Image: Abandoned farm on a Deeside estate.

Should tenant farmers in Scotland be given the legal right to convert their tenancies into ownership of the farm that they and their descendants have occupied and worked in some cases for over a century? It’s a question that will be at the centre of a review of agricultural tenancies soon to be announced by the Scottish Government. It is a question that has already been answered in the affirmative for individual crofters (Crofting Reform (Scotland) Act 1976), for leaseholders of residential property in England and Wales (dating back to Leasehold Reform Act 1967), for crofting communities (Part 3 of the Land Reform (Scotland) Act 2003), and for long leaseholders in Scotland (Long Leases (Scotland) Act 2012).

The issue was last debated in 2003 during the passage of the Agricultural Holdings (Scotland) Act 2003. This act provides secure tenants with a qualified right to buy their farm if and when it is put up for sale buy its owner. Secure tenancies (or 1991 tenancies – so-called after a consolidating Act in 1991) are the traditional form of agricultural tenancy many of which have been in place for well over a century. The Act also introduced new short tenancies for specified durations of 5 years (short limited duration tenancies) and 10 years (limited duration tenancies) – let’s call both of these “2003 tenancies”.

On 4 February 2003 during the Committee Stage of the 2003 Act, Fergus Ewing MSP argued that secure tenants should be given an unqualified right to buy at any time. He argued that,

“I find it somewhat ironic that Conservatives who extol the benefits of property ownership want to keep the benefits of property ownership to the few—indeed, the very few—landed estates. The Conservatives do not seem to realise the huge potential that could be unleashed by the creation of more property owners.

“I look forward to hearing what my Conservative friends on the committee have to say about why they do not want many more family farms under ownership in Scotland. Do they not accept that the vehicle of ownership will unleash a spirit of entrepreneurialism that could help to achieve some of the objectives that the Executive propounds in its forward strategy for agriculture?

“The SNP supports the absolute right to buy for secure heritable tenants. We recognise secure heritable tenants as a distinct group of people in Scotland. We do not advocate that those who have short leases should have the right to buy. We have never done so and will never do so, because, in most cases, secure heritable tenants have farmed the land for the whole of their lives, and their fathers and grandfathers, mothers and grandmothers did so before them.” (1)

Ewing’s challenge to the Conservatives is interesting. Back in 1946, Anthony Eden, in a speech to the Conservative Party conference had in fact extolled the virtues of just such a property owning democracy.

We believe that it is desirable to elaborate schemes whereby the private citizen and the returned soldier should be in a position not only to rent a house but to own one.” Conservatives believed, he added, believe “that the tenant farmer should be assisted and encouraged to become an owner-occupier.” (2)

The purpose of this blog, however, is not to visit the arguments for and against an unqualified right to buy for tenant farmers but to refute an assertion made by landowners in opposition to it – an assertion that has been repeated ad nauseum for over 10 years.

The day after Fergus Ewing’s amendment was defeated, Robert Balfour, the chairman of the Scottish Landowners’ Federation task force on land reform, said, “The SLF is glad that common sense has prevailed. An absolute right to buy will not achieve any of the aims of the Bill and will shatter the tenanted sector.”

More recently Scottish Land and Estates asserted that the revival of the debate on right to buy is jeopardising confidence among landowners to let land.

Many landowners, in evidence to the Land Reform Review Group argued that the threat of a right to buy would be a disaster. Richard Stirling-Aird argued that the right to buy was “probably the biggest deterrent to owners of land to let farms, and the mere threat itself is sufficient to pretty well dry up such supply of farms coming up for let

Roxburghe Estates claimed that “Any proposal to grant existing tenant farmers the right to buy their farm at any time, rather than, as at present, when a landowner plans to sell, will have a serious impact on the supply of land to let. Confidence in letting land would be destroyed“.

