Next steps for land reform

3. A programme of reform

25 years on from the start of Scotland’s current land reform journey with devolution, it is timely to refresh our focus on the next big steps for land reform. 

Drawing on our ScotLand Futures engagement, backed by the Commission’s wider research, evidence, and experience, we see three key pillars to take forward reforms in a joined-up way:

• Opening up new land opportunities
• Rebalancing the power of land ownership
• Shaping land use change locally

Delivery of reforms is not about a single piece of legislation but should be a co-ordinated programme making full use of existing policy, tax and fiscal levers, with targeted new legislation where needed. Underpinning the ability to deliver a programme of reforms is the need to transform Scotland’s land data system.

3.1 Opening up new land opportunities

Much land reform to date has focused on either the transfer or regulation of large land holdings, but there has been limited progress in opening up viable opportunities for many more people to own or use land. 

The desirable outcome is to enable many more individuals, businesses and communities to own or use land for a wide range of purposes including housing, food production, woodland management, nature conservation, business development and amenity.

Through ScotLand Futures we heard:

• There is significant appetite for people to be able to own, lease or use small-scale land holdings for a wide range or purposes.
• There is interest in new routes to access land through different governance models, allowing greater sharing of opportunities, risks, and benefits.
• There is wide support for community land ownership, but it feels unrealistic for many given the high land prices and complexity of legislative routes.
• Community ownership is as relevant to urban as rural Scotland, creating opportunities in both for regeneration and community wealth building.

Wider evidence and experience shows: 

• The Scottish Land Matching Service demonstrates a demand for land, including crofts, that significantly outstrips the supply of land available.⁸
• Land values are high, disconnected from economic use value and are a barrier to many people seeking land opportunities.
• Scotland has a proven model of small-scale regulated land tenure in crofting and small landholdings which offer new opportunities and valuable experience.
• International evidence points to strong benefits for ownership and governance structures that embrace diverse participation, improving business resilience, longevity, and performance.⁹
• European experience shows the significant role that municipal government plays in land ownership and use.¹⁰ We cannot replicate that without significant local government reform, but we can learn from this experience.
• Asset ownership is fundamental to community wealth and capacity, and to determining the flow of financial and other benefits from natural resource use.

Ways to achieve the ambition:

A programme to create new opportunities for small-scale land ownership.

A century ago, the Land Settlement (Scotland) Act 1919 was a bold intervention that changed the pattern of land ownership in a way fit for its time.¹¹ The challenges of today call for a similarly ambitious programme to create widely available opportunities, particularly for small-scale land holdings.

Key steps to develop:

• Leadership through public landowners with an ambitious programme creating new land opportunities with a range of tenure options on existing and newly acquired public land.
• Using existing and reformed legislation to the full to create new crofts and small landholdings across Scotland.
• Reforms to tax and fiscal policy that would incentivise and/or remove disincentives for landowners to lease or sell land.

Fresh momentum for community and co-operative land ownership

Scotland has a well-established modern model of community land ownership that is distinct in international terms and rooted in local democratic accountability. Expanding this ownership model beyond its current 3% of Scotland is constrained by high land prices, limited financial support and complexity in using rights to buy. 

While successful in establishing a new community ownership model, Scotland remains unusual in a European context in the lack of co-operative land ownership and shared governance that blend the strengths of community, local government, private and third sectors. There is an opportunity to inject fresh momentum by better supporting routes into community ownership and by supporting development of wider co operative and shared-governance models.

Key steps to develop:

• Strengthening and streamlining Community Right to Buy legislation following the current review and accompanying this with a well-resourced and flexible Scottish Land Fund.
• Using public land ownership proactively to support transition into community, co-operative, and shared ownership with interim arrangements where needed.
• Providing European-style institutional, policy, and legislative support to encourage more co-operative and mixed governance models.

Creating a public land bank and public land agency function

Delivering change needs an active state role to acquire, restructure and sell land to support public interest outcomes including creation of small-scale land holdings, community and co-operative land ownership, and creation of a housing land supply in rural communities. The proposed new More Homes Scotland agency provides the opportunity to deliver this role specifically in relation to housing land. 

More widely, a public land agency function would provide a proactive means to make available opportunities for small landholdings, crofts, tenancies or transfer to communities and cooperatives. Drawing on European experience this function could also support negotiated transfers or restructuring in partnership with other landowners. It would be able to make the most of the opportunities arising from the new Land Reform Act’s lotting provisions, by providing an active vehicle to acquire land for a specific public interest purpose.

Key steps to develop:

• Consider how existing public body powers or a new agency can most effectively create a rolling public land bank to deliver public interest outcomes.

