchases mean that no one can exchange until everyone is ready to do so. In those cases, the process is more akin to a courtly ball than a mere dance.

Conveyancers will want to be sure that all the financial arrangements for completion are in place. If there are transactions with or without mortgages, one can readily see the scale of the logistics. Again, the issues for the buyer and the seller are time and certainty. The buyers will want to be sure that the completion date proposed is practicable and suitable, and so on. The sellers will want to be sure that they have money available to meet their obligations on completion.

The third stage is less worrying. Everyone works to an agreed timetable. The problem, which is ironic considering what has gone before, is often that everyone is suddenly working to tight deadlines. Final searches are carried out, most importantly at the Land Registry, money is moved into place and documentation is prepared.

The fourth and final stage of this strange, eventful history is completion. Traditionally, the legal ceremony was done in person. The lawyers would gather and money would be swapped for the title documents. Once the ceremony was complete, the buyer would be informed and take the keys to the mansion of their dreams, or flat 37 Roehampton court, as the case may be, and take possession.

Taking possession used to be a ceremony in itself. A symbolic clod of earth might be handed over, or an actual entry onto the land might be staged. I am even told that, in some parts of the United States, a horseshoe would be thrown into the land accompanied by a loud yee-ha. However quaint, the object was to announce the new owner of the land to the world.

Nowadays, I am afraid, the romance has gone and there is very little ceremony. Completion is effected by electronic transfer of money, telephone and the posting of the title deeds from the seller's conveyancer to the buyer's conveyancer. They include a deed executed by the seller—executed in this case meaning signed in the presence of a witness and delivered as a deed. That is probably not a helpful definition, but it illustrates the fact that conveyancing has its own language.

Completion is usually the end of the process from the buyer's point of view, but the conveyancer is still not home and dry. Full ownership will pass to the buyer only on registration of the buyer at the Land Registry. The conveyancer must ensure that the application for registration is received at the proper district land registry before the expiry date of the pre-completion Land Registry search. As the application for registration can be made only when the buyer has received the transfer from the seller, the application is almost bound to be made at least a couple of days after completion. It then has to be checked and processed by the Land Registry. Only when the Land Registry is satisfied will the register be changed and, as I am sure hon. Members appreciate, the legal title vested in the buyer as from the date of receipt of the application. The gap between completion and receipt of the application at the proper office is the so-called registration gap, of which I shall speak more later.

Electronic conveyancing will not necessarily change those four stages, but it could revolutionise the internal workings of each. I shall start with the most generic change, which is the use of e-communications. Already, e-mail is a usual means of business communication. It speeds up communication. Think of the amount of correspondence that is carried about the country at any moment between the several players in a conveyancing transaction. Even the simplest transaction will probably involve buyer and seller supported by their respective lawyers or conveyancers; there could also be surveyors, estate agents, mortgagees and insurers and their respective brokers. Electronic communication enables them to keep in touch more easily. It will allow the progress of a transaction and any related transactions to be managed more effectively, not least because it will be possible to provide a single point of information for all concerned.

Electronic conveyancing, however, is about much more than substituting e-mail for the typed page, and the digital signature for the flourish of a fountain pen. Searches are about assembling information that, by definition, already exists. They are concerned with the collation of information, not primary research. Imagine a world in which all searches could be carried out online, extracting information directly from databases that already hold the data and can communicate with the conveyancer directly. One might receive answers in minutes rather than weeks, perhaps with the option of an automatic electronic updating service. One can imagine a world where contracts, deeds and other key documents could be kept in secure permanent electronic form.

Mr. Hawkins

The Parliamentary Secretary will, no doubt, go beyond his imaginings of the world of the future and give some more precise detail. However, before he leaves the subject, will he tell us whether the inefficiencies of searches in local authorities, especially in the inner cities, will be addressed by the new technology in the near future? Is he aware that a local search from a Labour-controlled London local authority can take as long as 10 weeks, even for the simplest piece of conveyancing, in which there are no chains on either side? No great brave new world will result from the changes that he mentions, because local searches are too inefficient.

Mr. Lock

One day, in that brand new world, the hon. Gentleman will make a speech that does not have a party political sting in its tail. Clearly, there are efficient and inefficient authorities of all political persuasions. The Audit Commission would not agree with his equation of efficiency with one side of the political fence and inefficiency with the other. To answer his question without taking his pejorative tone, I can tell him that some significant steps are being made. If he gives me time to develop the subject, I will explain precisely what has happened, what can happen and what is happening.

One can imagine a world where completion of a purchase and an application for registration of the buyer and the mortgagee could be completed almost simultaneously—a world without a registration gap. A fully developed system of electronic conveyancing would have many advantages. The changes that we are discussing would put the conveyancing system at the service of the people who use and depend upon it. I shall briefly highlight how e-conveyancing will help to make easier the four stages of the typical conveyancing transaction that I described.

First, electronic databases and search facilities offer obvious advantages of speed and accuracy for investigation and report. Those advantages apply whether the information is available on a public register or in a private electronic data bank, as parts of the searches go to public authorities and parts to private companies, such as the water utilities.

Another area in which efficiency will be improved is that of exchange. The ability to find out where all the connected transactions are at the click of a mouse will prevent anxiety and decrease the need to chase people over the telephone. Making a contract need no longer depend upon the safe arrival of an exchanged document in the post.

Completion will also become easier and quicker for all concerned. No bulky packets of deeds will need to be shipped around the country and stored safely for ever after. If the registration stage could merge with the completion stage, a simpler system would be created. However, even if registration remains a separate stage, electronic communication will prevent many errors that, at present, are corrected only after completion by the Land Registry. Electronic conveyancing can provide intelligent quality assurance.

A system offering all those advantages will not appear overnight. Electronic conveyancing is not a short-term project. The Land Registry, for example, is planning for a decade or so of progressive change. Advances will be made incrementally as experience is gained and methods tested. We must not prejudice the security and integrity of the land register, or any other public register, through undue haste. A big-bang approach would be a long time coming, out of date before it was launched and impossible to manage.

In case that gives the impression that electronic conveyancing is no more than a gleam in the eye, I shall explain what has happened so far, as well as what is planned for the future. There are four main strands of electronic conveyancing activity within Government at the moment. The first is the development of the National Land Information Service and the National Land and Property Gazetteer. The second is the introduction and continuing development of electronic services at the Land Registry. The third is the preparation of a draft order under section 8 of the Electronic Communications Act 2000 by the Law Commission, the Land Registry and my Department, with the prospect of further orders to follow. The fourth is the drafting of a new land registration Bill by the joint working group on land registration of the Law Commission and the Land Registry. I shall describe each in a little more detail and relate them to the four stages of the typical transaction that I have described.

Before I do so, it would be helpful to consider the private sector. There, complementing Government activities and, to some extent, making them worth while, electronic business techniques are being adopted by legal services providers and others connected with the property market. Already, property owners and their advisers are creating electronic data banks of documents for property management and disposal purposes. Firms offer secure virtual dealing rooms for transactions. Those practices may not yet have reached the mass market, but I expect that rising consumer expectations generally will find their way into the world of conveyancing. When they do, the competitive edge will lie with those who can offer the services that the public and business want.

