Yesterday the Daily Telegraph published an article (pdf here online here) based on an interview with David Johnstone, the Chair of Scottish Land and Estates (SLE). Mr Johnstone has been a frequent contributor to the media arguing the case on behalf of the members of his organisation. This is all just grand.
However, in his media appearances and in this article he makes a number of claims that don’t appear to accord with the evidence available.
On 2 December 2014, he was interviewed by James Naughtie on the Today programme. I do not have a transcript of the interview and it is no longer available online but shortly afterwards I received two emails. One was from a civil servant and the other from a Parliamentary official. They both asked me if I had heard the interview and if I knew of any evidence to back up his claim. I said I hadn’t but I then listened online. Mr Johnstone made a claim that the extent of absentee ownership of Scottish land was very small. As I don’t have the transcript I cannot be sure of his exact words but the impression was clearly given that absentee ownership of land was very modest. He was not challenged on this by Mr Naughtie. So what do we know?
One study by Edinburgh University conducted 2000-2002 looked only at hunting estates. Of 218 estates that were studied, 66% were owned by absentee owners. This is illustrated on the map below. Another source of data that I am aware of is from a study by Armstrong and Mather from 1983 which examined landownership in the Scottish Highlands which found evidence that approximately 50% of owners live outwith the region. (1)
A study of forest ownership found that 55% of the privately-owned forest area was owned by absentee owners. Research may be limited but it does suggest that absenteeism is not the very modest phenomenon that Mr Johnstone alleged that it was.
Yesterday’s article in the Daily Telegraph contains a further unsubstantiated allegation.
He told the Telegraph that,
..most estates make little or no profit…..
I know of no evidence to support this statement (which is not to say it is untrue of course).
There is very little information on profitability. Scottish Land and Estates conducted a significant study on the economic impact of estates but (rather curiously) chose not to gather data on profitability. (2) In Savills’ Scottish Estates Benchmarking Survey 2013, it was reported that,
Rural assets continue to outperform alternative assets and our survey again records a healthy investment performance on ‘All Estates’
In the year to 5th April 2013 the average Total Return for ‘All Estates’ in Scotland for all Let Property was 10.8%, the sum of a net income return of 1.3% and capital growth of 9.5% (see graph below)
In an interesting observation of the political process, Mr Johnstone said,
many MSPs and some ministers lavish high praise on the estates in their constituencies only to lambast landowners when they are at Holyrood…he said there was a gulf between SNP and Labour MSPs telling landowners in their constituencies they are the “good guys” and their “aggressive” rhetoric on a national stage where all the praise is “forgotten”.
SLE has indeed invited a significant number of MSPs to visit landholdings owned by its members but Mr Johnstone takes a rather naive view of the political process and confuses the role of MSPs as representatives of their constituents and as legislators. An MSP visiting an estate in their constituency is very unlikely to criticise the owner unless for very good reason. As a constituent, they are as entitled as any other to have their views and opinions heard with respect. A good constituency MSP will seek to do what they can to resolve any problems or issues the constituent has. If I were an MSP I would happily visit landowners and seek to assist them in any way I could.
However, MSPs are also legislators and those who are members of the SNP are relied upon to secure support for Government business in the Scottish Parliament. It is perfectly consistent for an MSP to, on the one hand, visit constituents and represent them and, on the other, to speak frankly about the iniquities of the system by which Scotland’s land is held. Winston Churchill put it very well.
I hope you will understand that, when I speak of the land monopolist, I am dealing more with the process than with the individual land owner who, in most cases, is a worthy person utterly unconscious of the character of the methods by which he is enriched. I have no wish to hold any class up to public disapprobation. I do not think that the man who makes money by unearned increment in land is morally worse than anyone else who gathers his profit where he finds it in this hard world under the law and according to common usage. It is not the individual I attack; it is the system. It is not the man who is bad; it is the law which is bad. It is not the man who is blameworthy for doing what the law allows and what other men do; it is the State which would be blameworthy if it were not to endeavor to reform the law and correct the practice.
We do not want to punish the landlord. We want to alter the law.
Mr Johnstone concluded,
People equate the idea of owning the land with having the ability to release all this money, and the income is all going to come flowing in. But it doesn’t happen – landowners aren’t sitting there stifling investment.
They are doing everything they can do to generate the income in these places. It’s not bloody easy.
If you say so.
(1) Armstrong, AM & Mather, AS, (1983) Land Ownership and Land Use in the Scottish Highlands. O’Dell Memorial Monograph No. 13. University of Aberdeen.