Corporate report

Accountability report

Updated 25 September 2019

Applies to England and Wales

Corporate governance report

Directors’ report

This section sets out the membership of our key directing boards and committees and explains their responsibilities.

HM Land Registry’s Board

The remit of HM Land Registry’s Board (LRB) is to support, advise, challenge and provide guidance. The LRB ensures good governance and public accountability, endorses the HM Land Registry strategy and assists the Chief Executive and Chief Land Registrar in their ultimate responsibility as Accounting Officer for the governance of HM Land Registry.

The LRB terms of reference were first approved in 2012 and were revised during 2015/16. They remained relevant in 2018/19.

The LRB met eight times in 2018/19. Meetings were held at HM Land Registry Head Office, regional offices and in London.

The Chair, Chief Executive and Chief Land Registrar and the Chief Financial Officer also held quarterly meetings with UK Government Investments (UKGI).

LRB membership
Michael Mire (Chair)	Non-Executive Chair
Kirsty Cooper	Non-Executive Board Member and Senior Independent Board Member
Iain Banfield	Chief Financial Officer (from 4 February 2019)*
Diana Breeze	Non-Executive Board Member
Ruth Curry	Acting Director of Finance and Business Services (to 3 February 2019)
Graham Farrant	Chief Executive and Chief Land Registrar (to 31 December 2018)
Doug Gurr	Non-Executive Board Member
Mike Harlow	Acting Chief Executive and Chief Land Registrar (from 1 January 2019) and as an attendee as General Counsel and Deputy Chief Land Registrar (to 31 December 2018)
Angela Morrison	Non-Executive Board Member
Chris Morson	Non-Executive Board Member
Chris Pope	Chief Operations Officer
Claire Wren	Non-Executive Board Member, UK Government Investments (UKGI)
Attendees
Mike Westcott-Rudd	Board Legal Adviser

*Iain Banfield’s appointment started on 1 January 2019 but he acted in his role of Chief Financial Officer from 4 February 2019.

Executive Board

The Executive Board (EXB) is chaired by the Chief Executive and Chief Land Registrar and its members are HM Land Registry’s executive directors. The EXB is responsible for the delivery of HM Land Registry’s Annual Business Plan and for the day-to-day operational management of the organisation. The EXB met monthly to 31 December 2018 and then weekly from January 2019.

Executive Board membership
Mike Harlow (Chair)	General Counsel and Deputy Chief Land Registrar (to 31 December 2018) and as Acting Chief Executive and Chief Land Registrar (from 1 January 2019)
John Abbott	Director of Data, Digital and Technology
Caroline Anderson	Director of Human Resources and Organisation Development (to 15 March 2019)
Iain Banfield	Chief Financial Officer (from 4 February 2019)*
Jon Cocking	Acting Director of Human Resources and Organisation Development (from 1 March 2019)
Ruth Curry	Acting Director of Finance and Business Services (to 3 February 2019)
Graham Farrant	Chief Executive and Chief Land Registrar (to 31 December 2018)
Robin Malpas	Acting Deputy Chief Land Registrar (from 1 January 2019)
Chris Pope	Chief Operations Officer
Karina Singh	Director of Transformation
Mike Westcott-Rudd	Board Legal Adviser
Attendees
Cathy Jenkins	Chief of Staff

*Iain Banfield’s appointment started on 1 January 2019 but he acted in his role of Chief Financial Officer from 4 February 2019.

Audit Committee

The committee supports the LRB and the Accounting Officer by seeking assurance on the risk management framework, the control framework, governance and compliance with policies, procedures, external standards and statutory requirements.

Audit Committee membership
Chris Morson (Interim Chair)	Non-Executive Board Member
Angela Morrison	Non-Executive Board Member
Derrick Palmer	Independent member of the Audit Committee
Attendees
Brian Anderson	Risk Manager
Iain Banfield	Chief Financial Officer (from 4 February 2019)*
Stuart Brown	Senior Internal Auditor
Ruth Curry	Acting Director of Finance and Business Services (to 3 February 2019)
Graham Farrant	Chief Executive and Chief Land Registrar (to 31 December 2018)
Patrick Green	Chief Internal Auditor (from 29 November 2018)
Darren Hall	Head of Internal Audit, Government Internal Audit Agency (to 31 December 2018)
Mike Harlow	General Counsel and Deputy Chief Land Registrar (to 31 December 2018) and Acting Chief Executive and Chief Land Registrar (from 1 January 2019)
Mike Westcott-Rudd	Board Legal Adviser
Representative of National Audit Office	National Audit Office
Representative of UKGI	UKGI

*Iain Banfield’s appointment started on 1 January 2019 but he acted in his role of Chief Financial Officer from 4 February 2019

Remuneration and Nomination Committee

The committee agrees pay strategy and authorises the annual pay review for HM Land Registry Senior Civil Service staff and agrees a strategy for succession to the LRB and EXB.

Remuneration and Nomination Committee membership
Diana Breeze (Chair)	Non-Executive Board Member
Graham Farrant	Chief Executive and Chief Land Registrar (to 31 December 2018)
Mike Harlow	Acting Chief Executive and Chief Land Registrar (from 1 January 2019)
Chris Morson	Non-Executive Board Member
Attendees
Caroline Anderson	Director of Human Resources and Organisation Development (to 15 March 2019)
Jon Cocking	Acting Director of Human Resources and Organisation Development (from 1 March 2019)

Register of interests

A register of interests is maintained at HM Land Registry’s Head Office. See note 20 to the accounts on page 106 for related party disclosures.

Statement of Accounting Officer’s responsibilities

Under Section 4(6) of the Government Trading Funds Act 1973 HM Treasury has directed HM Land Registry to prepare for each financial year a statement of accounts in the form and on the basis set out in the Accounts Direction referred to in note 1.1. The accounts are prepared on an accruals basis and must give a true and fair view of the state of affairs of HM Land Registry and of its income, expenditure, changes in reserves and cash flows for the financial year.

In preparing the accounts, the Accounting Officer is required to comply with the requirements of the Government Financial Reporting Manual and in particular to:

• observe the Accounts Direction issued by HM Treasury, including the relevant accounting and disclosure requirements, and apply suitable accounting policies on a consistent basis
• make judgements and estimates on a reasonable basis
• state whether applicable accounting standards as set out in the Government Financial Reporting Manual have been followed and disclose and explain any material departures in the accounts
• prepare the accounts on a going concern basis when appropriate to do so

The Permanent Secretary at HM Treasury has appointed the Acting Chief Executive of HM Land Registry as the Interim Accounting Officer for the trading fund. The responsibilities of the Interim Accounting Officer, which include responsibility for the propriety and regularity of the public finances for which the Interim Accounting Officer is answerable, for keeping proper records and for safeguarding HM Land Registry’s assets, are set out in the Accounting Officers’ Memorandum issued by HM Treasury and published in Managing Public Money.

So far as I am aware there is no relevant audit information of which the auditor is unaware, and the directors have taken all the steps that they ought to have taken as directors in order to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.

As Interim Accounting Officer I confirm that the annual report and accounts as a whole is a fair, balanced and understandable account of HM Land Registry’s operational and financial performance and I take personal responsibility for the annual report and accounts and the judgements required for determining that it is fair, balanced and understandable.

Other accountabilities

Health and safety

We have continued to develop the health and safety management system we have in place to ensure compliance with legislative and regulatory requirements, monitor the adequacy of health and safety policies and promote continual improvement.

We continue to hold to OHSAS18001, the British Standard for health and safety management, with work to move to ISO 45001, the European Standard for health and safety management, by January 2020. The retention of these standards provides further assurance of the maturity of our health and safety management system and promotes our continual improvement and alignment with best practice.

We have maintained a good standard of compliance despite mobilising a new facilities management provider, who delivers health and safety services on our behalf.

There has been a continued focus on awareness and improvement in display screen equipment assessment processes and online training and awareness campaigns on road safety to further reduce the risk for our drivers. We have initiated a review of lone working and are currently delivering improvements and delivering shared best practice. This work will continue in 2019.The total number of accidents reported by HM Land Registry staff at work was 137, three of which were required to be reported to the Health and Safety Executive under the Reporting of Injuries, Diseases and Dangerous Occurrences Regulations.

Service standards

Details of the service that customers can expect from us can be found on our website: https://www.gov.uk/government/publications/hm-land-registry-service-standards.

Welsh language service

See our Welsh language service for more information.

Complaints

Following training for key staff at every office during 2017/18 to improve consistency in the recognition and handling of complaints, the number of recorded complaints increased significantly and this increased recording was maintained through 2018/19.

We recorded 3,193 complaints in 2018/19 compared with 2,712 in 2017/18.