In the Government context, the NLIS computer system will provide access to information from the Land Registry, local authorities, statutory undertakers, the Coal Authority, the British Geological Survey, the Ordnance Survey and others. NLIS will be underpinned by the NLPG, which will, in effect, be a definitive digital index of land and property. It will provide a unique digital identifier for each property to be searched. That will enhance the accuracy and speed of the searching process by giving the computers a geographical address and description for the property, be it a field, a factory or a flat.

NLIS is a joint initiative of central and local government. It was the first channel implementation project to be announced in the "Modernising Government" White Paper, and it was successfully piloted in Bristol in 1997. The success of the pilot was recognised by a major British Computer Society award and led not only to the pilot's continuation—it continues to this day—but to the injection of funds from the invest to save budget, which enabled the Land Registry and the improvement and development agency to carry forward the project at speed. A contract for the provision of the hub of the service was placed with MacDonald Dettwiler and Associates in July. Contracts are now being negotiated with service providers and it is planned that the service will go live in April next year, with a fully electronic service operating from July 2001.

Of course, bringing all the information held by all the different authorities and other bodies across England and Wales on to electronic databases is a long-term aspiration. It will be achieved piecemeal in the coming years. In the meantime, NLIS will provide an online search submission and handling service, obtaining information from data providers by the quickest means possible. Even that mix and match of new and old will provide a significant improvement on the present cumbersome and time-consuming system of preparing and submitting separate searches to every relevant authority or body.

NLIS has been proved in Bristol. I am sure that the ability to conduct all property searches at the speed of the click of a computer's mouse will be a great boon to everyone involved in the conveyancing process. It will change the face of the investigatory stage of conveyancing. It will also have benefits far beyond conveyancing by providing access to so much reliable information about property. Indeed, the system has been described as an online Domesday book. However, there are two key differences: first, NLIS information will be continually updated, and, secondly, unlike the Conqueror's inspectors, NLIS will not describe everything north of the Humber as waste.

Mr. Burnett

The Parliamentary Secretary has a good point and is not shying away from the fact that the task is huge. Has he dealt with the significant difficulties associated with keeping this register—or Domesday book—up to date, particularly given the plethora of different agencies that will have to contribute to it continually in respect of properties?

Mr. Lock

The hon. Gentleman makes an important point, but we are dealing with information that, by definition, already exists, whether it is held by the Environment Agency, Severn Trent Water or a local authority. We are talking about providing access to existing information and tying it into the relevant property.

Mr. Burnett

rose—

Mr. Deputy Speaker (Mr. Nicholas Winterton)

I call Mr. Burnett.

Mr. Burnett

I welcome you to the Chair, Mr. Deputy Speaker.

I realise that this matter is at a rather inchoate stage, but is it envisaged that it will be the duty of the planning authority or the utility—or whichever body is responsible—to feed up-to-date information into this central computer network?

Mr. Deputy Speaker

I call Mr. Lock.

Mr. Lock

I, too, welcome you to the Chair, Mr. Deputy Speaker, for this exciting and interesting debate on electronic conveyancing, which you have, no doubt, looked forward to all week.

Mr. Deputy Speaker

Immensely—for more than a week.

Mr. Lock

The question is an important one. Bodies that hold information that is required before a conveyancing transaction can take place are already obliged to store it in a way that allows a search. We are concerned with an obligation not to hold the data, but to provide access to data in an electronic form so that it can be searched. Changing to an electronic form offers considerable advantages for local authorities and private companies such as utilities. Apart from anything else, they will save considerable staff time, inquiries could be answered in a non-labour-intensive way, and they will be paid for providing that information. There are sound business and organisational reasons, therefore, why the existing duty to hold and make available such information should be translated into a duty to provide it in electronic form.

Mr. Burnett

I point out to the Parliamentary Secretary's Department and the interdepartmental group to which he referred that it would help to speed up such transactions if one body—probably the borough or district council to which the search is made—held all the information on a particular property. Those bodies already have most of the information, but it would help if they had it all and collated it. Purchasers or their representatives could thereby access it through one route rather than from a multiplicity of sources.

Mr. Lock

I am grateful for that suggestion, but it seems that I am not making myself clear. The purpose of NLIS is to be one hub. Data requests will come into that hub from those who seek the data. The hub will, in turn, have connections to local authorities, the Land Registry, Severn Trent and a variety of bodies such as the Environment Agency, which hold the necessary data. Once the returns are made by those bodies—either manually, to themselves, before being fed back into the system, or by electronically interrogating an existing database—the information is fed back to the hub, then from the hub back to the person who raised the original inquiry.

The information is, by definition, held by a wide variety of bodies, which update it from their own information sources. The purpose of NLIS is to provide an electronic communication system—a hub—to enable electronic interrogation to take place from one place, the hub, to the variety of bodies holding data relevant to a particular property.

Mr. Miller

Has not the hon. Member for Torridge and West Devon (Mr. Burnett) a point, in that there must be an appropriate duty of care on the data holder to act in the public interest? For example, I might wish to buy an acre of glorious Cheshire. Indeed, you or I, Mr. Deputy Speaker, might well choose to do that. Let us say that there were 1.1 acres of land. The small matter of a decimal point might be missed out. Therefore, a clear duty of care would have to be established with the data holder to provide the correct information.

Mr. Lock

I appreciate what my hon. Friend is saying. Yes, those who provide information are under a legal duty to provide it accurately and in a timely fashion. We are concerned here with the more efficient discharge of existing duties by electronic means, not with a change in the nature of the duties. The existence of the hub would, I hope, enable the Environment Agency to update its computers with information on floods and developments, and on its own view as to what is on a flood plain. It would have its own computers interrogated through NLIS, when necessary, rather than have to collate that information itself and pass it to a third party, which would then provide it to others.

Mr. Burnett

The interdepartmental group will, no doubt, discuss this matter. Purchasers will have to have confidence in the hub—NLIS—which will have to be liable for any errors that it makes in giving property details to purchasers. The hub will also wish to recover any damages for negligence or omissions by statutory authorities, planning authorities or other bodies, which are—or should be—duty bound to provide such information to it.

Mr. Lock

The duties of care on information providers are a whole new subject. The providers are under obligations at present and the proposals for the electronic conveyancing system being developed through NLIS will provide a better way for them to discharge their existing obligations.

Any proposals for a series of new obligations relating to accuracy and timely provision would have to be considered extremely carefully, both from the perspective of framing those obligations to ensure that the maximum information was given in as timely a way as possible, and to ensure that the right division of risk and the right amount of exposure to that risk was managed. I am sure that the Local Government Association would have a considerable amount to say before any change in the law, because its member authorities are the holders of the majority of the information that is sought.

Hon. Members may be interested to know that of the many millions of transactions that take place each year, more than 80 per cent. occur in just 50 local authorities. It is quite a concentrated series of transactions. Most local authorities provide searches within two weeks. For searches to take as long as 10 weeks would be unusual and extreme.

The second aspect of electronic conveyancing activity to which I referred is the development of services by the Land Registry, which I have already mentioned numerous times. That is hardly surprising, because the future of electronic conveyancing and the future of the Land Registry are closely related.