The problem with such prophecies of doom is that there is no rational basis to believe that either

1, the threat of a right to buy should lead to any reduction in the amount of land to be let or,

2. such a right would, if it were introduced, reduce the amount of land available to let.

Let’s deal with the first claim first.

The right to buy has only ever been and is only being proposed for secure tenants – so-called 1991 tenants. As Fergus Ewing confirmed in 2003, no-one has or is proposing that any such right to buy be granted to tenants of 2003 tenancies. It is thus disingenuous to claim that any landowner should be put off granting such short tenancies. Indeed from 2005 to 2012, the number of SLDT tenancies has increased from 285 to 540 and LDT tenancies from 99 to 321. (3)

As for 1991 tenancies, they have been in decline for decades (down from 6348 in 2005 to 5402 in 2012). There is no possibility of any reduction in land let under traditional secure tenancies for the simple reason that landowners stopped granting such leases a long time ago.

There are thus no credible or reasonable grounds for arguing that the threat of a right will lead to a reduction in the amount of land to rent. No-one is granting secure tenancies in any case and no-one is proposing that 2003 tenancies be made subject to any right to buy.

Now let’s deal with the second claim.

It presumes that if most or all of Scotland’s tenant farmers become owner occupiers, there will be a reduction in the extent of land that is tenanted. Since 1982, there has been a steady decline in tenanted land as illustrated in the graph below – down from 42% in 1982 to 24% in 2012.

GRAPH – Percentage of agricultural land under a tenancy lasting at least one year 1982 – 2010. Source see footnote 3

Of course, if all tenant farmers were to exercise their right to buy, there would be a further immediate reduction but the important point is that there is no evidence to suggest that the extent of land that is leased overall will, in the longer term, reduce any further than it has already.

Indeed, there is evidence to suggest the precise opposite. In Norway, for example, in a country of owner-occupiers where tenant farmers as we recognise them in Scotland don’t exist, tenanted agricultural land has increased from 20% in 1979 to over 42% in 2010. See graph below.

Source: Statistics Norway, Census of Agriculture 2010.

Most countries in the EU have a high proportion of tenanted land. Compared to Scotland’s 24%, France has 74% and Germany 62% of its agricultural land rented out to farmers.

Country percentage of tenanted land
France 74%
Belgium 67%
Germany 62%
Sweden 39%
Finland 34%
Greece 32%
Italy 28%
Spain 27%
Netherlands 25%
Scotland 25%
Ireland 18%
Share of rented land as a % of the total UAA (2007) Source: Eurostat

The difference is that the vast majority of Scotland’s secure tenants own no land – they rent the whole farm including the family home. In France and Germany, the vast majority of farmers who rent land are also owner-occupier farmers themselves. In other words, across most of Europe owner-occupier farmers lease land to each other as and when they need to. The landlord and the tenant have equal status because they are both landowners. So whereas in Scotland, it is common for landowners to have multiple tenants, in France and Norway, individual farmers have multiple landowners.

Implementing a right to buy for Scotland’s tenant farmers could easily, if the European experience is any guide, lead to an increase in the amount of tenanted land available. 

If this is the case, it lends weight to the argument put forward by Professor James Hunter that the introduction of the right to buy should be accompanied by new freedoms to contract. This would mean landowners were free to enter whatever arrangements they saw fit with prospective tenants. Existing leases would continue until they expired and perhaps the 2003 tenancies would continue to be available for those wishing an off the shelf arrangement.

Is it not time, as this respondent argued to the Land Reform Review Group, to let Scotland flourish?

UPDATE 18 SEPTEMBER 2013

Richard Lochhead gave evidence to the Rural Affairs, Climate CHange and Environment Committee this morning on agricultural tenancies. I will post a link to the official report as soon as it is available. Meanwhile, here is the text of a statement released after the Committee.