We will continue to make further improvements in 2019/20. We anticipate this will result in a further increase in the total next year.

Forty-eight per cent of recorded complaints were upheld or partially upheld (42% in 2017/18). Customer feedback about the delays on registration applications and associated customer enquiries was the most common area of upheld complaint, comprising 19% of the upheld total. This reflects that we are unable to complete some of more complex applications involving the creation of a new register within our published service standard.

The other main areas of complaint related to our cancellation of applications (comprising 15% of the total), the requests we raise for information from customers when their applications are not in order (12%) and the results we send when we complete applications (10%).

The majority of complaints were not upheld and these were also mainly about delays on registration applications, the cancellation of applications, the requests we raise for information from customers and the results when we complete applications. Those that were not upheld tended to fall into the category of the complaint not being justified, for example where we received a complaint about delay, but the application concerned was completed within our service standard.

We conduct analysis of all complaints received throughout the year, both individually and in their overall categories, to capture learning points and act on them. For example:

• our customers said we sometimes took longer than expected to respond to enquiries about the progress of applications - we updated and clarified our enquiry handling protocols and standards and reminded our people how these enquires should be handled
• our customers said complex applications made to us requiring the consideration of senior staff were sometimes delayed - we improved our internal processes for the referral of this type of application
• our customers said we sometimes mishandled the servicing of applications that are not in order and those applications that are relodged following cancellation - we improved our systems, automating some aspects and provided clearer and more comprehensive information to our caseworkers
• our customers said our online GOV.UK guidance on applications relating to bereavement was difficult to find and unclear - we helped introduce new step-by-step guidance and made it easier to find

Our Independent Complaints Reviewer (ICR) provides a free and impartial review and resolution service for any customer dissatisfied with how we have handled their complaint. As well as making recommendations to us about individual customers they also propose actions to improve our practice and procedures to reduce the risk of making the same mistakes again.

Copies of every ICR report are forwarded to a committee of senior colleagues to consider any findings. Where complaints are upheld, the Chief Executive writes directly to the customer to apologise and explain what we will do to put matters right.

Security incidents

Physical security is overseen by the Physical and Personnel Security Panel. There were 49 incidents during the year and zero significant (Class 1) incidents.

Personal data-related incidents

There were no personal data-related incidents reported to the Information Commissioner’s Office during this reporting period.

Following the introduction of the General Data Protection Regulation in May 2018, we recruited a permanent Data Protection Officer. We introduced new processes to ensure we are compliant with the new regulations and have required all staff to complete the Civil Service Learning “Responsible for Information” training to ensure everybody has an appropriate level of awareness of data protection matters. Documentation has also been updated, including for example our Personal Information Charter on the GOV.UK website.

Governance statement

Scope of responsibility

As the Interim Accounting Officer for HM Land Registry I have responsibility for maintaining corporate governance structures that support the achievement of HM Land Registry’s aims, objectives and targets, while safeguarding public funds and HM Land Registry’s assets.

I was appointed as Acting Chief Executive and Chief Land Registrar from 1 January 2019, to replace the previous Chief Executive and Chief Land Registrar (Graham Farrant) who had held the role for the financial year 18/19 until 31 December 2018. I received from him an Interim Statement of Assurance which I have relied upon as an accurate record of how HM Land Registry was performing and how risk and assurance was being managed. I also received a ministerial letter of appointment pursuant to The Land Registration (Acting Chief Land Registrar) Regulations 2003 and a letter from the Permanent Secretary to the Treasury, appointing me as Interim Accounting Officer plus a letter from the Chief Financial Officer at BEIS providing me with financial delegations.

HM Land Registry is a non-ministerial government department, an executive agency and a trading fund. My duties as Interim Accounting Officer are set out in Managing Public Money, which are to ensure public money is safeguarded, properly accounted for and used economically, efficiently and effectively. I am accountable for the performance and stewardship of HM Land Registry to the Secretary of State for BEIS, with day-to-day responsibility delegated to the Parliamentary Under Secretary of State.

The main duties relating to maintaining the register of title to freehold and leasehold land and mortgages are defined in the Land Registration Act 2002 and those relating to Land Charges and Agricultural Credits are defined in the Land Charges Act 1975 and the Agricultural Credits Act 1928. The Infrastructure Act 2015 enabled HM Land Registry to become the registering authority for statutory Local Land Charges in place of individual local authorities. Five local authorities’ registers of Local Land Charges have been moved over to HM Land Registry’s single digital register during this financial year.

Reclassification of HM Land Registry

The Office for National Statistics (ONS) has conducted a review of the classification of HM Land Registry within government, as part of a wider review of a range of other government bodies for the purposes of national accounts.

At the end of October 2018 the ONS published its conclusion and has reclassified HM Land Registry into the central government subsector for national accounts’ statistical purposes. We were previously a public (non-financial) corporation.

It means our finances will now be seen as part of the financial statistics relating to central government. As part of a review following the decision, it is possible that Government may revoke our trading fund status as from April 2020. We would then enter the parliamentary vote-funding regime from 2020/21.

We are in discussions with HM Treasury to see that any future financial framework provides the flexibilities we need in order to continue our functions and meet our ambitions.

Purpose of governance framework

The governance framework is designed to give assurance that HM Land Registry carries out its duties in a manner that fulfils the appropriate standards of effective internal control and risk management. It is based on processes designed to identify and prioritise the opportunities and risks to the delivery of HM Land Registry’s strategy, the strategic objectives and performance targets. It aligns with our statutory duties and is designed to support the governance and strategic aims of BEIS and our statutory duties. The governance of HM Land Registry and its relationship with other government bodies is set out in a Framework Document dated 2012. Although we continue to work to this document it is in the process of being revised and is currently with departmental stakeholders for comment. It reflects all current arrangements and ensures alignment with all current government codes of practice in relation to arm’s-length bodies.

Key elements of the governance framework

The governance framework includes:

• ministerial appointment of the Acting Chief Executive and Chief Land Registrar
• HM Treasury letter appointing the Interim Accounting Officer
• letter from the Chief Financial Officer at BEIS providing financial delegations
• the Framework Document
• HM Land Registry’s Board, the Audit Committee and the Remuneration and Nomination Committee
• the Executive Board, the Transformation Board, the Programme Boards and Executive Board delegated committees and the panels
• letters from the Interim Accounting Officer to directors setting out financial and functional delegations and accountabilities

HM Land Registry’s Board

HM Land Registry’s Board (LRB) contains a mix of executives and non-executive board members. In line with Cabinet Office guidance the LRB is tasked with advising on, challenging and supervising five main areas. They are:

• strategic clarity
• commercial sense
• talented people
• results focus
• management information

Non-executive members of LRB are highly skilled and have the appropriate experience in the relevant fields to support and challenge the Executive Board. There are currently six non-executive directors plus the chair.

The LRB, supported by its Audit Committee, also ensures that HM Land Registry is working within a framework of prudent and effective governance arrangements and controls that enable risk to be appropriately assessed and managed. As part of that function, the LRB agrees the key activities that HM Land Registry will need to undertake to meet its strategic objectives as set out in its published Business Strategy. LRB supports the Acting Chief Executive in ensuring the necessary financial and human resources are in place for HM Land Registry to meet these objectives. It agrees the organisation’s risk appetite, approves the annual budget and plan and regularly reviews performance in relation to agreed targets.

The non-executive members are independent of management. They are required to sign an annual statement recording any potential conflict of interests. A central “Register of Interests” record is then retained.

The LRB intends to carry out a self-assessment by the end of July. HM Land Registry has been discussing with UKGI the most appropriate means to deliver that.

During the year 2018/19 HM Land Registry’s Board evaluated and agreed, among other things:

• the strategic direction and pace of change within HM Land Registry
• HM Land Registry’s potential involvement in a “property logbook” as proposed by the Ministry of Housing, Communities and Local Government
• the approach to strategic risk management
• payment of a corporate performance award for the year 2017/18
• a strategic workforce plan and establishment size
• the approach to speed of service and work in progress
• the approach to handling open data releases
• proposals for fee restructuring
• the budget and transformation priorities
• partnering Ordnance Survey in financing PropTech start-ups via Geovation

Committees of the LRB

Audit Committee

The Audit Committee supports the LRB and me as the Interim Accounting Officer by reviewing the risk management framework and the principal risks of the organisation, as well providing oversight and challenge in the preparation of the annual report and accounts.

At every meeting, the committee sees a Risk Register and Statement of Assurance of at least one directorate.

