Crown Estate land sale at Orchard Portman
The final investigation into the land sale at Orchard Portman has just reported back. The land was owned by the Crown Estate, which to cut a long story short, is these days the taxpayer. The land was sold to Taylor Wimpey, a housing developer. But it was sold at agricultural land values without any uplift in the event that planning for development was granted. That could result in a significant loss of income to the Crown Estate if planning permission were to be granted. And the land is very near to the new Nexus 25 business park.
The Leveller®, working with the Daily Mail, reported on the whole sorry saga last year. The Crown Estate asked audit firm KPMG to review the details of the land sale. This report has just been finalised and it does ask some interesting questions. We should note that broadly the process did follow the internal guidelines of the Crown Estate for similar sales. However with two significant caveats:
The Crown Estate’s records do not provide a complete and precise audit trail for the decisions made, and their basis and the contractual position with Savills did not meet best practice.
While the disposal of the Estate had been properly approved by The Crown Estate’s Board, as the final sale price had escalated above £10m (to a level that was significantly higher than anticipated at the outset of the Transaction), the Transaction should have reverted back to The Crown Estate’s Investment Committee under the Board delegation,
rather than being approved under an individual delegation.
These are serious failings, both of which we had questioned in our own original article on the subject. In particular the fact that Savills were acting both for the Crown estate and Taylor Wimpey. The lack of a proper audit trail is embarrassing. Especially when taken together with the failure to get properly delegated authority for the sale.
The Chief Executive of the Crown Estate has now written to MPs Rebecca Pow and Jack Davies. In his letter he notes “We understand and fully accept the findings in the report and are addressing how we will deliver on the highlighted areas for improvement as a matter of priority. In doing so, we aim to demonstrate our commitment to continuous improvement in our governance and best practice, in the sectors within which we operate.“
There will be more on this in the July edition of The Leveller®