“Absolute right to buy will only be considered for secure farm tenancies in Scotland, the Rural Affairs Secretary has confirmed. Speaking after giving evidence on a range of agricultural matters to the Scottish Parliament’s Rural Affairs, Climate Change and Environment Committee, Mr Lochhead said:

“I have taken this opportunity to confirm more detail about the Scottish Government’s review of tenant farming legislation. I have already made clear that it would be inconceivable for this review not to include consideration of absolute right to buy.

“Today I was pleased to clarify, for the avoidance of any doubt, that consideration of absolute right to buy will be restricted to secure 1991 Act agricultural tenancies which can be passed down through families for generations.

“I also confirmed the review of Agricultural Holdings legislation will be a Ministerial-led, rather than external, review. I will soon be making an announcement on the remit of the review, the appointment of review group members and the timetable involved.

“Many tenant farmers have made the case that current tenure arrangements stifle on-farm investment. Given the current land reform debate in rural Scotland we need to consider what is in the best interest of rural communities and the role individual land ownership plays in this. Landlords’ views must also be heard.

“It is also important that we give all tenant farmers and stakeholders the opportunity to enter into full and frank dialogue about absolute right to buy.”

 

(1) (Col 4188 Scottish Parliament Rural Development Committee Official Report 4 Feb 2003

(2) Cited in David Torrance, Noel Skelton and the Property-Owning Democracy, Biteback, 2010. pg 208.

(3) Tenanted Agricultural Land in Scotland 2012. Scottish Government, 12 June 2013.

“Price of farmland hits record high” scream the headlines today across all the media. The BBC, Scotsman, Herald, and local media from the Deeside Piper to the Kilmarnock Standard.

All these stories have two things in common. First, they are virtually identical. Journalists have simply reproduced a press release. Second, they are all inaccurate. What is going on? The answer is that vested interests are successfully capturing the news agenda. In this case it is the Royal Institute of Chartered Surveyors (RICS) and they are on a roll.

Ten days ago, RICS issued a media statement entitled “RICS July 2013 Residential Market Survey” which was widely reported in the press as a recovery in the housing market with rising prices and more buyers entering the market. In reality, the survey (copy here) was a “sentiment” survey based on asking RICS members for their opinion. This is analysed as a “net balance” – a figure between -100 and 100 where -100 means all members think that a variable will decrease and +100 means they all think it will increase. As the small print makes clear, “Net balance data is opinion based; it does not quantify actual changes in an underlying variable”

The vested interest is relevant here because of course members of RICS earn their living by charging fees. In the case of land and property transactions, they typically charge a percentage of the selling price. So the opinion of RICS members is not an objective opinion.

Nevertheless, their Residential Market Survey received massive coverage. So much, in fact that two days ago, the RICS proudly announced that it had generated “our greatest number of media hits ever in one day“. I am sure their members are delighted that their membership fees are buying such good coverage of their own opinions.

So to today’s reports in the media about farmland prices. The BBC report claims that,

“The price of farmland in Scotland hit a record high in the first half of 2013, according to research by surveyors.

“The Land Market Survey by the Royal Institution of Chartered Surveyors (RICS) indicated land values had trebled in less than a decade.

“It calculated the average price of land in Scotland was now £4,438 per acre.

“Surveyors reported the price was being supported by demand from farmers and investors.

“Their report predicted further price increases were likely, with the market “far from finding its level”.

The press release from RICS claims that,

“£7,440* per acre across the UK, hitting a record high for the eighth consecutive period. The cost of land is now more than three times that of the same period in 2004 when an acre cost just over £2,400.”

That asterisk is important. It was not there when I first looked at the press release but was added after I phoned the RICS press office to ask what the following footnote referred to. The footnote says,

* Opinion based measure, £ per acre (based on median surveyor estimates of bare land only containing no residential component, not subject to revision).

Looking at the Rural Market Survey report, itself (which is only available if you register as a RICS site user), things become clearer. The basis for the claim that “prices had trebled in less than a decade” is based upon “an opinions based measure (which is a hypothetical estimate by surveyors of the value of pure bare land).”

