Friday 11 January 2013

On land reform

[this is slightly edited from my response to the Scottish Government's recent consultation on land reform]

Introduction: on the basis for private land ownership

The lands which now comprise Scotland did not come into existence private. God did not give out property deeds graven on tablets of stone. Rather, over the past four thousand years, successive peoples have come into Scotland and taken land more or less by force from its previous occupiers. There can be no square inch of Scotland now, which has been passed down peacefully within the family from generation to generation from its original settlers. Rather, all land in Scotland has changed hands by murder, theft, extortion or deceit, most of it many times. There is no land-holding in Scotland now which is not based at some remove on malfeasance.

The most iniquitous malfeasance has been in the enclosure of commons. Until the eighteenth century, most of Scotland's land was not enclosed; rather, local people had rights of common across it. The legal theory under which land 'owners' were able to arbitrarily extinguish those rights was, to say the least of it, novel. In this part of Scotland at least, the enclosure was fiercely resisted by 'levellers', which is to say, the dispossessed majority. Enclosure progressed across Scotland slowly, and by the time the far north west was enclosed, the public mood had begun to swing against the 'right' of enclosure. So instead of 'the Highland Enclosures' we now speak of 'the Highland Clearances', but in fact the process, whether called 'clearance' or called 'enclosure', has been the same. The people of Galloway were just as deprived of ancient rights and livelihood, just as driven off the land, as the people of Caithness. It's just, for us, the process happened earlier.

Having said this, land in Scotland is (by and large) now held privately and that is established political fact. While one may argue about the outcomes for which farming is optimised, by and large lowland Scotland is farmed productively. A revolution which made our farming significantly less productive would not be a good thing.

Subsidy on private land ownership

Currently, farming subsidies are paid to landowners in ways which are opaque to the general public and which appear to have no upper bound. The intention of the common agricultural policy is, we are told, to keep people on the land. But in practice in Scotland, farm subsidy is a payment made to the rural super-rich out of the taxes on, inter alia, the rural working poor. There is no possible justification for this: it is a huge, cancerous injustice which causes grave damage to the economy and to the social fabric of rural communities.

Land ownership is a good, for which people are prepared to pay a great deal; land is a finite resource, of which there is not sufficient for everyone in Scotland to have a fair share while making that share an economic holding. People who own an unfair share of a good should not be subsidised.

If the purpose of agricultural subsidy is to keep people on the land, then there should be a cap on the amount of it that any individual holding can claim, and that cap should be at greatest less than the median income (since, presumably, an economic holding also makes some profit). If the purpose of agricultural subsidy is to optimise food production, it should be paid only on food actually produced. Otherwise, it is simply a subsidy of the rich, paid for out of the taxes on the poor. And that is necessarily iniquitous.

Tax on private land ownership

Land ownership is a good. It is a good which is in short supply. It is a good which cannot easily be distributed equitably. And every hectare of land which is held privately is a hectare whose use is not optimised to the public good; it is, in a real sense, a cost to the community. It is normal for goods which cannot be distributed equitably and whose use imposes a cost on the community to be taxed, to recompense the community for that loss of amenity and cost. Land should be no different. Land should be taxed.

Other people will argue the benefits of a land value tax. A land value tax would be better than no land tax at all, but it is not what I wish to argue for. I wish to argue for a flat land tax.

The flat land tax: outline

The flat land tax would be a tax imposed uniformly on every hectare of privately held land within a region, where that region might be one of the current local government areas, or might be the whole of Scotland. The rate at which it was set would decided at the level of that region. Every land owner would be required to pay, annually, an amount equal to the rate of tax multiplied by the number of hectares held. If a landowner was unable to pay, or chose not to pay, the tax on any area of land, that land would revert to common. The liability for payment of the flat land tax would be on the owner, not the tenant, of the land.

Land tax would be collected regionally, but would be paid to existing community councils. Common land would be administered by existing community councils for common amenity, or, if the relevant community council chose not to administer it, by a Common Lands Factor appointed by the state.

I envisage the flat land tax being in the region of ten or twenty pounds per hectare, at current rates. It should not be sufficient to deter productive agriculture, but should be sufficient to deter very large holdings of unproductive land.

The flat land tax: merits

Much land in Scotland is agriculturally productive. It would be economically sensible to pay the land tax on productive land, so this land would remain in private ownership and would continue to be farmed. But much land in Scotland is marginal or unproductive. Our hill lands are a grossly degraded environment, largely as a result of over-grazing by subsidised sheep or by deer or grouse kept for the blood-sports of the rich. This land has a very low return, and consequently a flat land tax would effectively price it out or private ownership.

This means that marginal land would return to communal ownership. Of course the community might decide to use it as common grazing, in which case their local landscape would continue to erode and degrade. But they might equally decide to allow tree cover to return, either by benign neglect or by positive intervention, thus improving the quality and ultimately the productiveness of the land. Or they might choose to manage it for specific community amenity purposes, for example to attract tourism or other economic activity. In any case, it's there choice: local democracy at work.

At the same time small holdings ('crofts') could be encouraged by allowing each adult an allowance, say of ten hectares, on which they would not be taxed.

The flat land tax would also be very cheap and simple to collect. The land registry means that who owns how much land is unambiguous. Because the flat tax takes no account of improvements or of market value or of land quality, it is unambiguous how much tax should be paid. Finally, because in default of payment ownership of the land ceases, landowners who wished to maintain their holding would be highly motivated to ensure the proper tax was paid.

