Impact Evaluation of the Community Right to Buy

1 Introduction and Methodology

1.1 This report presents the findings from the impact evaluation of the Community Right to Buy, carried out on behalf of the Scottish Government. This report is based on research carried out between November 2014 and August 2015.

Background to the evaluation

1.2 The Community Right to Buy (CRtB) was introduced under Part 2 of the Land Reform (Scotland) Act 2003 as a mechanism for encouraging opportunities for community ownership of land and land assets in rural Scotland. The CRtB provision gives community bodies representing rural communities with a population of less than 10,000 the right to register a community interest in land and to obtain first refusal on the land when the landowner wishes to sell.

1.3 The Scottish Government commissioned Ipsos MORI, in collaboration with Scotland's Rural College (SRUC), to evaluate the impact of the CRtB aspects of the Land Reform (Scotland) Act 2003 on local communities in the period from 2004 to 2014. The evaluation has the following objectives;

• To develop a logic model identifying how the objective and process of CRtB relates to the wider objectives of the Land Reform (Scotland) Act 2003 and the outcomes of the National Performance Framework and from this, to establish a clear set of policy outcomes.
• To provide basic data on the number, composition and levels of interest at each stage of the legislation.
• To carry out a survey of all those communities who have exercised the right to buy, both those who were successful and those who were not. The survey should also capture those communities who have set up a community company but who did not subsequently register an interest in land.
• For selected case studies, to examine and provide evidence on the impact of community land reform provisions on the desired outcomes.
• To establish an evaluation framework to identify the specific impact evaluation questions to be asked in relation to each case study.
• To compare and contrast the impact of the provisions in different communities who have a community interest in land to see if impacts are more beneficial in particular circumstances. In addition, to consider, within the limitations of the study, whether such conditions are replicable or unique to individual communities.
• To identify if there are key indicators that could assist in monitoring the community right to buy which are not unduly burdensome or complex for local communities to collect or, alternatively, specific data collection or analysis that the Scottish Government could undertake to build up knowledge in this area.

Methodology

1.4 The evaluation involved a mixed-method approach. The first stage consisted of a desk-based review of relevant documentation and in-depth scoping interviews with stakeholders. Stakeholder interviews were conducted face to face and by telephone with representatives of: the Scottish Government, Big Lottery Fund, Development Trust Association Scotland (DTAS), Highlands and Islands Enterprise (HIE), and Scottish Land and Estates.

1.5 An online survey was carried out with community bodies involved at each stage of the CRtB process. The survey sample was identified by analysing data provided by the Scottish Government Community Right to Buy branch and available through the Register of Community Interest in Land (RCIL). Every effort was made to identify valid email addresses for community bodies, including making phone calls to named contacts to verify or correct email addresses. Those without a valid e-mail address were excluded from the sample as they would be unable to receive the online survey, Responses were received from 65 community bodies, from a sample of 186 (response rate of 37% after adjusting for 29 non-contacts). Forty-eight per cent of those with a current registered interest in land completed the survey.

1.6 Following the survey, case studies were selected for more in-depth, qualitative research. Case studies were selected to include a broad spectrum of communities involved at each stage of the process. Selection criteria were based on the stages reached in the process, agreed with the Scottish Government in advance. Case studies were then selected at random from the original survey sample to fit each criterion. Sixteen case studies were carried out. Eight of these were "full" case studies involving site visits and face-to-face fieldwork with representatives of community bodies, while a further eight were "light" case studies that involved telephone interviews with community body representatives. Where possible and where relevant, full case studies also included in-depth interviews with other community representatives (e.g. community councils) and with the current or former landowner. In most cases, however, interviews with landowners proved difficult. Although every effort was made to contact landowners, in certain cases they were unable to respond to our requests for participation in the fieldwork while in other cases the relevant contact person was unable to be traced. Relevant monitoring data (e.g. application form and supporting documents) was also reviewed for each case study.

1.7 A detailed description of the methodology is included in Annex B.

The logic model approach

1.8 The evaluation has been structured around the CRtB logic model which shows the planned inputs and activities that are intended to lead to short, medium and, ultimately, long term outcomes.

