Official Report 313KB pdf
Item 2 is the continuation of our evidence taking on the Land Reform (Scotland) Bill. I remind witnesses and members that our focus today is on part 2 of the bill, which deals with the community right to buy. In particular, I remind members that the committee agreed to focus on the impact of the proposals on rural businesses.
As you said, convener, I am a solicitor; I work in private practice and am based in Stornoway. I have been involved in assisting a considerable number of communities to achieve community ownership over the past 10 years or so. I think that that is all that I need to say at the moment.
I have lived on Eigg for 25 years. I was involved in all stages of the community buy-out. I am the company secretary of the Isle of Eigg Heritage Trust and I currently work as the administration secretary.
I am accompanied by John Hutchison, who is the Highland Council area manager for Lochaber. In that capacity, John has been involved in the council's efforts to support a number of community ownership initiatives throughout the Lochaber area of Highland Council.
I was just about to ask you to introduce Mr Hutchison. Thank you, and welcome to the committee, Mr Hutchison.
Are the witnesses happy with how the bill identifies communities? We have been told that polling districts are the preferred option. However, yesterday the Justice 2 Committee took evidence that showed that postcode areas might be preferable.
I am concerned that, as drafted, the bill is unnecessarily restrictive. Identifying communities by polling district might be appropriate in one area, whereas using the postcode might be appropriate in another. Either might be completely inappropriate in many situations. I suspect that, in any given situation, a community can readily identify itself. I am more in favour of an enabling provision that would allow a community to be identified by reference to the polling district, postcode or some other appropriate means, but would leave it to the community to identify itself. It would then be for ministers to decide on the best option.
Evidence that we have taken states that that is the communities' preferred option. The problem is that there has to be a legislative area of people who can be balloted. If the bill did not restrict the way in which a community could be identified, two separate communities from roughly the same area might use two different ways of identifying themselves.
I appreciate that. The case of Gigha was straightforward because the polling district is the island of Gigha. Eigg, however, is included in a polling district that comprises all four of the small isles, so using the polling district to identify the community would have been inappropriate in that case. There are other instances where, for administrative reasons, a postcode is drawn to take in a very large area that might have no social or other relevance to the core community that is interested in a piece of land. I cannot suggest how you ought to draft the provision. I am merely suggesting that, at the moment, the bill is overly restrictive.
I hope that all the witnesses will feel free to catch my eye if they want to make a comment. I will leave it up to them to do so.
I am interested in the economic impact of part 3 of the bill. If a community buys a piece of land, what sources of income are open to that community that would not be available to a private landlord? For instance, I know that Eigg has had bad landlords in the past. However, would there be anything more beneficial in community ownership than in a good landlord? Would the community have access to external sources of funding that are not available to a private landlord?
The Isle of Eigg Heritage Trust has charitable status and there are certainly some areas where funding is available to charities that is not available elsewhere. In the five years since the Isle of Eigg Heritage Trust bought the island, the difference has been like night and day. Prior to the buy-out, there were no opportunities for individuals because of security issues and lease issues. Since the buy-out, there has been a complete change on the island, not only because of what the trust has done, but because a climate has been created in which individuals can create their own businesses. The climate has changed completely from one in which people had virtually no employment to one in which there is almost 100 per cent employment.
The essence of community ownership is that the land and the assets of the community are managed in the interest of the whole community and not in the interest of a single part of, or single economic entity in, the community. As Maggie Fyffe demonstrated, we are not necessarily talking about a community running an estate that it may have purchased as a single business entity. When the Isle of Eigg Heritage Trust took over ownership of the island, an initial plan demonstrated clearly that to attempt to run the place as a single business would require a substantial amount of annual revenue support. That plan was not followed. The economy of the island diversified and—it would seem—pluralised. The community buy-out allowed a host of rural businesses to develop, which in turn allowed the economy of the island to develop.
Could you give me some examples of other streams of income that may be available?
The Eigg example illustrates the point well.
Initially, we were able to source funding from Lochaber Enterprise for a purpose-built building on the pier, which houses three separate businesses. Only one is run by a subsidiary company of the trust; the other two are leased to individuals. That is a good example of the funding that was brought to the island.
My question is on the same general point that was implied in Murdo Fraser's questions. Murdo asked about the difference that community ownership makes, but the money is either there or it is not. The right to buy is not the issue. That may be an unfair paraphrasing of what he said, but I want to explore it a little further.
Given that there is currently no statutory right, all community ownership organisations have competed and bought on the open market. In general, they have bought as and when an opportunity has arisen. Often that has been on the back of bad history—the community's experience of the way in which things were run in the past—or on a perception of a future threat. If the opportunity has presented itself—because a place comes on the market—some people have decided to go ahead with a proposal to buy and others have decided not to. The bill seeks to increase the opportunities.
I am asking you to list subjectively the kind of circumstances that would provoke communities into feeling that buying is their only option for the future.
A number have taken the step when there has been an opportunity and a bad history, if you like.
Can you go into the bad history concept?
The circumstances on Eigg were that, when the last landlord left, the economy of the island was completely flat and dead; an economic desert had been created. The whole business of the place—the farms and the employees—was rundown. All the estate cattle were sold off to pay the wages of the remaining people; when that money ran out, those people were made redundant. There was nothing left because the landlord controlled everything about the island's economy. After that, the only way was up and, as you know, the islanders took the decision to go ahead with their buy-out. That is a fairly extreme example.
Not only was the island in a completely rundown state but the community was completely demoralised and we were in danger of losing people. In a small community such as ours, to lose a couple of families would have been a huge loss. What has happened in recent years has completely turned that around. Not only do the families feel secure and stable in their whole way of life, but new people have begun to come to the island. Some of our young folk have come back and started their own businesses. The issue is about the whole climate for a community and whether it sees a future in what is happening.
So the buy-out has led to economic regeneration on Eigg.
Totally.
