Rural Economy and Connectivity Committee

Meeting date: Wednesday, November 23, 2016

Official Report 659KB pdf

---

Crofting Law Reform

Item 3 is our final evidence session for our review of the legislative priorities for crofting. The cabinet secretary and Gordon Jackson are now joined by Michael O’Neill, who is the Scottish Government’s crofting bill team leader.

As I mentioned in previous meetings, the committee is particularly conscious that contentious crofting issues have been in the media in recent weeks. However, the committee does not intend to stray into those specific areas and I urge members and witnesses to focus on the legislative priorities.

I invite the cabinet secretary to make a short opening statement.

Thank you for the opportunity to discuss matters that relate to the future of crofting legislation. In recent months, I have met a number of stakeholders; in each case, I have been impressed by the enthusiasm that they have displayed and the sense that much can be achieved if everyone pulls in the same direction.

I would like the process of modernising crofting law to bring people together and I would like them to take the opportunity that is presented to work constructively for the future good of crofting. The Scottish Government is committed to crofting and to support for crofting. That support is wide ranging and includes crofting agricultural grants, common agricultural policy payments, the Scottish rural development programme, pillar 2 grants and the less favoured area support scheme.

We have made commitments that we intend to deliver during this parliamentary session, which are to introduce a new entrants scheme for crofting; to develop a national development plan for crofting; to explore whether we can create new woodland crofts; to reintroduce a croft house loan scheme; to ensure that new community landowners are not left out of pocket through registering as the new landlord of crofts in their community-owned estates; and to reform crofting law. If committee members—individually and collectively—have ideas, we will be grateful for them and keen to hear them.

Crofting law reform is the topic of today’s discussion. We understand that crofters have long been concerned about overly complicated and outdated legislation, so we want to modernise crofting law to make it more transparent, understandable and workable in practice.

A lot has changed since crofting law came into force in 1886. Some argue that it is very outdated and that it is time to take a clean-slate approach to ensure that the law best serves crofting in the 21st century. Others argue that we should sort all the problems and reconcile and consolidate all the nuances but leave the basic components as they are. Others still think that a hybrid approach should be taken.

Much good work has already been done through the Shucksmith report and the creation of the so-called crofting law sump. It is important that we use that work to inform what we will undertake to develop new law.

Whatever the approach, we need to think strategically about what we want from crofting and about what we want and expect from new legislation. We need to be clear at the outset about what we want crofting to deliver, so being clear about the role of crofting and the vision that we have for it will be key. I want the new law that is developed to be fit for meeting crofting needs in the future.

In thinking about that future, we must consider many issues, such as the flexibility to cater for new entrants and the need for crofts to be thought of not as hobby farms but as thriving rural businesses, as well as productive agricultural units. It is important that we are clear about why we need change, what change we want to see and how we plan to achieve that, bearing it in mind that creating new legislation might not be the only way to do it.

It is essential that stakeholders engage and help the Scottish Government with the development of new legislation. I have been pleased to meet many stakeholders, and I am keen to meet individuals who have profound knowledge and experience of crofting, as well as representative bodies, statutory bodies and others. All that work is to ensure that we are in the best position to create the right environment in which crofters and crofting communities can further contribute to a successful rural Scotland.

Crofting legislation is important and we need to get it right. Crofting is an essential part of our history and our culture and it is crucial that we take the time to do this properly. I have my own views on policy objectives, but they are not set in stone. I have no doubt that the committee’s questions and its role will help us all to develop our thinking. I want the process of creating new legislation to be open and I am determined that others outwith this place should engage, so that their views are clear and can be considered in the work that is undertaken. Here, we are a long way from the crofting counties geographically and perhaps in many other ways.

I know from my experience in government that the best solutions are always arrived at collaboratively and after a great deal of thought and discussion. It is in that spirit of co-operation that I wish to take forward the future of crofting law.

Thank you. A lot of what you said reflects the committee’s keenness to take forward crofting and make it fit for purpose, which will serve the aspirations of those who are involved and of the people of Scotland.

My question is basic and gets to the heart of the matter. We have taken evidence from various witnesses and heard various ideas of what crofting is all about. Is it about population retention, farming, housing or something else? We believe that any legislation that covers crofting should be underpinned by a clear policy on what the Scottish Government expects crofting to deliver. What does the cabinet secretary consider the purpose of crofting to be in the 21st century?

09:30  

Crofting serves and fulfils many purposes. I urge people not to think of it as having only one purpose.

Mr Chapman has raised a good starting point to allow us to think about the various roles and purposes that crofting fulfils. For example, crofting undoubtedly contributes to population retention. It also contributes to the sustainability of rural and remote communities, where, as members—especially those who represent the crofting counties in the Highlands—know, there tend to be fewer opportunities than in cities to get jobs and set up businesses and the likelihood of being connected to the internet is perhaps less. Connectivity is never far away in any debate, and that is right these days.

Crofting has a role in population retention and the sustainability of remote and rural communities. At a basic level, for a great many thousands of people, crofting activity supplements family income. In almost all cases of crofting, it is reasonable to say that that income is unlikely to be the sole income. Where crofting as agricultural activity is carried out, the income may supplement work that is done as a main job or self-employment.

When I met Stewart Robertson in the rural payments and inspections division office in Stornoway, which I visited when I was on holiday this year—I tend to have lots of busman’s holidays—he informed me that the largest payment to a crofter of which he was aware under the basic scheme was £22,000. As many members will be aware, that would not be an enormous payment to many farmers.

Crofting has a purpose of providing an income, but that is often a very modest income. Nevertheless, it is an income and perhaps it provides the difference between a subsistence existence and a little more comfort and opportunity. Crofting contributes to agriculture and to the cohesion of society.

I have mentioned some purposes, and I hope that members will see that crofting is not about one thing and does not have a sole purpose. For that reason as well as many others, it is important that we continue to support it in the work that we do in the Parliament.

