Rural Economy and Connectivity Committee

Meeting date: Wednesday, November 28, 2018

Official Report 708KB pdf

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Subordinate Legislation

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Tuberculosis (Miscellaneous Amendments) (Scotland) (No 2) Order 2018 (SSI 2018/3330)

The next item of business is an instrument on bovine tuberculosis. The instrument is subject to negative procedure. Before we discuss it, I ask members to declare any interests. I declare an interest as a member of a farming partnership.

Likewise, I declare an interest as a member of a farming partnership.

I, too, declare an interest as a member of a farming partnership.

The instrument relates to TB control measures and compensation for bovine animals. The committee considered an earlier version of the instrument on 20 June 2018. That instrument was revoked on 30 June 2018 after we had identified difficulties with the consultation process.

I wrote to the Scottish Government to clarify the compensation arrangements for bovine TB. The response can be found in the committee papers. It confirms that compensation will be different for bovine TB and BSE.

No motions to annul have been lodged in relation to the instrument.

Does the committee agree that it does not wish to make any recommendation on the instrument?

Members indicated agreement.

10:59 Meeting suspended.  

11:05 On resuming—  

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Agricultural Holdings (Scotland) Act 1991 (Variation of Schedule 5) Order 2019 [Draft]

Item 4 is consideration of an instrument that is subject to affirmative procedure that relates to the Agricultural Holdings (Scotland) Act 1991.

I declare that I am a member of a farming partnership.

Likewise, I declare an interest as a member of a farming partnership.

I declare an interest as a landowner and a farmer.

The committee will take evidence on the order from the Cabinet Secretary for the Rural Economy. The motion that seeks the committee’s approval of the order will be considered under agenda item 5. Members should note that the committee has received no representations on the order.

I welcome Fergus Ewing, the Cabinet Secretary for the Rural Economy; Jen Willoughby, the head of the Scottish Government’s agricultural holdings team; and Julia Burgham Pearson from the Scottish Government’s legal directorate. I invite the cabinet secretary to make a brief opening statement of up to three minutes.

Good morning, convener, and thank you for inviting me to discuss the Agricultural Holdings (Scotland) Act 1991 (Variation of Schedule 5) Order 2019. I hope that the committee will agree that the order is a good-news story for tenant farmers in Scotland.

Schedule 5 to the Agricultural Holdings (Scotland) Act 1991 sets out a list of improvements to agricultural holdings that may make tenants eligible for compensation when they leave a holding. The list was originally created for the Agriculture (Scotland) Act 1948—some time ago—and has not been updated since, which means that some items that are now readily accepted as being legitimate improvements are not listed therein. Informal arrangements might be in place between landlords and tenants to cover some of those items: they will depend on individual arrangements, so there is no uniformity in practice.

During the widespread consultation that was conducted by the agricultural holdings legislation review group in 2014, there were calls from the sector for the list to be updated to reflect modern farming practice and to eliminate doubt and confusion.

The underlying rationale for the current provisions on waygo is to encourage tenant farmers to invest in the agricultural holding and to keep it in good condition, knowing that they will be adequately compensated. Therefore, updating the schedule will benefit the tenant who makes an investment and the landlord whose property is thereby improved.

To ensure that any update was industry led, we placed a duty on the tenant farming commissioner to make recommendations to modernise the list. After consulting key stakeholders, he delivered his recommendations to me in December last year, and we are now seeking to implement those recommendations. That will mean that, for improvements that have been begun when the order comes into force in January next year, the updated schedule will apply. I hope that that will lead to greater certainty for both sides

I have been heartened by the positive press reaction since the order was laid.

I hope that the committee will approve the order. My officials and I are happy to answer questions.

Thank you, cabinet secretary. Peter Chapman will ask the first question.

You said that the order is a good-news story for tenant farmers, and I certainly agree that it is very welcome.

You also said that there had been consultation with the industry, which I accept. Were any particular areas of concern highlighted during the consultation?

We consulted fairly widely with the Scottish Tenant Farmers Association, NFU Scotland, Scottish Land & Estates, the chartered surveyors and the Scottish Agricultural Arbiters and Valuers Association. I think that it is reasonable to say—in as much as it is ever accurate to make such generalisations—that the majority of stakeholders are broadly satisfied with the outcome and, indeed, have in many cases welcomed it.

