Chamber and committees

Amendment 289 does not take account of the need for tenant farming businesses to be able to play their part in sustainable and regenerative agriculture.

On definitions, the member will no doubt be aware that we had similar discussions throughout the passage of the Agriculture and Rural Communities (Scotland) Act 2024 act. That act required us to publish a code of practice, which we did last week. The code of practice provides guidance and examples, recognising that sustainable and regenerative agriculture is a collection of different practices. That is how we addressed the issue that the member raises. We did not look to define it in that legislation, which is why we are not looking to define it in this bill.

At present, a tenant’s landlord can object to a tenant’s diversification if it will substantially prejudice the use of the land being diversified for agricultural purposes in the future. Tenants need to be able to take a whole-farm approach to making the right decision for them. As the people who actively manage the land, they know more than anyone else what works and what needs to be done. The bill helps them to do that by reforming the grounds on which a landlord can object to proposed diversification, so that the objection must be that the diversified use would substantially prejudice the use of all the land in the lease for the purposes of sustainable and regenerative agriculture. Therefore, the amendment would simply mean that we maintain the status quo and that tenant farmers would not have the same ability to take part in or benefit from our future support framework. It is a backward step that should be resisted. I ask the committee not to support the amendment.

I have concluded my remarks, but I am happy to take a point from Mark Ruskell.

The Scottish Government amendments in the group make procedural changes to the provisions on appointing a valuer for the resumption process that is set out in sections 11 and 12. Ultimately, those changes meet stakeholders’ asks in that area. The current processes require the tenant farming commissioner to appoint a valuer in every resumption by the landlord of land in the lease. It should be noted that my amendments relate to the procedural aspects of the resumption notice and the appointment of a valuer, not to the basis of compensation for a tenant and what the valuer is to value. The amendments do not change those aspects of the bill.

My amendments 234 to 237, 242 and 243 modify the wording of section 11, which is named “Resumption in relation to 1991 Act tenancies”, in order to align it to the legal position that a landlord of a 1991 act tenancy cannot resume all of the land in the holding. The amendments are required because the existing wording could cause confusion.

My amendment 238 removes the requirement for the landlord to send the tenant farming commissioner a copy of the resumption notice that is issued to the tenant.

My amendments 241 and 258 extend the timescale in which a tenant can terminate a tenancy following receipt of a notice of resumption from 28 days to six weeks. Amendment 241 covers 1991 act tenancies and amendment 258 covers 2003 act tenancies. The extension will provide tenants with more time to fully consider the implications of a notice of resumption prior to coming to a decision on termination.

My amendments 522 and 523 make consequential changes arising from amendments 256, 257 and 260 that are similar to those made by amendments 239, 246 and 248.

My amendments 245, 251 to 253 and 263 to 265 make minor textual changes to how the tenant farming commissioner is referred to in provisions for 1991 act and 2003 act tenancies.

The Government and the non-Government amendments in this group provide the first chance to consider the issues about resumption that were raised during stage 1.

In agricultural tenancies, a landlord and tenant agree in the farm lease that the tenant will have exclusive use of the farm for the term of the lease, but there are circumstances when the landlord is able to take back part of the farm before the lease has ended. That might be reasonable for a particular case, provided that the tenant is properly compensated for loss and inconvenience.

All sides agree that the current level of compensation for resumption is too low and therefore unfair. The bill changes that for tenancies under both the 1991 act and the 2003 act. The approach for both types of farm lease is for the landlord and the tenant to share the uplift in the value of the land being resumed. That capital value approach uses the model that was previously agreed by the Parliament for compensation for the relinquishment of tenancies.

I am happy to, convener. The amendments in my name in this group reflect the commitment that I made at stage 1 to clarify proposed new schedule 5 to the Agricultural Holdings (Scotland) Act 1991, following the range of evidence and information that was provided by tenant farming stakeholders.

Amendment 287 seeks to remove new part 4 of schedule 5 to the 1991 act, which contains a list of improvements that facilitate or enhance sustainable regenerative agricultural production. Amendments 282 to 285 seek to modify parts 1 to 3 of the schedule to rehome the improvements that were included in part 4, which will now be included in the illustrative lists for which the consent of the landlord is required or of which the tenant may be required to notify the landlord.

