Small landholdings: landownership and registration - report

3. Findings

3.1. Small landholdings are a unique and minority form of agricultural holding of which there are approximately 68 remaining, down from a peak figure of around 476. This form of holding was created under the Small Landholders (Scotland) Act 1911, and developed in a number of interesting directions, driven by short term contemporary issues. For example, pressure on government to allocate land to ex-service landless labourers and small tenants during and after World War One or to support the initial years of the Forestry Commission. Contemporary small landholdings are by definition all outwith the crofting counties.^[1]

3.2. The Small Landholders (Scotland) Act 1911 came into operation in April 1912 via the creation of the Board of Agriculture for Scotland [BoAS] and the Scottish Land Court [SLC]. The BoAS was constituted and given powers to create new holdings on privately-owned land. It was composed of three executive officials: the chairman; an official in charge of agricultural education and improvement and – most relevant to this project – an official in charge of the Land division, with responsibility for creating small landholdings.

3.3. Schemes were established along the following principles. Firstly, a demand for small landholdings had to be established, usually in the form of applications from potential tenants or a suggestion by the BoAS itself, but occasionally volunteered by landowners or farm tenants. Secondly, some potentially available land had to be identified. Sub-commissioners of the BoAS were required to keep themselves informed of which farms were about to fall out of lease, to inspect these and report on their suitability for schemes. Then, if the report was positive, negotiations would be opened with the relevant estate management.^[2] If the estate agreed in principle, there were two options: (1) the settlement could proceed through agreement, in which case the estate had no right to subsequent compensation if the scheme failed, or (2) if the estate had no objections but wished to protect their right to compensation, an unopposed compulsory order would be sought from the SLC. Route (2) was by far the most common.^[3] Up to £200,000 per annum was available to the BoAS via the Agriculture (Scotland) Fund to support these activities.

3.4. Much of these funds were eaten up by various compensation claims from both existing tenants, whose tenancies were being disrupted, and also the landowners. Compensation claims under £300 were settled by the SLC; claims of over £300 were taken to an arbiter appointed by the Court of Session. The landowner was only required to state whether they would be claiming in excess of £300 without giving an accurate or final amount and this often delayed the settlement of schemes.

There was widespread contemporary dissatisfaction about the inconsistency of compensation awards made by the arbiters appointed by the Court of Session, but inconsistency was hardly surprising given that the arbiters had no guidance to follow. Compensation was paid from the Agriculture (Scotland) Fund meaning that the more compensation paid, the fewer schemes could be established. Financial pressures had other consequences (see 3.10).

3.5. As its provisions were not taken up by large numbers of agricultural tenants, and as there was no overarching and dedicated overseeing body, information or recordings of how these holdings have changed over time in terms of area, use and status, has not been systematically kept. Historically, part of the issue is that this scheme was something of a 'Cinderella's sister' to the much better known (and even more complex) histories of crofting tenure and farm tenancies, as well as the lack of a dedicated organisation overseeing small landholdings (such as the Crofters Commission for instance), or a land register.

3.6. The researchers also looked to see if there were enough records to (re)establish a small landholdings register detailing the current situation. While there is a lot of accessible archival material, gaps in the records on either ownership or tenure terms, from 1940 to today – when many changes will have occurred – will result in any 2019 register having significant gaps on the majority of schemes. This is partly due to landed estates and government agencies having no incentive to maintain archives in any great detail after schemes were established.

3.7. As the archival record is the most detailed for the periods around establishment of schemes, it is a straightforward process to identify compensation paid to landowners and sitting farm tenants. One of the chief initial obstacles for the BoAS was the lack of defined processes for calculating compensation in the 1911 legislation, leading to long delays over schemes. While the issue of compensation was taken on a case by case basis, a common formula was eventually developed. It was for the landowner to be paid 25 years' worth of rental value, of the difference between the old and the new 'fair' rents set by the SLC. Securing 25 years' purchase might be considered generous to landowners, particularly in the period 1918-1930, when a wave of private land flooded the market, depressing prices to significantly below that on the private market. For example, land being sold privately by the Sutherland estates achieved (at best) 11 or 12 years' purchase.^[4]

3.8. Overall, most landed estates were amenable in principle to the creation of small landholding schemes on their property, especially after WWI, although there might be protracted negotiations over levels of compensation. Compensation claims focused on the value of the existing buildings, infrastructure and other facilities, as well as the loss of rent. The estates were also focussed on ensuring that proposed schemes had a robust business model; that is, that they had a chance economically. It is also worth noting that in terms of the process of establishing new schemes, the BoAS normally opened negotiations with the landowner, without informing any existing tenant(s) on the land identified for the scheme. Negotiations would continue 'behind closed doors' and the archives show that plans might be up to five years in development before the existing tenant(s) were informed. Lastly, with all of the case study schemes, both existing tenants and landowners dealt very cautiously with the BoAS, as they were concerned that the BoAS would (as it did) abandon plans for schemes regularly. This made it difficult for existing tenants in terms of the security of their leases and renewal negotiations. To evidence this from the case studies selected here, at Bennicarrigan on Arran, negotiations for a scheme began in 1912 and the scheme did not progress until after 1928. The norm was 2-5 years from negotiation to scheme establishment (as in the cases of Crossbankhead and Grassmillees).