The purpose of the Land Registry is summed up by its three principal aims, which are: to maintain and develop a stable and effective land registration system throughout England and Wales as the cornerstone for the creation and free movement of interests in land; to guarantee, on behalf of the Crown, title to registered estates and interests in land for the whole of England and Wales; and, to provide ready access to up-to-date and guaranteed land information, enabling confident dealings in property and security of title. The registry was established in 1862. Since then, it has been quietly and effectively getting on with its business of registering title to freeholds and long leaseholds. It is a success story. There are now 17 million registered titles, of which more than 95 per cent. are computerised and available for online viewing.

For comparative purposes, I should add that there are thought to be around 4 million titles that are not registered. Perhaps the benefits of electronic conveyancing will encourage the owners of some of those unregistered titles to come forward for registration. However, even if they do not, England and Wales now comprise an entire area of compulsory first registration, so any sale of such property must be registered. The days of unregistered land may not yet be numbered, but the future is in registered property. We can look forward with optimism to the creation of a complete, or very nearly complete, register.

In parallel with the process of computerising the title registers, the Land Registry is computerising the title plans and the 6 million or so deeds and documents that are referred to in those registers. That process is well advanced and will, when complete, provide a fully integrated online register. The next stage of the computerisation project will be the computerisation of the general index map, which, as its name suggests, is a map that shows all the land in England and Wales, whether or not it is registered. Conveyancers use the map to find out whether land is, or is about to be, registered.

This computerisation is, of course, only a means to an end. The Land Registry is at the forefront of the Government's drive to electronic service delivery. In July this year, the registry launched a new internet browser-style version of its successful direct-access service. DAS was established in 1995 for telephone and fax access to services. The new service, Land Registry Direct, enables customers who are account holders to view the computerised register and the filed plan. It is already proving highly successful and it generated more than £450,000 of fee income in October alone. Land Registry Direct, which is directed at account holders, is complemented by Land Registry Online, which is targeted at the casual user. Payment is made by credit card.

The provision of information at the touch of a button is an important improvement in the conveyancing process. The creation of an integrated computerised register and the new access services will speed up the flow of information and the crucial pre-completion searches of the register. The Land Registry's information will form a key element of NLIS.

Mr. Burnett

The Parliamentary Secretary referred to pre-completion searches. I should declare an interest because some of the property that I own is unregistered and is likely to remain so, because I hope that it will pass to my children on my death. However, I hope that the computerisation process will take account of the land charges register.

Mr. Deputy Speaker

Mr. Lock, potential fee payer.

Mr. Lock

Is it not wonderful to be able to say, "some of the property that I own"? As I am not in that advantageous position, perhaps the hon. Gentleman will allow me a little time before I reply to his interesting question.

These services cover the provision of information. Electronic conveyancing implies electronic dealings and moving from the inactive provision of static information to the active creation of transactions by electronic means. The first step in that direction was the piloting by the Land Registry of the electronic notification of discharge system; hon. Members will not be surprised to learn that that is abbreviated to ENDS. This project concerns the deletion of the entry of a mortgage from the register when it is paid off. It was piloted successfully in 1998 and it is expected that electronic notification will soon become the norm. Work is also progressing towards the introduction of real-time priority for substantive applications for registration. I have already referred to the need to get the application for registration to the proper district land registry before the time for the search expires to ensure that a transaction—for example, a first mortgage—is not overtaken by a later transaction, such as what should have been a second mortgage. In technical terms, the search enables the first mortgage to preserve its priority over the second. Without that facility, every completion would have to take place at the Land Registry.

At present, all applications for registration that arrive at a district land registry after 9.30 am are deemed to have arrived at 9.30 am on the next working day. This is clearly incompatible with and would, at the very least, make nonsense of an electronic system. The introduction of real-time priority, which we anticipate will be in 2001, is a vital building block for electronic conveyancing. Electronic conveyancing is, inch by inch, being introduced. NLIS and Her Majesty's Land Registry clearly show that we are on the road to a better system. However, there is still a lot to do and the Land Registry is working to identify how it can develop its services further.

Despite that progress, some limitations can be overcome only with legislation. I have mentioned that contracts for the creation or disposal of an interest in land must, in most cases, be in writing. That is a requirement of section 2 of the snappily named Law of Property (Miscellaneous Provisions) Act 1989, but the basic policy can be traced to the Statute of Frauds, which was made in the reign of Charles II in 1677. Conveyances, mortgages, transfers and leases for terms of more than three years must be made by deed; the relevant legal requirements are found in the Law of Property Act 1925, although, again, the policy of the law is much older.

Deeds must be executed properly. For individuals, that includes signature in front of a witness who also signs the document. For companies, the company seal may be affixed and witnessed, or the document may be signed by authorised signatories. I shall not go into details, because all that matters for present purposes is that there cannot currently be an electronic deed.

The Government are committed to removing those legislative obstacles to electronic communication and electronic data storage. We took powers to do so under section 8 of the Electronic Communications Act 2000 and we propose to use those powers to make orders to create a legal framework for electronic contracts for the sale and creation of interests in land and for electronic deeds. Work is already under way on drafting the first of the orders. When complete, the order will be issued for public consultation. We must also ensure that stamp duty on these virtual documents can be collected. I am pleased to say that, yesterday, my right hon. Friend the Chancellor of the Exchequer announced in his pre-Budget statement that the enabling legislation will be included in next year's Finance Bill. We intend our proposals to be rigorously tested before they take effect. The order will be made subject to affirmative resolution procedure to ensure full parliamentary scrutiny. It is important that we get the product right and that nothing is permitted that might undermine the security of the land register or the confidence of the property market.

The section 8 order, which will amend primary legislation, will have to be supported by other legislation such as new land registry rules. We acknowledge that it will be vital to allow sufficient time for practitioners to come to grips with the new rules before they are introduced. The new framework under section 8 will coexist with the traditional framework.

The fourth area of Government activity that I mentioned was a draft land registration Bill, which is being prepared by the Law Commission and the Land Registry. I hope that they will publish it jointly next year. It would be inappropriate for me to comment in detail on the contents of the Bill until the Law Commission and the Land Registry have completed their work. I can say with confidence, however, that the Bill and the accompanying report are eagerly awaited.

The Bill will build upon the successful consultation document, "Land Registration for the Twenty-First Century", issued in September 1998 by the Land Registry and the Law Commission, which propose that the Bill should completely replace the Land Registration Act 1925. For those outside the property world, the year 1925 has little significance. However, for people who work with property day in, day out, 1925 is the defining year. The 1925 Act has been described as the poor relation to the giants of the great 1925 property legislation, which include the Settled Land Act 1925 and the Law of Property Act 1925. It was seen in some quarters as a bureaucratic variant of proper conveyancing. The new Bill will put matters to rights. It will be built upon sound land registration principles and will recognise that a registered title is not the same as an unregistered title with a registration number.

The Land Registry's 1998–99 annual report suggests that a central plank of the reforms will be that transfers of land and the creation of many rights and interests in or over land will be dealt with electronically. That proposal will fundamentally change the legal basis of much of the conveyancing system. As I heard it rather neatly described at Tuesday's seminar in Birmingham, we would move from a system of registration of title to a system of title by registration. That would open the way to the fullest possible exploitation of the benefits of electronic conveyancing.

