Scale and concentration of land ownership – the elephant in the room?

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The scale and concentration of land ownership in Scotland has been passionately discussed for more than 40 years, indeed it has been central to the land reform debate.

Today, the Scottish Land Commission published an Investigation into the Issues Associated with Large-Scale and Concentrated Land Ownership, as well as a Report to Ministers, and a short summary.

Motion S5M-16445 will be debated by the Parliament tomorrow. The motion asks the Parliament to agree “[…] the importance of ensuring that land reform continues to be a key policy priority to change the entrenched and inequitable pattern of land ownership in Scotland so that everyone can benefit from land”.

A developing policy for the 21st century

Prior to devolution, government action on land reform was conspicuous by its absence, and it has subsequently become a distinctive policy area in Scotland.

Land use and reform was, until 2015, largely perceived as a rural development issue. It is now considered to be more reactive to changing economic, social and cultural factors. It spans topics as diverse as community ownership, urban renewal, housing, human rights, and agricultural land, as well as modernising property law and the fiscal systems which govern land ownership and management.

Yesterday, giving evidence to the ECCLR Committee, land reform was described by Andrew Thin, the Chair of the Commission as being of “huge social and economic importance”, and “not primarily or exclusively a legislative matter” but fundamentally requiring “a cultural shift”.

Supported by the Scottish Land Fund, community ownership through the pre-emptive community right to buy is the most established of the Government’s land reform policies. More recent initiatives have provided statements of rights and responsibilities, and guidance, as well as seeking improvements to transparency of ownership.

However, it has long been argued that addressing the scale and concentration of land ownership matters most. Others of course, counter this by arguing that it is how land is managed and used that matters, and that a significant contribution is made by rural businesses.

The publication of the Land Commission’s research and recommendations in this area is likely to be considered a significant milestone.

Concentration of land ownership

Research published by the House of Commons Scottish Affairs Committee, and often cited elsewhere, has estimated that Scotland has one of the most concentrated land ownership patterns in the developed world, with 432 owners accounting for half of Scotland’s private land.

A Research Review, published alongside the Land Commission’s most recent investigation provides more detail:

  • In 2014, 1,125 estates were estimated to control about 70% (4.1 million hectares) of privately-owned rural land.
  • 667 of these estates were between 1,000 and 10,000 hectares in size and 87 were larger than 10,000 hectares.
  • There is a strong preference amongst the owners of large estates to pass them onto heirs.
  • Succession law in Scotland has generally allowed estates to stay intact, suggesting that the long-term pattern of low turnover in estates is unlikely to change in the foreseeable future.

In the Land Rights and Responsibilities Statement, the Government has made it clear that there is a need for change, stating that “there should be a more diverse pattern of land ownership and tenure, with more opportunities for citizens to own, lease and have access to land”.

There are currently no specific restrictions on who can own land or how much land a single individual or entity can own.

What are the key findings and recommendations of the recent investigation?

This is a significant report, with many detailed and nuanced arguments. Notably, “scale” and “concentration” are considered to be distinct, with:

“Most of the advantages associated with Scotland’s current pattern of land ownership related to the size of landholdings [due to economies of scale] and most of the disadvantages related to the concentration of social, economic and decision-making power.”

Other findings include:

  • In some places, concentrated ownership impedes economic development and causes significant and long-term harm to affected communities.
  • The pattern of concentration has parallels with wider economic monopolies.
  • A lack of effective participation in land use change decisions is also an issue.
  • These problems can be associated with public, Non-Governmental Organisations and community landowners as well as private ones.
  • There are few, if any, ways that communities or individuals can rectify adverse economic or social impacts from concentration of ownership.

Initial recommendations to address the impacts identified and to “introduce systemic change” include:

  • A Public Interest Test for significant land transfers/acquisitions, similar to the regulation of corporate acquisitions and mergers.
  • Requiring land holdings over a certain scale to engage on, and publish, a management plan.
  • Where there is evidence of adverse impact in the operation of landholdings, a statutory Land Rights and Responsibilities review should ensure accountability.
  • The forthcoming Community Right to Buy Land to Further Sustainable Development should take the effects of concentrated ownership into account.
  • Policy options to encourage a more diverse pattern of private ownership and investment should be reviewed and investigated by the Commission.
  • There are strong drivers for land use change, including climate change and population retention/growth. The Government should develop robust mechanisms for engaging land managers and communities in land use change, choices and priorities at a local or regional scale.
  • Using the Land Rights and Responsibilities framework, landowners should review their holdings to support wider community and public interest development, and mitigate the potential risks of concentrated ownership.
  • The Commission should, immediately, work with Government and relevant stakeholders to implement a joint programme of land rights and responsibilities good practice.

What now?

The Scottish Government has stated that it expects the report to “inform how we address long-standing issues caused by the concentration of land power in rural Scotland, to the benefit of local communities”.

Professor David Adams, a member of the Commission, tweeted that this is a “landmark report”. It certainly feels like it – expect further recommendations and legislation to follow, alongside impassioned debate!

Alasdair Reid, Senior Researcher; Brexit, Environment and Rural Unit