1.9 Rather than presenting individual descriptions of each case study, feedback from case studies has been combined with data from other sources (review of administrative data, survey of community bodies and stakeholder interviews) and presented under the logic model headings of inputs, activities and outcomes. Reasons for this are two-fold. Firstly, case studies have been fully anonymised, which protects the identity of respondents and minimises sensitivities around individual viewpoints and existing ('live') CRtB processes. Detailed case-by-case descriptions may make case studies easy to identify, thereby removing the anonymity of research participants. Secondly, individual case study descriptions may not make clear the extent to which outcomes from the CRtB have been met. Using the logic model headings allows comparisons to be made across all case studies, along with other data sources, to explore each outcome area along with the inputs and activities that precede them.

1.10 The basis of the logic model is that, where evidence exists of short term and medium terms outcomes (for the community and for the land/assets), these should in turn lead to long term outcomes. The evaluation has sought to capture evidence of short and medium term outcomes, but it is outside the scope of the evaluation to provide evidence of longer term outcomes having been achieved. Long term outcomes are, by their nature, more difficult to capture as they are realised over a longer period of time and would, therefore, require more time to gather evidence than was possible within this evaluation. By following the logic model approach, however, the methodology acknowledges that evidence of short and medium term outcomes should ultimately lead to long term outcomes being achieved.

1.11 A draft logic model was developed by the research team at the beginning of the evaluation and tested with the Scottish Government and stakeholders before being finalised. The final logic model is shown in Figure A. Findings from the evaluation have been outlined in this report under each of the outcome areas shown in the model.

Summary of the Community Right to Buy process

1.12 Figure 1.1 shows the key stages in the CRtB process. Broadly, the CRtB has two main stages. The first stage is to register an interest in land, which may include land and/or buildings. The second stage arises when the landowner markets the asset: the right to buy (the right to buy becomes automatic where a "late" application is received after the owner has taken steps to market the land).

Figure 1.1: Summary of the CRtB process.

1.13 In order to submit an application to register a community interest in land which includes land assets, the community must have formed a community body - a company limited by guarantee - and have a compliant Memorandum and Articles of Association.

1.14 When the community body has met the various provisions in the legislation about their set up, they are issued with a Section 34(4) letter from the Scottish Government.

1.15 A community body can then make an application to register a community interest in land. This involves submitting an application form with general details of their proposed use for the asset together with various support documents such as maps, drawing and evidence of community support.

1.16 On receipt of a valid application, the Scottish Government then processes the application, seeking views from the landowner and parties affected by it. Ministers then consider it in relation to a number of criteria, including whether it is in the public interest to register the interest in the Register of Community Interests in Land (RCIL).

1.17 If an application is successful, the registered interest is entered into the Register of Community Interests in Land. The registered interest remains active for five years. If the asset does not come up for sale within this time period, the community body has to apply to re-register the interest.

1.18 The second half of the process is triggered when land that is registered comes up for sale. For late applications, where land was being marketed prior to completion of the registration stage, this follows on automatically from successful registration. For timeous applications, where an asset was not being marketed before Ministers received an application to register an interest in land, the relevant landowner must advise the Scottish Government of their intention to sell.

1.19 Once a community body has confirmed that it wishes to proceed with the right to buy, the Scottish Government appoints an independent valuation of the asset. Following this, the community body is required to ballot the community to show local support to proceed with the purchase. It is also required to show that it complies with the Act including: the asset is registrable; the proposed uses are compatible with sustainable development (demonstrated by a business plan, feasibility study or options appraisal); the purchase is in the public interest.

1.20 Finally, if the Scottish Government considers that the community body has met the provisions of the act, then the purchase can go ahead and the community body seeks funding and transfers the land.

1.21 Although no provision is made in the legislation, a key part of the right to buy stage of the process for community bodies is securing funding for their purchase.

1.22 Viewed from the perspective of the communities, there is wide variation as to timing and importance of land/assets coming onto the market. For some, knowledge that the land will come on the market is the catalyst that triggers involvement in the process, and is the main reason why a community body is formed. For others, the organisation may have been formally constituted for a considerable length of time. Furthermore, among these community bodies, some develop plans and submit applications in response to a potential sale, while others are more speculative in that they are undertaken on the basis of a potential future sale.