3.9. Most private landowners were represented by a select number of legal firms which built up reputation and expertise in this area of land law. Some were Edinburgh-based with national reach; others local to specific schemes. They were:

• Tods, Murray and Jamieson (Edinburgh).
• Brownlie, Watson and Beckett (Glasgow).
• McDonald and Roddick (Annan): dealing with Crossbankhead.
• Gillespie and Paterson (Edinburgh).
• Haddon and Turnbull (Hawick): dealing with Kinninghall.
• Balfour and Manson (Edinburgh); R. Peden Smith (Irvine): both dealing with the Drumaghiner scheme.

3.10 Depending on the location of the schemes, the lack of existing facilities, communications and infrastructure could pose obstacles and add significant costs for the BoAS. For example, at Kinninghall, near Hawick, provision for water supplies was required. The BoAS tried as often as possible to ensure the incoming small landholders were made responsible for these facilities rather than themselves. They advanced loans and to a lesser extent grants for this purpose to the small landholders (not the landowner). These loans generate a good deal of archival detail and raise the issue of to what degree small landholdings were financially within reach of the average working person. Certainly, they are the source of long and complex cases in many case studies. A further recurring issue was future financial responsibility for facilities put in place, e.g. further repairs, upkeep and costs. The BoAS rejected arguments that it was them and wrangles over these issues could spin out over many years.

3.11. As per standard practice, when a scheme was successfully established, the landowner retained the rights to game, minerals, feuing, quarrying etc.

3.12. Once holdings were established and occupied, the BoAS turned the maintenance of the scheme over to the small landholders and the landowner. For example, it was the landowner's responsibility to ensure the landholdings remained occupied after a small landholder vacated/died. This means that it is possible (but by no means guaranteed) to track the history of a small landholding in the archives of the landowner, once the government records end.

3.13. Issues could arise when small landholders wished to give up their tenancies (often due to the fact they could not make them work economically), but still owed loans to the BoAS. There was some confusion around which party was responsible for making good any loans to the BoAS. The Kinninghall case study suggests that this might have been the landowner. The BoAS refused to transfer outstanding loan amounts to new small landholders coming into a tenancy. There was often confusion about whether the landlord or BoAS had responsibility for taking decisions on critical issues of land transfer and change of use/ownership.

3.14. The scale of activity under the small landholders scheme was significantly greater after WWI than before. In the pre-1914 schemes, the BoAS was testing its processes and demand, and took time to 'tweak' settlement plans (for example, reducing or increasing the number of holdings in a scheme after it had been agreed). In the war years themselves, the pace of work of the BoAS and SLC slowed considerably due to essential staff, as well as potential new small landholders, being away on war service. After 1918 the scale rapidly increased, and the BoAS was establishing many schemes simultaneously, up to around 1925, when significant budget cuts (the so-called 'Geddes Axe') as well as declining demand, curbed the establishment of new schemes.

3.15. Another area of controversy for the BoAS and the SLC after 1919, was the revaluation of loans on schemes developed in the period of very high prices in the immediate post-war years. The subsequent dramatic fall in those prices left the small landholders saddled with unserviceable debts. In 1925, £338,299 (or approx. £13.8 million in 2018 values), worth of small landholder's loans (across the whole of Scotland), were written off by the BoAS to keep the schemes 'workable'.

3.16. It is likely that the number of small landholdings peaked in the early 1930s, and has been steadily decreasing since then, but particularly from the 1960s. There are a number of reasons for this; some national and some local. First, there was declining demand for SLHs as a tenancy type as the mechanisation of agriculture and an increasing requirement for capital to farm from the 1930s became apparent. Few SLHs were large enough to warrant this type of investment. Demographic decline, critical in Scotland in the 1920s and 1930s overall, but particularly rural Scotland, impacted succession to and demand for SLHs. Fundamentally, SLHs were created for a short-term political purpose, and once the initial demand was met, the need for new SLHs declined and the tenure arrangements on existing SLHs began to change.

3.17. As noted in section 2, the project focussed on 7 case study schemes, with the findings from each detailed here. This has been visualised as a table for each case study, enumerating the costs of its set up, including compensation granted to landowner and sitting tenant, grants and loans made to the new SLHs and other costs, where applicable. First, here is a table bringing all the case studies together for ease of comparison. Please also see section 6.1.1-7 (pages 18-21) for fuller narrative summaries of each case study.

Name of Scheme	Total cost of establishment5*	Compensation to landowner	Compensation to sitting tenant	Buildings Loans and Grants6	Additional Loans and Grants7
Kinninghall, Hawick	£10,471	£5,650	£208	£3,650	£963
Crossbankhead, Annan	£79	£51	Nil	Nil	£28
Bennicarrigan, Arran	£4,592	£1,075	£117	£2,600	£800
Shedog, Arran	£11,120	£500 (for buildings)	£90	£5,900	£1,380
Grassmillees, Kilmarnock	£16,936	£2,200 (approximately)	£2,161 to Paton, £540 to Brown	£10,875	£1,160
Springbank, Arran	£2,370	Nil	£50	£2,000	£320
Drimaghinier, Arran	£53	Nil	Nil	Nil	£53

*All costs rounded to nearest pound^[5][6][7]

Not all schemes required each type of expenditure.