Thank you for the full answer. I warn you that there are a huge amount of questions and that we do not want to miss any of your replies. I ask you and committee members to make sure that questions and answers are as focused as possible.

I will be briefer next time.

On that basis, I move to the deputy convener, Gail Ross, for the next question.

Point taken. Thank you for your time this morning, cabinet secretary. As you know, the function of developing crofting sits with Highlands and Islands Enterprise. How effective is that? What is your opinion on the idea of the development function sitting alongside the regulation function in the Crofting Commission?

HIE is well placed to perform its development role, not least because, as members know, unlike Scottish Enterprise, it has a social function as well as an economic duty. It differs in its statutory duties and in how it approaches its task.

I know that individuals who work for HIE have an affinity for and an understanding of crofting, so they can be responsive in many cases. HIE tends to deal with the larger business enterprises; business gateway exists to deal with smaller businesses. They both play a part.

The Crofting Commission is effectively, substantially and primarily a regulatory body. It does not have the budget to be a development body. It is important to remember that the issue is not just about which organisation has the duty but about the budget to fulfil that duty. The two issues must be considered together.

I am aware that HIE is working intensively with about 50 communities in its most fragile areas. I support that. When the Crofting Reform (Scotland) Act 2010 was introduced, a conscious decision was taken to remove the development and grant-giving functions that were carried out by the Crofters Commission, the predecessor body, from the range of functions that were transferred to the Crofting Commission.

Through RPID, the Scottish Government administers, for example, the croft house grants, the CAGS, support for new entrants, agri-environment schemes and the crofting cattle improvement scheme. I have involved myself in many such decisions, which are taken fairly swiftly and reasonably efficiently, as far as I can see. If others take a different view about how well we perform those functions, I am keen to hear that. It is a perfectly legitimate area for debate, and I would welcome the committee’s thoughts, once it has explored the issue with all the witnesses and—I hope—listened to what I have had to say.

HIE is the Scottish Government’s economic and community development agency. It supports businesses and strengthens communities, and it has done a tremendous job in the past 30 to 40 years. When young crofters or people who want to go into crofting go to a bank to ask for a loan, the bank says no because they do not have a title over the land or they owe it money. Do you believe—as I do—that HIE should make small loans to people to encourage and develop crofting?

Access to affordable housing is the key issue. Part of the issue is access to secured loan finance—to mortgages, to use what I still think of as the English term; “heritable security” is the Scots law term, but I suspect that “mortgage” wins the day. An unfairness perhaps arises through the vagaries of crofting law, as it is quite difficult to get a mortgage. Decrofting has to be done, and even then it is difficult.

Getting a mortgage is difficult for practical reasons, because many crofters have seasonal income and cannot persuade a bank or building society that they have sufficient financial standing to qualify for a mortgage. It is also difficult because many of the houses are self-built and it has traditionally been difficult to secure a mortgage for such properties.

The process of decrofting does not exist for people outwith the crofting counties. If members here wanted to buy a house, how would they feel about having to go to a regulatory body first to apply for permission to buy it? If one thinks about it, that is a bit of an anomaly. I have raised that anomaly with, for example, Scottish crofting lawyers. At least one of them has opined on various ways in which the issue could be resolved. A provision to do that was in a previous crofting bill, but I think that it was removed at stage 3.

This is undoubtedly a key area that we all need to consider carefully. It is a matter of fundamental rights. It is unfair that people who live on crofting land should find it so difficult to get access to a loan to build or buy a house on the same terms as everybody else who is not in the crofting counties. I do not particularly think that HIE should sort out the matter; rather, it is for Parliament, working with, for example, the Committee of Scottish Bankers, to do so.

I am sorry to go on about this, convener, but I have done a bit of work on the matter. I have met most of the major banks in Scotland over the past wee while. I have asked them all to consider and contribute to the issue’s resolution and I believe that they are all willing so to do. It would be helpful to tackle the issue by working with everybody, because the issue is controversial. After all, loss of tenure and security of tenure were what the Napier commission and the Crofters Holdings (Scotland) Act 1886 were all about. As I said, the issue is not without controversy, but I hope that we can study it in detail and find options for solutions.

To return to HIE’s role in crofting development—that is, in business rather than housing development—a lot of the evidence that we have got is that it has worked with crofting communities, but what is missing and what the Crofters Commission provided in the past was individual advice to crofters on how they could develop their business and increase their income. That seems to have largely disappeared. Is there a way to get HIE or the Crofting Commission to do that?

That is an interesting observation and I would like to look closely at the evidence for it. Across Scotland, improvement can always be made to businesses, potential businesses, new starts and so on. In most cases, business gateway and not HIE has that responsibility, just as Scottish Enterprise has in the rest of Scotland when it deals with larger businesses.

The responsibility is primarily with business gateway, but many crofters are involved in agricultural activity and various sources of advice are available to them. For example, mentoring is available from the banks and is often provided free of charge. Mentoring is also arranged through HIE, although that is for larger companies. We provide finance to Scotland’s Rural College to provide advice and I would expect that to extend to crofters. In response to your question, I will check to make sure that the farm advisory service gives such advice.

There is a range of areas where advice can be sought. I certainly agree that we need to be sure that appropriate advice is available to those who live and work in the crofting counties who wish to have it. It is especially important that businesses should be nurtured and supported where possible and appropriate and that the relevant sources of advices should be available to them. The committee has raised an important point.

The issue of forming new crofts and giving new entrants the opportunity in that respect has been raised with the committee. That falls under HIE’s development principles. It has been suggested that, especially on crofting estates that have been purchased by the community, some areas of common grazings should be resumed to allow for the formation of new crofts. Would that encourage more crofters and make communities more vibrant, or do you think that that is a bad idea?

Given our commitment to introducing a new entrants scheme for crofting, we certainly welcome suggestions about how that can operate. Work has already begun in the crofting stakeholder forum to identify what such a scheme might look like. As we understand it, a draft new entrants paper has been compiled, and it focuses strongly on making crofts available and the reintroduction of the croft entrants scheme. As with all papers, the new entrants paper will, once it is finalised, be presented to Parliament in some shape or form.