Whether the Government accept the recommendations of the Law Commission and the Land Registry and whether Parliament will enact the Bill, with or without amendment, remains in the future. I cannot prejudge matters. I should like, however, to pay tribute to the people who have carried this project so far in such a short time. In particular, I express my thanks to Charles Harpum, the property and trust law commissioner at the Law Commission, and to Chris West, who, although a barrister, is the solicitor to the Land Registry. They have led the work done since the establishment of the joint working group in 1996. They already have the Land Registration Act 1997 to their credit. Speaking personally, I hope that they will also chalk up the much greater prize of replacing the 1925 Act with land registration law fit for the 21st century.

A new Act would be supplemented by new land registration rules, which is where the detail of the new system for electronic conveyancing will be found. Placing the technical details in secondary legislation is necessary to ensure that we can keep pace with technological change and the needs of the development programme for e-conveyancing. To allay any fears that hon. Members may have, I must mention that there will be consultation before any new standards or procedures are created.

I have spoken so far about the electronic conveyancing process and the machinery to support it. I shall now refer briefly to some of the more generic issues applicable to acceptance by the public and business of e-commerce in our environment. Such issues are inevitably relevant to e-conveyancing. The essential ingredient to ensure the success of a new service is confidence: if users have confidence to take up the service and it is successful, others will be tempted to follow suit.

Confidence will be built on good interoperable technical IT systems, on user-friendly systems, and on the use of electronic—or more accurately, digital—signatures. We must bear in mind in conveyancing and e-commerce that people need to have confidence that they really are dealing with the people with whom they think they are. People need to know that the message they send is the electronic message that will arrive, they need to know that the message will not be corrupted at some date in the future, and they must be confident that private information will be treated confidentially.

The Government and industry are working together to deal with authentication, integrity, trust and security. Our approach is one of co-regulation with providers and users. In support of that aim, the law already provides that electronic signatures are admissible as evidence in legal proceedings. The probative value of the signature will be tested by evidence in the usual forensic way. It seems likely, however, that the electronic system will offer far stronger proof of authentication than exists with handwritten signatures.

We are working with the Alliance for Electronic Business to develop a co-regulatory certification system for digital signatures—the so-called t-scheme, "t" meaning trust. Should the t-scheme fail, the Government have taken powers under part I of the Electronic Communications Act 2000 to set up a statutory scheme. The basic concept of a registration and certification system is, of course, tried and tested. Electronic systems already operate in many parts of the world. In the e-conveyancing context, it is likely that high levels of authentication and security will be required for electronic contracts and deeds.

Concepts such as algorithms, encryption and hashing, which underpin the creation of digital signatures, are a wonder of mathematical science. The people who devised them are very clever. For our purposes, the important thing is that they work. The technology required to deliver secure communication already exists. The task is to apply it in the best possible way. If we succeed in that, trust and confidence will follow.

In summary, electronic conveyancing is important and it is already here, in part. The Government are determined to use it to improve the conveyancing system. The electronic system will make great speed and accuracy possible, not a matter of Herculean effort, as is the case now. It will put people in charge of the process, not the other way round. All that will involve considerable change to the law and to conveyancing practice and business, and that will be all to the good.

3.28 pm

Mr. Nick Hawkins (Surrey Heath)

I am glad to tell the few hon. Members who are present this afternoon that I shall be brief. The Minister spoke for only a fraction less than one hour, but he explained to us that he felt that it was incumbent on him to set out the picture in full. I can certainly say that he has sought to do that. In thanking him for setting out the Government's thinking on this important matter, I must say that, for people who wish to move house, any improvement in the conveyancing system is bound to be welcome. I raised earlier a particular concern that had been expressed to me by legal experts. Some of the things that the Minister set out in what he called his "brave new world" may not work out as he and his officials expect.

I was glad that the Minister responded to my intervention about his interdepartmental working group. I was reminded of some of the more arcane problems exposed to the public gaze by "Yes, Minister". Everyone knows that those programmes were based on the scriptwriters' civil service experience under a previous Labour Government. Those problems were exposed also in the Crossman diaries. I am greatly sceptical of interdepartmental working groups.

The Government have engaged in a great deal of rhetoric about joined-up government, but, in practice, it is not joined up; instead Ministers, their civil servants, political advisers and spin doctors are always fighting turf wars. I hope that this might prove to be the exception, but that will be only because those at the sharp end are involved. The Minister was kind enough to confirm that the professional bodies will be involved, including the Law Society and the Institute of Legal Executives. I hope that consumers, the people who suffer the endless delays of the current system, will also be represented.

Mr. Burnett

I feel sure that the hon. Gentleman did not mean to omit it but, for completeness, I am certain that he will agree that the Council of Licensed Conveyancers should also be drawn into the regime.

Mr. Hawkins

I am grateful to the hon. Gentleman for reminding me of it. A welcome development under the provisions introduced by the previous Government was the great expansion in the numbers of licensed conveyancers. The fact remains, however, that the vast majority of people have their conveyancing done by solicitors or legal executives working for firms of solicitors.

As I said to the hon. Member for Torridge and West Devon (Mr. Burnett), there is a certain irony in the fact that none of the three Front-Bench spokesmen participating in today's debate has done any conveyancing. At least the hon. Gentleman is on the right side of the profession, but I know from the valuable contributions that he regularly makes that he is a specialist on other matters, such as taxation. He might have done some conveyancing and he has certainly passed examinations on it, but the Minister and I, being on the other side of the profession, have not done any. However, the Minister may have had the same experience that I had in my time at the Bar. When a solicitor was accused of professional negligence in conveyancing, the matter was dealt with by members of the Bar. Unfortunately, members of the Bar sometimes found it difficult to judge whether there had been professional negligence, because they had not passed exams in conveyancing.

I may have one small advantage over the Minister in that, for the three years before being elected to the House in 1992, I ceased going into court from chambers every day and became a corporate barrister, acting as the group legal adviser for a public limited company, one of whose subsidiaries was a national chain of estate agents. In that position, I was instrumental in creating the legal framework for the first ombudsman scheme for corporate estate agents. I know that Governments of both parties welcomed the creation of the estate agency ombudsman scheme, because things sometimes go wrong, perhaps through negligence or the inadvertence of lawyers, because of mistakes at the Land Registry or—I hope rarely—because of fraud by estates agents.

The ombudsman scheme was an extremely welcome development, and I was pleased that my former colleague Mr. Peter Constable, who created the ombudsman scheme for corporate estate agents, was able to see it successfully brought into existence while he was still the most distinguished chief executive of the Black Horse estate agency. He had to retire shortly afterwards because of ill health, and it is only proper to pay tribute to his work and to say how much the estate agency profession, both corporate and independent, regretted his retirement. I also pay tribute to the work of the National Association of Estate Agents in raising standards in the profession of estate agency. We all welcome improved standards in that area of the law, because, as has been said many times, the vast majority of members of the public deal with lawyers, perhaps luckily for them, only when they move house.