A self assessment of performance was undertaken this year and was deemed to be effective. During this financial year the issues covered by the Audit Committee included:

• monitoring and challenging the progress of the local land charges programme
• reviewing whether HM Land Registry had met government standards concerning the introduction of the General Data Protection Regulation
• an assurance and risk management review
• overseeing a risk-based programme of internal audit assurance activity and monitoring implementation of agreed management actions

Remuneration and Nomination Committee

The Remuneration and Nomination Committee (Remco) ensures that remuneration (and, where appropriate, nomination arrangements), including senior pay strategy, support HM Land Registry’s aims and the recruitment, retention and performance of the executive team. During the course of this year the main issues covered were:

• Senior Civil Service performance and pay
• the HM Land Registry corporate performance award
• the departure of the Chief Executive and Chief Land Registrar and subsequent objectives and arrangements

Attendance schedule for LRB, Audit Committee and Remuneration Committee

Non-executive	Title	Period (appointment relates to whole of the reporting year unless otherwise specified	Board LRB	Committee
				Audit	Remuneration
Michael Mire	Non-Executive Chair		8/8	–	–
Kirsty Cooper	Non-Executive Board Member and Senior Independent Board Member		7/8	–	–
Diana Breeze	Non-Executive Board Member		8/8	–	3/3
Doug Gurr	Non-Executive Board Member		4/8	–	–
Angela Morrison	Non-Executive Board Member		8/8	5/5	–
Chris Morson	Non-Executive Board Member		8/8	5/5	3/3
Derrick Palmer	Non-Executive Audit Committee Member		–	5/5	–
Claire Wren	Non-Executive Board Member		8/8	–	–
Executive
Mike Harlow	General Counsel and Deputy Chief Land Registrar (to 31 December 2018) and Acting Chief Executive & Chief Land Registrar (from 1 January 2019)		8/8	5/5	1/1
Caroline Anderson	Director of HR, OD & Communications	To 15 March 2019	–	–	2/3
Iain Banfield	Chief Financial Officer	From 4 February 2019 (see note 1)	2/2 (see note 2)	1/1	–
Jon Cocking	Interim Director of HR, OD & Communications	From 1 March 2019	–	–
Ruth Curry	Acting Director of Finance and Business Services	To 3 February 2019	7/7 (see note 2)	3/4	–
Graham Farrant	Chief Executive & Chief Land Registrar	Appointment ended 31 December 2018	6/6	4/4	2/2
Chris Pope	Chief Operations Officer		8/8	–	–
Mike Westcott-Rudd	Board Legal Adviser		8/8	4/5	–

1. Iain Banfield’s appointment started on 1 January 2019 but he acted in his role of Chief Financial Officer from 4 February 2019.

2. Both Iain Banfield and Ruth Curry attended the February 2019 meeting, although Ruth was not a formal committee member at this stage.

Executive Board and Executive Committees

Executive Board

The Executive Board (EXB) leads and manages HM Land Registry to ensure the delivery of the objectives and business targets, the successful implementation of the approved Business Strategy, annual plans and compliance with the Framework Document.

Through the mechanism of individual letters of delegation, members of the EXB handle the day-to-day running of HM Land Registry.

A number of committees report to the EXB focusing on people, information management and register protection matters. Each committee is in turn supported by a number of sub-groups on specific items such as diversity, health and safety, cyber and counter fraud. All meetings are chaired by senior managers and report regularly to their parent board or committee. Membership is drawn from across the organisation and to include subject matter experts.

Transformation Board

The Transformation Board is made up of the EXB directors and other representation from appropriate areas of the organisation. The board oversees the delivery of operational and digital change in the organisation through oversight of delivery programmes and projects, their strategic alignment, benefits, risks and finances. Significant progress has been made across programme areas on digital and data, service improvement, customers, local land charges, IT infrastructure and brilliant by design.

Commercial Governance Panel

The Commercial Governance Panel is chaired by the Chief Financial Officer and includes the Head of Commercial Group, the Head of Strategic Finance and a corporate lawyer. It provides an additional layer of internal governance for expenditure on external goods and services over £100,000. The panel provides assurance to the Chief Financial Officer and the Interim Accounting Officer in relation to significant contract awards and contract extensions. It ensures all expenditure is aligned to HM Land Registry’s Business Strategy; that the proposed procurement route will deliver the best value for money; and, that HM Land Registry complies with public procurement legislation and Cabinet Office controls.

Business Strategy 2017-22

HM Land Registry has an ambitious Business Strategy for the period 2017-22. Its objectives are to realise the Government’s commitment for HM Land Registry to become the world’s leading land registry for speed, simplicity and an open approach to data. The strategy is founded on our mission statement: “Your land and property rights guaranteed and protected” and our values: “we give assurance; we have integrity; we drive innovation; we are professional”.

The strategy is based on the rationale that any transformation should only be about change for the better, with strategic risks managed, clear governance, financial controls in place and core service standards maintained or improved at all times.

Local Land Charges statement on governance

The Infrastructure Act 2015 provided the basis on which HM Land Registry became the registering authority and holds the statutory Local Land Charges Register in place of local authorities. To date, five local authorities have migrated their data across. The data migration is taking longer than forecast given the mixed data quality. This means that the migration of the remaining local authorities included in Phase 1 was not completed in 2018/19 and we have obtained ministerial agreement to extend Phase 1 into 2019/20 to give more time to assess and analyse the data from Phase 1 local authorities, and test our proof of concept assumptions more thoroughly. We can then consider a full range of options in evaluating the next steps.

I receive progress reports and assurances from the programme senior responsible owner. This involves monthly reporting to the Local Land Charges Programme Board and complete review of all risks, including the associated strategic risk, on a quarterly basis. Risks are also reported to BEIS on a monthly basis, including presenting an update to their Performance Finance and Risk Committee. As the programme falls within the remit of the Infrastructure and Projects Authority, I receive regular gateway reports from them.

Quality of management information

HM Land Registry has a dedicated ‘Strategic Planning and Performance’ team, falling under the umbrella of the Finance and Business Services Directorate.

HM Land Registry operates a number of models critical to its core business. These include models to forecast intakes and fee income; a strategic workforce planning model; an operational forecast model for matching workload and resources and models to support standard management and financial reporting. A dedicated Operation Forecast Model Steering Group provides oversight and relevant challenge to some of our models, which provides confidence in the use of those datasets.

We also have specific financial models for our major programmes, which are used to inform the business cases and to provide detailed financial planning.

A Performance Panel of senior managers meets monthly to review, challenge and provide commentary on the performance and management information of the organisation. The information and commentary is then reported to the EXB monthly and LRB quarterly.

Financial performance is monitored and reported using monthly reports. There is a procedure for setting annual budgets and reviewing financial performance and full-year forecasts. Quarterly forecast reviews are in operation giving the EXB and LRB appropriate oversight and assurance.

All LRB papers and the data included are cleared by the Acting Chief Executive and Chief Land Registrar in advance of meetings. Senior managers and staff that draft papers have been reminded during the year of requirements for all board papers and new templates have been produced to help ensure consistency.

Working with the Macpherson Review on quality assurance of government models

We continue to ensure that robust quality assurance arrangements are in place and this review is included as part of our finance department’s annual review of Managing Public Money.

Framework for risk management

The organisation has recently reviewed its risk management framework and aligned its strategic risks to the Business Strategy. A new Single Risk Register was launched on 10 December 2018. This records all the organisational risks in one place. An external review of risk and assurance management was conducted this year by EY. The report made various recommendations for improving the consideration and oversight of risk management. The EXB has accepted the recommendations and is working to adopt a clearer ‘three lines of defence’ model and assurance map. Implementation will complete in the year 2019/20.

All senior managers who are or potentially may be responsible for identifying and managing risk have undertaken risk training. To support and help develop our risk management policy, we have recruited an interim Risk and Assurance Manager and expect this to be followed by appointing a permanent Head of Risk and Assurance shortly. We have also recruited an interim Head of Business Continuity and expect to increase the size of the risk team.

The LRB, EXB and Audit Committee all consider the strategic risks of the organisation. The Board Legal Adviser acts as the EXB’s risk champion until such time as a permanent Head of Risk is appointed. The strategic risks are reviewed quarterly and any key changes reported to EXB. A comprehensive risk review is completed each quarter in relation to the directorate held risks. These reviews are facilitated by the Risk Manager, with directors attending Audit Committee, at least annually, to report on the strategic risks they hold and their key directorate held risks. Lead indicators are monitored to provide early warning of changes in strategic risk which are then acted upon.

There are currently 14 strategic risks, 13 of which are aligned to the objectives contained in the Business Strategy and for which individual EXB members have specific individual responsibility. Aligning the strategic risks to the strategic objectives ensures the emphasis is focused on achieving our ambitions as set out in the Business Strategy. A description of the strategic risks is set out in the Performance Report. The 14th risk relates to EU exit

HM Land Registry’s key strategic risks include ensuring the capacity of staff to deliver our core services, the quality of the register, combating and preventing fraud, cyber security and resilience of our systems.

