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Scottish Government’s tenant farming proposal will ‘betray’ sector

Scottish Land & Estates said today that new proposals by the Scottish Government to enable tenant farmers to ‘sell’ their tenancies will be a generational betrayal of the tenanted sector and therefore of Scottish agriculture.

The Scottish Government has tabled an amendment to the Land Reform (Scotland) Bill that will enable tenant farmers with secure ‘1991’ Act tenancies to assign their tenancies to another tenant, thereby perpetuating the secure tenancy and denying landlord access to his property. The landlord would be able to intervene and regain possession of a property they already own but only if they are willing to pay a premium.

Scottish Land & Estates said the Scottish Government’s amendment will shatter confidence, undermine the future of tenant farming and will have the following outcomes:-

  • The amount of land let to tenant farmers on a long-term basis will plummet.
  • Owner-occupier farmers looking to retire will not want to let land for fear of losing control of their land.
  • Landlords will mount legal challenges claiming a breach of property rights and submit claims for compensation estimated at several hundred million pounds.
  • Banks and lenders have warned of the potential damage to the value of assets owned by landlords and the significant impact such a change in value could have on existing lending covenants. This could cause havoc in an already heavily debt geared farming sector.

David Johnstone, chairman of Scottish land & Estates, said: “The vast majority of the industry made it abundantly clear that there is a workable alternative to what Richard Lochhead is now proposing at the 11th hour – enabling secure tenants to convert to a long-term tenancy instead of a secure tenancy.

“Many farmers have made this point at recent public meetings across Scotland – yet Richard Lochhead does not seem to be listening. If his proposed measure goes ahead he will go down in history as the Cabinet Secretary who heralded the demise of the tenant farming sector in Scotland.

“That’s a great shame and it appears that the Cabinet Secretary has caved in to placate and line the pockets of a small group of tenant farmers looking for a pay-off. Of course, farmers need to retire with dignity but a vibrant future for the sector is very important too. The conversion model favoured by the industry and proposed by the Cabinet Secretary’s own Review Group could achieve both.

“It is vitally important that everyone’s rights are respected on this issue, tenant and landlord. What the industry largely agreed on went some way to striking a better balance of those rights.

“The Scottish Government keeps asking for views on this subject and despite a mountain of evidence from all sides of the industry in favour of conversion over assignation, Mr Lochhead has chosen a last minute, unscrutinised, destructive and punitive path. This is even more inexplicable given that the industry spent two years debating this issue intensely. We made our position clear that conversion could work for many landowners and tenants, even though it may not suit all but Mr Lochhead has not made any justification for this late change. It may appear good politics but it does nothing for Scottish agriculture. We appeal to the Scottish Parliament even at this late stage to act in the best interests for farming and pass legislation that will help the majority in the sector and not fatally undermine tenant farming.”   

 

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