We have been talking about a community buying a whole island. The bill's provisions will apply equally to a community in another part of Scotland that wishes to buy a tiny bit of field for a playground. Given the variety of circumstances that one can envisage, do you think that the bill is flexible enough on the number of people required to become a registered body? Some people might want to buy a whole island, while others might just want to buy a tiny bit of a field. Do you think that more flexibility is required or does the bill cover that variety of circumstances?
The proposals are nowhere near flexible enough. First, on the issue of the number of members, 20 is probably too high for some communities. Secondly, the bill does not explicitly envisage the possibility of partnerships in the ownership organisations. Eigg, for instance, is a partnership between the residents association on the island, Highland Council and the Scottish Wildlife Trust. Knoydart is a bigger partnership. Those partnerships can be extremely powerful and effective. I would like the bill to flag up the role of partnerships.
It was said that, in some cases, 20 members might be too many. Do you accept that there could be circumstances in which 20 members could be seen as too few? The provision might allow a minority interest within a community to register a right of interest. Do you accept that there are justified fears along those lines?
There are opportunities in any community for difficulties to be created by small groups taking control. Under the bill, the right would have to be open to everyone within the community and everyone would have a say in the matter. From that point of view, the bill is fairly well drafted; it ensures inclusiveness rather than providing an opportunity to be exclusive.
The community might be defined by postcode or by other means. Some of the communities might not have a unanimous view. In your view, what would be an acceptable percentage of people in that community voting to approve the acquisition of the asset?
I have no firm view on that. Clearly, we would want a substantial percentage of people to vote in favour—more than 50 per cent would probably be reasonable. We will never get 100 per cent agreement on anything. To pitch the acceptable percentage too high would place an unnecessary hurdle in the way of the community. However, I do not have a hard view on the matter.
Do you appreciate the fact that a marginal majority might create a difficulty? I am not suggesting that communities should have a unanimous view, although in some circumstances they might. Somewhere in the region of, for the sake of a figure, 75 per cent of the community in a given area might be acceptable.
That is far too high in my view. We tend to find that in the earlier stages of discussion of a proposal there is a core level of support. Only as the buy-out gradually becomes a reality does the support firm up and increase. I recently saw that happening in a place with which I was involved. A 75 per cent threshold at the outset, before the buy-out becomes a reality, is unnecessarily high. About 50 per cent is probably about right.
Maggie Fyffe has already ably covered a number of the points that I was going to raise with her, but I have one question. If the community had not bought and assumed control of the island, where do you think that you and the island would be today?
I am sure that I would still be there, but who knows the answer? The whole point of the bill is that, at present, land sales in Scotland are a total lottery. If the trust had not bought Eigg, who knows who might have bought it and what the future might have held? I know that, before the buy-out, a lot of people relied on the owner for leases of houses and businesses. People were completely restricted because they did not have leases, which meant that they could not access any development grants. The ability to do so has made a big difference on Eigg. Who knows what might have happened otherwise?
Thank you. I wish you and your fellow islanders the very best in the years to come.
I am sorry; I am not sure what you mean.
As far as registering an interest in the purchase of land is concerned, are you talking about a community council or a local authority?
Any body, such as a community association or community council, could do it, as long as that body was representative of the area.
Why would that be an advantage?
At the moment, only an organisation that qualifies under section 31 of the bill will be able to register an interest. As a result, that organisation will have to exist already and be registered with the registrar of companies. Furthermore, it will have to hold annual meetings, make annual returns and carry out all the usual business associated with keeping a company alive, in the faint hope that the property might come on the market. That would be difficult and would impose an unnecessary burden on any district or any community. Most initiatives start with community bodies. If a representative body could simply register an interest, that would hold the position and allow the appropriate type of organisation to be set up.
I read your submission with interest, particularly the sections dealing with the developments in Eigg and the Assynt estate. I have been trying to reconcile the contents of your submission with statements made not only in this chamber only seven short days ago by the Highlands and Islands Rivers Association and the Crofting Counties Fishing Rights Group, but outwith this chamber in the press. It was clearly articulated that, since the crofters assumed control in Assynt, the fishery has been diminished. Holding up that assertion against the evidence that you have submitted and subsequent statements by John MacKenzie, a crofter from Assynt, I must come to the conclusion that the earlier statements represent a reprehensible smear on that community. As an independent solicitor, will you expand on the reality as you know it?
I agree whole-heartedly about the use of that tactic. Those who resort to disparaging communities and the good things that they have achieved bring shame on themselves and lower the tone of the debate. I hope that we will not hear that sort of nonsense in future.
Do you believe that other private landowners, and indeed public landowners, could learn from the crofters of Assynt about the management of fisheries?
I know that the committee does not want to talk too much about fisheries now—I am aware that crofting communities' right to buy salmon fishings is covered under part 3—but I will make one point. I do not believe that the power to buy salmon fishings will be used in respect of the rivers Halladale or Grimersta or other rivers of that order. I see a huge potential for what I call the second-division and third-division salmon rivers. Nobody has done any research into the number of salmon there, but there are a large number of salmon rivers in Scotland that historically had salmon or sea trout in them but no longer do.
When Maggie Fyffe was talking about the economy on Eigg prior to and after the community buy-out, she said that many families were unemployed before community ownership. How many families were dependent on benefits from the state to survive during the period of private ownership?
Approximately 50 per cent of the adult population were in receipt of some kind of benefit.
Before calling Fergus Ewing, I signal to members that we are now into the last 10 minutes of this part of evidence taking.
I have read Simon Fraser's written submission, and would like him to tell us about a community buy-out about which we have not heard so much today: Inverie, in Knoydart. Could you describe—as you have done in your written evidence—the consequences of community ownership for that community?
The circumstances there were that the previous landowner had, quite spectacularly, gone bankrupt. The whole community depended on that landlord for everything in the place: not just employment, but their electricity supply, which came from a private hydroelectric scheme. The biggest scheme that has been taken on in Knoydart is the refurbishment of that hydro scheme, which is now close to completion.
So the residents in Inverie, as on Eigg, now have security of tenure, which they previously lacked.
Yes. However, the area concerned goes beyond Inverie—it goes well round the coast.
