Saturday, 21 July 2018

The minimum viable village

Hay Harvest
This blog post is occasioned by the National Council of Rural Advisers' consultation on Rural Economic Strategy. It isn't directly a response to that consultation, but I'm writing it to help formulate my thoughts in order to respond. A lot of the figures in this piece come out of my Minimum Viable Village Model.

In this essay as in other essays I treat it as axiomatic that the economy should serve the people, not the people the economy. I also treat it as axiomatic that a settled landscape is a good thing in itself. I'm not going to argue those propositions; if you disagree with either of them, then you will disagree with my argument and my conclusions, and that's just how it is.

There are a number of key problems with Scotland's rural economy. The first is population density. It takes about 270 adults of working age to produce enough children to maintain a viable primary school. Currently, average agricultural holding size in Scotland is 101 Ha and rising; increasingly, those holdings are each providing only one income. That means, given coast, forestry, and unfarmable land, there are about 40 holdings and consequently about 40 farm incomes in a 5Km travel-to-school radius.

Consequently, to sustain a viable village school you need about 200 non-agricultural incomes per village, and those incomes must be within a viable travel to work radius.

You also need affordable housing for 270 adults per village. Typically, in rural Scotland, wage rates are depressed, while housing costs are inflated by people from outwith the rural economy buying retirement and holiday homes.

This is just another example of the fact that capitalism simply doesn't work for people, and that we spend an awful lot of time and effort working around the manifest failings of capitalism to produce an economy which supports the many. What the Scottish rural economy needs is full communism now, but we aren't going to get that, so we need to keep on tinkering with the margins of a broken economy.

But one thing we can tinker with is planning law. If people are going to live in the landscape, on the depressed wages which are probably inevitable in rural areas, then they need to leverage the advantages of rurality to make their lives viable and fulfilling, and that means they need land - to grow food for themselves, reducing their costs, and to increase their amenity.

They also need housing that they can afford, and which is not subject to 'market forces'. Which means, essentially, they need housing which cannot be traded on the open market. And they need non-farm economic opportunities, which means we need more rural workplaces.

Planning policy over my lifetime has been hostile to 'sporadic development', and very hostile to village industry. Houses have been huddled together in ever expending villages of urban density, while industry has been pushed to the outskirts of far-away towns. That won't do. The Internet does allow far more folk to work from home, but rural areas typically have the worst Internet connections.

In any case, people go to work (among other things) for social contact; and Scotland needs engineering production at least as much as it needs jobs that can be done in front of a screen. But for both these things - if we are to support a peopled landscape - we need the work where the people are, and if we want the people distributed across the landscape, then so must the work be.

So: we need smaller holding sizes, not larger ones, to put more folk on the land. We need sporadic development in the countryside, because people need to live on the land they manage We need more workplaces, because smaller holdings won't necessarily provide full incomes, and in any case agriculture will only employ 20% of the population we need to sustain. And we need the workplaces where we want the people to be, which means sporadically, in the landscape.

But we don't need those sporadic homes bought up by the rich retired, or the even richer second home buyer. We need them lived in by the people of the place; people who will at some stage in their lives, have children for the school. People embedded in the landscape, who are intimate with it, who know it and care for it, and are committed to it in the long term.

For all those reasons I think these houses we need should not be privately owned. They should be community owned, and let to members of the community on a life rental - a tenancy which is secure for the whole of the tenants' lifetime, but which is not transferrable or heritable. People need security; but inherited wealth is the key driver of social inequality, and, in any case, that which can be inherited can very often also be sold.

As I said at the beginning of this piece, what the Scottish rural economy needs is full communism now.

Thursday, 19 July 2018

Response to the consultation on the Register of Persons Holding a Controlled Interest in Land

My croft
Environment, Climate Change and Land Reform Committee

Land Reform (Scotland) Act 2016 (Register of Persons Holding a Controlled Interest in Land) (Scotland) Regulations 2021 - Call for Views



Much land in Scotland is held by extremely wealthy individuals who chose to use opaque ownership structures to avoid taxes or other civil duties. There is no reasonable justification for an honest person to use opaque ownership structures or secrecy jurisdictions. Such people have the ability to hire extremely ingeniuous lawyers to work around the intention of legislation, as we saw with Agricultural Holdings (Scotland) Act 2003.

Consequently, legislation aimed at cutting through this veil of secrecy must be simple, clear, and free of weasel-words like ‘reasonably’. Further, because of the degree of wealth (and the penchant for secrecy) of some of these individuals, fines are unlikely to be effective deterrents.

