When Scotland’s new land laws were approved this year, it marked the end of a process that has run for most of the current five-year parliament. Landownership was arguably ripe for change: in egalitarian Scotland, a reported 50% of private rural land is owned by fewer than 500 people and entities, and landownership has not been liberated in the way that it has in some nearby countries.
This was not Holyrood’s first dalliance with the subject. Previous reforms in 2003 gave everyone access to Scotland’s outdoors, even without an owner’s prior consent, provided it is taken responsibly and subject to certain exclusions. It also gave communities some rights over local land, including a right of first refusal in rural areas and a right to buy in the crofting areas of the north and west of Scotland.
Important as those innovations were, some called for more reform. They were answered in part by rules introduced last year to further empower communities by entitling them to participate in numerous local decisions and giving them a new right of acquisition for abandoned, neglected or environmentally mismanaged land. It also widened the right of first refusal into Scotland’s cities.
What the new rules do
Now comes the Land Reform (Scotland) Act 2016. In some cases it could directly force a change of landowner, either through a community buying land to further sustainable development, or by allowing certain types of agricultural tenant to buy land where the landlord is in material breach of a court order or arbitration award. (As I’ve explained before, this doesn’t quite go as far as compulsory purchase orders.)
There is a boost to transparency of ownership through new rules about disclosing the controlling shareholder in a landowning entity. Coupled with an existing drive to complete the map-based Land Register of Scotland by 2024, which will improve accessibility of information about the land itself, this will make it harder for operators registered in offshore tax havens to hide who directs their Scottish land holdings.
Landowners now have a decision to make about making their land available for shooting, as the new act removes rate reliefs on such activities. Whether they still allow shooting will of course depend on whether they can afford the rates, and also whether they are eligible for other offsetting reliefs (such as those for small business).
There are some important reforms to farm tenancies regarding matters like rent review, tenancy transfers and inheritance. They don’t enable tenants to pass their lease to absolutely anyone, but a reform introduced in the latter stages of the bill’s passage through Holyrood will allow transfer to “an individual who is a new entrant to, or who is progressing in, farming” in certain circumstances. That procedure is convoluted and controversial, so much so that there have been indications that landowners may challenge the rules on human rights grounds.
Landlords will also in future be measured against a “land rights and responsibilities statement”, and there are new guidelines for how they should engage with local communities when important decisions are made. And the whole regime will be overseen by the new Scottish Land Commission, which will also have a role in ensuring land reform stays in the foreground of Scottish policy.
These reforms will undoubtedly make quite a difference to landowners, land managers, communities, tenants and Scottish society as a whole. It is difficult to make a direct comparison with England, which has very different land rules, but Scotland is certainly now a little less favourable for the landowning classes. That said, the SNP government could have covered more ground still. At various points in the development of this law, there were suggestions about: a cap on landownership above a certain level; preventing entities registered outside the EU from owning land; and full compulsory sale orders. None of these appear in the legislation.
The Holyrood election campaign has demonstrated that many political parties are interested in further land reform: Scottish Labour’s manifesto says the new act is “botched” and that it would look at making improvements, including ensuring land in Scotland is “registered within the EU”. The Scottish Greens proclaim that “Scotland can be bolder on land reform” in terms of tax and offshore ownership.
The Scottish parliament has gone some way towards changing the rules about landholding in Scotland. Now that the genie is out of the bottle, the debate is clearly not going to end here.