As the Parliamentary Secretary said, 70 per cent. of housing in this country is owner-occupied. He might have paid tribute to the distinguished former Prime Minister, Baroness Thatcher of Kesteven, for achieving a huge increase in the number of owner-occupied properties by introducing the sale of council houses, which was bitterly opposed by Labour in opposition, but subsequently adopted by them in a manner that would lead one to think that they had invented it. Nevertheless, I recognise that the fact that a large proportion of property in this country is owner-occupied inevitably means that the vast majority of people become involved in conveyancing at some time. Anything that speeds up that process is bound to be welcome.

My consultation with those who are at the sharp end of conveyancing has alerted me to some points that should be raised, although I do not ask the Minister to give a detailed reply this afternoon. With so few hon. Members present, it would not be appropriate to prolong the debate unduly, but I should explain what has been said to me by those experienced legal executives who are at the sharp end. I hope that the Minister and his officials, or both, will write to me and other hon. Members present this afternoon.

It has been suggested to me by those who carry out conveyancing regularly that the main problem is the slowness of local searches. When I raised that point, the Minister thought that it was politically partisan, but it is a real issue. The Minister recognised that the register of land is a vital part of what I am concerned about. My consultations suggest that what is most needed to speed up conveyancing is not only greater use of information technology, but a system in which there would be a logbook, rather like the registration document for a motor vehicle, for each parcel of property. If every change—every extension to a house, or sale of part of a parcel of land, for example—was entered in the logbook, which could be done electronically with IT, the process would be much quicker.

The other matter that has been pointed out to me is that the vast majority of properties in this country are subject to some sort of mortgage or legal charge. Not only does a chain of purchases frequently cause delay—for example, because it is not possible to ask one's solicitor, legal executive or licensed conveyancer to proceed to the next stage in the process until one's purchaser has received a mortgage offer—but the status inquiries of building societies or other mortgagees can take a long time. For example, it can take some time to obtain medical or other information from the employer of someone in the chain who has applied for a mortgage. Some large companies have efficient personnel or human resources departments that respond quickly, but other, small companies cannot treat those status inquiries with such urgency. Improving IT in the conveyancing system is not all that is needed; other problems jam the works. At a time when many people are moving house, there are inevitable problems such as chains and gazumping.

I had discussions with the Law Society about what it considers important. The Minister referred at length to developments at NLIS. A joint bid was made by the Law Society and MacDonald Dettwiler and Associates, with Hays plc, Laser-Scan and the Halifax. That group won the right to operate the United Kingdom's first online conveyancing service for the next 10 years. The then vice-president of the Law Society, Mr. David McIntosh, was enthusiastic, saying that: Homebuyers and solicitors will benefit from this innovative online conveyancing system and the Law Society is delighted to be part of this exciting project. When I asked people at the Law Society whether any firms were extensively using that facility, I was given the name of a go-ahead, information technology-oriented firm called Sykes Anderson. That firm was mentioned as a good example of one that has proceeded with the use of new technology. Clearly, it is welcome news that any firm—small, medium or large—is taking full advantage of that facility.

The Law Society has been at the forefront of encouraging the Government to use information technology to the full. The Minister and his colleagues will be aware that several Members are involved in the all-party group on information technology—PITCOM. That group is unusual because industry experts in IT have as firm a membership of it as parliamentarians. It is one of the strongest groups in the House and all of its members, including the hon. Member for Ellesmere Port and Neston (Mr. Miller), who has been involved in it for as long as I have, know what valuable work it does. We all want there to be greater use of IT, not merely in the legal, but in every field, for the benefit of the public.

The Law Society referred me to the work of Ken Byass, a member of the council of the Law Society. His name is spelt with a y, so it has no hint of a double meaning. His article on electronic conveyancing begins with the words: In spite of anything you may have been told, e-conveyancing is not possible today. He goes on to set out, as the Minister has, some of the legislative obstacles there have been in the past, and to welcome the changes that are being made.

I hope that at least some of those changes to which the Minister has referred will come to pass. I do not want to be a prophet of doom and gloom, because I welcome the use of IT in conveyancing as long as the public is properly safeguarded. However, those at the sharp end, not merely civil servants on an interdepartmental working party, should be involved. I join the Minister in his tribute to Mr. Charles Harpum; it is a pleasure to be able to pay tribute to that law commissioner twice in successive days, as we both referred to him in our remarks during the debate on the Trustee Bill.

It is a matter of some regret, although it is perhaps not surprising on a Thursday afternoon, that so few hon. Members are present. I totted up the number and I believe that 25 hon. Members are solicitors but, of the six of us present today, only the hon. Member for Torridge and West Devon belongs to that profession. The issue is important, and I wish that it were being debated on the Floor of the House. I have expressed my reservations about Westminster Hall to the Leader of the House, because debates here are not usually well attended. Debates such as this, which should have a wider attendance, should take place on the Floor of the House.

3.44 pm

Mr. John Burnett (Torridge and West Devon)

I do not know whether I am becoming a masochist, but I have found this debate interesting. I should declare the fact that, although I am a solicitor, as the hon. Member for Surrey Heath (Mr. Hawkins) said, I do not practice and I am not especially conversant with conveyancing. Although I did a bit of it in the past, I was, as has been mentioned, mainly a specialist in taxation. I declare also that I am not as computer literate as I should be.

I, too, pay tribute to Mr. Charles Harpum, as I did during the Committee stage of the passage of the Trustee Bill. Unfortunately, I was unable to participate on Report and Third Reading yesterday as I had to be present in my constituency. You will be delighted to hear, Mr. Deputy Speaker, that I opened a new primary school at Holsworthy.

I believe that electronic conveyancing will expedite the conveyancing process, although I understand that that is a huge task. Before I speak on it in more detail, however, I remind hon. Members that, as the Minister pointed out, some property information should be private to the property owner and/or the buyer.

For one reason or another, there is a lot of dissatisfaction with the conveyancing process. It has arisen largely because of delays. It has always been my view that, if the vendor has no contingent purchase or the purchaser has no contingent sale, conveyancing should be pretty swift, especially if the property is registered. Problems and delays sometimes arise because of tight financing, but purchasers should have sorted that out before they made offers for property. Delays invariably arise either because the purchaser has a property to sell, or the vendor has a property to buy, or both. Delays can also arise in relation to local authority searches. It is important to ensure that most people manage to synchronise property purchases and sales. Most of them are selling their only dwelling and rightly want to complete and move into their new dwelling on the day when they complete and move out of their existing property.

We should not be concentrating today on delays caused by chains of transaction, but on the speed of the conveyancing process and how it can be assisted by electronic conveyancing. I should like to refer to some of the problems that arise in the first stage of the transaction, which precedes exchange of contracts—investigation and report, as the Minister called it. The hon. Member for Surrey Heath referred to the delays that can occur with local authority searches. Even the most efficient local authorities—I count both Torridge district council and West Devon borough council in that category—will take about five working days to conduct a search, which is swift. Of course, local authorities have to collate a huge amount of information. It can relate to strategic plans—one hopes that under a new electronic regime, information about emerging local plans will be given to purchasers—and to land charges, planning agreement, enforcement notices, tree preservation orders and countless other matters.