If a different community, for example on the island of Rum, where the landowner is not a private landowner, but an agency, wished to exercise the right to purchase, or if the residents—who, I understand, are based exclusively in Kinloch—wished to exercise or consider a right to purchase, you would broadly support that.
Yes.
I wish to raise an argument that has been put to us from the other side of the debate: that the bill will encourage cherry-picking, whereby communities opt to purchase only the pieces of land that are most valuable, or from which most money can be raised through development. What is your response to that line of argument, much of which has been put to us?
I have not witnessed cherry-picking taking place in practice. The Knoydart estate, for instance, had to be bought lock, stock and barrel, whether the community wanted the big house or not. My view is that communities do not want a big house. However, the trust in Knoydart was able to sell on the house and get a good amount of capital into the trust. The house was sold on to an appropriate individual, who was not necessarily the highest bidder; it went to somebody who came to live there and set up their own business, thus adding to the economy of the place. I have not encountered cherry-picking. My advice is to avoid a big house if it is possible to do so, but to put it to good use if it is not.
Would you follow that advice in respect of the big house on Eigg?
Yes, definitely.
I have a final question for Maggie Fyffe. I understand that not only did one of the previous landowners on Eigg, Mr Schellenberg—who is not characteristic of all landowners—not grant security of tenure, he sought to evict two residents. Is that correct?
It is.
Mr Maruma was of that ilk.
All I could say about Mr Maruma is that he visited Eigg for a total of four days during his two years' ownership. He did not do anything during his time as owner.
Did you ever get to see any of his fire paintings?
No.
I have two questions, the first of which is probably for Simon Fraser. Section 73 of the draft bill contained provisions that controlled the disposal of land that was purchased by a community body, but there is no such provision in the bill as introduced. There is therefore the possibility that, as Fergus Ewing said, a community could register interests in the more valuable parts of a property and then sell them on for profit, leaving the rest of the area less valuable. Should there be provisions in the bill on the disposal of assets?
There ought not to be any unnecessary restrictive conditions of that nature. Most community owners, like any other owner, will find themselves in the position of having to or wanting to dispose of bits of land for a whole variety of reasons. If a community body that passes the test of the bill were to sell an asset, the funds would have to come back in and be used for the community body's purposes. The funds could not be distributed to its members or anything like that. If there were a disposal, it would doubtless be made with the agreement of the membership. The money that would be generated could be put to other good purposes, such as the development of the remainder of the estate.
Alasdair Morrison posed a question about the river in Assynt. You said that it was the one in which the hydroelectric scheme had been built. Am I right in thinking that you said that there was a small migratory run on that river? I believe that that dam was built without a proper fish pass. Concerns have been expressed to me about that. First, to my knowledge, doing that is illegal. Secondly, it is not an example of good practice in fishery conservation. Why do you defend it?
I understand that it was subsequently discovered that there was a small amount of migratory fish in the system. I understand that the facility there enables migratory fish to pass up and down. That is my information.
My information is that salmon smolts were found first in the tailrace of the turbines and that the area above the dam was then electrofish monitored by scientists, who found evidence of large numbers of parr and smolts. That dam had been put in without thought for that. As such, it is completely illegal without a fish pass.
I cannot comment in that level of detail. All I can say is that I understand that the dam was constructed in a way that would allow fish to pass through. There are many other aspects of that scheme of which the committee might be unaware.
I am asking you whether you know that it is illegal to construct a dam on a migratory river without a fish pass.
I can say only that, as far as I am aware, the dam went through all the statutory controls.
I have a question for both witnesses. In the light of your clear reservations about some aspects of the bill, what impact do you think it will have on the pattern of land ownership in Scotland? I understand that roughly 15,000 people own the vast majority of Scottish land. Will the bill have a modest, significant or massive impact on land ownership in Scotland?
The provisions in part 2 are an extremely difficult maze to go through. It is a game of three-dimensional snakes and ladders, perhaps with more snakes than ladders, in which we have to throw several double sixes before we get past the starting line. It is far too restrictive and far too difficult. Part 3 will change the situation, but part 2 is far too restrictive.
I do not have much to add to that. I certainly welcome a climate that encourages change. When the community on Eigg first thought about buying the island, very little support was available to us. Since the buy-out on Eigg, the community land unit has come into existence, as have a variety of other things, including the bill, which will go a long way to help communities such as ours.
I see where Simon Fraser is coming from: we have waited about 100 years for land legislation that will not have much impact on land ownership.
In principle, that sounds a good idea. Given that the bulk of land registration is moving to a map-based system, I suspect that once all the land is in the land register, it will be much easier to do. At the moment, it is difficult to get information on the ownership of land, although the Highland Council has done a lot to investigate land ownership in its area. It can be difficult to get information. In the absence of that information, I do not see how it would be possible to register the interest. However, you have a valid point.
Many community bodies know their boundaries and know exactly who owns what land within their boundaries.
Sometimes they think that they know, but if the owner is an anonymous Liechtenstein trust for somebody or other, they do not really know who owns the land.
Time is up, but before I ask you to step down, are there any comments that you want to make in reference to the two parts of the bill that we have not addressed, parts 1 and 3—although we have touched on part 3? I would be happy to hear any specific remarks that you have to make, but it is not compulsory.
My only continuing beef in respect of part 1 is the issue of liability of persons who access land. That needs an overhaul, but that is a personal position.
That subject has come up and I am sure that it will do so again next week when we discuss access.
I am David Gass, chief executive of Scottish Enterprise Borders. I also chair Scottish Enterprise's rural group. I am accompanied by Dr Julian Pace, who is director of strategy and planning at Scottish Enterprise Borders. Is it appropriate to make a short opening statement at this point?
Please do, but briefly.
Scottish Enterprise supports the bill and believes that it should create new opportunities for local economic development and help to support the integrated approach to rural development and the development of confident communities, as set out in "A Smart, Successful Scotland". It should, for example, support the development of land and resources that might otherwise be left unutilised and create the potential for new jobs and increased income in rural areas. That could include opportunities for new start-up businesses and existing small rural businesses and tourism. In addition, the bill provides the opportunity to harness and find an outlet for local skills to build the economies of local communities through retraining and the retaining and attracting of talented people.