I support Ariane Burgess’s amendment 286, which seeks to add to part 3 of the schedule two of the improvements that were listed in part 4.

Amendment 271, 275, 276 and 277 seek to modify the provisions on the Scottish Land Court’s determining whether to approve a proposed improvement following the removal of part 4 of the schedule. The court will still be required to consider whether an improvement is likely to facilitate or enhance sustainable or regenerative agricultural production. The corresponding improvements will be set out alongside those provisions rather than in part 4 of schedule 5.

Amendments 272, 273 and 274 seek to set out the process for notifying a landlord or obtaining their consent to carry out an improvement. The changes include requiring the landlord to provide written reasons to the tenant when they have not agreed on the terms of consent for a proposed improvement, or when they object to a proposed improvement following notification by a tenant.

Amendments 268 to 270, 271, 275, 278, 279, 281 and 288 are minor consequential amendments, which relate to those that I have already discussed.

I hope that members will support my amendments.

I turn to Tim Eagle’s amendments. Amendment 544 sets out a statutory process for the landlord to request further information from the tenant about a proposed improvement for which the landlord’s consent is sought—including the timeframe for responding and the effect of failing to do so. That would add unnecessary complexity to the process and place an unreasonable burden on the tenant to respond to a further request for information.

Amendment 535 would permit the landlord to notify the tenant that they will carry out on the tenant’s behalf improvements required by enactments or by the lease. That could have an effect on the rental value, because improvements that are paid for by the landlord are included in rental calculations.

I understand the issue that amendments 544 and 535 are trying to resolve, but what they propose needs further consideration and discussion with the industry. I am not sure that the bill is the right place for what they are trying to do. That would be something for future legislative change, because the range of unintended consequences needs to be fully considered, given the interface of amendment 535 with not only the houses on a tenancy but the rental values of tenancies.

Amendment 276A seeks to modify the list of matters that the Scottish Land Court must consider when it is deciding whether to approve the carrying out of an improvement. The list would include whether sufficient information has been provided to the landlord to enable them to make an informed decision, in line with the new duty that Tim Eagle seeks to create in amendment 544. The Scottish ministers already have the ability to prescribe the information that a tenant’s notice must include. However, there might be cases in which, for various reasons, less information is available. Ultimately, it is in both parties’ interests to provide sufficient information in relation to a proposed improvement, given that the tenant will be seeking the landlord’s consent or hoping that they do not object following a notice. Therefore, I do not think that amendment 276A is necessary.

Amendment 280 seeks to require that the affirmative procedure be used to alter the illustrative activities for the non-exhaustive lists for parts 1 and 2 of new schedule 5 to the 1991 act, and to add any activities to part 3.

In my response to the stage 1 report, I confirmed that we are

“committed to working closely with stakeholders before bringing forward any changes that might be helpful for the sector.”

However, there are technical issues in relation to the drafting of the amendment, and it fails to make a necessary consequential change.

Amendment 540 would restrict the ability of a tenant to object to a proposed improvement detailed in a landlord improvement notice under section 14A, which would mean that a tenant would be prohibited from objecting to an improvement if it related to an item of fixed equipment that was considered by the landlord

“to be an economic requirement for the purposes for which the farm is let”

and the landlord has given the tenant the opportunity to relinquish the item. A tenant would not be entitled to compensation if an item of fixed equipment was relinquished in such circumstances.

Amendment 540 is a significant amendment that would have a range of potential unintended consequences that would place financial burdens on tenants, and there would be no ability to recover costs if the item was relinquished.

Accordingly, I ask members not to support Tim Eagle’s amendments in this group.

I move amendment 268.

I hope that I will be able to shed light—

In relation to the control of deer, those matters are being dealt with and considered through the Natural Environment (Scotland) Bill; that is where matters in relation to control are considered. Here, we are dealing with the impact on the tenant. Ultimately, we are trying to ensure that there is fair compensation to the tenant for damage that comes about through no fault of theirs.