In November 2018, a new reporting system, Fusion, replaced our existing HR and Finance systems. This transition was a risk that could have potentially impacted our accounting and revenue capabilities. Although there was a delay in the go-live date, the system is now operational and is managed at directorate level. There have been and remain difficulties with some aspects of its functionality that we are endeavouring to resolve with our suppliers.

In December 2018 we had a power failure at one of our data centres that affected a number of our key systems. External services were back online quickly on the same day, with the majority of customers being able to use our services with minimal disruption. We reviewed both the cause of the incident and our response for lessons learned. Enhancements to improve system resilience have been put in place as a result.

Whistleblowing

No new whistleblowing cases have been reported this year. We have continued to make staff aware of our policy. A recent Internal Audit report gave our procedures a substantial assurance.

The report recommended line manager training, which is now being coordinated, and additional signposting to the policy for staff, which is in hand and due to be completed by the end of the first quarter of 2019/20.

Information and cyber risk

Information risk is the responsibility of all staff. The Board Legal Adviser is also the Senior Information Risk Officer (SIRO). The SIRO is assured by information risk returns carried out by our Information Asset Owners (IAOs) and fully documented asset descriptions. A deputy SIRO has recently been recruited and will support the SIRO to advise senior colleagues on how to manage security risks and to assess information risks to the organisation.

HM Land Registry is in the process of recruiting a Security Adviser, as approved by the Cabinet Office under the Transforming Government Security programme. This Government programme is designed to ensure that all security arrangements, physical, personnel and cyber, are undertaken to common high standards across Government, led by the Cabinet Office and the National Cyber Security Centre.

In the meantime, HM Land Registry is maturing its cyber defences, in collaboration with the National Cyber Security Centre, and has created a cyber project which brings together a number of cyber measures designed to combat and detect cyber crime.

Protecting information

All staff are required to complete the appropriate levels of information management training and undertake an online training activity every year. More than 95% of staff have undertaken the training in 2018/19.

We are continuing to work within the ISO27001 framework, the international standard for information security management, which we have done now for almost 15 years. The standard works on a three-yearly recertification cycle and we are due to be recertified in 2020. The standard is comprehensive and includes IT security, physical security, information management, business continuity and risk management. The latest review has just taken place. This confirmed that all recommendations received last year have been addressed.

Response to Alexander Review and guidance for off-payroll contractors and revised recruitment processes

HM Land Registry continues to proactively monitor the systems and procedures relating to off-payroll contractors to comply with changing requirements to provide assurance that all contractors engaged by HM Land Registry are complying with appropriate tax and NIC regulations. I am assured that our processes assume all off-payroll staff are subject to IR35.

The majority of our off-payroll staff are employed through Alexander Mann, and a requirement within this framework is that staff are employees of the introducing agency with tax/NI deducted at source. For those coming to us through another route, we ensure in advance that they understand the IR35 requirements and the need to demonstrate compliance – this is normally provided by way of a copy of their first payslip.

Litigation (Employment Tribunal cases)

At the start of the 2018/19 financial year there were two ongoing Employment Tribunal claims. One was originally raised in August 2017 and settled in April 2018, including payment being made to the claimant, an ex-employee. A further claim raised by a current employee in March 2018 did not reach a conclusion before the end of the financial year.

During 2018/19 two further Employment Tribunal claims were made against HM Land Registry. These are all still ongoing with one claim being made by a current employee and one being made by a former employee.

Central controls

My role as Acting Chief Executive and Chief Land Registrar is to carry out the role of Chief Land Registrar referred to in the Land Registration Act 2002, the Land Charges Act 1972 and the Agricultural Credits Act 1928 and the Local Land Charges Act 1975 as amended by the Infrastructure Act 2015. The Chief Executive and Chief Land Registrar is responsible for keeping the registers established for the purposes of those Acts and has all the powers, responsibilities and duties conferred and imposed on the Registrar by those Acts and by the rules and other secondary legislation made under them. In carrying out those specific operational functions the Chief Executive and Chief Land Registrar is not subject to any ministerial control or direction. They are subject to supervision by the court.

In managing its business more generally, HM Land Registry operates within the delegations framework as defined by the Cabinet Office for arm’s-length bodies and the specific delegations authorised by officials at BEIS. There is also a requirement to work with the Government Digital Service to ensure that product releases conform to standards in terms of security, effectiveness and consistency. Before products are released as betas, HM Land Registry must submit products and comply with the conditions specified by the Government Digital Service.

Procurement assurance

I am assured by the Chief Financial Officer, regarding specific procurements, that procurement activities are conducted in line with Cabinet Office and HM Treasury guidance and that senior managers have complied with these and HM Land Registry specific procurement guidelines.

Performance reporting

In addition to the monthly financial reports from the Chief Financial Officer, I receive information on operational performance through a performance hub, which is compiled from wider performance data received and reviewed by the Performance Panel before its submission monthly to the EXB. I also receive update papers and presentations from management teams to me and my EXB.

I regularly visit the operational offices and Head Office groups, as do all the other members of the EXB, and we receive feedback on organisational performance and other issues of concern to our staff from colleagues at all levels of the organisation. I write a weekly blog. These are the subject of comment and feedback. Other directors also produce a weekly blog on rotation, covering important key messaging.

The operational visits provide vital feedback on quality, work in progress and speed of service outcomes. I also meet with a range of external stakeholders through planned visits, regular meetings and formal stakeholder engagement groups to understand their concerns and operational context.

Assurance reporting

All directors are required to submit a biannual statement of assurance covering their strategic and key directorate risks and the controls in mitigation of these. The draft statements of assurance are challenged by all directors and subject matter experts in a twice yearly Assurance Panel meeting. The interim statement of assurance was timed this year to coincide with the departure on 31 December 2018 of the Chief Land Registrar to ensure that he could incorporate those statements as part of his statement of assurance to that date.

The EXB and the Audit Committee also receive assurance from the Register Integrity Team regarding casework quality and the Counter-Fraud Group on fraud resilience. Part of our risk management maturity plan is to identify more clearly other parts of the organisation that could offer assurance to the board.

Internal Audit and opinion

For the 12 months ended 31 March 2019, the Head of Internal Audit’s opinion for HM Land Registry is as follows: “HM Land Registry has an adequate and effective framework for risk management, governance and internal control to support the satisfactory achievement of its business objectives, and to enable key risks to be effectively managed. However, our work has identified further enhancements to the framework that are required to ensure that it remains adequate and effective”.

Mike Harlow Acting Chief Executive and Chief Land Registrar 1 July 2019

Remuneration and staff report

Policy for senior civil servants

The remuneration of senior civil servants (SCS) is set by the Prime Minister following independent advice from the Senior Salaries Review Body.

In reaching its recommendations, the Review Body has regard to:

• the need to recruit, retain and motivate suitably able and qualified people to exercise their different responsibilities
• regional/local variations in labour markets and their effects on the recruitment and retention of staff
• Government policies for improving the public services including the requirement on departments to meet the output targets for the delivery of departmental services
• the funds available to departments as set out in the Government’s departmental expenditure limits
• the Government’s inflation target

The Review Body takes account of the evidence it receives about wider economic considerations and the affordability of its recommendations.

The salary of the Chief Land Registrar and Chief Executive is set by BEIS. The HM Land Registry Remuneration and Nomination Committee, acting on the authority of the HM Land Registry Board, considers pay recommendations provided by line managers and decides the distribution of performance pay in the annual pay review for HM Land Registry senior civil servants, in accordance with Cabinet Office guidance.

Both base pay and non-consolidated performance related awards are dependent on performance, which is assessed through an annual appraisal system for senior civil servants, see Senior Civil Service: performance management for more details.

During the year the members of the Remuneration and Nomination Committee were Non-Executive Directors Diana Breeze (Chair) and Chris Morson, Chief Executive and Chief Land Registrar Graham Farrant (until his appointment ended 31 December 2018) and Mike Harlow as Acting Chief Executive and Chief Land Registrar (from 1 January 2019) and attended by Director of Human Resources and Organisation Development Caroline Anderson (until her appointment ended 15 March 2019) and by Acting Director of Human Resources and Organisation Development Jon Cocking (from 1 March 2019).

Policy for other civil servants

Pay for HM Land Registry employees who are not in SCS grades is determined each year following negotiation and consultation between HM Land Registry and the unions, and is subject to approval by the Secretary of State, taking into account guidance issued by HM Treasury.

Service contracts

The Constitutional Reform and Governance Act 2010 requires Civil Service appointments to be made on merit on the basis of fair and open competition.