I chair the board of Highlands and Islands Enterprise. Since 1997, Highlands and Islands Enterprise has had a community land unit, which has assisted the community purchase of land and associated assets. We have now assisted getting on for 60 such purchases. The unit is headed by John Watt, who is with me today.
I want to repeat the question that I put to the previous witnesses. What impact will the proposals have on land ownership patterns in the Highlands and Islands? Perhaps David Gass can comment on the impact on the rest of Scotland.
The proposals will be of assistance in moving us towards a greater diversification of ownership. As I mentioned, even without the benefit of the bill, there has been a substantial increase in the number of cases of and amount of land in community ownership. The bill is clearly designed to assist that process. It is a definite move in the right direction.
I echo those comments. Lowland Scotland would see an increase in community land ownership, although it is impossible to say how big that increase would be. The bill will stimulate demand and provide for communities to consider their opportunities in relation to local land. The Scottish Enterprise network has participated in more than 10 projects that have involved communities purchasing their own land.
My second question relates to the impact of the legislation outwith the Highlands and Islands. You might be aware that had 20 MPs voted a different way in a vote in the House of Commons in the 1880s, Aberdeenshire would have enjoyed the same legislation as the crofting counties, and our rural areas might be much more vigorous today. Do you propose any amendments to the bill that would help to diversify land ownership in lowland Scotland? Should tenant farmers be given the right to buy to help to achieve that?
In answer to your first question, the enterprise companies would consider each case on an economic development basis. We have tended to focus not on the ability of communities to purchase the land, but on the purpose of purchasing it and what benefits it would bring to the wider community.
I asked whether tenant farmers should be given the right to buy and whether that would help to diversify land ownership.
Most tenant farmers in lowland Scotland with whom we work have good relationships with their landowner at present. The option to buy would be possible.
Members may not be aware that the National Farmers Union of Scotland is currently consulting its members on the tenant right to buy.
I will resist the temptation to talk about the 1880s—I would be here all day.
I wish to continue that thread briefly. I should perhaps declare an interest, in that I am a landowner with tenants.
I appreciate the force of that argument and recognise its validity, but I point to the experience elsewhere. I have already mentioned as an example the island of Ireland, in which—both north and south of the present border—owner-occupation of farm land is absolutely universal. Under that system, all sorts of mechanisms have been found to create, in effect, the equivalent of tenancies to allow people to come into farming. Although there are difficulties everywhere in western Europe for young people who want to go into farming and agriculture, I do not think that the tenurial position is critical in that regard.
I echo that. The issue comes down to the need for the right mechanism to allow that to happen. I return to the point that, as an enterprise company, we consider the economic development benefit across the board, although individual situations may have many strengths and merits. It is a question of finding the right mechanism to allow that to happen.
What support systems are in place at present for communities that wish to buy? Given the fact that companies would have to register their interest, how would those support systems need to change in the light of the bill? How would what we do at present need to change? Would such change create difficulties?
To date, most of our involvement has been twofold. Individual enterprise companies have examined the economic development case that has been made by the community or organisation that sought to purchase the land. They have considered whether the purpose or use to which the land would be put was sustainable and they have looked at any funding issues.
Do you envisage that you will have to put in place support for communities to create companies? Will the enterprise companies get involved in that?
Possibly, if that is the best way forward for a project from an economic development viewpoint. We have a virtual land community unit, which works in line with the Scottish Enterprise rural group. We offer advice and utilise the advice and expertise that have been built up by HIE in that area.
I want to ask Jim Hunter of HIE about economic development in the Highlands, in which I am interested not least because I used to work for HIE's predecessor, the Highlands and Islands Development Board.
No.
Given the evidence that the committee heard last week, why not?
As you indicated in your question, I have spoken to some of the gentlemen from whom the committee heard last week. I understand fully their concerns, as employees of river fishings, that their jobs and the activities in which they engage may be jeopardised by the bill, particularly under part 3 on the crofting community right to buy salmon fishings.
Perhaps Mr Hunter can help me understand why many of the bill's opponents have used the word "expropriation" in relation to this part of the bill. The Scottish Landowners Federation states in its written evidence that it is "wholly opposed" to it and to the community right to buy.
Are you talking about part 2 or part 3 of the bill?
I am talking about part 3, concerning the crofting community right to buy. I would like Mr Hunter to comment on that part of the bill.
That is my understanding. With members' permission, I will ask John Watt, who has much more experience of the detail of this issue than I have, to respond to Fergus Ewing's question.
I suspect that that completely contravenes procedure, but I will take the rap for it later.
In our view, as well as financial compensation for owners, a substantial number of safeguards are built into the bill. I will run through those steps quickly, as fears about expropriation have been exaggerated.
So one would need to be an Olympic athlete to navigate successfully the many hurdles that you have very helpfully described.
That is why I—and, I am sure, many others—took exception to the description of part 3 of the bill by some of its opponents as legitimising a Mugabe-style land grab. The process that is set out in the bill was developed following immense consultation with members of the Rural Development Committee, their colleagues and others. As John Watt just outlined, the process involves a series of complicated steps under law. To compare that with what Mr Mugabe's thugs are doing in Zimbabwe is utterly offensive, which is why I was somewhat outraged when that comment was made.
I have one further area to explore. How much money has been invested from the land fund to enable the purchases that went ahead? How much is left of the allocation of the land fund for future purposes?
Are you asking about the Scottish land fund or Highlands and Islands Enterprise's community land unit?
I am asking about the whole of Scotland. My suspicion is that the money that is left will enable no more than a small number of purchases. If that is right, some of the more extravagant fears that have been expressed by certain landowners might be misplaced because it appears that a relatively limited amount of the land fund is available for community land purchases.