It is also a UK wide figure and thus says nothing about the farmland market in Scotland.

The “RICS spokesperson” states, in the RICS media release that,

“The growth in farmland prices in recent times has been nothing short of staggering. In less than ten years we’ve seen the cost of an acre of farmland grow to such an extent that investors – not just farmers – are entering the market. If the relatively tight supply and high demand continues,  we could experience the cost per acre going through the ten thousand pound barrier in the next two to three years.”

What she really means is that the cost of an acre of land according to the opinion of her members. And when she speculates that the cost per acre could go through the £10,000 barrier in the next two or three years – that too is simply the opinion of those with a vested interest in precisely that outcome.

And that trebling only relates to England and Wales, not to Scotland.

Oh, and finally, that £4438 per acre price that the BBC reports the RICS “calculated”?

That’s just an opinion too but reading the press reports today you would not know.

So why does the media give such prominence to the self-promotional opinions of vested interests?

In this Guest Blog, poet & novelist John Burnside reflects on the land, nature, folk and elite power. John’s most recent book is a collection of short stories, called Something Like Happy (Jonathan Cape). This essay was first published in The Scotsman on 29 June 2013 and is published here with their kind permission.

Should Scotland’s environmental policies be governed by the rich and powerful?

John Burnside 29 June 2013

IN 1997, I gathered with a group of other writers at the Edinburgh Festival, gamely sporting my yes/yes badge, to pledge support for a Scottish Parliament. At the time, I had no great expectations of the radical changes I thought were needed, here and elsewhere; what I hoped, however, was that a devolved Scotland might moderate, or even abandon, the high-handed approach to government that I had come to know and despise under Thatcherism. The gathering that day was jovial, with much joking and not a little self-consciousness for some. I had only been back in Scotland for a couple years, having moved south at the age of ten when my father got a job at Corby Steelworks and, at the time, I felt a little uncertain of the territory. I had no party-political affiliations and the idea of nationalism had always rendered me queasy. Still, crossing my fingers, I pledged my support and cast my vote, then stood back to see what would happen.

Now, we are about to do the referendum ceilidh all over again, only this time the stakes are higher. The trouble is, none of the changes I want to see are even on the agenda. Well, they are, in the usual lip service, greenwashed fashion, but none of it is real.

Meanwhile, I am much the same this time around as I was then: unaffiliated, highly sceptical and wondering which compromise to make in order to avoid the lesser of two evils. I would like to be affiliated: like many people, I suspect, I am still waiting for a green party in Scotland worthy of the name, but I see no sign of that for the near future and, to be frank, I want to weep when someone like Al Gore pops round for the day to praise the current government’s supposed environmental credentials (built entirely, and rather ironically, on a flawed energy strategy that, while it lines the pockets of landowners and developers, is devastating our wild places).

In fact, it is a mark of how compromised we are that my political wish-list for today is much the same as it was in 1997: a sound energy policy based on energy saving and informed research into genuinely renewable technology; land uses governed by environmental principle, rather than developer whim; meaningful, by which I mean radical, land reform; clear policies to eliminate, or at least reduce, pollution, (rather than craven kowtowing to the interests of neonicitinoid producers); and democratic social policies aimed at effecting equality of opportunity, not ‘community’ initiatives that sneak ‘Big Society’ in through the back door. Central to all of this, and the chief cause of our failed environmental policies to date, is land use. Or rather, land ownership.

In his 1931 polemic, Natural Prosperity, the Australian economist, RF Dyson, wrote: “It is just as impossible to secure to each his full earnings and at the same time to treat land as wealth, as it is to make an omelette without breaking the eggs. For first of all the private ownership of land means the private collection of its rental value. Since the rental value, which is always collected in money, is purely a community product, incomes gained through its private collection are as morally indefensible as incomes gained through common burglary…theft is morally wrong because it enables some to live on the labour of others. The private collection of land rent is worse than burglary because it is a continuous and increasing theft, and also it keeps opportunities unequal. That is economically wrong because incomes gained in that manner are not limited by the natural productive power of the recipients, and consequently a few people receive incomes far in excess of their needs.”