It is costing a fortune for local authorities to collate those records and pay for the computer equipment, software and expertise necessary to do the work. I understand that information is brought together, collated and included in maps. Individual properties are identified and the information is collated. As the Minister said, a gazetteer of all properties is being created. It is of great assistance to a buyer, as I said in an intervention, to get all the information from one source, which we called the hub and the Minister says is the National Land Information Service. I understand that a Canadian company called MacDonald Dettwiler is to make loans or other financial assistance available to local authorities. The local authority to which I have spoken is not aware of the terms of such loans, although it has been stated that £205 million will be made available to local authorities. I would be happy if the Minister would write to inform me of the terms and conditions on which the money will be lent to local authorities. What will be the duration of the loan? What interest rate will apply? A coach and horses will be driven through a swift, reliable electronic conveyancing procedure if timely information is not given to a central source, which can be accessed readily by purchasers and their representatives. That is one of the greatest sources of delay in the conveyancing process.

The stages of conveyancing are familiar to all hon. Members, and have been outlined by the Minister, and, to some extent, by the hon. Member for Surrey Heath. As I said in an intervention, it would be wise to introduce a convention whereby proper and full disclosure must be made of problems relating to title, rights of way, covenants and encumbrances. I do not think that it is wise to change the rule of caveat emptor, but perhaps the matter can be resolved by a market solution of a title insurance policy, which could be assignable to purchasers. I concede that it is up to the purchaser, by survey or inspection, to be satisfied of the state and condition of the fabric of the property. However, it would speed up the title process, whereby the purchaser or his representative should be satisfied that there are proper easements of water, electricity and gas, if full disclosure was made on those matters, buttressed by a system of insurance. I believe that that is done in the United States, and I hope that the interdepartmental working group to which the Minister referred will consider the matter.

Mr. Lock

I want to respond to two of the hon. Gentleman's points.

Mr. Deputy Speaker

Order. Does the Minister wish to intervene on the hon. Member for Torridge and West Devon (Mr. Burnett). Could not the Minister deal with the matter in winding up the debate?

Mr. Lock

I will take your guidance, Mr. Deputy Speaker.

Mr. Burnett

I am grateful to you, Mr. Deputy Speaker.

In relation to the issue of post-exchange of contracts, I want to comment further on a matter that was touched on only lightly by the previous speakers—the swift movement of funds from building societies to conveyancers and from conveyancers to conveyancers. I have always been led to believe that CHAPS—clearing house automated payment systems—or at least the central clearing banking systems, are something of a cartel. Part and parcel of achieving a swifter system and aiding electronic conveyancing should be the ability to move money in a matter of minutes. That means not only mortgage advances and completion money but, because of high property prices, deposit moneys. It is important in all commercial transactions to have the ability to move money fast. I hope that the interdepartmental committee will give its views on that matter and consider it carefully.

Electronic conveyancing will involve the purchaser or his representative being able swiftly to access details of title and up-to-date office copy entries from the Land Registry on computer. I was pleased to hear the Minister say that the matter was in hand, and that the information could—if I understood him correctly—be accessed immediately in relation to some properties in the United Kingdom.

I hope that the Minister will respond to another point that I made about the land charges registry. The registry is a rather arcane institution that deals with the records and registration of entries in relation to unregistered property. There is still a considerable amount of such property. I dare say that there is quite a lot of it in or near Macclesfield, so you might have an interest in the matter, Mr. Deputy Speaker.

Electronic conveyancing will be involved in a third matter, that of local searches. Replies should be immediately accessible. There should be a duty of care on the hub or central authority to provide up-to-date and accurate information on the plethora of entries relating to property, from planning and enforcement notices to details of mining.

It is important that the public trust the electronic system. For them to do so, there must be a method by which the people who provide the information are liable for any mistakes, errors and delay. I believe that the proposals are exciting and interesting and will help the public. If the public are to have confidence in the system, institutions and organisations must take responsibility and stand by the information that they provide.

3.58 pm

Mr. Andrew Miller (Ellesmere Port and Neston)

First, I want to praise the Lord Chancellor's Department. Contrary to the rather silly remarks of the hon. Member for Surrey Heath (Mr. Hawkins), it is one of the most innovative bodies involved in the programme of modernising government. I know that it is a rarity for any of your constituents to find themselves in court in Chester, Mr. Deputy Speaker. However, if they had done so before some of the changes made by the Lord Chancellor's Department, they would have found that the system required paper to chase itself around the town between the Crown Prosecution Service, the courts, the police and so on. That is coming to an end, so the Department deserves credit. I hope that that is another example of a progressive move from which industry, the consumer and, in the longer term, the state can benefit. Given the right level of early investment, it could drive down costs and time delays in the system.

I appear to speak today as the voice of the consumer, as lawyers outgun me. I can claim no expertise in conveyancing—other than that of a consumer—although I claim some expertise in the management of IT systems and the management of change. Irwin Mitchells, the well-known firm of solicitors, conducted my last conveyance brilliantly. I give credit to the firm for its efficiency, but the purchase involved several unreasonable delays as a result of the rather stupid conveyancing system.

One cannot often use debates such as this to solve one's case work, but I ask my hon. Friend the Minister to ponder the difficulties that Thornton-le-Moors parish council faces in its dialogue with the diocesan registrar of the Church of England in Chester. For some time, we have been discussing the problem of who owns the parish rooms and is responsible for their upkeep and modernisation. As a result of the earlier legislation to which my hon. Friend referred, the diocesan registrar finally managed to find the conveyance, which is dated 31 December 1896. It turned up in this morning's post, which was timely, as I can use it to illustrate my point.

I should be extremely grateful if my hon. Friend would translate it into English for me, because it is written in a language that nobody could understand without referring to expensive lawyers who charge by the yard. My hon. Friend would be slightly cheaper. I am making a serious point. We now have an opportunity to collect data in a form that ordinary, sensible human beings can understand—unlike the arcane language of the conveyance, from which I quote: do hereby certify that the Rev Charles Coliwyn Richard Rector of the Parish of Thornton-in-the-Moors within the said Diocese being about to convey a portion of land situate in the Parish of Thornton-in-the-Moors for the purpose of a school under the powers of an Act passed in the fifth year of the Reign of her present Majesty Queen Victoria entitled "An Act to afford further facilities for the conveyance and endowment of sites for schools— and so on. That is just a part of one sentence.

My hon. Friend's work will ensure that the key pieces of information to which he and the hon. Members for Torridge and West Devon (Mr. Burnett) and for Surrey Heath referred can be translated into English. I echo the comments of the hon. Member for Torridge and West Devon about the duty of care that is required to ensure that those who have a statutory duty to provide information do so in language that is intelligible and accurate. The small example that I gave suggests that there cannot be any opposition to the case for change.

My hon. Friend the Minister touched on some of the technical issues, such as the registration gap. It is there because it has always been there, and it has always been there because it takes a long time for a horse and cart to travel around the country between legal firms. The delay seems to me, as a lay person, to be entirely unnecessary in these days of electronic mail. I shall return to the question of digital signatures, to which my hon. Friend referred.

My hon. Friend also referred to real-time conveyancing and I want to raise a technical point with him. Does he mean absolute time, because conveyancing, especially for property in London, may take place between people in different time zones and on different days of the week, such as a transaction between someone here and someone in Hong Kong? Has that been thought through?