I stress that I do not speak for the Scottish land fund; I think that the committee will hear directly from a representative of that organisation. Of the £10 million in the Scottish land fund, which has lottery funding, around £4,447,000—that is the figure before me—has been allocated. That is around half of the total. Highlands and Islands Enterprise has also invested in land purchases. Although we have a community land unit, which has notional figures attached to it, as a development agency, our funding is discretionary. If community groups come to us for assistance, we can treat each application on its merits and decide to help finance groups when it makes sense to do so.
Whether or not Mr Hunter approves of the phrase "Mugabe-style"—and I understand why he does not—the legislation seeks to introduce a compulsory right to buy without a right of appeal for the individual who owns the title. How do you feel about the right of appeal for the individual, particularly over the valuation? Should there be a right of appeal?
In the context of crofting, I take slight exception to your claim that the bill introduces the right to buy. The bill does not introduce that right: it has existed since 1976 for inby croft land. Since 1976, all crofters have had an absolute right to purchase their inby croft land from the landowner for a price roughly equivalent to 15 times the annual rent of the croft, at a time of the crofter's choice and whether or not the landowner wants to sell it. If agreement is not reached, the matter is subject to arbitration by the Scottish Land Court. Those who argued for what is now incorporated in part 3 of the bill—I have made the case for a long time in various capacities—sought to extend the right that has existed for quarter of a century. The right should be extended from the inby land to all land that is under crofting tenure. I stand to be corrected, but, to me, the bill will in principle extend a right that already exists.
I accept what you say, but when it comes to the right to buy the salmon fisheries, we are on new territory. Do you or do you not agree with the right of appeal?
I accept that that is new territory. However, again, words such as "compulsory acquisition" have been—
Yes, but do you agree with the right for the current owner to appeal if they do not agree with the valuation and if there are no rentals at stake in terms of the fisheries? How relaxed are you about the introduction of a right of appeal for the existing owners?
I will think about that.
Thank you. It took a while to get there.
I have a question for Dr Hunter or Mr Gass. Generally speaking, it is accepted that many estates, especially in the poorer land areas, run at enormous losses. In the past, those estates have been subsidised by private business, private ownership or private money. There might be money in the land fund to buy, but where will the money come from to deal with losses if they accrue under community ownership?
Again, that goes back to a previous point. Community ownership might well open new funding avenues through trusts, through European Community funding and through other avenues that a community would be able to pursue.
Those are suggestions, but nothing is in place to pay for losses if they start mounting up. Would the councils pay? Would HIE pay? Who would pay?
I want to make it clear why HIE favours moves in such a direction. I take issue with your description of land use and where it fits in to wider development. We should consider many parts of the rural west Highlands and Islands that are successful today.
We included Borders Forest Trust in our evidence as an example of the process of establishing a robust business case. The trust took into community ownership what was previously commercially unviable hardwood forest. Borders Forest Trust has a focus and a development potential that has seen new businesses grow and the trust become viable. To date, our experiences in the Scottish lowlands have not seen loss leaders.
Let me be specific about the two cases in which we have assisted community ownership—Eigg and Knoydart. Members have asked about estates as businesses, but I will leave that aside for reasons that I tried to explain earlier. In the relatively small period of time since those two estates were taken over, we have assisted the development of six new, privately owned businesses on each of them. Part of the explanation for that is the new climate that is created by that type of ownership. Maggie Fyffe and Simon Fraser tried to indicate that. People feel empowered. Their morale increases greatly, they are more self-confident and their self-esteem is higher. In those circumstances, people are much more likely to take entrepreneurial steps to create new businesses on their own account.
Jim Hunter's exposition of community ownership was so eloquent that we should move straight to stage 3 of the bill and be done with it.
As Mr Watt has run the unit for the past few years, I will defer to him.
I am not sure that I am the best person to ask that question of.
In the broadest terms, of the 60 acquisitions, how many would have foundered without your subvention?
We assist in many ways other than simply giving money to acquire land. A lot of our effort goes into giving technical assistance and advice and paying for small feasibility studies, legal assistance and advice. Maggie Fyffe mentioned earlier that she went through the process without such assistance. It is possible without assistance, but it is much easier and quicker with it. The effort that we have put into many of the communities in the pre-acquisition stage has been of great importance and has been at relatively modest cost in terms of public expenditure.
Although the sums of public and land fund money that are involved in this are by no means negligible, it is interesting to put them into context.
I want to return lastly to the question of Assynt. We have established clearly, having read and listened to Mr Fraser's evidence, that the crofters of Assynt have been denigrated by two recently formed lobby groups. As a small aside—and this is not a political point—I urge colleagues who readily quote so-called evidence from those organisations to treat it with caution, given the way that they have so systematically denigrated one—
Can we have a question please, Mr Morrison? We have covered this ground already.
I said that I would make a small aside, which was meant to be of assistance to my colleagues.
I agree with Simon Fraser's points and have no need to repeat them. It is a great pity. As one who is seen as being on the other side of the argument, as it were, I should make it clear that there are many privately owned Highland estates that are making substantial contributions to the process of Highland development. I have always recognised that. I am thinking in particular of those that have diversified radically out of the traditional activities of such estates, engaging instead with new ventures of many kinds. Their contribution is substantial and has been recognised. Highlands and Islands Enterprise will continue to be pleased to assist such private owners of estates.
I apologise to those members who wanted to come back in, but we have already overrun slightly. Do you have any brief remarks on access? We have already covered part 1 fairly well.
I would like to make a general point on the access provisions. Experience suggests—and work by ourselves and others demonstrates—that the amount of economic activity generated in the countryside by hillwalking, climbing, birdwatching and people having access to land for recreational and holiday purposes is hugely more important now than activity generated by bloodsports, salmon fishing, deerstalking and so on. I personally, and Highlands and Islands Enterprise as an agency, have no problem with any of those activities and we welcome them. However, in the greater scheme of developing the rural economy they form a minority sector. The other sector, which enables people to get into the countryside, to walk and pursue leisure and holiday opportunities, is far more important as a contributor to rural wealth. Therefore, as a general principle, we strongly welcome anything that enhances and strengthens rights of access to the Scottish countryside. It can only be good for the rural economy and should be welcomed. Anything that inhibits access is, in principle, to be discouraged. Having said that, I recognise that there are legitimate inhibitions regarding access. However, as a general principle, the more access that we can have, the better.