If we add in the continuous and increasing theft that is the current agriculture/energy subsidy system, Dyson could be talking about Scotland today – which is not to say that all landowners in Scotland are thieves. There are many who, in the context of current practice, are both responsible and, given the temptations, restrained in the uses they make of the land. The fact remains, however, that because of the way land is owned, and because the subsidy system throws public money – our money – at any business interest that can afford the consultancy to complete the appropriate forms and doctor the Environmental Impact Assessment, (should this even be called for), the fact remains that it is the larger landowners, along with developers and corporations, who dictate Scottish environmental policy, such as it is.

There can be no more obvious illustration of this than the Menie scandal. There is not room, here, to rehash all the details, but one clear fact remains: this was a defining, even textbook case of how to override local democracy, environmental issues and the basic rights of local residents.

On the environment issue, The Scottish Wildlife Trust’s objection was clear: “The very high nature conservation value of this coastline is recognised at both a European … and national level … indeed, the whole stretch of coastline hosts a rich assemblage of specially adapted higher and lower plants and other wildlife, including a diverse breeding bird community and otters. Of even greater concern [is] the destruction of over a third of Foveran Links Site of Special Scientific Interest (SSSI), which is important nationally for both its biological and geological features.” As we know, these concerns were ignored by Holyrood. The billionaire developer would come first; local people, and their environment, came nowhere.

It would be foolish to suggest that this government is any more cynical or undemocratic than many others; for some reason, governments do tend to pander to the rich and powerful. Nevertheless, it’s galling when even our supposedly ‘green’ policies are blatantly shaped by the interests of landowners and developers. Take wind energy, for example. In 2012, the Spanish Ornithological Society, having conducted an independent study on the impact of turbines on birds, said: “The more than 18,000 wind turbines [currently operating] in Spain, could be causing an annual mortality of birds and bats [of] between 6 and 18 million individuals.”

Researchers working on raptors, migrating birds and bats in the United States have called for a moratorium on wind farms or, at the very least, clear guidelines and regulation that would help lower the number of birds and bats killed. With this in mind, surely it would make sense, in a country so fanatically committed to Big Wind, to do all we can to protect birdlife – but in Scotland, turbines all too often go where landowners want them to go, because turbines attract huge subsidies, (the system was, in fact, originally modelled on agricultural subsidies). As The Guardian reported recently: “The boom in onshore wind power, likened to a “new industrial revolution”, is being dominated by a small number of private landowners who will share around £1bn in rental fees over the next eight years. Rental payments vary and are secret but…landowners can now expect £40,000 a year “risk-free” for each large turbine erected on their land. Those set to benefit include senior members of the Royal Family and the Forestry Commission in Wales and Scotland.”

That our energy and land use policies should be governed by the most brutal profit motive is tragic, but this subsidy-grab is just the latest in a long history of moral and environmental crimes. In 1808, tenant farmer named Robert Burns penned these satirical lines:

Farmin, and fencin, an a

Ploughin, and plantin, an’ a

Beha’d how our kintry’s improvin,

An’ poverty wearin awa

Since then, we have continued ‘improvin’ the land for the benefit of the richest and the least socially productive, to the detriment of what should have been a shared environment. As long as it is in the interests of corporate landowners, faux-green energy companies and billionaire developers, Scotland still means business.

However, as we ask ourselves again, over the coming year, what Scotland ought to mean, and what we ought to be doing to protect the quality of life of all (human and otherwise) who live here, we must finally begin the work of making Scotland free for all, not just by redistributing a few acres here and there in ‘community’ buy-outs, but by revolutionising our ideas of how land could be used, not for the profit of a few, but for the delight of all.