3.2 Rebalancing the power of land ownership

An ambitious programme to create new land opportunities will help diversify land ownership, but the concentration of power associated with the current pattern of ownership remains present and significant. Large scale land holdings, in public, private, community or NGO ownership, will likely continue to be a part of Scotland’s land ownership in places. We also know that the power associated with land ownership can be felt at relatively small-scale, where there is essentially a localised monopoly, for example in an island or village situation.¹²

Targeted regulation should address the impacts of concentrated power in land where it currently exists, as well as safeguard against a trend of increasing concentration. 

The desirable outcome is to create a settled system of regulation which addresses the risks of concentrated power while creating confidence for innovation, investment and delivery. Regulatory measures to achieve this may need to be significant interventions but should be designed to reset the system in a way that provides as much confidence as possible.

Through ScotLand Futures we heard:

• People feel that current land ownership concentrates too much power and control in the hands of too few people and organisations and they are seeking a more diverse pattern of ownership.
• Being part of the place is important – that those who own land should in some meaningful way be resident or connected to that place.

Wider evidence and experience shows:

• The concentration of land ownership in Scotland is increasing. This trend is not unique internationally, but Scotland starts from an already highly concentrated pattern that is unusual in international terms.
• Without interventions, the pattern of land ownership remains remarkably consistent, and the land market remains increasingly inaccessible to most people, communities and local businesses.
• Scotland and the UK are unusual in having few constraints on who can buy land and the extent of land anyone can buy.¹³
• Legal duties of residency and purposeful use are well established in Scots law and have applied to crofters, as tenants and owner occupiers, for 140 years.

Ways to achieve the ambition:

Public interest assessment on land acquisition

International experience shows that a common form of land ownership regulation is to have some form of approval process on acquisitions, to safeguard the public interest and in many cases to require residency, often in an agricultural context.¹⁴ While these cannot be lifted directly to Scotland, careful consideration should be given to how and when significant acquisitions of land could be subject to conditionality that considers key public interest outcomes, including the risks of monopoly power, local presence, local economic outcomes. 

Over 20% of people responding to the ScotLand Futures survey identified concerns about absentee land ownership, including corporate ownership, and a desire that landowners should normally be present in a meaningful way in the local place and community. The question of residency, where relevant, can most practically be addressed through an approval mechanism or obligation applied at the point of acquisition. Where ownership is a corporate entity, it could be expected to have a registered office on or near the landholding, and an accessible local contact or presence, with decision making power, in the community. 

Local presence, or residency, helps build and support good community relationships and improve local economic outcomes. It is striking that for Scotland’s regulated system of small-scale land holdings – crofting – there is a long-established requirement to be resident on, or close to, the landholding, which helps explain why many remote and island communities are as vibrant as they are.

Key step to develop

• Options for an approval mechanism on significant land acquisition that is able to review key public interest considerations and place obligations on acquiring parties where necessary.

Safeguards against the misuse of power

While there is an opportunity when land is acquired to ensure that risks of concentrated ownership can be addressed, there is also a need for the ability to address cases where the power of existing land ownership is being misused. 

While good practice, codes and responsible land ownership can provide an effective framework for most, there are cases where the misuse of power has a significant impact on individuals and communities, impacting social, economic and environmental outcomes. In these cases, there should be a means to bring matters to a head and take action that addresses the issue, without creating overly complex or burdensome regulation. 

When triggered, such a mechanism should be able to scrutinise the risks to the public interest and take proportionate action. Remedies could, for example, include binding commitments to land use, governance or management practices, obligations to ensure there is an identifiable and accessible local decision maker for the landholding, or mandatory partial sales.

Key step to develop:

• Developing an effective means to address misuse of power within land ownership, for example through a statutory review process.

3.3 Shaping land use change locally

Scotland is pursuing significant change in land use to deliver on climate, nature and economic ambitions. It is striking in our engagement that people feel uneasy with the pace and scale of change, and in many cases, disconnected from decisions about their local places. For some, this reflects concern about the impacts of change. For others, it questions whether our current system is able to make the most of the opportunity of change. For example, in ensuring that communities or local businesses can take a stake in delivering that change, or whether the financial benefits flowing from land and natural resource use are felt in local economies. 

To carry public support through significant land use change, a stronger sense of local involvement and benefit is needed. Strengthening local involvement in decisions about a place is an opportunity to strengthen local democracy and improve outcomes. In a European context, our local government system has been disempowered and spans large areas with widely varying populations. In contrast, the more usual European model of municipal governance holds significant power at local level, where decisions about land ownership and use are normally taken. 

Significant local government reform could address many of the issues people seek to deal with through land reform. In the meantime, the opportunity is to have a more joined-up land use planning system, empowered at regional and local levels, backed by clear mechanisms to ensure a fair distribution of risk and reward. A national land use strategy which sets out clear direction should be backed by the powers, resource and flexibility to deliver at a regional and local scale.