As I am conscious of the time, I simply echo Mr Hunter's final comment. We welcome the principles of the bill—in which the right balance has been struck—which offers rural areas a huge opportunity.
Thank you for your evidence, which is greatly valued. I ask you to step down in order to make way for our final group of witnesses.
Convener, I believe that you said that, after questions on part 2, there would be a chance for members to ask questions on part 3.
I did, but I also said that we would try to keep to 40 minutes per session. We had 50 minutes on that particular set of witnesses. I am sorry, but we have run out of time.
You said that we could ask further questions so that the gentlemen would not have to come back. Will they now have to come back for a second time?
No. I do not think that there is any way in which we could get them back for a second time. However, if there are specific aspects of their evidence that you would like to raise with them, I am sure that you could write to them or telephone them in order to make those inquiries. We have simply run out of time, for which I am sorry. As members are well aware, one of my concerns about the procedure is that we do not have enough time to investigate thoroughly all the issues that I believe we need to investigate.
I wish to record my protest that we did not have enough time to—
You have done exactly that. Thank you, Mr McGrigor.
My name is Andrew Hamilton and I represent the Royal Institution of Chartered Surveyors in Scotland. In order to put into context the reason why surveyors might be interested in the bill, I should explain that I am a rural faculty member of the RICS. Professionally, we are involved in anything to do with rural land. We are involved in the management, valuation, purchase and sale of rural land and in almost anything else relating to rural land that members can imagine. We are a completely apolitical, professional body and are not lobbying on behalf of anyone. Our clients—or our employers—range from landowners, tenants and farmers who are owner-occupiers, to non-governmental organisations, charities, companies, local councils, central Government and so on. We cover a broad spectrum and our interest is in the workability of the proposed legislation. I have with me Lynne Raeside, who is the head of policy at the RICS in Manor Place.
My name is Robert Balfour and I am the convener of the Scottish Landowners Federation. I have with me Dr Maurice Hankey, who is our director. In attendance—sitting behind me—are Marian Silvester, who is our access adviser, and Michael Smith, who is our legal adviser.
I have two questions, one for each group. The first question is for the Scottish Landowners Federation. We heard an eloquent contribution from Jim Hunter about the benefits that he thought that community ownership would bring to the Highland economy. He suggested that community ownership would not inhibit rural development, but enhance it. The implication, certainly in some cases, is that the pattern of land ownership we have at the moment is not delivering the sort of Highland economy that we would want. How would you respond to that?
We would start by saying—Dr Hunter said as much himself—that many of the businesses that he referred to did not involve large tracts of land, but were small businesses in a rural community. I suggest that the restriction on the development of businesses is to do not with the pattern of land ownership, but with the planning system.
Common to both previous sets of witnesses was the opinion that things are already changing in the Highlands. We have heard about what is happening on Skye. It is about economic pressure. That is the way things are going. We would like to think that the legislation would aid and assist that process, but we are concerned that certain aspects of it may stall the process. We would love our owners to get more actively involved in diversified activities on estates—we will be doing more to help encourage that process.
My second question is to Mr Hamilton and in some ways follows on from that answer. The RICS is involved professionally in the valuation of property and in its marketing. What impact will the bill have on investment in rural Scotland by private individuals and companies? Is there any prospect of a blight on rural Scotland as a result of the right to buy?
As the legislation is not yet in force, we have no evidence of what will happen. What we do have is anecdotal evidence from our members, who are used to valuing land and are aware of all the criteria that affect the valuation of land. The general view of members is that there will be a blighting effect, where potential purchasers of or investors in land will be faced with a choice of investing in land in Scotland that may be taken from them—if that land is in a crofting area or where its value may be affected—and buying in England, Wales or elsewhere.
I want to begin with Mr Hamilton. In the second paragraph of your submission, you say:
Most of what has been said this afternoon has been perfectly eloquent and logical. The institution's submission makes it clear that we have absolutely no objection to community ownership. As far as the ownership pattern in Scotland is concerned, I imagine that the best scenario is to have a whole series of different types of initiative involving private individuals, charities, local authorities or communities. However, we are concerned that one section of the land ownership community—if I can call it that—will be preferred over others and that community ownership has been given a distinct advantage and a leg-up over all other types of ownership. It has not necessarily been proven that, in all cases, that is a preferable form of ownership to the other types that are available.
You state that your institution represent neither the interests of landowners nor the interests of tenants or community groups. How would you respond to the charge that you are in hock to land-owning interests?
My response would be that it was utter nonsense. As I said at the outset, we act for all types of people with an interest in land. Some of those people might be owners; a lot of them are occupiers, tenants or people who are simply interested in land. For my part, I act on behalf of landowners, tenants, Scottish Natural Heritage and charities. Your point is not well made.
Thank you for your response.
It is not up to us to comment on how people run their estates; in particular, we have never made any comments about how Assynt is run. When the Assynt Crofters Trust was formed some years ago, my predecessor at the time—I cannot remember who it was—wished it well and in fact hoped that the body would become members of the SLF. We represent all forms of land ownership.
Last week—
I am sorry, Mr Morrison, but I must interrupt. I hope that you are going to ask questions about the issue that we are here to discuss, instead of trying to denigrate some of the witnesses appearing before us.
I am not trying to denigrate anyone; I am merely questioning the witnesses.
I really do not think that your previous question related to part 2 of the bill, which is what we are asking about.
With all due respect, convener, you should have intervened then.
Well, I am intervening now.
Thank you, convener.
It is on its way to you.
I am delighted to hear that. Last week, I asked for the definition of a bad landowner and how many you represent. Will you direct me to the relevant passage in your code of practice—when it finally arrives on my desk—that will help me to deduce what a bad landowner is?
Our code of practice defines what we would expect a good landowner to do. By inference, if they are not doing those things, they are not as good a landowner as they might be.