The Recruitment Principles published by the Civil Service Commission specify the circumstances when appointments may be made otherwise.

Unless otherwise specified, all the directors covered by this report hold appointments that are open-ended and are subject to a notice period of three months. Early termination for the directors on open-ended service contracts, other than for misconduct, would result in the individual receiving compensation as set out in the Civil Service Compensation Scheme.

Get more information about the work of the Civil Service Commission.

Off-payroll disclosure

Off-payroll engagements as at 31 March 2019, for more than £245 per day and that last for longer than six months.

	2018/19	2017/18
Existing engagements as of 31 March 2019	17	21
Of which existing:
— for less than one year at time of reporting	15	20
— for between one and two years at time of reporting	2	1
— for between two and three years at time of reporting	–	–
— for between three and four years at time of reporting	–	–
— for four or more years at time of reporting	–	–
New off-payroll engagements, or those that reached six months in duration, between 1 April 2018 and 31 March 2019, for more than £245 per day and that last for longer than six months.
New engagements, or those that reached six months in duration, between 1 April 2018 and 31 March 2019	25	23
Of which:
— have been assessed as caught by IR35	21	19
— have been assessed as not caught by IR35	4	4
— have been terminated as a result of assurance not being received	–	1
Number engaged directly (via PSC contracted to department) and are on the departmental payroll.	0	1
Number of engagements reassessed for consistency/assurance purposes during the year.	25	23
Number of engagements that saw a change to IR35 status following the consistency review.	–	–
Off-payroll engagements of board members and/or senior officials with significant financial responsibility between 1 April 2018 and 31 March 2019
Number of off-payroll engagements of board members, and/or, senior officials with significant financial responsibility, during the financial year.	–	–
Total number of individuals on payroll and off payroll that have been deemed “board members, and/or, senior officials with significant financial responsibility”, during the financial year. This figure should include both on-payroll and off-payroll engagements.	11	12

Expenditure on consultancy

	2018/19	2017/18
	£’000	£’000
Cost of consultancy	714	676
Total	714	676

Salary and performance pay – executive directors (see note 1) 2018/19

	Salary	Performance pay	Benefits in kind	Pension benefits (see note 2)	Total
	£’000	£’000	To nearest £100	£	£’000
Graham Farrant Chief Executive and Chief Land Registrar (see note 3)	145 – 150	–	–	–	145 – 150
Annual equivalent	(195 – 200)	–	–	–	(195-200)
Mike Harlow Acting Chief Executive and Chief Land Registrar (see note 4)	120 – 125	–	–	139,000	260 – 265
John Abbott Director of Digital, Data and Technology	115 – 120	10 – 15	–	46,000	175 – 180
Caroline Anderson Director of Human Resources and Organisation Development (see note 5)	90 – 95	–	–	37,000	125 – 130
Annual equivalent	(95 – 100)	–	–	–	(95 – 100)
Jon Cocking Acting Director of Human Resources and Organisation Development (see note 6)	5 – 10	–	–	29,000	35 – 40
Annual equivalent	(85 – 90)	–	–	–	(85 – 90)
Ruth Curry Acting Director of Finance and Business Services (see note 7)	75 – 80	–	–	55,000	130 – 135
Annual equivalent	(90 – 95)	–	–	–	(90 – 95)
Iain Banfield Chief Financial Officer (see note 8)	15 – 20	–	–	40,000	55 – 60
Annual equivalent	(100 – 110)	–	–	–	(100 – 110)
Chris Pope Chief Operations Officer	130 – 135	–	–	51,000	180 – 185
Karina Singh Director of Transformation	105 – 110	–	–	186,000	290 – 295
Robin Malpas Acting General Counsel and Deputy Chief Land Registrar (see note 9)	20 – 25	–	–	106,000	125 – 130
Annual equivalent	80 – 85	–	–	–	80 – 85
Mike Westcott-Rudd Board Legal Adviser	80 – 85	–	–	1,000	80 – 8

1. Audited.

2. The value of pension benefits accrued during the year is calculated as (the real increase in pension multiplied by 20) plus (the real increase in any lump sum) less (the contributions made by the individual). The real increases exclude increases due to inflation or any increase or decreases due to a transfer of pension rights.

3. Graham Farrant’s appointment ended on 31 December 2018.

4. Mike Harlow was placed on temporary promotion to Acting Chief Executive and Chief Land Registrar on 1 January 2019. The salary figure includes a period from 1 April 2018 to 31 December 2018 where Mike was General Counsel and Deputy Chief Land Registrar.

5. Caroline Anderson’s appointment ended on 15 March 2019.

6. Jon Cocking was placed on temporary promotion on 1 March 2019. The disclosed amounts above relate to his appointment as Acting Director of Human Resources and Organisation Development.

7. Ruth Curry’s appointment ended as Acting Director of Finance and Business Services on 3 February 2019. Due to an error in the application of a pay increase, the salary paid to Ruth Curry in 2017/18 was incorrect. The overpayment was recovered during 2018/19. The correct annual equivalent figure for 2017/18 was (85 – 90).

8. Iain Banfield’s appointment started on 1 January 2019 but he acted in his role of Chief Financial Officer from 4 February 2019.

9. Robin Malpas was placed on temporary promotion on 1 January 2019. The disclosed amounts relate to his appointment as Acting General Counsel and Deputy Chief Land Registrar.

Salary and performance pay – executive directors (see note 1) 2017/18

	Salary	Performance pay	Benefits in kind	Pension benefits 2	Total
	£’000	£’000	To nearest £100	£	£’000
Graham Farrant Chief Executive and Chief Land Registrar	195 – 200	–	–	–	195 –200
Catherine Vaughan Director of Finance and Business Services (see note 3)	45 – 50	10 – 15	–	19,000	75 – 80
Annual equivalent	(125 – 130)	–	–	–	(125 – 130)
John Abbott Director of Digital, Data and Technology	115 – 120	10 – 15	–	45,000	170 – 175
Caroline Anderson Director of Human Resources and Organisation Development	95 – 100	–	–	37,000	130 – 135
Alasdair Lewis Director of Legal Services (see note 4)	55 – 60	–	–	-4,000	55 – 60
Annual equivalent	(95 – 100)			–	(95 – 100)
John Peaden Director of Operations (see note 5)	25 – 30	–	–	-3,000	20 – 25
Annual equivalent	(100 – 105)			–	(100 – 105)
Ruth Curry Acting Director of Finance and Business Services (see note 6)	50 – 55	–	–	91,000	145 – 150
Annual equivalent	(90 – 95)			–	(90 – 95)
Chris Pope Chief Operations Officer (see note 7)	55 – 60	–	–	21,000	75 – 80
Annual equivalent	(130 – 135)			–	(130 – 135)
Karina Singh Director of Transformation (see note 8)	45 – 50	–	–	119,000	160 – 165
Annual equivalent	(105 – 110)			–	(105 – 110)
Mike Harlow General Counsel and Deputy Chief Land Registrar (see note 9)	20 – 25	–	–	7,000	25 – 30
Annual equivalent	(120 – 125)			–	(120 – 125)
Mike Westcott-Rudd Board Legal Adviser (see note 10)	85 – 90	–	–	15,000	100 – 105

1. Audited.

2. The value of pension benefits accrued during the year is calculated as (the real increase in pension multiplied by 20) plus (the real increase in any lump sum) less (the contributions made by the individual). The real increases exclude increases due to inflation or any increase or decreases due to a transfer of pension rights.

3. Catherine Vaughan’s appointment ended on 3 September 2017.

4. Alasdair Lewis’s appointment ended on 31 October 2017.

5. John Peaden’s appointment ended on 30 June 2017.

6. Ruth Curry was placed on temporary promotion on 1 September 2017. The disclosed amounts above relate to her appointment as Acting Director of Finance and Business Services.

7. Chris Pope joined on 25 October 2017.

8. Karina Singh joined on 1 November 2017.

9. Mike Harlow joined on 1 February 2018.

10. This includes a period from 1 November 2017 to 31 January 2018 where Mike Westcott-Rudd was acting Director of Legal Services.

Salary – non-executive directors (see note 1)

	2018/19	2017/18
	£’000	£’000
Michael Mire Non-Executive Chair	55 – 60	55 – 60
Claire Wren Non-Executive Director (see note 2)	–	–
Diana Breeze Non-Executive Director	20 – 25	0 – 5
Annual equivalent		(20 – 25)
Kirsty Cooper Non-Executive Director	20 – 25	0 – 5
Annual equivalent		(20 – 25)
Chris Morson Non-Executive Director	20 – 25	0 – 5
Annual equivalent		(20 – 25)
Doug Gurr Non-Executive Director (see note 3)	–	–
Angela Morrison Non-Executive Director	20 – 25	0 – 5
Annual equivalent		(20 – 25)

1. Audited.

2. Claire Wren represents the interests of UK Government Investments (UKGI) and does not receive any remuneration from HM Land Registry.