Of course, it is the way of things that not everyone gets everything that they want. I suppose that we could say the same about Christmas. Government is not well cast in the role of Santa, however desirable that might be. Some stakeholders might be disappointed that we have not been able to take on board, for example, the tenant farming commissioner’s recommendation to include

“Permissions, consents, contracts, authorisations and restrictions.”

I can explain why we were not able to accept that recommendation—and perhaps will do so later—but other than that I am not aware of any specific areas of disappointment.

The only point of detail that I would follow up on is that a catch-all clause seems not to have been included. Why have you chosen not to do so?

The commissioner considered the option of a general catch-all to future proof the schedule. Mr Chapman is correct to say that some stakeholders were in favour of that approach, and I can see its attraction, but we elected not to include that kind of general clause, because it is open to interpretation and might therefore lead to more disputes and disagreements over what is and what is not in scope. The purpose of what we are doing is to provide as much detail and specification as possible to inform the parties in the negotiations over waygo compensation and to have as little scope as possible for ambiguity and therefore disagreement and disputation.

That said, I agree with the tenant farming commissioner’s recommendation that, instead of including a catch-all clause, we commit to reviewing the schedule on a regular basis. I am willing to make that commitment to look at the schedule every five years, say, to see whether it is still fit for purpose. Indeed, if it were shown that a more frequent review was necessary, I would consider that very carefully.

In short, instead of putting in a catch-all, which we felt might give rise to difficulties, we thought that a willingness to update the list more frequently than has been the case might be the better, preferred approach.

It is important that we look at the list regularly, and I certainly welcome your promise to do exactly that.

John Scott has a brief follow-up question.

First, I again declare an interest as a farmer.

Cabinet secretary, I seek a final assurance with regard to compliance with the European convention on human rights. The policy note says that the order will “avoid any unfairness”, which I know has been an issue with various parts of the legislation. Indeed, we have been rebuked by Lord Gill and others in the past for our inadequacies in this Parliament.

We have no reason to believe that any significant risk attaches to any claim under the ECHR, which I presume would, like most of these issues, be based on article 1 of the first protocol. However, I entirely agree with the approach advocated by Mr Scott, namely that we have to take great care in this area of legislation, not least because, sadly, previous legislation passed by a former Administration had to be overturned and corrected by us with consequences that I know we all very much regret.

I am not aware of any issue in this respect. Indeed, as far as I am aware and have been advised, SLE did not raise any issues, either.

11:15  

The order is really good news, and I compliment you and your officials on the work that you have done.

I note that in his report the tenant farming commissioner says:

“there is reasonable certainty that Schedule 5 can be reviewed regularly”.

I think that you have partly answered the question already, but how often will you review the schedule to ensure that emerging issues can be included?

I mentioned a period of five years, but that is kind of a long stop. If all parties were to come to me and suggest that there was a pressing need for a swifter review, I would always seek to be as accommodating as possible—assuming, of course, that the issue could be dealt with through secondary legislation. Primary legislation is another kettle of fish, particularly in these times—but I will not mention the B-word, because I do not want to depress anybody this morning.

I have always found you very accommodating when I have raised any problems with you.

The tenant farming commissioner has also said:

“there may be a case for ... drawing attention to the fact that improvements that are part of a diversification are subject to different regulation with respect to approval and compensation arrangements.”

Such a note appears not to have been included. Why not? Do you have other plans for avoiding possible confusion in this area?

This matter requires a lawyerly answer, which is that the 1991 act permits us only to vary the provisions of the schedule. Clarification of the point raised by the commissioner is a matter for guidance, but my officials will work with him on a code of practice that will clarify such issues. I hope, therefore, that the matter will be dealt with in that fashion rather than through this statutory instrument.

Members appear to have no more questions, cabinet secretary. Do you wish to make any brief closing remarks?

No.

In that case, we move to agenda item 5, which is formal consideration of motion S5M-14752, in the name of the cabinet secretary.

Motion moved,

That the Rural Economy and Connectivity Committee recommends that the Agricultural Holdings (Scotland) Act 1991 (Variation of Schedule 5) Order 2019 [draft] be approved.—[Fergus Ewing]

Motion agreed to.

I thank the cabinet secretary and his officials for their evidence to the committee. I must ask you to depart quietly, as we are moving straight on to the next item on our agenda.