Through ScotLand Futures we heard:

• People feel disconnected from decisions that are having a major impact on their local place.
• People see major land use change taking place without certainty that the economic benefits will be felt locally.
• Landowners seek joined-up land use policy with recognition of the long-term implications.
• People feel stronger local authority powers are needed to ensure that buildings and land are used productively.

Wider evidence and experience shows: 

• Carrying public support for land use change is key to meeting the Scottish Government’s climate, nature, and just transition commitments.
• There are many benefits for landowners, project developers and communities associated with early engagement when making land use decisions.¹⁵
• International experience shows that direct community and resident involvement in ownership and governance is an important factor in building support for change as well as directing where financial value from natural resources flows.¹⁶
• Scottish examples of community owned energy are not uncommon, with direct ownership stakes providing annual returns up to 60 times greater than industry standard community benefit schemes.¹⁷

Ways to achieve the ambition:

Strengthen regional land use planning and local place planning

It is not practical to reconcile all of Scotland’s competing demands on land at a national scale, nor can individual landowners be expected to do this at a holding scale. There is instead a compelling case to strengthen land use planning at regional and local levels, something that has wide and deep support across the land sectors. These are scales at which people can relate to and respond to the choices and prioritisation needed and at which involvement and accountability can be meaningful. The Land Management Plans required by the new Land Reform Act are a useful step at a land holding level and will be most impactful where there is clarity on local and regional land use planning that they can connect into.

Key steps to develop:

• Delivering regional land use frameworks across Scotland, backed by devolving decision-making and resource flexibility to deliver against these frameworks.
• Strengthening the resourcing and role of Local Place Plans so that many more communities can use them as a focal point for articulating local priorities and for collaboration with land managers, project developers and public bodies.

Local stakes in ownership, delivery and benefit

The opportunities of investment in renewable energy, nature and climate action are significant for rural Scotland. There is a particular need for regional collaboration in associated housing, skills, jobs, and investment. There is also significant potential for future revenue that can underpin services and infrastructure for local communities. But at present, it is far from certain that the financial and other benefits of land use change and natural resource use will flow into local economies. Governance models including ownership and benefit agreements need to develop an appropriate balance of risks and rewards to local communities.

Key steps to develop:

• Making it a standard option for communities, residents, and local businesses to be able to take an ownership stake in renewable energy and natural resource projects through community, co-operative or shared governance models.
• Establishing a meaningful framework for community benefits arising from land and natural resource use that ensures value is reinvested in local economies.

Improved powers for local government to support productive land use

Local government is in a key role to enable change of use and ownership to support active and productive use of land and buildings. To do this, it can use planning and land assembly tools such as compulsory purchase or masterplan consent areas to prioritise strategic sites. Local authorities also have local tax powers at their disposal which can be used as an incentive to encourage specific outcomes and raise revenue in the longer term.

Key steps to develop:

• Adding Compulsory Sale Orders to local authorities’ regeneration powers to bring about a change in ownership where land or buildings have been abandoned or are neglected, blighting the local community.
• Giving local authorities greater autonomy and further tax powers to encourage productive use of land and property. For example, through use of exemptions, reliefs or new local taxes.

• Using the public land agency functions proposed above in collaboration with local government to be active in acquiring and disposing of land to create public value.

   

⁸ Scottish Land Matching Service (2025) Annual Review 2024/25 

⁹ Alma Economics (2021) Understanding the Benefits of Diversification in Ownership, Tenure and Control, Scottish Land Commission 

¹⁰ McMorran R., Glass, J., McKee, A., Atterton, J., Combe, M., Xu, T., Jones, S. and Perez Certucha, E. (2019) Review of International Experience of Community, Communal and Municipal Ownership of Land, Scottish Land Commission 

¹¹ Hunter, J., (2019), Repeopling Emptied Places: Centenary reflections on the significance and the enduring legacy of the Land Settlement (Scotland) Act 1919, Scottish Land Commission

¹² Glenn, S., MacKessack-Leitch, J., Pollard, K., Glass, J., and McMorran, R., (2019), Investigation into the Issues Associated with Large scale and Concentrated Landownership in Scotland, Scottish Land Commission.

¹³ Glass et al (2019) Research on intervention to manage land markets and limit the concentration of ownership elsewhere in the world, Scottish Land Commission

¹⁴ Glass et al (2019) Research on intervention to manage land markets and limit the concentration of ownership elsewhere in the world, Scottish Land Commission

¹⁵ Wright, N., and Tolson, S., (2020) The Value of Early Engagement in Planning, Scottish Land Commission 

¹⁶ Mason, N., Radcliffe, E., Benstead, S., Murphy, C. and Tupling, J. (2024). Analysis of mechanisms and governance approaches to securing public value from natural resources. Scottish Land Commission 

¹⁷ Aquatera Ltd (2021) A comparison of the financial benefits arising from private and community owned wind farms, Point and Sandwick Development Trust