At the risk of embarrassing Robert Balfour, I should declare a potential interest in that he and I are trustees of the Carbeth trust, which is designed to promote the interests of the Carbeth hutters. I have been working with Mr Balfour to that end for some time now.
I should perhaps declare an interest in that I, too, am a chartered surveyor. The bill does not use the words "open market value." My understanding is that there will be full market-value compensation. Parts 2 and 3 of the bill do not have the words "full open market value."
I agree with that, to a certain extent. It appears that the bill is trying to arrive at a new method of valuation. Various methods of valuation are set out in compulsory purchase statutes and so on. The RICS in Scotland has a valuation manual that defines how valuations are to be carried out and what is to be taken into account when they are.
I listened carefully to what you said, but I cannot help commenting that section 85(5) plainly states:
Is not that definition qualified thereafter?
Section 85 goes on to say that "account may be taken" of various factors. However, perhaps it is wrong to get into too much detail, because we are talking about the bill's principles.
Yes.
Given that that is true and that you are against the state—in that it would give communities a right of pre-emption—I presume that in the past the RICS in Scotland and the SLF were also opposed to private landowners having the right of pre-emption, which has existed for centuries?
We have not said that we are opposed to communities having a right of pre-emption.
The issue is that the traditional use of the right of pre-emption was in order to match a received bid by making the sale of land openly known and so attracting other bids. Many of our members would be much happier with that sort of process—they are not in any way convinced that the amount that the valuer is likely to fix through the process that the bill describes is likely to match what they would probably get on the open market.
I hear what you say and I appreciate that there are many niceties and points of difference, but there has been a right for private landowners to create a right to buy back land if they wanted to do that. That right has been imposed in many feu dispositions for decades and centuries and, as far as I know, neither the SLF nor the Royal Institution of Chartered Surveyors has offered one word of protest about it. Although I appreciate that it is not identical to what is proposed in the bill, both your bodies support in principle private landowners' being able to provide for themselves an automatic guaranteed right to buy land, but you are not so keen on that right when it comes to communities. Perhaps I am exaggerating the position slightly, but it is disappointing that your two bodies—both of which are reputable and which I respect, and which I know do not represent the likes of Schellenberg and Maruma—are taking an overly negative approach to the broad concept of the bill.
In our response to the draft bill—I appreciate that perhaps not all committee members have read our evidence—we suggested that the mechanism that is proposed under parts 2 and 3 of the bill could be handled through a classic right of pre-emption; that is, instead of registering to buy in the way that is described in the bill, communities could in effect register to be granted the right of pre-emption along the lines that I have just described. However, that would involve property being put on to the market and finding out the market demand for that land.
The right of pre-emption—where a landowner sells a bit of land to a person, but if that person sells it the landowner has the option to buy it back again—is very different from an entirely new body being given a right to buy land. In what is to some extent an echo of Maurice Hankey's point, one of the Royal Institution of Chartered Surveyors' earlier suggestions was that giving communities a right of pre-emption would at least ensure that full market value was paid, instead of there being a rather artificial system of evaluation.
Finally, am I right in saying that the bill specifically provides that, where communities are seeking to exercise their right to buy, the cost of the valuation—which may be expensive—will be met by ministers? I have a question for Mr Hamilton. By opposing that measure, is not he opposing new business for chartered surveyors, who will be called upon—with the state paying the bill—to carry out valuations, which no doubt would be of great benefit to members of his profession, in particular in the north of Scotland, where the survey fee may be linked to the value of the land, and therefore may be substantial? Would the potential exist for a strong minority of the RICS to be tempted to rebel against the official line that we have heard from Mr Hamilton today?
You will find that our members tend to be instructed on any land sale, whether it is a community-right-to-buy land sale or not. I am not convinced that the legislation will result in more land sales and therefore more business but, even if I was, business for our members is not necessarily the reason why I am here. We mentioned our royal charter earlier. We are here to secure the optimal use of land; we are not here to secure maximum fees for our members. The Law Society of Scotland would say something similar, but I am sure that Fergus Ewing could advise me on that.
I want to raise a point in relation to access, and the specific point of the exclusion from access rights in section 9(2)(a) of business and commercial activities. Jim Hunter has already commented on that—he was not happy about it. Both your organisations—the SLF and the RICS—have welcomed that measure, but a lot of concern is being expressed about it by so-called business and commercial enterprises, some of which comprise only one individual. I would like some indication of how both organisations envisage the activities and their extent being defined and whether you consider that the provision opens the way for wholesale charging for access.
I start by repeating what I said last week to the Justice 2 Committee. The bill, if passed as introduced, would create new rights. It would not preclude other activities. Commercial activity already takes place on land throughout Scotland. I do not see why any of that should not continue by mutual agreement between the organisers of such activity and the landowners concerned.
We would never condone charging somebody to take a photograph. The SLF has never condoned the idea of charging for access. The landowner can charge for facilities, such as car parking, loos and shops.
You would therefore have no objection to an explicit bar on such charging as is practised in Dartmoor national park.
With respect, there is no suggestion in the bill that a landowner would be able to make such charges.
There is no suggestion in the bill that such charges would be barred, either. That is my point.
The RICS supports section 9 and the fact that the right of access does not extend to access for commercial use, because owners or occupiers of land have it as an asset from which they can derive economic benefit or income, whether from farming, forestry or tourism. In our view, if someone else wants to derive a profit from that land, which may to some extent conflict with the use to which the owner or occupier is putting it, it is only equitable that permission should be sought for that. There should not be a free-for-all in which anyone can make a profit from the use of land that they do not own, do not pay rent for or do not occupy in any way. It is self-evident to me that such a free-for-all would be wrong. Am I missing something? I would be glad if members could provide me with elucidation.
I welcome your comments, but the problem is that none of that is stated in the bill.
Our submission states that we have always argued that those who wish to make a profit from exercising rights of access should seek permission to do so. That seems perfectly reasonable to me.
I presume that the Dartmoor National Park Authority sees its position as being perfectly reasonable as well.