Emma Harper’s amendment 524 reverses a change made by the bill to clarify the law. I do not believe that the amendment is necessary. A tenant who has a right to kill and take game does not require permission from the landlord to do so. They do not need to have a right and permission, which is the effect of the amendment.

Amendments 518 and 519 seek to take away the right of a landlord or tenant to refer a question about compensation to the Scottish Land Court. Instead, there would be compulsory arbitration, which is unusual. It would be left to ministers to make that work, if they could, through secondary legislation. I appreciate the reasons why those amendments have been introduced. I agree that it would be helpful to consider, over the longer term, how alternative dispute resolution processes such as arbitration might help the tenant farming sector. However, we need to be able to explore those issues further in discussions with our wider stakeholders.

I mentioned last week that we would look to consult on the powers of the tenant farming commissioner. We will look to add to that the theme of alternative dispute resolution, so that we can tease the matter out more thoroughly.

I ask the member not to press her amendments.

I absolutely appreciate that. The reason why we are discussing these issues is because they are not necessarily easy to resolve. Some of them have been under discussion for quite some time. However, notwithstanding the issues that relate to amendment 542, I am keen to commit to having wider discussion, engagement and consultation, because there are issues in relation to Arbitration (Scotland) Act 2010, some parts of which have not been commenced. Ultimately, we want to ensure that we get this right for everybody involved in the process, which is why wider engagement and consultation are so important.

Thank you, convener. I would have to look at that specific point. Other than that, I do not have anything further to add to my comments.

As we have touched on in our debates on previous groupings of amendments, including groups 37 and 38, I absolutely appreciate why Emma Harper has lodged amendment 542 and why we should consider encouraging arbitration for some disputes. However, there needs to be space for alternative dispute resolution more generally. Although the amendment focuses on arbitration, there are other tools that can be considered.

There are also technical issues with the amendment, given that parts of the Arbitration (Scotland) Act 2010 have yet to be commenced, in part because of the challenges of making arbitration work for statutory disputes. At present, under the Agricultural Holdings (Scotland) Act 1991, tenant farmers and their landlords are able to undertake arbitration and still have the right of appeal, on a point of law, to the Land Court. However, that process is not used, because some parties consider that the system does not work and will not be entered into in good faith.

For the reasons that I have outlined in relation to previous groupings, and because of the wider commitment to tease out some matters in more detail and have a wider discussion with industry and stakeholders, I ask Emma Harper not to press amendment 542.

I realise that we debated the amendments relating to the pre-emptive right-to-buy process for small landholders as well as 1991 act tenant farmers, including amendment 225, last week. It is, of course, amendment 225 that Tim Eagle is seeking to amend through his amendments.

In relation to amendment 225A, it is standard practice that such notices are in writing. That is also reflected by the requirement on the tenant to send a copy of the notice to the keeper, so I do not think that it is necessary to amend section 10 in that way. However, I am more than happy to have a conversation with Tim Eagle in relation to that, and to bottom out any concerns that might persist.

Tim Eagle’s amendments 225B and 225C seek to amend the regulation-making power included in amendment 225, which empowers a tenant to exercise their right to buy when their landlord takes certain steps with a view to transferring land and fails to notify the tenant. The amendment enables the Scottish ministers to make regulations for the timescales in which a tenant will be required to notify their landlord that they intend to exercise that right.

On amendment 225B, while it is the Scottish Government’s intention to engage with stakeholders and to make regulations, it would not be appropriate to amend the power in the way suggested, given that whether regulations are made is ultimately a decision for the Scottish Parliament, in line with the affirmative procedure.

Amendment 225C also seeks to restrict the scope of the power under amendment 225 in a way that would limit its effectiveness and ministers’ ability to make the intended changes. The ability of the regulations to modify section 29 of the 2003 act when providing for a period within which notice is to be given provides flexibility in the drafting approach, including for making any necessary consequential changes.

I cannot support amendment 543, for the reasons that I set out last week in relation to Tim Eagle’s amendment 226. Amendment 543 likewise seeks to limit the powers in the bill for the Scottish ministers to make regulations for how 1991 act tenant farmers can register their interest in acquiring the land comprised in their lease.

I ask the committee not to support the amendments in this group.