In the meantime, crofters are already eligible to apply for other new entrants schemes and funding such as the young farmer start-up grant, the new entrants start-up grant and the new entrants capital grant is available through the common agricultural policy. Your proposal might cause a bit of controversy but it should be considered. We will look at it carefully and work with the committee on the new entrants scheme.

The programme for government commits to beginning work this year on the national development plan for crofting. We have heard various opinions, including from Sir Crispin Agnew, that that might be challenging within the existing limitations of the 2010 act and that there is no active crofting policy to develop new entrants or the other issues that you have just mentioned. Can you advise on a timescale for the production of the national development plan?

That is a very fair question. Scotland’s programme for government, which was published a couple of months ago, makes it clear that we will engage with crofting stakeholders to start the process of drafting a national development plan for crofting as part of a sustainable rural economy. It will focus on what we want from crofting in future rather than what has gone on in the past, although it goes without saying that pieces of work such as the Shucksmith report and the crofting law sump will set a helpful context. We must use the fruits of all the valuable work that has been done by a great many people in the past.

09:45  

There will be further stakeholder engagement—and, indeed, that process has already commenced. The development plan will include a wide variety of measures to support new entrants, provide support for crofting housing, explore the potential to create woodland crofts and ensure that community-owned estates are not disadvantaged by the croft registration process. We have begun the process of delivering all that.

As with all such things, that process should be governed by the principle of getting it right, not getting it out. We need to get the process right—that is the priority. This committee’s work will be a useful contribution to that process. It is far more important to have a plan that is right, that wins support, that commands buy-in and which is visionary but deliverable and practical. It is far more important to ensure that we have that than rush something out, which would be very easy to do but would not be the right approach.

Can you clarify who is responsible for implementing the plan?

The buck stops with me.

Thank you.

I understand your determination to get the process right, and I think that that is entirely the right approach. However, you will have in your brain a timescale for when you want to get it right by. Can you give the committee an indication of when that would be? You have not done that yet, and I wondered whether I could push you for some guidance on it.

Obviously, we are talking about the national development plan at the moment, not the bill. It is one of the pledges in our manifesto, but, advisedly, the authors of the manifesto did not set a timescale because we knew that it was a matter that needed to be the subject of careful thought. I therefore do not have in my brain a definite timescale, but I am always keen to make as swift progress as possible.

To answer your question directly, I envisage that it would be possible within a reasonable period of time to set some kind of target for timing, because people want us to make progress. However, I am not planning to do so today, because I think that it is too early. We have not really had the chance to hear views from crofters and their representatives about what precisely they want to see in the plan. I have mentioned a series of things, but it could well be that the process of engagement might raise another series of issues. Some that occur to me include more of a focus on potential areas of further diversification such as food and drink, tourism and renewable energy, all of which are very important areas for many individual crofters.

There might be a host of such ideas. I do not want to delimit and constrain the national development plan’s ability to be ambitious, bold and effective by the arbitrary and premature setting of a timetable. However, I always want to make progress swiftly, so I might give you a clearer answer at some point in the reasonably near future, if that is any consolation.

Even with your reference to “the reasonably near future”, I am not sure that I am any the clearer. However, we will leave it at that for the moment. Unless anyone else has a question on the development plan, I will move to Stewart Stevenson.

I have a series of questions about the Crofting Commission, the first of which relates to the review of the commission itself. Can the cabinet secretary tell us a bit more about the review’s objectives and give us an indication of the timetable for it and how the Government might deal with its outcomes?

Yes, I can. The review will consider the governance arrangements of the Crofting Commission’s board—in other words, the systems, procedures and support mechanisms that are in place to underpin effective decision making. The review will have due regard to the three recent common grazings cases at Bohuntin, Upper Coll and Mangersta—although not to the decisions taken—and it will also examine arrangements that are in place for handling conflicts of interest.

The work will be undertaken by business advisers and accountants Scott-Moncrieff, and we expect to make available the report on the review’s findings early next year. The review will help to promote effective governance in the Crofting Commission; it will be an opportunity to take stock, learn from experience and examine positives as well as opportunities for improvement; and we expect the report and its findings to inform the new board of the crofting commission following the elections in spring next year. The Scottish Government will work with the commission, through its normal sponsorship arrangements, to ensure that due regard is had to the review outcomes.

I am going to change the order of my next two questions in light of what has just been said, but I will deal with both matters.

An issue that has arisen in evidence relates to delegated decision making and, perhaps, direct delegation to commissioners. The minister’s comment that the review of the commission will consider conflicts of interest might give a context to this question. Does the minister consider that the current processes of delegated decision making are working to the interests of both the commission and the crofting areas?

We are supportive of the Crofting Commission’s delegated decision-making initiative, and my officials have informed me that it has been undertaken in parallel with the Crofting Commission board’s initiative to develop and implement regulatory policies and set the framework within which delegated decisions can be taken. That is good for governance, because it improves organisational efficiency and effectiveness and frees up commissioners’ time for work on more strategic matters, which can be only a good thing.

Delegated decision making is sensible for many bodies and can work very well where the delegation is supervised and is carried out effectively. In local planning authorities, for example, it is routinely and correctly used to free up the time of senior officials and, indeed, members to allow them to consider the cases that really warrant the devotion of sufficient time and expense. In general, I support delegated decision making and I am told that it is working reasonably well.

With regard to the elected members—there are also, of course, appointed members—there appears, from the evidence that we have had, to be a tension between the idea that elected members have to act on behalf of the whole commission and the idea that they are simply delegates from their own constituencies. The issue is one that members here are probably familiar with, but I wonder whether the system of elected commissioners is working well in dealing with the tension between the two—perhaps alternative—duties that there are on commissioners.

Perhaps related to that is another question: how well do the staff who are appointed help those who are elected take a corporate view rather than an individual one? I am sure that that will be necessary from time to time.