On digital signatures, my hon. Friend was right to refer to the mysteries of the science of mathematics. I commend to him and the House the brilliant book written by Simon Singh, "The Code Book", which has recently been televised. It demystifies the matter and shows Britain in a good light because of our brilliant expertise in mathematics. I am sure that the t-scheme will provide a basis for a solution, because the industry has the will to achieve it.

I turn to what we want as consumers. I am sure that matters can be simplified. What do I want to know when I buy something? A reasonable starting point is to know who owns it, from whom it was bought, the history of that chain and the plethora of additional information that is held by different agencies. That presents an ideal opportunity to require agencies to participate imaginatively. My hon. Friend referred to the British Geological Survey, which has done some fantastic work to enable people to see on a website the geology surrounding their houses. Ordnance Survey is doing parallel work to show whether areas are at risk from flooding, which is particularly relevant today.

Many other agencies could be involved. The Environment Agency is subject to a statutory requirement to maintain information about ancient landfill sites and their safety, and that information could be included. The Health and Safety Executive in my constituency actively dissuades planning applicants from building domestic dwellings in some areas and it, too, should be included in the equation. Other bodies include the utilities, to which the hon. Member for Torridge and West Devon referred, and the Oil and Pipelines Agency, which is relevant to your constituency, Mr. Deputy Speaker. We have a network of pipelines and much of the information is not in the public domain, for obvious security reasons. However, if I were about to buy a property and the largest gas pipelines in the country went through the next field or even through the property, it would be reasonable to want to unearth that information. The study should include a careful evaluation of all possible bodies that should be encouraged to participate and feed information into the hub in a form that is easily accessible to those with a legitimate need for access.

Every hon. Member will have experienced the problem, which always baffles me, of the constituent who visits one's surgery and says that a fence has been built that is 2 ft—sometimes, it is 2 in—inside his garden. I was somewhat intrigued by the suggestion of the hon. Member for Surrey Heath that some form of logbook be used, and it is true that there are problems associated with defining parcels of land. Given the scale of the plans, the thickness of a pencil line can prove to be a couple of metres in real terms.

The Post Office address files that are used for purposes of definition are somewhat inaccurate—if they do not believe me, representatives of the Post Office may examine the errors on my database. Increased use of Ordnance Survey grid references might provide a good technical definition, or one could increase use of global positioning satellites. Much more simply—and slightly closer to earth—one could consult the millennium map of the UK that is being created from an aeroplane by photographic means. That might provide a better definition of a parcel of land, and the two parties concerned could thereby reach agreement before entering into a contract. In terms of the necessary technology, it would not be particularly difficult to incorporate such information into a central website hub.

Mr. Burnett

The hon. Gentleman makes a good point—it is very difficult to collate such information. As I understand it, local authorities have different references for a property: the electoral roll reference, the council tax reference and the land charges reference. That is a measure of the huge and exceptionally expensive task that falls on the shoulders of the various agencies.

Mr. Miller

I take the hon. Gentleman's point. At the moment, I am dealing with a case involving a single utility that cannot agree the proper definition of its metering service for a property because the meter is not located where the service claims that it is located. That seems bizarre, given that one can go and look at the meter, but such problems are not unusual.

Definitional issues can be dealt with through the simple application of technologies that are available today. For less than £200, professional walkers can buy a portable device that will locate their position to within a couple of feet anywhere in the British Isles. I am not talking about rocket science or the next generation of technology; such technology is available today. Ordnance Survey's high-quality work has resulted in a fantastic base map that, combined with better use of aerial photography and GPS, could alleviate silly problems. That is why I intervened on my hon. Friend the Minister. May we please, when examining the scope of the proposals, look for ways of improving the service to our constituents?

I hope that Opposition Members will accept that these matters cannot be rushed. We are dealing with the creation of a very complex database. As my hon. Friend the Minister said, it will not be a single database but a hub access mechanism. All the suppliers of data into the hub will have to operate within common standards, using common terminology that lay people can understand rather than silly sentences such as the one that I read earlier—I shall not try your patience, Mr. Deputy Speaker, by reading it out again. It will require a lot of hard work to bring that about. I urge all parties in the House to work co-operatively on this exciting venture, which should, within a few years, provide a radically different form of conveyancing, giving the consumer more information more accurately, more quickly and more cheaply.

Those are worthy goals, and I hope that all parties will give the Minister every support in introducing these complex technical changes. However, I would also say to him that the measure of whether we succeed in this drive for greater efficiency will be whether the consumer gets a better deal. I am sure that that will happen if we adopt the right approach, and I wish the Minister every success with his endeavours.

4.17 pm

Mr. Lock

This has been a good debate. I shall not respond to every point that has been raised, but I assure hon. Members that the working party that I announced at the beginning will be improved by this debate and that its members will study it as part of their deliberations.

I assure the hon. Member for Surrey Heath (Mr. Hawkins) that the interdepartmental group does not have the Orwellian overtones that he fears. It is the usual system that operates in government: no doubt, it operated before 1997, just as it has since. However, the group will consult and draw on licensed conveyancers, the Law Society, surveyors, estate agents, the Institute of Legal Executives, and representatives of others concerned with property—we must not forget the lenders, or the consumers. A wide constituency of stakeholders is involved, because most of us will, at some point in our lives, own a property—or, in the case of the hon. Member for Torridge and West Devon (Mr. Burnett), very considerable amounts of Devon.

Mr. Hawkins

I appreciate that the Minister is being helpful and I realise that he cannot deal with all the matters raised. However, the point that I was trying to make was a serious one. The process would be improved if all the bodies that the Minister mentioned, including consumers, lenders and professional bodies, were full members of the working party, rather than merely consultees.

I have a great fear of consultation processes in which the only people on the working party are civil servants. I am not attacking civil servants collectively; I am saying that, as a principle, I prefer Government consultation processes that involve consumer and professional organisations as full members of the discussion rather than as consultees.

Mr. Lock

I am grateful to the hon. Gentleman for raising that matter. At present, we do not propose to include external members in the detailed working group. However, I can assure him that there will be full consultation. Any consultation in which I am involved means precisely that—listening to and taking careful note of views. However, in the end someone has to make a decision and, inevitably, not everyone who has been consulted will agree.

The hon. Gentleman mentioned a logbook for properties. Several Governments have considered that as a possible way forward. There are several problems with the idea. First, a logbook would by its nature have to be updated. In the current system, information in one form or another is searched from its primary source. It would be a considerable administrative exercise to extract information from its primary source and effectively turn it into a logbook that would have to be continually updated. It is not clear that it would be preferable to locate that information in a logbook, rather than through an electronic interface used by a local authority, concessionary undertaking or private body for suitable inquiries relating to the property. The second problem is that, even if that system were possible within a local authority, because of the nature of the disparate groups that hold information on any property, different locations and properties will give rise to different inquiries, even within a local authority area, and there cannot be complete information.

Thirdly, I ask the hon. Gentleman to bear in mind that in conveyancing we are concerned with the transfer not of property, but of interests in property and, therefore, in the multiple layers of interests that can occur in regard to the same property. The concept of there being only a logbook for a house, which is a nice idea in theory, might not work in practice where a freeholder, a head leaseholder, and a sub-leaseholder all own different parcels of land.