3. Doug Gurr does not receive any remuneration from HM Land Registry.

Salary

‘Salary’ includes gross salary, reserved rights to London weighting or London allowances, recruitment and retention allowances and any other allowance to the extent that it is subject to UK taxation. The tables on pages 68 to 70 are based on accrued payments made by HM Land Registry and thus recorded in these accounts.

Benefits in kind

The monetary value of benefits in kind covers any benefits provided by HM Land Registry and treated by HM Revenue & Customs as a taxable emolument.

Performance awards

Awards are based on performance levels attained and are made as part of the performance review process. The awards reported relate to the performance in the year in which they were paid to the individual. Therefore, the awards reported in 2018/19 relate to performance in 2017/18 and the comparative awards reported for 2017/18 relate to performance in 2016/17.70

Pension benefits (see note 1)

	Real increase in pension and lump sum at 60		Total accrued at March 2019		Cash equivalent transfer value (CETV) at 31 March		Real increase in CETV after adjustment for inflation and changes in investment factors
	Pension	Lump sum	Pension	Lump sum	2019	2018
	£’000	£’000	£’000	£’000	£’000	£’000	£’000
Graham Farrant Chief Executive and Chief Land Registrar (see note 2)	–	–	–	–	–	–	–
Mike Harlow Acting Chief Executive and Chief Land Registrar	5 – 7.5	–	25 – 30	–	412	265	102
John Abbott Director of Digital, Data and Technology	2.5 – 5	–	10 – 15	–	155	109	18
Caroline Anderson Director of Human Resources and Organisation Development	0 – 2.5	–	10 – 15	–	175	130	25
Jon Cocking Acting Director of Human Resources and Organisation Development	0 – 2.5	–	25 – 30	–	401	331	13
Ruth Curry Acting Director of Finance and Business Services	2.5 – 5	2.5 – 5	30 – 35	70 – 75	558	459	36
Iain Banfield Chief Financial Officer (see note 3)	0 – 2.5	2.5 – 5	20 – 25	40 – 45	290	263	24
Chris Pope Chief Operations Officer	2.5 – 5	–	10 – 15	–	177	120	35
Karina Singh Director of Transformation	7.5 – 10	7.5 – 10	40 – 45	45 – 50	754	534	143
Robin Malpas Acting General Counsel and Deputy Chief Land Registrar	2.5 – 5	12.5 – 15	30 – 35	100 – 105	753	589	102
Mike Westcott-Rudd Board Legal Adviser	0 – 2.5	0 – 2.5	30 – 35	100 – 105	763	725	0

1. Audited.

2. Graham Farrant chose not to be covered by the Civil Service pension arrangements during the reporting year.

3. Iain Banfield’s appointment started on 1 January 2019 but he acted in his role of Chief Financial Officer from 4 February 2019.

4. No director paid into a stakeholder pension.

Civil Service pensions

Pension benefits are provided through the Civil Service pension arrangements. From 1 April 2015 a new pension scheme for civil servants was introduced – the Civil Servants and Others Pension Scheme or alpha, which provides benefits on a career average basis with a normal pension age equal to the member’s State Pension Age (or 65 if higher). From that date all newly appointed civil servants and the majority of those already in service joined alpha. Prior to that date, civil servants participated in the Principal Civil Service Pension Scheme (PCSPS). The PCSPS has four sections: three providing benefits on a final salary basis (classic, premium or classic plus) with a normal pension age of 60; and one providing benefits on a whole career basis (nuvos) with a normal pension age of 65.

These statutory arrangements are unfunded with the cost of benefits met by monies voted by Parliament each year. Pensions payable under classic, premium, classic plus, nuvos and alpha are increased annually in line with Pensions Increase legislation. Existing members of the PCSPS who were within 10 years of their normal pension age on 1 April 2012 remained in the PCSPS after 1 April 2015. Those who were between 10 years and 13 years and 5 months from their normal pension age on 1 April 2012 will switch into alpha sometime between 1 June 2015 and 1 February 2022. All members who switch to alpha have their PCSPS benefits ‘banked’, with those with earlier benefits in one of the final salary sections of the PCSPS having those benefits based on their final salary when they leave alpha. (The pension figures quoted for officials show pension earned in PCSPS or alpha – as appropriate. Where the official has benefits in both the PCSPS and alpha the figure quoted is the combined value of their benefits in the two schemes.) Members joining from October 2002 may opt for either the appropriate defined benefit arrangement or a ‘money purchase’ stakeholder pension with an employer contribution (partnership pension account).

Employee contributions are salary-related and range between 4.6% and 8.05% for members of classic, premium, classic plus, nuvos and alpha. Benefits in classic accrue at the rate of 1/80th of final pensionable earnings for each year of service. In addition, a lump sum equivalent to three years initial pension is payable on retirement. For premium, benefits accrue at the rate of 1/60th of final pensionable earnings for each year of service. Unlike classic, there is no automatic lump sum. classic plus is essentially a hybrid with benefits for service before 1 October 2002 calculated broadly as per classic and benefits for service from October 2002 worked out as in premium. In nuvos a member builds up a pension based on his pensionable earnings during their period of scheme membership. At the end of the scheme year (31 March) the member’s earned pension account is credited with 2.3% of their pensionable earnings in that scheme year and the accrued pension is uprated in line with Pensions Increase legislation. Benefits in alpha build up in a similar way to nuvos, except that the accrual rate in 2.32%. In all cases members may opt to give up (commute) pension for a lump sum up to the limits set by the Finance Act 2004.

The partnership pension account is a stakeholder pension arrangement. The employer makes a basic contribution of between 8% and 14.75% (depending on the age of the member) into a stakeholder pension product chosen by the employee from a panel of providers. The employee does not have to contribute, but where they do make contributions, the employer will match these up to a limit of 3% of pensionable salary (in addition to the employer’s basic contribution). Employers also contribute a further 0.5% of pensionable salary to cover the cost of centrally-provided risk benefit cover (death in service and ill health retirement).

The accrued pension quoted is the pension the member is entitled to receive when they reach pension age, or immediately on ceasing to be an active member of the scheme if they are already at or over pension age. Pension age is 60 for members of classic, premium and classic plus, 65 for members of nuvos, and the higher of 65 or State Pension Age for members of alpha. (The pension figures quoted for officials show pension earned in PCSPS or alpha – as appropriate. Where the official has benefits in both the PCSPS and alpha the figure quoted is the combined value of their benefits in the two schemes, but note that part of that pension may be payable from different ages.)

Further details about the Civil Service pension arrangements can be found at the website www.civilservicepensionscheme.org.uk

Cash equivalent transfer values

A Cash Equivalent Transfer Value (CETV) is the actuarially assessed capitalised value of the pension scheme benefits accrued by a member at a particular point in time. The benefits valued are the member’s accrued benefits and any contingent spouse’s pension payable from the scheme. A CETV is a payment made by a pension scheme or arrangement to secure pension benefits in another pension scheme or arrangement when the member leaves a scheme and chooses to transfer the benefits accrued in their former scheme. The pension figures shown relate to the benefits that the individual has accrued as a consequence of their total membership of the pension scheme, not just their service in a senior capacity to which disclosure applies.

The figures include the value of any pension benefit in another scheme or arrangement which the member has transferred to the Civil Service pension arrangements. They also include any additional pension benefit accrued to the member as a result of their buying additional pension benefits at their own cost. CETVs are worked out in accordance with The Occupational Pension Schemes (Transfer Values) (Amendment) Regulations 2008 and do not take account of any actual or potential reduction to benefits resulting from Lifetime Allowance Tax which may be due when pension benefits are taken.

Real increase in CETV

This reflects the increase in CETV that is funded by the employer. It does not include the increase in accrued pension due to inflation, contributions paid by the employee (including the value of any benefits transferred from another pension scheme or arrangement) and uses common market valuation factors for the start and end of the period.

Reporting of Civil Service and other compensation schemes – exit packages (see note 1)

Exit package cost band	Number of compulsory redundancies		Number of other departures agreed		Total number of exit packages by cost band
	2018/19	2017/18	2018/19	2017/18	2018/19	2017/18
£0–£10,000	–	–	4	4	4	4
£10,001–£25,000	–	–	1	–	1	–
£25,001–£50,000	–	–	–	1	–	1
£50,001–£100,000	–	–	2	4	2	4
£100,001–£150,000	–	–	–	2	–	2
£150,001–£200,000	–	–	–	–	–	–
£200,000	–	–	–	–	–	–
Total number of exit packages	–	–	7	11	7	11
Total cost	–	–	£166,862	£587,258	£166,862	£587,258

1. Audited.

There were no ex-gratia payments in 2018/19 (2017/18: none).