Such issues are matters of debate and, indeed, I discussed them with my officials earlier this morning. Elected commissioners are expected to bring their knowledge of crofting from their respective constituency areas and their responsibility is to use that knowledge better to inform board decisions on regulatory matters.

The Crofting Commission is, as I mentioned earlier, fundamentally a regulatory body, which puts into sharp relief the potential conflict of interest of an elected commissioner in, for example, representing one individual person in one individual case. There is a fundamental debate to be had here about the role of the elected commissioners, because each member here would probably take the view—as I certainly do—that our job is to represent all constituents as individuals and to do so irrespective of their views, our views, their politics, our politics, their position and their standing. Our job is to represent everyone. It would therefore be a matter of common view that someone who is elected should represent those who elected him or her. However, in a regulatory body such as the commission, the purpose is to effect and carry out and implement regulations.

This is a very important area for debate and, perhaps, reform of the law in due course. I am very interested to hear the committee’s views in that regard after it has had the chance to reflect on what I have said and what has been said by others in evidence. Being an elected commissioner is not an easy task.

So if I take this back to where I started, you are saying that this is essentially part of the review of the Crofting Commission.

I think that it is something that, if it wished to, the committee could consider in the sense that it is a legitimate and important area of debate. What is the duty of an elected commissioner of the Crofting Commission? Is it to individuals or is it to the area? Is it to bring knowledge and expertise to the board or is it to opine, lobby and put forward the case of individuals? I am not prescribing any of those views but it appears to me that there are potential areas of reform in relation to the proposed legislation.

As the cabinet secretary probably knows, my constituency does not have many crofts so I am learning as we go along. My questions are about administration costs, including, to start with, the cost of having to register a croft. It has been pointed out to us that registering a croft involves quite considerable costs, particularly the requirement to put advertisements in newspapers, which some questioned as possibly being a little bit out of date and quite expensive. Often there seem to be legal costs or other costs involved in the registration process, and we have certainly had some witnesses suggesting that that is an area where things could be modernised and perhaps simplified. Do you have any thoughts on that?

That is another good point that has been raised by your committee members today, convener.

There are costs involved, and they are incurred in maintaining the register, which is free to search online. The £90 fee for registering or updating a croft is based on a common principle of public finance, namely cost recovery, and the fee has remained the same since the register commenced on 30 November 2012. Scottish ministers recently announced that the fees charged by Registers of Scotland will remain the same.

On potential cost savings, the 2010 act provides that in most cases the applicant for first registration of a croft must,

“on receipt of the certificate ... give public notice of the registration ... by ... placing an advertisement, for two consecutive weeks, in a local newspaper circulating in the area where the croft is situated”.

That requirement has been the subject of much criticism, given that the cost of advertising is, as Mr Mason has quite rightly pointed out, not inconsiderable. As part of the regulatory review process, we will explore options for removing or reducing costs in this area, possibly through the use of some form of web-based notification system. It needs to be considered carefully but the member has raised a very valid point indeed and one with which I have a degree of sympathy.

Thank you—that is great.

Secondly, there is the whole question of how common grazings are mapped. I am not entirely clear about this but it has been suggested to us that in the past specific funding or a specific budget was given to the Crofting Commission to map common grazings but that that is no longer the case. That appears to be the commission’s reason for not carrying out mappings of common grazings at present. Is that your understanding, or were you expecting the Crofting Commission to carry on with such work within its existing budget?

No funding has been withdrawn. The Scottish Government provided the commission with an additional £400,000 over the four years from 2012-13 to 2015-16. At the outset, that was expected to be sufficient to facilitate registration of all the circa 1,000 common grazings.

The task proved to be more challenging than had been first anticipated and despite the Crofting Commission’s adding significant levels of resource from its own budget, it was only able to register around 300 common grazings. That equates to around £1,300 per grazing, without taking into account resources above the £400,000 budget that were invested by the Crofting Commission, and it is likely that registering the 500 or so grazings committees without a committee in office will be more resource intensive.

Any decision on whether to devote resources from within its existing budget allocation to continue with common grazings registration would be for the Crofting Commission to make and would need to be balanced against the organisation’s other responsibilities, such as processing regulatory applications, tackling absenteeism and administering the annual crofting census. That illustrates the importance of the governance review that we are carrying out and of ensuring that, in some cases, delegated work is carried out to allow the body to operate as efficiently as possible. An important matter has been identified and I hope that I have given the full factual detail of the situation at the moment, if not a perfect solution to the problem. However, it is a problem that we are considering.

10:00  

You said that there was a governance review. I imagine that that could throw up a lot of different things. Are you saying that, if there was £400,000 in the past, there are no plans to repeat that with another £400,000 to move the situation on?

After next year’s elections, the new Crofting Commission should consider how to continue the work. It is a perfectly legitimate topic for the process of elections, of course, and we will need to discuss with the commission the question of how we achieve a task that we all wish to be carried out effectively and swiftly.

Of course, it is not only in the crofting counties that there is much work to be done in completing registers. As members will know, the land register is being converted to map-based land certificates, as paired to the register of sasines. Most people understand that such matters are being progressed but cannot be done overnight. It is the nature of the beast that such work must be done with great care and meticulous attention to detail; otherwise, it is of no purpose.

The committee has heard that it is important to ensure that the system is map based. Your answer to the point that John Mason raised is reflected in answers that we have had from previous witnesses. However, there is definitely a call from all the witnesses—across all the bodies—that more money is needed for croft registration. With the budget coming up, have you made a plea for some extra money to allow registration to be carried forward over the next couple of years so that we get it right?

As members will be aware, there are huge pressures on the budget from many sources. I undertake to communicate with the commission to explore how best to ensure that we all fulfil the functions that rest on us.