Stage reached in the process

1.23 The information in this section is derived from a review of administrative data collated from two sources:

• Applications to register an interest in land for the CRtB (collated together with information from any subsequent stages post-registration).
• Records of community bodies who had received a Section 34(4) letter as part of the CRtB legislation (but who had not yet submitted an application to register an interest in land).

1.24 The data provides information on the population of community bodies in Scotland who have registered, or who could register and interest in land using the CRtB. This was used as the sampling frame for the online survey. While this evaluation is focused on the impact of the CRtB process, rather than the process itself, below we summarise the number of community bodies who have reached each stage in the process. This provides context to the survey findings and the qualitative case studies. The data was collated as of late November 2014.

1.25 Receiving a Section 34(4) letter is the first formal stage in applying to use the CRtB. As of late November 2014, 206 community bodies had been issued with a Section 34(4) letter.

1.26 Table 1.1 summarises the stage reached in the CRtB process. Of the 206 community bodies issued with a Section 34(4) letter, 122 (54%) had not submitted an application to register a community body under the CRtB. (Some community bodies had submitted more than one application to register an interest in land. For these, Table 1.1 shows the latest stage reached in the application process).

Table 1.1: Stage reached (latest stage reached if multiple applications to register) for all community bodies with a Section 34(4) letter issued.

(Latest) stage reached - all community bodies	Total community bodies	% of all	% of registered
Section 34(4) letter issued	206	100%
Of which, applied to register an interest in land	94	46%
Of which, successfully registered	72	35%	100%
Of which…
Registration expired/deleted	14	7%	19%
Registration still active	21	10%	29%
Land bought (wholly or partially, within or outwith CRtB)	19	9%	26%
Right to Buy failed/rejected/community body withdrew	18	9%	25%

1.27 Of the 94 community bodies who submitted at least one application to register an interest in land, 72 (76%) successfully registered that interest. Of these 72, around half did not have the opportunity to purchase land as it had not come up for sale. Among community bodies where the land had come up for sale, around half were successful in purchasing (either wholly or partially, and within or outwith the CRtB legislation).

1.28 It is not uncommon for community bodies to make more than one application to register an interest in land under the CRtB legislation - either for land covered by a previous unsuccessful application, or for a different areas of land. Table 1.2 summarises the stage reached for all CRtB applications. Overall, 116 of 174 applications to register an interest (67%) had been successful. Of those that had not been successful, 20 were withdrawn and 39 were rejected.

1.29 For 42 of the 116 successful applications to register an interest, land had come onto the market and the subsequent stage of attempts to purchase the land had been completed. As shown in table 1.2, for half of these (22), the community body was successful in purchasing the land. These 22 purchases were either wholly (21) or partially (1), within (21) or outwith (1) the CRtB legislation.

Table 1.2: Stage reached for all CRtB applications.

Stage reached (all applications)	Total applications	% of all	% registered
Applications to register an interest in land	174	100%
Successful applications	116	67%	100%
Of which…
Registration expired/deleted	39	22%	34%
Registration still active	35	20%	30%
Land bought (wholly or partially, within or outwith CRtB)	22	13%	19%
Right to Buy failed/rejected/community body withdrew	20	11%	17%

1.30 Table 1.3 shows the stage reached for all CRtB applications to register an interest in land by whether the application was a timeous or late application.

Table 1.3: Stage reached by whether application was late or timeous.

Stage reached (all applications)	Late	Timeous	All
Applied to register an interest in land	46	128	174
Successfully registered	23	93	116
Of which…
Registration expired/deleted	1[1]	38	39
Registration still active	2[2]	33	35
Land bought (wholly or partially, within or outwith CRtB)	13	9	22
RTB failed/rejected/CB withdrew	7	13	20

1.31 Late applications are less likely to be successful than timeous applications (50% compared to 73%). However, because the land has come onto the market, they are more likely to have led to purchases (13 of 46 (28%) compared to 9 of 128 (7%)).

Location of community bodies

1.32 Figure 1.2 shows the location of Community Bodies who have received a Section 34(4) letter as part of the CRtB legislation. Overall, it shows a wide geographic spread.

Figure 1.2: Map of community bodies who have received a Section 34(4) letter as part of CRtB legislation.
(Location for community bodies who have not applied to register is approximate)