Compensation for loss of office

Redundancy and other departure costs have been paid in accordance with the provisions of the Civil Service Compensation Scheme, a statutory scheme made under the Superannuation Act 1972. Exit costs are accounted for in full in the year of contractual agreement to depart. Where applicable, the additional costs of buy-out of reduced pension benefit are met by HM Land Registry and not by the Civil Service pension scheme. Ill health retirement costs are met by the pension scheme and are not included in the table.

Pay multiples (see note 1)

Reporting bodies are required to disclose the relationship between the remuneration of the highest-paid director in their organisation and the median remuneration of the organisation’s workforce.

Total remuneration includes salary, non-consolidated performance-related payments and benefits in kind. It does not include employer pension contributions and the cash equivalent transfer value of pensions.

	2018/19	2017/18
Band of highest paid director’s total remuneration (£’000)	195 – 200	195 – 200
Median total	26,213	25,378
Remuneration ratio	7.5	7.8

1. Audited.

In 2018/19 no employees received remuneration in excess of the highest paid permanent director. Remuneration ranged from £195,000 – £200,000 to £15,000 – 20,000 (2017/18: £195,000 – £200,000 to £15,000 – £20,000).

Staff report as at 31 March 2019

	2018/19	2017/18
Number of employees (including fixed-term appointments)	5,619	5,216
Permanent full-time equivalents	5,074	4,719
Number of apprentices	62	321
Number of temporary/contract staff	17	27
Average sickness days per employee	7.3	7.5
Average number of training days per employee	4.4	5.2
Training days per apprentice	45	25
Training spend as percentage of salary bill	0.38%	0.40%
Female employees	60.50%	60.10%
Employees working part-time	33.20%	32.60%
Employees from ethnic minorities	5.60%	4.80%
Employees who report they have a disability	8.50%	8.60%

Staff costs for 2018/19

	Permanent staff	Apprentices	Others	Total
	£’000	£’000	£’000	£’000
Salaries	158,851	3,844	1,416	164,111
Social security costs	15,415	171	117	15,703
Other pension costs	28,476	670	206	29,352
Total staff costs	202,742	4,685	1,739	209,166

Gender analysis at 31 March 2019

	Male	Female	Total
Non-executive board members	3	4	7
Executive directors (see note 1)	7	1	8
Senior Civil Service – band 2 (see note 1)	4	1	5
Senior Civil Service – band 1 (see note 1)	10	5	15
Permanent employees (not including SCS) (see note 2)	2,178	3,378	5,556
Apprentices (see note 2)	36	26	62

1. Some Senior Civil Service employees are also directors and are included in both categories.

2. Some Apprentices are also Permanent employees and are included in both categories.

Average full-time equivalent in year

Resourcing

HM Land Registry is governed by the Civil Service Commission Recruitment Principles which requires the selection of people for appointment to be on merit and on the basis of fair and open competition.

In addition, all our job opportunities are subject to the Guaranteed Interview Scheme which ensures disabled people will progress to the next stage of the selection process if their application meets the minimum criteria. It is our policy to ensure that any tests used do not discriminate against disabled candidates.

Resourcing activity has addressed a number of requirements including:

• addressing front-line needs to meet and maintain service delivery standards and to address future workforce sustainability
• enhancing specific capability areas, particularly in digital transformation and agile development skills
• establishing a new senior management structure with clear accountabilities to provide greater support and drive resilience and succession planning

We have supplemented our digital transformation and agile development capabilities through the engagement of delivery partners through the Government’s Digital Services Framework.

Our apprenticeship schemes were expanded to provide the opportunity for people to gain a qualification in business administration, information technology or cyber-security. These entry routes allow them to learn the technical skills that could lead to future permanent employment with HM Land Registry, so creating the basis of a sustainable workforce.

Recruitment

In support of our core service standards, and to supplement our substantive workforce, a number of short-term fixed-term appointments were made, allowing our more experienced colleagues to focus on more complex core registration activities.

Off-payroll contractors have also been used to meet short-term needs in more specialist areas, and information regarding compliance and disclosures is included in Off-payroll disclosure.

Health and wellbeing

Our People Strategy sets out the key people issues and challenges we face in delivering our Business Strategy, and how we plan to meet them. We will look to improve individual colleagues’ resilience to change through the implementation of our Attendance, Health & Wellbeing Framework to ensure we continue to make HM Land Registry a great place to work. We will also aim to provide a holistic approach to health and wellbeing, setting clear expectations for all staff.

To achieve this aim our framework for attendance, health and wellbeing focuses on four key areas:

• culture – we will create the right environment to support attendance, health and wellbeing
• prevention – we will help ourselves and others to stay healthier and stay in work
• intervention – we will ensure that the right support is provided at the right time
• return to work – we will support our people back to work in a timely way

The aim of our attendance, health and wellbeing delivery plan is to create a culture in HM Land Registry that recognises the importance of health and wellbeing, and to build an environment that supports our wellbeing and helps us to look after our own health. We are at our most productive and fully engaged at work when we are healthy, happy and feel able to be ourselves. In respect of mental health, we want to make a real difference in the way we view, talk and act on mental health – for HM Land Registry to be an organisation where mental health issues are widely understood and destigmatised; where our people will feel confident to talk about their mental ill health; and where our managers will be equipped to identify and understand the spectrum of mental health issues they may encounter and support those affected.

The plan has also been aligned to two external drivers. In October 2017 Thriving at Work, the Stevenson/Farmer review of mental health and employers commissioned by the Prime Minister, was published. It sets out recommended core standards on mental health support which all employers should meet, and enhanced standards which leading employers should meet. In line with the ambition for the Civil Service to be a leading employer on mental health, the Civil Service has accepted both the core and enhanced standards. The approach in the Civil Service is also supported by the ‘Five Strategic Priorities for Health and Wellbeing (2017-2020)’ to which every department within the Civil Service has signed up to in order to realise our ambition to be part of ‘A Brilliant Civil Service’.

This year we have delivered a variety of initiatives to support our colleagues and the organisation, including:

• cross-HM Land Registry promotion and participation in health campaigns, supported by our network of local health and wellbeing committees, including mental health awareness, neurodiversity and suicide awareness
• introduction of mental health first aiders into all HM Land Registry locations as a source of on-site support for people experiencing mental health crisis, signposting and further raising mental health awareness to help normalise conversations around mental health
• rollout of Wellbeing Confident Leaders training to all senior leaders;
• delivery of a range of formal and informal training initiatives, collaborating with our occupational health and employee assistance providers, providing line managers with guidance and advice to improve confidence and capability on sickness absence procedures and supporting staff dealing with physical and mental health issues

Capability

Our Learning and Development Framework has continued to provide the focus for our skills development in 2018/19. We have delivered a comprehensive programme of leadership and management training, including a series of masterclasses for our senior leaders focusing on key leadership expectations. Workshops dedicated to training and upskilling new and existing line managers were delivered with 882 attendees of more than 80 workshops.

Other priority areas of focus for skills development have included the development of technical caseworker skills, financial and commercial awareness, change and project management and digital.

An average of 4.4 days per employee have been spent on training and 83% of staff indicated they had the knowledge and skills to do their job in the annual Civil Service People Survey.

We have conducted a further capability assessment against our generic and specialist skills that has confirmed our key areas of focus for future development in both our technical and professional functions.

Employee involvement

We continue to engage both informally and formally with our colleagues and their representatives.

Chief Executive and director blogs have been issued during the year on a weekly basis and colleagues have been encouraged to respond to these, with the aim of creating open and honest dialogue and exchange of views.

Managers are expected to have regular monthly discussions with individual team members to discuss openly employee performance, ideas for improvements to working practices, wider organisational issues, changes and any employee concerns.

We meet regularly with our trade unions. The Chief Executive and members of his team formally meet representatives at the Departmental Whitley Council meetings twice a year. There are structures in place for local Whitley meetings, and unions are consulted on specific issues.

Informal six-weekly dialogue between the Chief Executive and trade union leads has continued during the year. Day-to-day operation of employment relations is managed through monthly engagement and consultation meetings between senior management and departmental trade union representatives. We continued with fortnightly Model Office consultation meetings.

The Model Office approach to engaging with union colleagues has been to work in a more collaborative way. The unions have been part of the two site steering groups, resolving issues and concerns throughout the trials. This has been successful and issues have not been formally escalated to the fortnightly consultation meetings.