I understand that, to appeal against something in the register, one has to go to the Scottish Land Court. We have had slightly differing evidence from witnesses about that. It has been suggested that a mediation service might be helpful, as that would save people having to go to court to resolve disputes, which can be expensive, I presume. On the other hand, one witness told us that the Scottish Land Court is quite a friendly court and a lawyer is not necessary, so it is not such a bad process. Is there a need for mediation, or is the Land Court process sufficient?

I am amused by the phrase “friendly court”, but I will pass to Michael O’Neill for an answer.

In considering the changes to crofting law, mediation should be considered because it may be a useful tool in settling disagreements. So far, there have been about 44 challenges to croft registration and common grazings registration combined, out of about 3,500 registrations. My understanding is that most of those cases are being considered by the Scottish Land Court. That is done swiftly and the process is not intended to require any specialist legal representation, which should reduce crofters’ costs. There may still be people who are hesitant to take a challenge to court, but the figures may suggest that the current system functions well, in that the vast majority of boundary disagreements are resolved prior to registration.

If mediation is to be progressed, we will need to consider the financial implications and the risks. There will still be challenges, which will likely end up in the Scottish Land Court.

Are you saying that there could be extra costs if we bring in an extra layer?

Potentially, yes.

I am with you. Thank you.

Mr Jackson has a supplementary point to make, if that is okay.

It is on the context. As far as we know, there have been 44 challenges so far, which equates to 1 per cent of the cases. The fact that that is a relatively small number suggests that amicable agreements are being reached in most cases.

I suppose that my only comment is that, as Mr O’Neill said, some people will back off as soon as the word “court” is mentioned, whether they feel that they are right or wrong. However, I accept that none of us knows that at the moment.

I was going to ask about access to mortgages for crofts, but the issue has been touched on already.

My other question is on the provisions in crofting law that deal with absenteeism and neglect, on which we have heard from quite a few witnesses already. One of them said:

“The underlying principles ... are ... simple, but the process ... is anything but.”—[Official Report, Rural Economy and Connectivity Committee, 16 November 2016; c 16.]

It would be useful for the committee to hear the cabinet secretary’s thoughts on those provisions.

The characterisation that you quoted might be shared by many people. I think we all accept that the underlying principle is simple, but the process is anything but.

The current legislation has the means to deal with absenteeism and neglect, although some regard the process for dealing with a breach of a crofter’s duty on an ad hoc basis as cumbersome and long and believe that it does not necessarily improve the overall situation in an individual community. The commission is trying to move the way in which it focuses on such issues towards the idea of geographically based regulatory work, whereby it operates within a particular community at the community’s request to address the issues concerned, including breaches of duties.

With regard to new legislation, absenteeism and neglect clearly need to be considered and the most appropriate way to deal with them thought through. They are very sensitive issues, as they are about people’s lives. Often, absentees have a strong affinity for the croft. Indeed, people may have had to leave places such as the Western Isles to go to Glasgow to work in the police force or the national health service. All of us probably know a great many people who have a real affinity for their croft. I am very conscious of that and I hope that we all understand the need to deal with those matters sensitively and see that as the appropriate approach.

Absolutely. The young crofters who came in to give evidence talked about how important it is to get new entrants into crofting, and the points that you touched on with regard to mortgages are important. I was glad to hear about the conversations that you have had with the banks, because they are the big stumbling block. I do not know whether it is possible for us to seek more information on that, but it would be useful to look further into it, because the banks play an integral role in that situation.

I would be pleased if the committee felt it appropriate to involve the banks. That would be a welcome intervention if the committee thought it appropriate.

One issue that was mentioned was that the common grazings committees have to produce and submit annual reports on crofting that cover things such as absenteeism and neglect. Some of those committees find that particularly difficult to deal with. Indeed, I am not aware that the majority of them actually submit reports. Is there a better way of dealing with those issues?

I ask Mr Jackson to deal with that, because he is keen to do so.

On a point of clarification, the 2010 act requires common grazings committees to report at the earliest opportunity, but thereafter every five years, not every year. It is a challenging area because the committees might perceive that they are interfering with the day-to-day business of crofters within the crofting communities. Nevertheless, that is a requirement in primary legislation.

How many have actually submitted annual reports?

The Crofting Commission has recently encouraged common grazings committees to come forward, but they have not done so as yet.

I understand that the Crofting Commission is asking people to come forward. Do you have a figure for those who have actually submitted reports? If not, would it be possible for you to submit that in writing to the committee post this session?

As far as I am aware, no committees have reported as yet.

No committees have reported, despite the fact that the provision was instigated in the 2010 act.

That is correct.

Do you feel that the committee should be looking at that more closely in relation to the future of crofting?

I would certainly agree with that, yes.

Thank you. The next question is from Richard Lyle.

I entirely support crofting; it is an integral part of the Highlands and of Scotland. This legislation has been going on since 1883—for 133 years—and has been amended 22 times. Prior to that, we had the laird, then we had the crofter. In 2010, we changed it to cover owner-occupiers. Does the cabinet secretary agree with witnesses that provisions in the 2010 act with regard to owner-occupiers are complex and inconsistent and have proved difficult to apply? Do you intend to consider legislative changes to that in future?

I am no legal expert, but I was fortunate to have a very interesting and lengthy discussion with the crofting law group, many of whose members are extremely experienced and well informed. I think that the crofting law on owner-occupiers who croft is complex; the issue has been raised in the crofting law sump by members of the crofting law group; and there have been calls for a simpler definition of “crofter”. It is important that new legislation addresses the matter, and I am open to suggestions as part of our considerations in that respect.

We should go back to our earlier discussion about what it is we are trying to achieve. There is a case to consider, because what we should be trying to achieve is the removal of impediments to people obtaining affordable housing—or any housing, or access to a mortgage. Those are issues on which, I hope, we would all want progress to be made, given the complexities of making some of these obvious, clear, simple and desirable social aims as easy to achieve in the crofting counties as they are in other parts of Scotland. That purpose should be the driver of our work on legal definitions. In any case, that is certainly an issue that requires to be simplified, and I would therefore support the thrust of what Mr Lyle has said.