I do not know that authority's position, so I cannot comment on it.
It has been put to me by a number of different organisations that it would be better for many of the exemptions to be removed from the face of the bill and dealt with in the code. They argue that anomalies of the sort that Roseanna Cunningham has identified would be dealt with better and more easily after the bill is passed, through statutory instruments rather than primary legislation. How do you feel about that?
That would be fine. However, if we proceed in that way on this issue we must do the same with other items that are dealt with in the bill, in order to restore the balance that has been lost in the provisions on access between the draft bill and the bill as introduced. For example, a so-called criminal offence for access takers has been removed from the bill, but landowners and land managers can still be taken to court over certain actions that they take. If the bill is to regain some of the balance that we believe it has lost, either those items should be dealt with in the code or the other items to which the convener referred should be dealt with in the bill. However, I do not disagree that those items could be dealt with in the code.
Many of the points that I wanted to make have already been made. However, I would like clarification on some of the matters that have been discussed.
Many of the extra provisions to which Rhoda Grant refers reflect the present situation in compulsory purchase. Under current legislation, the purchasing or taking away of a piece of land often causes a loss that is greater than simply the value of the land. That is why the bill refers to factors such as disturbance.
However that, too, gives comfort to the seller rather than to the buyer.
I think that the bill as introduced also gives comfort to the buyer, in that the community might end up paying an awful lot more than the market value for the piece of land that it wants to purchase, because of the injurious affection, as it is called—in other words, the blighting effect—on the residual of the estate or land.
I do not agree; we can agree to differ on that. I also wish to ask about access and to develop further Roseanna Cunningham's points. You say that there might be conflict between commercial users of land and the owner of land. Do you agree that any conflict could arise only as a result of irresponsible use of access? Given that the bill allows for responsible access, such conflict should not arise.
The question is; what happens if access is defined as irresponsible, and what sanctions would then be available to the occupier or owner to do anything about that? As far as I can see from the bill, the answer is that they could do very little. On the question about a conflict about use of land, whereby someone who occupies the land wants to use it for one thing and someone who does not occupy it and who has no connection with it wants to use it for something else, I would say that the norm in wanting to use a piece of land to make money out of it would be to pay rent for it. I am not sure why it should instead be a free-for-all.
My question is about someone accessing the land, for instance a mountain guide. I can understand why the Scottish Landowners Federation says that someone who provides facilities would rightly charge for the use of those facilities. However, where it is a matter only of access to the land—by a photographer or guide, for example—I cannot understand why people should be charged for that use of the land, nor can I understand why they should not have full access.
I would like to correct one thing. You have been using such phrases as "should be charged" for access to the land. I do not think that the bill says anything about charging for access. It says only that that is not included in the right of access, so people have to seek permission from whoever is occupying the land. It is not a matter of charging—that is one step on, and might or might not happen.
Can you guarantee to me that no charges would be levied for use of or access to land by a commercial user?
Undoubtedly not. If a commercial user wishes to use a piece of land to make a profit, what is the difference between that and a farmer wanting to use a piece of land to keep his sheep on it? That is dealt with in the current market through the payment of rent. I do not understand the point about whether there could never be a charge for somebody other than the occupier of the land using the land commercially. That does not make sense, I am afraid.
I am talking about people, for example mountain guides, who are presently allowed to use land to conduct their business. They currently have the right to use land without permission, as long as they use it reasonably. They do not have to pay for that access. If the right of access is removed from them, they will have to seek permission from the landowner and it is then quite feasible that the landowner might levy a charge for granting that permission.
I do not disagree that there is a problem there. A distinction is to be drawn and we come up against definitional problems. The work of a photographer or a guide—as well as other sorts of commercial activity—on the land is generally ancillary to the use to which the occupier puts the land. I suggest that the problem that will have to be sorted out in the wording of the bill is that there is a difference between those two uses. I hope that you see the difference to which I am alluding.
I call Dr Hankey to speak on that point—I can see that he has been itching to get in.
I would differentiate between the mountain guide, with whose trips the landowner probably has no difficulty, and—I will avoid the temptation to use the word "extreme"—the rather different position whereby the bill grants the right for someone to do the same thing, but on horseback. If that commercial access constitutes an interest in the district, with regular use being made of someone's property—for example through a pony trekking centre, with horses making regular and frequent use of the land—costs will be associated with that. How do you propose to differentiate between a charge for a service and the user's contributing to the cost of maintaining the upkeep of the facility that he is using?
The definition that I would give is that if one is using land responsibly, one is not causing damage to it. If one is causing damage to it, that is not responsible use of the land.
However, if—as was mentioned—that pony trekking centre continues to use that route, and the so-called responsibility is defined only in a code that the landowner cannot enforce, we are unwilling to grant commercial access as a right.
I understand that an interdict could be taken out against someone who is using the land irresponsibly.
Yes, our members are involved in factoring estates. What was the second question?
Is the factoring service more likely to be used by absentee landlords than it is by people who are based on their estates?
Statistically, I suspect that that is probably correct.
My question is for Mr Hamilton. Your written evidence states that part 3 of the bill
The first question was about whether we think that the compulsory right to buy will affect investment in communities. From evidence from our members about how owners of land make investment decisions, the concept of the land being bought from them when they do not want to sell it will have a serious effect on how they consider valuing their land. The question is about confidence.
If the right to buy rivers was in part 2 of the bill instead of in part 3, would that alleviate the problem?
Which problem?
The problem of the lack of investment in rural areas.
Do you mean that if salmon rivers could be bought only when they were advertised for sale?
Yes. Part 2 of the bill is about the community right to buy rather than a compulsory right to buy.
If I interpret what you say as meaning that salmon rivers could be bought only when they were being sold voluntarily, that would have less of an effect than would land being bought whether or not the landowner wanted to sell.
Does the SLF want to add to that?
Only to say that we agree with all those answers.
We have come to the end of this part of the meeting. I thank the witnesses for giving evidence.
Meeting adjourned.
On resuming—
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