Latterly, we have changed the scope of the fortnightly meetings to cover the Transformation agenda rather than Model Office specifically.

We continue to co-monitor the use of facility time with union colleagues, and are within the 0.1% paybill guide figure set by and reported to Cabinet Office; for greater detail see Appendix F.

During the year we have again seen positive improvements in our engagement scores in the Civil Service People Survey, and regular internal surveys held during the year have shown these improvements have been maintained. We continue to be committed to further improvements in engagement and are combining our approach and planning to drive cultural change with a strong focus on behaviours. An executive lead has responsibility for an engagement key performance indicator and combined action plan. The aim is to create an environment where everyone feels valued and connected and which moves us towards the cultural change we have described through our People Strategy and with our people.

Constructive discussion with unions at both departmental and local level, in addition to encouraging staff involvement on other committees (including health and wellbeing, social and sports, diversity and charity), and directors’ visits with question and answer sessions, are all essential in ensuring our colleagues’ views are heard and understood.

Diversity

In this first year of our Diversity and Inclusion Action Plan (2018-2022) we have refined and strengthened our infrastructure so we continue to develop a truly inclusive environment for all employees, one that is welcoming, respectful, engaging and enriched with opportunities for personal and professional development.

Our new infrastructure brings together diversity and inclusion (D&I) and other functional areas across the organisation, to support a cohesive approach where transformation and culture are at the heart of what we do. More than 600 colleagues have been involved in 36 culture workshops, where colleagues from each office were invited to talk freely about the culture we have and to inform the development of the culture we want. D&I awareness sessions have been held with all staff over the last 12 months, and we have ensured that D&I messages and celebrations are now firmly embedded in corporate communications planning. As a result, we have seen significantly higher Civil Service People Survey scores for D&I, including a 12% uplift in staff belief that we are committed to creating a diverse and inclusive workplace.

We have refreshed and reinvigorated our network of Inclusion Champions in every office, and they have begun to work with local leadership teams to ensure that our workforce not only reflects, but also supports, the communities in which we work.

In May, with support from our Disabled Employees’ Network, we successfully achieved Disability Confident Leader accreditation and will continue to implement the positive recommendations from the assessment process over the coming months.

Our other staff networks, in particular our Women’s Network and our Black, Asian and Minority Ethnic Network, have worked tirelessly with our HR Resourcing Teams to remove barriers to progression and to increase representation of women in our middle management grades. Their commitment and hard work has contributed directly to the achievement of our organisational key performance indicator (KPI) for D&I. In the last 12 months, we have created opportunities for 57 more women to work in these grades than at the start of the year.

This has also contributed in some part to good progress in reducing our gender pay gap, which we reported in December. The 15 actions we have taken this year to address the gap, including those around the representation of women, are beginning to have a positive impact.

In the next 12 months we will continue to build an inclusive culture and reputation that attracts, develops and fully engages diverse talent, and increases representation from underrepresented groups, particularly ethnic minority and disabled people. We will further embed our actions to support women into management roles, which will continue to be a KPI into year two of our four-year action plan.

To broaden our approach to representation, we will also develop a second KPI to measure the success of actions to improve the progression of black, Asian and minority ethnic staff from entry level grade into the first levels of management, supported by an overarching focus on the development of clearer data and metrics to better monitor and analyse our progress across our D&I programmes.

Parliamentary accountability and audit report

Fees and charges (see note 1)

The following information on the main activities of HM Land Registry is produced for fees and charges purposes and does not constitute segmental reporting under IFRS 8.

	2018/19			2017/18
	Income	Total costs	Surplus	Income	Total costs	Surplus
	£’000	£’000	£’000	£’000	£’000	£’000
Registration of title (see note 2)	308,745	288,723	20,022	304,550	253,924	50,626
Land Charges and Agricultural Credits (see note 3)	7,004	988	6,016	6,875	897	5,979
Commercial (see note 4)	4,504	2,468	2,036	5,760	2,603	3,157
	320,253	292,179	28,074	317,185	257,424	59,762

1. Audited

2. Registration of title - includes HM Land Registry’s statutory duties under the Land Registration Act 2002

3. Land charges and agricultural credits - register of short-term loans secured on farming stock and other agricultural assets

4. Commercial – includes commercial release of HM Land Registry data

HM Land Registry applied cost allocation and charging requirements as set out in HM Treasury guidance. However, due to the demand for our services exceeding our expectations, the recommended rate of return has been exceeded.

Losses and special payments (see note 5)

There are no losses or special payments to disclose, as the total of all losses was below £300,000 and there have been no special payments.

5.Audited

Mike Harlow
Acting Chief Executive and Chief Land Registrar
1 July 2019

The Certificate and Report of the Comptroller and Auditor General to the Houses of Parliament

Opinion on financial statements

I certify that I have audited the financial statements of HM Land Registry for the year ended 31 March 2019 under the Government Trading Funds Act 1973. The financial statements comprise: the Statement of Comprehensive Income, Statement of Financial Position, Cash Flow Statement, Statement of Changes in Reserves; and the related notes, including the significant accounting policies. These financial statements have been prepared under the accounting policies set out within them. I have also audited the information in the Accountability Report that is described in that report as having been audited.

In my opinion:

• the financial statements give a true and fair view of the state of HM Land Registry’s affairs as at 31 March 2019 and of its retained surplus for the year then ended
• the financial statements have been properly prepared in accordance with the Government Trading Funds Act 1973 and HM Treasury directions issued thereunder

Opinion on regularity

In my opinion, in all material respects the income and expenditure recorded in the financial statements have been applied to the purposes intended by Parliament and the financial transactions recorded in the financial statements conform to the authorities which govern them.

Basis of opinions

I conducted my audit in accordance with International Standards on Auditing (ISAs) (UK) and Practice Note 10 ‘Audit of Financial Statements of Public Sector Entities in the United Kingdom’. My responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of my certificate. Those standards require me and my staff to comply with the Financial Reporting Council’s Revised Ethical Standard 2016. I am independent of HM Land Registry in accordance with the ethical requirements that are relevant to my audit and the financial statements in the UK. My staff and I have fulfilled our other ethical responsibilities in accordance with these requirements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Conclusions relating to going concern

I am required to conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on HM Land Registry’s ability to continue as a going concern for a period of at least twelve months from the date of approval of the financial statements. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor’s report. However, future events or conditions may cause the entity to cease to continue as a going concern. I have nothing to report in these respects.

Responsibilities of the Chief Executive for the financial statements

As explained more fully in the Statement of Accounting Officer’s Responsibilities, the Chief Executive as Accounting Officer is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view.

Auditor’s responsibilities for the audit of the financial statements

My responsibility is to audit, certify and report on the financial statements in accordance with the Government Trading Funds Act 1973.

An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with ISAs (UK), I exercise professional judgment and maintain professional scepticism throughout the audit. I also:

• identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control
• obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of HM Land Registry’s internal control
• evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management
• evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation

I communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit.

I am required to obtain evidence sufficient to give reasonable assurance that the income and expenditure recorded in the financial statements have been applied to the purposes intended by Parliament and the financial transactions recorded in the financial statements conform to the authorities which govern them.

Other Information

The Chief Executive as Accounting Officer is responsible for the other information. The other information comprises information included in the annual report, but does not include the parts of the Accountability Report described in that report as having been audited, the financial statements and my auditor’s report thereon. My opinion on the financial statements does not cover the other information and I do not express any form of assurance conclusion thereon. In connection with my audit of the financial statements, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or my knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work I have performed, I conclude that there is a material misstatement of this other information, I am required to report that fact. I have nothing to report in this regard.

Opinion on other matters

In my opinion:

• the parts of the Accountability Report to be audited have been properly prepared in accordance with HM Treasury directions made under the Government Trading Funds Act 1973
• in the light of the knowledge and understanding of the entity and its environment obtained in the course of the audit, I have not identified any material misstatements in the Performance Report or the Accountability Report
• the information given in the Performance Report and Accountability Report for the financial year for which the financial statements are prepared is consistent with the financial statements

Matters on which I report by exception

I have nothing to report in respect of the following matters which I report to you if, in my opinion:

• adequate accounting records have not been kept or returns adequate for my audit have not been received from branches not visited by my staff or
• the financial statements and the parts of the Accountability Report to be audited are not in agreement with the accounting records and returns o
• I have not received all of the information and explanations I require for my audit
• the Governance Statement does not reflect compliance with HM Treasury’s guidance

Report

I have no observations to make on these financial statements.

Gareth Davies, Comptroller and Auditor General

National Audit Office
157-197 Buckingham Palace Road
Victoria
London
SW1W 9SP

1 July 2019