We should always remember that the 1886 act came from the struggle of crofters in the Bernera riots in 1874 and the battle of the braes about 10 years thereafter. It was only activism against the landlords of the time that brought security of tenure following the Napier commission. These are not matters of history, but things that are still felt strongly in the crofting counties today. We need to proceed with clear objectives, but with one eye on history.

As a lowlander who is starting to learn about and getting very interested in crofting, I totally agree with your final comments.

The evidence to the committee so far on owner-occupiers falls into two camps. Those in the first camp feel that someone who occupies a croft should be considered a crofter and thus subject to the same rights and responsibilities, and those in the second feel that owner-occupiers should not be considered crofters and thus should not be subject to crofting regulations. Do you have a view on either opinion?

I am aware of two views and, again, I think that this is a matter for legitimate debate. Indeed, that debate is necessary; it would be impossible to approach our task with regard to crofting law without looking at such issues at a high level. I will ask Mr O’Neill to answer your question from a more technical point of view.

It is a very interesting question that attracts differing views among stakeholders and potentially polarises opinion. Given where we are with thinking about new legislation, it is really too early to say that there is a firm view on the matter. There is a case to be made either way, and people should feel free to make their views heard as we go forward to ensure that each case is considered on its merits.

Thank you.

10:15  

Common grazings have already been mentioned. Some people seem to feel that grazings committees are working and are quite happy with them, while others feel that they need to be upgraded, given that a lot more things are being done with common ground than used to be the case. Interestingly, the Shucksmith report says:

“At community level, Grazings Committees should be modernised to become Crofting Township Development Committees with a broader remit and more inclusive membership.”

It has been suggested that, with wind turbines appearing, or potentially appearing, on common grazings and with other ways of using the land, grazings committees need to be updated. Do you have a view on that?

I think that there is a very strong case for updating the role of grazings committees. Indeed, the topic was raised by the crofting lawyers, particularly Sir Crispin Agnew, who might well have shared his thoughts on the matter with you.

Grazings committees are very much creatures of their time. They were prescribed as an appropriate method of ensuring that the common elements of crofting were properly organised in a world where crofting was the norm—indeed, the fundamental way of life and existence. As Mr Mason pointed out, things have changed substantially since then, but the role, definition, duties, functions and organisation of grazings committees have not been updated alongside them. As a result, law reform should involve examining the potential for grazings committees or their future equivalents to take on business development or community development company-type roles. At present, their remit is, I am told, prescribed in statute as set out in section 48 to 50B of the 1993 act, and there might be a desire for the grazings committees to assume a wider role. That would need to be looked at in the context of legislation.

For those who are reading the Official Report of this discussion, I am keen to stress that the vast majority of grazings committees function well and are operated by people who give their time freely and voluntarily pro bono, and that we recognise and value that work.

Continuing with that theme, the issue of a deemed croft in a common grazing has been raised with us. As I understand it, that might sometimes be marked with only an X on the map of the common grazing, and people have asked whether there is a conflict there between guidance and what is eligible on an integrated administration and control system—or IACS—form. I think that the area is quite complex.

I ask Mr Jackson to take that question. [Laughter.]

It is a complex area, but the top-line answer is relatively simple. The Scottish Government can see nothing to prevent common grazings committees from applying for funding under the SRDP. Furthermore, it sees nothing in the IACS rules to suggest that land that is subject to common grazings rights is precluded. That is the Scottish Government’s position on the matter.

So as far as you are concerned no change is needed.

That is right.

Thank you.

I do not know who would be the appropriate person to answer this question—I am sure that you will decide that, cabinet secretary—but one question that has come up relates to the fact that shares in common grazings have become separated from crofts to such an extent that those who sell their crofts retain their common grazings shares and do not actually use them. It has been suggested that that prevents new entrants from getting a share in the common grazings; it has also been suggested by some witnesses that people who have shares in the common grazings but who are not active crofters are able to benefit from any income that the common grazings achieve. Is that a problem? If so, what should happen about it?

I will pass that over to Mr Jackson, who I know has looked at the issue.

We do not have figures, but anecdotal evidence suggests that a number of common grazings are underutilised and that some people who have shares are not utilising them. There is a missed opportunity and, as the committee has recognised, the area needs to be looked at in the context of crofting law reform and how matters are progressing. It is a missed opportunity, particularly for new entrants; it is important matter.

You are suggesting that you accept entirely that it is a problem. As a farmer, I note that we have—rightly—got rid of the slipper farming cases, but there may be slipper crofters. I see the cabinet secretary shaking his head, and I know that we have got rid of a lot of them, but is it correct that we have a situation in which a shareholder in the common grazings may be taking income—to which he or she is entitled—but without doing any activity?

Not to my knowledge. The concept of the active farmer still applies; the area-based payment depends on active use. There is an opportunity for shareholders who do not utilise the common grazings to enter an agreement to pass over the share—the souming—to somebody else who can use it.

I am going to push you a wee bit on that. You have said that there is no reason why a common grazings committee cannot claim a payment. Indeed, such committees get payments for resumptions and any use of the common grazings for windfarms. We have also been told that they are not allowed to hold money. The money belongs to the shareholders and the committees have to pay out the money if it is not being used to improve the common grazings. People could be taking an income from, but not contributing to, the common grazings. Is that correct?

My understanding of the legislative provisions is that resumption moneys go via the constable and should be distributed to the shareholders. The money should not go to common grazings committees. Furthermore, pillar 1 payments under the CAP for use of the common grazings should go to the shareholders and not to the committees.

Someone with shares in the common grazings but no croft could take money that is being paid under a grant scheme.

It is slightly complex. In that scenario, it would be a deemed croft. It would be a croft for all intents and purposes, and if the shareholder utilises the common grazings they would be entitled to CAP payments.

I observe that a person who has a deemed croft on the common grazings but does not have inby land would not necessarily be using the common grazings, because there would be nowhere to overwinter the stock. Does Peter Chapman have a view?

