Scottish land reform aims to benefit communities

Land has been a consistent concern of the Scottish parliament since the Land Reform (Scotland) Act in 2003 introduced the community right to buy, the crofting community right to buy, and the right of responsible access.

Since then, further legislation has added other community rights to buy, for sustainable development and for abandoned, neglected and detrimental land, and introduced changes to agricultural tenure laws, rebalancing the rights and relationship between landlords and tenants.

But land reform is more than this. During the past two decades community landownership has expanded to cover 3% of Scotland, mostly through negotiated sales. Although the legislation is not often used directly, it has played a pivotal role in shifting expectations and cultural norms around landownership.

The Land Reform (Scotland) Act 2016 went on to introduce the land rights and responsibilities statement (LRRS), principles approved by the Scottish Parliament that define the relationship between people and land. The statement has influenced the shift across all landownership sectors to engage local communities more in decisions about land now recognised as a standard practice for responsible business.

But while the 2003 and 2016 Acts focused significantly on community rights, the Scottish government still wants to deal with the long-standing issue of concentrated landownership, which has been a consistent concern of national land reform ambitions. It therefore put the Land Reform (Scotland) Bill 2024 before Holyrood last March, which includes new measures to regulate large landholdings in the public interest.

While some of the government's measures differ from these recommendations, they draw on the commission's research about the impacts of concentrated ownership and how these can be dealt with.

Since the publication of the Scottish Government's Bill, the commission has published further advice recommending ways to strengthen the bill's measures and simplify their implementation, ensuring they are both practical and effective.

The bill, as drafted, sets out two definitions for the land holdings in scope. For the obligation to prepare and engage on land management plans (LMPs), it defines large landholdings as those greater than 3,000ha – or exceeding 1,000ha and more than 25% of an inhabited island.

For the other measures, prior notification of sale and the transfer test, it defines large land holdings as those greater than 1,000ha. The commission proposes simplifying this to a single definition of 1,000ha for all three measures.

The bill requires large land holdings to prepare and engage on as LMP. At the commission we see significant benefits in this, including increased transparency and opening up opportunities for collaboration, leading to benefits for both land owners and local communities.

The challenge will be to ensure that the plans are both effective in terms of engagement and delivery, but proportionate in the cost and information required, the detail of which will be set out in secondary legislation.

The commission suggests that LMPs should be high-level documents rather than a detailed business plan, to avoid duplicating other requirements such as forestry or farm plans. We see their value in providing disclosure and transparency and a parallel with the disclosure approach taken in corporate environmental, social and governance (ESG) practice, where transparency plays a big role in shaping improved practice.

It is worth noting that, as drafted, this provision includes all sales of parts of a holding, which could bring into scope many small-scale land transfers. The prior notification also provides an additional opportunity for communities to use the existing community right to buy, although short timescales mean the impact of this is likely to be limited.

At the commission, we think the principle of publicly notifying intended sales is important. In recent years a significant number of large land transactions have taken place off-market. Prior notification will open up opportunities for others to negotiate land acquisition, not just for communities but for individuals, local businesses, farmers and others. However, as drafted, it risks being a resource-intensive approach, and we are advising a simpler option.

The commission has recommended exempting certain transfers such as sales to sitting tenants, house plots and garden ground that would simplify the process and reduce the number of small transactions in scope.

Because it is often smaller sites that communities wish to buy, we recommend introducing the ability to designate land or assets of community significance through engagement on the LMP. This would ensure that the landowner and community know which assets are significant and that they are noted in the LMP.

We also advise a simpler local notification process that doesn't require the government to manage a centralised register and system. This could work by landowners notifying local community councils and local media, similar to the way existing notifications in the planning and crofting systems work.

The third key measure in this part of the bill gives ministers power to require landholdings greater than 1,000ha to be subdivided, or lotted, when they come up for sale through a transfer test. It is a test that would apply ahead of the transfer by sale of a large land holding, requiring the seller to lot in a particular way.

This differs from the public interest test recommended by the commission, though, because it applies only to the seller of land and does not set any public interest test or conditions for the party acquiring it. It could, however, be an effective way to help the government reduce the concentration of landownership in specific places.

The bill sets out the basis for a decision being whether lotting would better support community sustainability, rather than selling the land as a whole. At this stage however, the bill does not provide further clarity on the criteria that would inform this.

We see a need for greater clarity on the criteria to be used in assessing the case for lotting. The bill would be clearer if it specifically referenced the public interest as the basis for this. The considerations to be taken into account in relation to the public interest could be set out either in the bill itself or in the secondary legislation to follow.

In terms of practical implementation, considering a lotting decision will require a pause in the sale proceedings. The commission recommends a two-phase approach so transactions that do not need to be in scope can proceed without unnecessary delay.

We also advise that ministers should be able to use public land acquisition more strategically alongside the transfer test so the government can buy some lots directly and ensure specific outcomes; for example, transfer to community ownership, housing provision, new crofts or opportunities for new entrants into farming. Using public land acquisition in this way would help reduce delay and uncertainty, while giving more control over the intended public interest outcome.

The new commissioner would have specific responsibilities to investigate alleged breaches related to the community engagement obligation, as well as to advise ministers on the transfer test.

There are of course many different views and perspectives on the bill, and these are being debated as it goes through the parliamentary process. The commission continues to advise, recommending ways to simplify and strengthen the legislation. There is no doubt though that it takes significant steps to regulate large land holdings in the public interest.

We also continue to look at wider issues to make more of Scotland's land: our work includes examining the role of tax, public landownership, natural capital values and access to small-scale holdings, alongside promoting good practices in land management.

Land reform is often described as a journey. Beyond this bill, we need to bring into focus the destination with as much consensus as possible. While complete agreement may be unlikely, greater clarity on the intended outcomes and a shared route map would improve certainty and benefit everyone with an interest in Scotland's land.