Mr. Hawkins

I recognise what the Minister says and agree that those are important issues. All I ask him to confirm now, particularly in the light of the comment of his hon. Friend the Member for Ellesmere Port and Neston (Mr. Miller), is that, as we have the opportunity to consider a new system—which, as his hon. Friend pointed out, is not rocket science—he will at least undertake to present it as one subject for consideration by his new working party and its consultees.

Mr. Lock

All that I can say now is that I will consider it.

Mr. Burnett

Having done some trust law, I take the point that there may be myriad interests in one block of property. That is a difficulty when it comes to a logbook. I think that we all understand that. However, will the Minister advert to the fact that there is every good reason for the existence of a central register, not of encumbrances in terms of mortgages, charges and so on—not title matters—but of the hub, for want of a better expression, around which all information can be accessed in relation to planning, mining and all the statutory information that can be obtained in regard to a property?

Mr. Lock

The hon. Gentleman is right. That is precisely what NLIS is. It is a hub that, while not holding the information itself, provides electronic links through to the various private and public bodies that hold it. If NLIS is working—the pilot in Bristol has been extremely successful—the fact that there is no one physical location where the information is held is not relevant. The joy and benefit of electronic communication is to access information from the different physical locations where it can be properly updated, given the core business of whoever is the holder of that information. For the purposes of the person who is inquiring and then receiving such information, it appears on the computer screen—in the solicitor's office in Torridge, say—as if all the information sought has come from a single source. That is how NLIS is designed to work.

The hon. Gentleman referred to the investment required downstream, particularly with regard to local authorities. They are undertaking considerable investment in their IT systems as a result of the NLIS programme. He asked for information about that, but the details of major contracts between the contractor and different local authorities are, unfortunately, subject to a veil of commercial confidentiality. I undertake to write to him and to other hon. Members who are in the Chamber setting out the information that I have available, but the majority of information on detailed costings and investment structures is not in the public domain.

Mr. Burnett

To help our local authorities, we want to know from where the loans can be obtained. Which companies are providing them and on what terms are they being made? The local authorities that I have spoken to are not clear about where they can get financial assistance to cope with the huge cost of what we have been discussing.

Mr. Lock

I am grateful for that information and I undertake to give the best information that we have available.

As the hon. Gentleman said, the land charges searches are a feature of unregistered property conveyancing. I am pleased to say that searches can already be made electronically and, ever one for statistics, I can say that 42.6 per cent. of the searches undertaken last year were not processed by document exchange or post. I am sure that the majority of them were undertaken electronically and that that part of e-conveyancing is storming ahead.

The hon. Gentleman referred also to title insurance, which is a difficult and interesting topic. In their work on the housing market, the Government considered the option of title insurance as an alternative to an approved title. It is right that that is available and used widely in the United States. The extent of title insurance is essentially a matter for the market to develop, but the more effective and reliable it is and the more confidence we have in our system of title, the less room there is for the sort of risks that title insurance guards against. It is essentially a matter for the market, but we have a secure and established system of title from the land registration system. That may be one reason why the market in title insurance—in effect, insuring against the possibility that land is owned by someone else—has not developed here as it has in other places where establishing who owns land is not as easy.

Mr. Burnett

I am grateful to the Minister for his comments about insurance. Unfortunately, mistakes happen and I hope that the hon. Gentleman will confirm that not all the entries in the land register, or all office copies, are correct, for reasons that have already been referred to, such as the width of a pencil mark. Perhaps, to speed matters up, title insurance would be a valuable form of assistance. Will the interdepartmental group at least discuss the merits or otherwise of such assistance in the conveyancing process?

Mr. Lock

I assure the hon. Gentleman that I shall consider its suitability for reference to the group.

The hon. Member for Torridge and West Devon and other hon. Members made a point about the relationship between electronic conveyancing and boundary disputes. It is not the job of the Land Registry to settle boundary disputes. The nature of land registration and the filed plans—and their degree of accuracy—is to provide indicators of the position of boundaries, but the existing land registration rules make it clear that they are not final evidence. It would not be right for the land register to be the final arbiter of 6 in here or there, or the route of a fence now as compared with 15 years ago. It is impossible to devise a system of land registration in which there is a duty on the land registrar to maintain that level of detail.

Of course, if a dispute arose about whether a field was in one farm or another, the Land Registry would be approached, if the land was registered, and would provide, to all intents and purposes, the definitive answer. However, I caution hon. Members not to try, through the process of changing from paper-based to e-conveyancing, or by any other means, to impose on the Land Registry duties that are not its business. A boundary dispute over 6 in of fence, or who is to maintain a wall, is a matter of property law, to be determined in accordance with the law between two neighbours and, if it cannot be resolved any other way, in the county court.

Mr. Miller

I entirely accept my hon. Friend's point about the Land Registry, especially given the nature of the historic data that it keeps, in addition to the legislative provisions. However, does he agree that it would be beneficial to the conveyancing process if, where more modern and accurate definitions exist, those were considered as being among the spokes relating to the hub?

Mr. Lock

Certainly, computerisation of the map, which involved the use of many of the techniques to which my hon. Friend has alluded, will assist in resolving many disputes whose outcome would otherwise have been uncertain. However, my point is that it is not the Land Registry's function to resolve all disputes. By its nature, it cannot do so.

The hon. Member for Torridge and West Devon mentioned the movement of money. Of course, on a tough Friday afternoon towards the end of the month, CHAPS, impressive as it has been at some times, creaks a little under the strain. I shall ask the group to examine the issue, although I fear that, as in many similar instances, and while the hon. Gentleman is right about the need to move money quickly, accurately and reliably, the problem goes far beyond the remit of e-conveyancing. It concerns the generation of a climate in this country's business environment in which e-commerce works much more widely than in the buying and selling of land. To the extent that the matter is an important part of the e-conveyancing system, I shall ask the group to consider it.

My hon. Friend the Member for Ellesmere Port and Neston (Mr. Miller) quoted the language of a conveyance that seemed perfectly straightforward to me as a lawyer. I could not see why it was unclear. Perhaps I have spent too many years in the Chancery Division and not enough in my hon. Friend's constituency. All professions have their language. The language of professionals has always been used as a barrier to the layman, and the legal profession is no different from the medical profession in that respect. I agree entirely that the language needs to be simplified. Hon. Members may have noticed that I have referred not to vendors and purchasers during the debate, but to buyers and sellers. We all understand that simple form, but using the words "vendor" and "purchaser" means getting into lawyers' language. We are taking steps the right direction, but I agree that further steps are necessary.

An awful lot has been and is being done to promote better conveyancing. A degree of co-operation has been established between all of the various players that are involved to achieve the prize of a better conveyancing system that is fast and reliable and cuts out a great deal of the uncertainty and pain of house buying and selling. I am grateful to have participated in this good debate, which has provided an opportunity to show how much has been done, as well as to look ahead and see the prize that is before us: a conveyancing system that is accurate, which can work electronically and in which conveyancing will occur when people want it, rather than when the system gradually creaks into life.

Question put and agreed to.

Adjourned accordingly at twenty-two minutes to Five o'clock.