We have heard that there is real pressure for young new entrants to get into crofting and that it is very difficult for them to get a start for various reasons. Thousands of acres of common grazings are underutilised, so why can we not take some of that land and create new crofts for young, keen folk to get into the crofting system? That suggestion has been made.

That issue may have been raised earlier. It is a perfectly legitimate point and one that should be considered very carefully indeed, because I think that we all share the objective of getting new entrants into crofting.

There is land of all sorts. Last week in the chamber, when John Scott raised with me the general question of new entrants, I referred to work that has been done under the chairmanship of Henry Graham and by me to persuade public bodies to look at making available land that they own to new entrants. Of course, public bodies that own land in the crofting counties should be encouraged to look at new entrants not only in farming, but in crofting.

That important work has the potential to provide some opportunities for new entrants, and the Forestry Commission has led the way on it. Other public bodies, including Scottish Water, Scottish Natural Heritage, the Scottish Environment Protection Agency, local authorities and even smaller public bodies, are actually quite large owners of land in Scotland, which they hold for the nation. They have all been tasked by me and Mr Graham to come back fairly early in the new year and advise us whether they think that there is the potential to provide some of the land that they own—perhaps relatively small parts of it—for new entrants. That is a related piece of work that I hope is of relevance to the topic.

That is one issue—and I understand what you are saying about public bodies—but my question was specifically about common grazings. Is it possible to use some of the common grazings to create new crofts?

That is a perfectly legitimate point that should be considered further in exploring the means of fulfilling an objective that we all share.

We have heard frequent mentions of smallholders. Does the Scottish Government have any plans to bring together smallholders and crofters? Could that be part of a simplification of crofting law?

I am not ruling out the possibility that we may need to simplify and improve the legislation that governs smallholding and crofting and look at how best to make crofting and small landholding legislation work in practice. Unlike crofting, which is undertaken only in specifically designated parts of Scotland, small landholdings are spread across the country. Turning them into crofts is not necessarily the answer. There are concentrations of small landholders in Ayrshire, Aberdeenshire, Dumfries, the Scottish Borders and east central Scotland, but there are only a small number in the designated crofting areas.

I can share with the committee that recently my officials met small landholders on Arran, who had differing views. Some wanted to be crofters and some did not. Some did not want to be tenant farmers either. It is right that we consider all their views and the views of other small landholders across the country, to give them the opportunity to have their voices heard before decisions are made that affect their homes and businesses.

The Scottish Government has said that it will legislate on crofting, possibly towards the end of this parliamentary session. You have rehearsed some of the options for that legislation, but you have not expressed a preference. Is there one option that is the Scottish Government’s preference? What is the timescale for consulting on that?

I have a script here, but I do not need it so I will not use it.

There are two main approaches and a hybrid. The first main approach is the clean-sheet approach that has been advocated by some. The second main approach is to tidy up the legislation and use the good work that lawyers and others have done to produce the sump. “Sump” is a slightly derogatory word, since it refers to a container for waste water. The sump is actually a valuable container of useful ideas for reforming and upgrading the legislation.

In other words, one approach is a fundamental overhaul, starting from first principles, to update crofting law and make it fit for the 21st century. I hope that I am fair in saying that Sir Crispin Agnew has perhaps advocated that kind of thing. It would overhaul definitions of grazings committees, to bring modern parlance and concepts to them and allow them to be used as community development vehicles, for example. The other approach is to tidy up the existing legislation. A third group argues for a hybrid approach.

I should say for completeness that there are others who believe that we can have crofting but do not necessarily need the Crofting Commission. I do not necessarily share that view, but it has been expressed by others in the debate.

I have no set view on which approach should be taken. Indeed, it is right that I should not have a set view at this very early stage of consideration. If it is the case that we should look at an overhaul, then, almost by definition, one should not have a set view until that approach has been fully considered. One should consider the merits of that approach first before coming to a view on the correct approach to take.

10:30  

All that means that I do not expect that the bill will be introduced in the first half of this parliamentary session—Rhoda Grant referred to that—and nor should it be. Most crofters of my acquaintance are blessed with large quantities of patience and would far prefer that we spend a lot of time on matters and have a lot of discussion rather than rush into one approach or another.

I hope that I have given a reasonably clear answer to Rhoda Grant.

When will you formally consult on the matter so that you can take some of those views forward? My concern is that Parliament dealt with the 2010 act at the end of a parliamentary session and with undue haste. That created a lot of the issues that are now being put in the sump, because the timing meant that there was not the chance to go back to the bill and review the provisions about which concerns were raised. I fear that if the new crofting act, whatever form it takes, is dealt with at the same point in a parliamentary session, the same thing will happen and we will end up with legislation that creates problems. I agree that we need to get the legislation right, but rushing it through at the end of the parliamentary session might not be the way to do it.

I hope that it is not impertinent to say that it is taking a slightly gloomy perspective to argue that legislation that is passed in the final year of a parliamentary session is necessarily inferior to that which has been passed at a different time. I have been the lead minister for many bills, some of which were dealt with at the end of the parliamentary session, and I could only bristle at that idea—initially at least.

To be serious, the process is not to be rushed. That is the important thing to me. I am not trying to dodge any question about the timetable; I sincerely think and strongly believe that we should tak tent and take time to listen to views very carefully. There is no compulsion or compulsitor that means that we have to rush into the matter. My impression is that that is not expected of us.

The committee’s decision to work on the matter is a very welcome contribution to opening a debate on a topic to which it is very clear that different approaches could be taken. We need to collectively and carefully decide what we want our work in the Parliament to achieve.

I will press you on that, cabinet secretary. You said that we should take time, but could somebody fairly quickly decide whether we will just do a sump tidying-up exercise and perhaps a consolidation, which would be pretty straightforward and which we could move forward fairly quickly, or take the clean-sheet approach and rewrite the whole of crofting legislation from scratch, which would clearly take a lot longer? Does that basic decision not need to be made fairly soon? There is no point in delaying if we are just going to do the sump exercise in two years’ time.

