Hot on the heels of the $10 billion selloff of the Port of Melbourne, the Andrews Labor government has now sold Victoria’s land titles office, Land Use Victoria (LUV). Andrews sold the LUV for $2.86 billion in defiance of a Labor state conference resolution passed earlier this year.
The Community and Public Sector Union (CPSU), covering workers at LUV, described the selloff as a “short sighted revenue grab” while even the Industrial Left faction of Labor said “This is a betrayal of the working people who we all serve”.
Apart from showing the complete absence of democracy within the Labor Party, and the lack of accountability the parliamentary wing has to bodies such as the conference, the LUV selloff demonstrates that the neoliberal agenda of both the major parties is not abating.
Monopoly state assets like the LUV are hungrily sought after by private investors and the buyer, First State Superannuation, already owns the New South Wales land titles office. The South Australian titles office has been sold to the Macquarie Group.
Facing no competition, these now privatised assets satisfy capitalist investors by returning high profits for many years.
Victoria has a history of privatising public assets. Since the 1990s transport, energy infrastructure, roads, ports and public housing stock have all been sold off to private interests. In every instance we have seen costs increase and service quality decline.
There is no reason to expect that the privatisation of the land titles office will be any different.
A number of commentators have suggested that land title fees could quadruple as was seen recently in Canada. Already in New South Wales there has been an increase in costs and complaints about the quality of service.
The other trend we have seen when it comes to privatisation has been job losses. The LUV currently has 517 employees and the CPSU has said that 400 jobs are at risk.
LUV has an annual surplus of $300 million. Until now these funds have been put back into general revenue to fund other public services like schools, roads and hospitals. This money will now be in the hands of corporations, with only a tiny portion coming back via taxation.
The risk to jobs, and the loss of ongoing revenue, far outweighs the short-term gain from the present sale.
LUV is responsible for all land and property in Victoria and holds important data on mortgages, restrictions, leases and rights of way. Putting this data in the hands of the private sector lends itself to the possibility of fraud and compromise.
Belinda Wilson from the Law Institute of Victoria said that “The privatisation of the land registry may compromise the security, accuracy and privacy of this data as governmental oversight controls may no longer be applicable, resulting in it being exploited for corrupt or fraudulent means”.
People will increasingly be forced to take out expensive title insurance because of the lack of integrity the private sector has. Who knows who they will be prepared to sell this lucrative data to in order to increase their profits further?
It is important to note that there was absolutely no need for the sale of LUV. The state budget is currently in surplus, and government services – as well as new infrastructure – could be easily financed by other means.
The most obvious way would be to increase taxes on large corporations. But even if the government was desperate for a quick $2 billion, they could have borrowed it at the present 10-year bond rate of 3%.
This would cost $60 million in interest a year. Given the revenue stream from LUV was $300 million a year and increasing, it would be a saving of $240 million plus!
The truth is that Labor, just like the Liberals, are wedded to privatisation as it’s a boon to their big business mates. They don’t admit this though, as they know privatisation is hugely unpopular. In fact, they say the exact opposite to cover their tracks.
As recently as August, Daniel Andrews said that “Privatisation has not worked, its only made things harder for families…privatisation and deregulation have gone too far.”
This unbelievable duplicity is only possible because of the lack of any sort of mass opposition to the major capitalist parties. We need to ditch these lackeys of the bosses and establish a socialist alternative to really advance the interests of the working class.
By Michael Naismith