A digression: the exponential land tax

A variation on the flat land tax which I would personally prefer, but for which I do not believe it would be possible at present to build a democratic majority, would be the exponential land tax. Under this tax, a land owner would pay one penny on the first hectare of his holding, two pence on the second hectare, four pence on the third, eight on the fourth, and so on. This eminently reasonable scheme would see tax of about ten million pounds on the thirtieth hectare. As before, land on which tax was not paid would revert to common. Such a tax would drive rentier landowners, and private sporting estates, out of Scotland in a decade. Obviously the starting point and scaling factor could be adjusted, but the principle that larger holdings should be taxed more seems to me socially beneficial.

Communities in south western Scotland


Much has been made of the depopulation and social disruption that has afflicted the 'crofting areas' - the Highlands and Islands. I do not wish to minimise that in the least. But depopulation and social disruption has affected areas of Galloway on an equally devastating scale. My home village of Auchencairn had, in the 1880 census, around 2400 inhabitants; it now has 180. That raw figure sounds devastating, and it is; but the truth is worse. Of the eighty or so stone built houses which make up the core of the village, only three are now occupied by people born in the village, and they are all in their seventies and eighties. The price of even a modest house is now of the order of quarter of a million pounds, and local wages are depressed. So it simply isn't possible for people earning their living in the local economy to buy a house.

The reason for this is that people retiring from the cities, with the proceeds of selling an urban house, can outbid local people, and have done so. Most of these people are resident - only about 10% of houses stand empty - and many of them make a positive contribution to the community. But nevertheless their interests are different from the interests of people who need to earn a living in the local economy, and that does skew communal decision making away from economic development.

Furthermore, with the local private housing monopolised by incomers, what 'native' - second or third generation, or more - villagers remain are coralled into a bantustan of 'social housing' on the other side of the burn, leading to a community divided between white settlers in the increasingly gentrified village and natives in the social housing. This is not a good thing.

And finally, it's even worse than that. The people of my generation born in the village who remain in the village are the children of farmers who inherited the family farm, and those families who have subsisted largely on social benefits, and who therefore qualify for social housing. There's virtually no-one in between. Everyone else went away to university and never came back. There are no jobs for them, and there is no housing they can afford.

I'm painting a bleak picture. Driving through, you'd see a pretty village, and a vibrant village, with its own newly built, community owned post office, with its recently renovated village hall, with its generally well kept and pretty houses. It's true that, by comparison with many other villages in Galloway, Auchencairn is doing well. Nevertheless, my picture is true, and it is a picture of depopulation and social disruption every bit as bad as that experienced in the West Highlands. It's just less visible.

On the size of holdings

We've developed a rural economy in southern Scotland comprising a relatively small number of relatively large agricultural holdings, and more or less nothing else. There are few small rural workshops for craft, small manufacturing, and so on; very few rural offices for office based employment of any kind. Planning policy strongly opposes the establishment of small manufacturies in rural areas. This contrasts sharply with southern Germany, for example, where small agriculture and small but often high value manufacturing are intimately interwoven. Few German farmers expect to make the whole of their family's income from the land. Instead, they expect to work a shift in a factory or other local business as part of their daily cycle. In Scotland, farmers expect to be just farmers. That's partly why there are relatively few of them. It's also partly why there's little other rural enterprise which can employ anyone else.

Even on good land in southern Scotland, a holding of around fifty hectares is the minimum needed to provide the income to sustain a family. Most holdings are much larger. Consequently, population is highly dispersed. The issues discussed earlier in this document, of incomers with little direct involvement in the rural economy taking over the majority of the non-farm private housing stock, exacerbates this problem. Community cohesion is greatly eroded, and in many parts of the south, simply broken.

Policy on holding size can have to rational public policy objectives. It can be to maximise food production. Or it can be to sustain rural communities. Presently, it does neither.

The merits of smaller holdings

Where holdings are smaller, the same area of land sustains more families. So the density of population is higher, and casual social contact is greater. Small holders need to co-operate with one another, because a single small holding cannot provide the capital to maintain one of every sort of machine and tool required to work the land; they necessarily have to co-operate and share. Moreover, if people live on holdings which are marginal or less than marginal in terms of agricultural income, they must needs engage in other, non-agricultural work - which means they will develop other small enterprises in the locality (if the planning regulations allow them to), potentially providing additional employment.


The Land Reform Act 2003 is still one of the landmark achievements of our restored parliament. It's still one of the things which makes me proud to be Scots. It has made public access to the land much easier, and that's a very good thing - a thing to be proud of. But, except in the crofting areas, it has not done much for public engagement with the land. For people in Scotland - even for people in rural Scotland - the land is something from which they are more or less alienated. It belongs to others, to the few, to - almost by definition - the very rich. Others - the few - decide how it will be managed, what crops will be planted, what buildings and tracks constructed, what mines dug, what trees felled, what pesticides and fertilisers used.

This is not, in the long term, sustainable. The land needs the engagement of its people; the people need engagement with their land.

Private ownership of land needs to be understood as a bargain struck between the owner and the community on the basis that the owner can add real value to the land, and return some share of that value to the community. The default position - the position to which land should return when no land owner can make real commercial use of land - should be that land is common, held by and for the benefit of the community as a whole.

And the public subsidy of the rich, paid out of the taxes on the poor simply because the rich own the land, must just stop.

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The fool on the hill by Simon Brooke is licensed under a Creative Commons Attribution-ShareAlike 3.0 Unported License