The archival record is unclear in many cases as to the final total cost of loans and grants, and some of these figures are estimates. All compensation amounts are actual.

Most carried legal costs, but these have not been enumerated here, as in most cases the BoAS covered these costs and where they did not in full, it was often the case that each party (i.e. the landowner and the Board) were required to pay the stamp duty on the paper. The landowner had to pay their half of this which was not repaid by the Board.

3.17.1. Kinninghall, Roxburghshire. Archival material is available from October 1912 to August 1962, with the majority of material from the 1920s. The scheme consisted of nine units.

Name of Scheme	Total cost of establishment*	Compensation to landowner	Compensation to sitting tenant	Buildings Loans and Grants	Additional Loans and Grants
Kinninghall, Hawick	£10,471 (estimate with actual compensation)	£5,650	£208	£3,650	£963

3.17.2. Crossbankhead, Dumfriesshire. Archival material is available from September 1912 to July 1927. This was a very small scheme of just one unit.

Name of Scheme	Total cost of establishment*	Compensation to landowner	Compensation to sitting tenant	Buildings Loans and Grants	Additional Loans and Grants
Crossbankhead, Annan	£79 (Actual)	£51	Nil	Nil	£28

3.17.3 Bennicarrigan, Arran. Archival material is available from October 1912 to December 1938. The scheme was suggested in 1912, abandoned around 1919, resurrected in 1928 and finalised by 1929. The scheme consisted of four new units and five enlargements of existing holdings.

Name of Scheme	Total cost of establishment*	Compensation to landowner	Compensation to sitting tenant	Buildings Loans and Grants	Additional Loans and Grants
Bennicarrigan, Arran	£4,592 (Actual compensation and estimated scheme)	£1,075	£117	£2,600	£800

3.17.4. Shedog, Kilmory, Arran. Archival material is available from December 1913 to January 1923. The scheme consisted of six new units.

Name of Scheme	Total cost of establishment*	Compensation to landowner	Compensation to sitting tenant	Buildings Loans and Grants	Additional Loans and Grants
Shedog, Arran	£11,120	£500 (for buildings)	£90	£5,900	£1,380

3.17.5. Grassmillees, Ayrshire. Archival material is available from March 1920 to May 1922. The scheme was initiated by the BoAS, and both the landowner and sitting tenant agreed in principle. The scheme consisted of 15 new units.

Name of Scheme	Total cost of establishment*	Compensation to landowner	Compensation to sitting tenant	Buildings Loans and Grants	Additional Loans and Grants
Grassmillees, Kilmarnock	£16,936	£2,200 (approximately)	£2,161 to Paton, £540 to Brown	£10,875	£1,160

3.17.6. Springbank, Arran. Archival material is available from December 1920 to 1930. The scheme consists of two new units.

Name of Scheme	Total cost of establishment*	Compensation to landowner	Compensation to sitting tenant	Buildings Loans and Grants	Additional Loans and Grants
Springbank, Arran	£2,370	Nil	£50	£2,000	£320

3.17.7. Drimaghinier, Arran. Archival material is available from February 1927 to March 1938. This case study is an example of where an existing tenant converts to the status of SLH. In this case, the landowner initiated discussions with the BoAS having already agreed in principle with the tenant to make the conversion. The scheme consisted of only one unit.

Name of Scheme	Total cost of establishment*	Compensation to landowner	Compensation to sitting tenant	Buildings Loans and Grants	Additional Loans and Grants
Drimaghinier, Arran	£53	Nil	Nil	Nil	£53

3.18. As the case studies demonstrate, there was a good deal of variation in the experience of establishing a SLH scheme. Overall though, they tended to be concluded with greater speed after 1918, when more political pressure was brought to bear on both the BoAS and landowners, and after the Land Settlement (Scotland) Act 1919 clarified some of the most obstructive elements of the original 1911 legislation. The case studies from before 1914 were also slowed down by (1) a relative lack of demand (outwith the crofting counties), and (2) the fact that the BoAS and SLC were newly constituted bodies with no precedent or established procedures to follow.

3.19. Most SLH schemes outwith the crofting counties were relatively small in scale, as demonstrated by the case studies. Some were as small as 1 or 2 new SLHs, whilst others contained up to 15. This meant that their overall cost could be relatively high (when calculated per unit), as economies of scale for infrastructure, buildings and fencing could not be achieved.

3.20. Demand for SLHs outwith the crofting counties declined from the late 1920s, as did political appetite and budgets. No central register was kept updated for SLHs by the BoAS, and most of the archival material relates to the establishment of schemes, rather than how they evolved.

Understanding the changing nature and status of small landholdings requires some understanding of the workings of the two government agencies most closely associated with them: the Board of Agriculture for Scotland (BoAS) and the Scottish Land Court (SLC).