Failure of undisclosed controllers of land to register

Consequently, there’s not a lot of purpose in being able to fine persons with a controlling interest in land where the ownership structure is opaque and held offshore in a jurisdiction in which the writ of the Scottish Government does not run, and the persons choose not to disclose their interest.

Instead, the Government should establish a Public Factor, who should take over the management of lands where the the controlling interest cannot satisfactorily be established, and manage that land in the public interest, retaining any and all profits, until the natural persons with a controlling interest choose to identify themselves and register their interest to the satisfaction of the registrar.

Non-natural persons

Non-natural persons should not be deemed ‘controlling interests’ for the purpose of this legislation. Behind every non-natural person are natural persons who control them. We need to disintermediate this, radically. Non-natural persons, having a controlling interest in land, should be required to register those natural persons which ultimately have controlling interests in themselves; otherwise, the value of the register is negligible.

Redactions and elisions

While I understand the force of the points made in para 71 of the Draft Explanatory Document, the power of the registrar to make redactions or elisions from the public register should be sharply circumscribed, and should in my view be limited to those cases where the personal safety of natural persons can be shown to be at risk.

Monday, 9 July 2018

The Growth Corruption

Andrew Wilson with Nicola Sturgeon, 

Andrew Wilson is managing partner of a lobbying firm, Charlotte Street Partners. There's no secret about that. The business of Charlotte Street Partners is to lobby the Scottish government in the interests of commercial companies. There's no secret about that. When Nicola Sturgeon appointed Andrew Wilson as chair of the growth commission, she knew this; there's no question about that.

What is secret is who the clients of Charlotte Street Partners are: who actually pays this piper. We don't know. We don't know whether Nicola Sturgeon knows.

Among the members of the Growth Commission were a number of business people; there's no secret about that. Nor is there anything inherently corrupt about that - any commission looking into the economy needs to take cognisance of the interests of business. For the record, they were:
  1. Dan McDonald, businessman and founder of N56 group
  2. Marie Macklin CBE, Founder and Chief Executive of the Klin Group and Macklin Enterprise Partnership
  3. Mark Shaw, Chief Executive, Hazeldene Group
  4. Petra Wetzel, founder and Managing Director WEST Brewery
Again: there is nothing inherently wrong with businesspeople taking part in this commission, and their taking part does not say anything against them. But we don't know whether any of these people is a client of Charlotte Street Partners.

The commission met with 22 trade bodies, and, again, there's nothing wrong with that; you'd expect them to. Full disclosure, the Chief Executive of ScotlandIS, one of those 22 trade bodies, is my sister.

At each meeting with a trade body, some members of that trade body participated; the minimum number was three, the maximum was twenty. It's entirely proper that when the commission met with a trade body, some members of that body should be present, and should put their views.

The commission report notes in section 1.15 that these meetings were held 'under Chatham House Rules'. What does this mean? It means this:
"When a meeting, or part thereof, is held under the Chatham House Rule, participants are free to use the information received, but neither the identity nor the affiliation of the speaker(s), nor that of any other participant, may be revealed."
Again, there's nothing inherently wrong about this. Chatham House rules are used to allow people to speak frankly, and frank speaking is what a commission such as this needs.

But something stinks, and it is this: we don't know which companies spoke with the commission at these twenty-two meetings, we don't know what was said, and we don't know which of them were clients of Andrew Wilson's firm. What we do know is that the growth commission came up with a set of recommendations which were extraordinarily favourable to the interests of the rich.

I think there are questions for two people to answer here. One is Nicola Sturgeon. She needs to explain why she chose a corporate lobbyist to lead this very important commission. Yes, I acknowledge that Andrew Wilson is a member of the SNP, I acknowledge he is a member of the Scottish Great and Good, and I acknowledge he is an economist. But, actually, the SNP is not short of members who are well regarded, economists, and not corporate shills. So why Andrew Wilson?

For Andrew Wilson there are more questions. Has any member of the commission ever been a client of Charlotte Street Partners, and if so, whom? Has anyone the commission had meetings with been a client of Charlotte Street Partners, and if so, whom? Did any client of Charlotte Street Partners have early sight of the Growth Commission report, and if so, whom? Did any comment on it, and if so did any such comment result in changes to the text? If so, whom, and what changes?

In a small nation there is a short step from cronyism to outright corruption. Andrew Wilson's business - the representation, for money, of undisclosed interests in undisclosed meetings with undisclosed senior members of government - is also a very short step away from from outright corruption. So, I say again: we need, very clearly, to know which of Andrew Wilson's clients were given the opportunity to influence the growth commission report.

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