I do not accept that that is the correct way to look at the matter, for reasons that I will give.

First, I do not expect that it would be a simple process if we decided simply to proceed with the sump approach. Moreover, it would perfectly legitimately lend itself to every member who wished to supplement any bill with the first approach. If a crofting bill is drafted, it is quite open to members to lodge amendments to it to fundamentally overhaul crofting. Just because the Government chooses one approach or the other, that does not necessarily mean that that will be Parliament’s choice. It is up to Parliament what choice to make.

I would far prefer to work towards developing in collaboration an agreement on whether to take a fundamental overhaul approach or an upgrading and improving approach. That needs time. We have made it quite clear that we do not expect to legislate in the early stages of this parliamentary session. I agree that the decision on the timing of a bill needs to be taken in due course in the context of the Scottish Government’s other legislative priorities, and I undertake that we will consider that decision very carefully.

I do not think, with all respect to the member who is quite rightly pressing me, that the Government could decide to legislate to tidy things up based on what is in the sump, and that that would of necessity mean that that is what Parliament would do.

Secondly, there is nothing very simple or easy about crofting law. Ms Grant, Mr Rumbles, Mr Stevenson and I have seen that through the various efforts that very well-intentioned ministers of all administrations have made. There are no easy solutions here. That argues for us to take the approach that I have advocated: to try to develop a broad consensus in and outwith this place before we decide which approach to take.

I will bring in Mike Rumbles, and then I will wrap up with some questions on finance.

From a Government perspective, the right approach is to take time to get right the decision whether to start with a blank sheet of paper and begin the whole thing again or to amend the existing legislation. I understand that the Government has huge resources to get this right and will take time to do that and then present the bill to the committee and Parliament to examine.

My plea is that it is very important that the committee itself is not rushed because the Government has taken such a long time to present the bill. The committee must also have an appropriate period in which to examine the bill in detail to make sure that everybody gets this right. We are all working for the same thing. I plead for time on the Parliament side as well as on the Government side.

I find myself in agreement with Mr Rumbles.

That is good.

It is a happy state to be in. I think that he is right. I undertake to work with the committee: its role is valuable and the work that it is doing is useful. I undertake to continue to work with the committee on this. That is the best approach. I am particularly keen to get a bipartisan approach across the political parties if we possibly can.

I have three questions on financial matters. The Government has been good at supporting the crofting bull hire scheme, which I believe costs in the region of £0.25 million to run, excluding capital costs. Is the cabinet secretary happy that that scheme will continue to run at the level that it has done and with the investment that it has had, post the budget that will shortly be announced?

I have been pleased to take a lot of decisions on the loan scheme as quickly as possible. Every loan granted—

I am sorry if I did not make it clear. I meant the bull hire scheme. I am pretty sure that I said the bull hire scheme.

Sorry, I thought that you said the loan scheme.

That is my next question. You can answer that one in a minute.

It would be wrong for me to make any undertakings about the budget. It is not for me to do so. Both the loan and the bull hire schemes play a valuable role. We want to continue to do everything that we can to support crofting.

I am well placed to say that we are under enormous financial pressure in the budget. I do not mean to be political. However, the pressures from a reduction in our budget mean that in my seat there are no easy answers and only a series of very difficult choices to be made.

The committee may try, but I do not think that I can be drawn into specifics. That would not be right, because all those matters are quite properly the province of Mr Mackay as the Cabinet Secretary for Finance and the Constitution in discussion with all cabinet secretaries.

I am pleased that we have been able to support the various schemes and I was very pleased to visit one of the recipients of a crofting loan who had completed his house. It is a very effective and cost-efficient method of providing houses and there is not a great deal of bureaucracy or administration involved. Were mortgages to be more easily and readily available to young people on crofts, it might be easier for more young people to build or obtain houses on crofts. We want repopulation and that is not easy to achieve. All those things will be taken into account in the budgetary decisions.

I understand that you want to skirt around the edges of that, cabinet secretary, but I note your understanding and commitment that the bull scheme and the crofting house grant scheme are both important and that, where possible, they should continue at the current level.

Cabinet secretary, does the Crofting Commission have sufficient resources to carry out the functions that you are asking it to do?

Obviously, all public bodies are required to optimise the use of finite resources and they need to be as efficient as possible. The Crofting Commission has already taken proactive action to improve organisational effectiveness, for example with the introduction of a new electronic case management system, of regulatory policies and of delegated decision making—we have covered some of those topics. They have made progress but, as with all public bodies, more progress will be required to be made at a time of serious financial pressure on budgets, and those are not easy matters. As far as I know, all the chief executives of public bodies are well aware of that issue and they work with the Scottish Government to get the best results possible out of an increasingly reduced budget.

Those are all the questions that we have for you. Is there anything that you or your team would like to add before we conclude this part of the meeting?

It is not for me to say, but I hope that we can work together on those issues in the way that Mr Rumbles suggested and I expect that we will. I also hope—this is really for the committee and it is not meant to be cheeky—that some meetings could be held in the crofting counties, perhaps in Stornoway or other places. Gail Ross looks very enthusiastic, so perhaps her constituency might be an appropriate location. The Scottish Parliament committees have always done such things, but it would be very appropriate for that to be considered as the way in which we do our work. That might allow evidence taking from ordinary individuals who—because of the geographical distance from Edinburgh—do not have their voices heard, generally.

Thank you for your comments, cabinet secretary, and the last comment on getting out and about was not at all cheeky. Looking to see whether we can meet crofters is one of the things that we have on our agenda for when we consider the islands bill.

I thank all the witnesses for attending today’s meeting, which is the committee’s final planned meeting on its review of the legislative priorities for crofting. The committee will now consider the evidence that it has heard and will write to the Scottish Government in due course.

10:43 Meeting suspended.  

10:50 On resuming—