Strategic Environmental Assessment (SEA) for the Small Landholdings and Land Use Tenancy Proposals Environmental Report

5. Assessment of proposals

Introduction

5.1 This chapter presents assessment findings and recommendations in relation to the current Small Landholdings and Land Use Tenancy proposals. The chapter is structured to present:

• An outline of the proposals and its component parts.
• An assessment of the proposals under the four SEA themes identified through scoping.
• Consideration of cumulative effects; and
• The overall conclusions at this stage and recommendations for the next stage of plan-making.

Methodology

5.2 The assessment identifies and evaluates ‘likely significant effects’ on the baseline, drawing on the SEA framework identified through scoping (see Table 3.3) as a methodological framework.

5.3 Every effort is made to predict effects accurately; however, this is inherently challenging given the strategic nature of the proposals under consideration and understanding of the baseline (now and in the future under a ‘no plan’ scenario) that is inevitably limited. Given uncertainties there is a need to make assumptions, e.g., in relation to proposals implementation and aspects of the baseline that might be impacted. Assumptions are made cautiously and explained within the text (with the aim of striking a balance between comprehensiveness and conciseness). In many instances, given reasonable assumptions, it is not possible to predict ‘significant effects’, but it is possible to comment on merits (or otherwise) of the proposals in more general terms.

5.4 Finally, it is important to note that effects are predicted taking account of the criteria presented within Schedule 2 of the Environmental Assessment (Scotland) Act 2005. So, for example, account is taken of the probability, duration, frequency, and reversibility of effects as far as possible. Cumulative effects are also considered, i.e., the potential for the Strategy to impact an aspect of the baseline when implemented alongside other plans, programmes, and projects. These effect ‘characteristics’ are described within the assessment as appropriate.

Proposals outline and component parts

5.5 A description of the Small Landholdings and Land Use Tenancy proposals and component parts are set out in the consultation document with which this Environmental Report accompanies.^[12]

5.6 The key elements of the proposals can be summarised as follows:

• Diversification (non-cultivated activities) – The aim of this proposal is to allow small landholders greater opportunity to diversify their business. Currently, small landholdings may only be used for cultivated purposes. This proposals seek to remove the barriers that landholders face when undertaking non-cultivated activities, with a view to supporting integrated land management.
• Right to Buy – This proposal aims to ensure that small landholders and landlords have a fair right to buy opportunity, including a right to buy their holding in the same way as crofters and tenant farmers.
• Land Use Tenancy – This proposal aims to provide a flexible form of land tenure tenancy which caters for integrated land management in a way that the current agricultural tenancies do not.

Assessment findings

Biodiversity and geodiversity

5.7 The Diversification (non-cultivated activities) proposal will help address biodiversity loss by allowing small landholders to pursue non-cultivated activities such as tree planting, habitat and peatland restoration, and other nature-based solutions. In doing so, it will support the maintenance and enhancement of priority habitats and species, including the recovery of degraded habitats and declining species, and improve ecological connectivity. The proposal also provides opportunities for small landholders to engage with conservation and restoration activities on their land. Increased levels of environmental enhancements across small landholdings are likely to provide additional opportunities to access biodiversity, not only for small landholders but also the wider general public. This will help enhance understanding of biodiversity.

5.8 The Right to Buy proposal, by making it easier for small landholders to buy the land they farm, is likely to lead to small landholders developing a vested interest in their land. This could be leveraged to support biodiversity and geodiversity through activities such as habitat restoration, species conservation, protected area enhancements and public engagement/ education. However, it is recognised that any benefits remain largely dependent on the priorities and actions of the new landowner after purchase, rather than being inherent outcomes of the policy itself. Hence, whilst the proposal has the potential to lead to positive biodiversity and geodiversity outcomes, it does not guarantee them.

5.9 The Land Use Tenancy proposal introduces greater flexibility in the way land can be used, including a greater focus on activities contributing towards biodiversity recovery and nature restoration. It will support integrated land management approaches bespoke to the local setting, which will ensure that the local context, including local biodiversity and geodiversity, is considered through land management. This provides clear opportunities for habitat enhancement and species protection, ecological regeneration, tenant engagement and the achievement of biodiversity goals through context-specific management.

5.10 It is noted that these proposals will also support other activities, such as renewable energy uses (e.g. wind, solar and biomass), which have the potential to negatively impact biodiversity. However, it is also possible for such uses to enhance biodiversity if designed and managed appropriately, particularly if biodiversity net gain is effectively enacted.

5.11 Overall, all three proposals perform well under the biodiversity and geodiversity SEA theme. Whilst there is some concern regarding the potential of non-agricultural uses such as renewable energy provision to harm biodiversity, it is recognised that proposals are unlikely to support activities that have a negative impact on biodiversity and geodiversity. In light of this, major positive significant effects are considered likely under this SEA theme. However, it is recognised that the Right to Buy Proposal does not guarantee positive outcomes with respect to climate change.

Climate change

5.12 The Diversification (non-cultivated activities) proposal contributes to climate change mitigation by allowing small landholders to pursue non-agricultural activities such as tree planting and peatland restoration which support biological carbon sequestration (the natural process of removing carbon dioxide from the atmosphere and storing it in trees/ soils). It also supports activities such as wetland and floodplain restoration, which will contribute to climate change adaptation by increasing the resilience of agricultural land to the impacts of extreme weather events, such as floods and droughts. In addition to these nature-based climate solutions, this proposal supports renewable energy uses (e.g. wind, solar and biomass), further contributing to climate change mitigation and supporting Scotland’s goal to reach net zero emissions by 2045.

5.13 The Right to Buy proposal, by making it easier for small landholders to buy the land they farm, is likely to lead to small landholders developing a vested interest in their land. This could be leveraged to support land management activities that contribute to climate adaptation and mitigation, including tree planting, peatland restoration, renewable energy production, and resilience capacity building. However, it is recognised that any benefits remain largely dependent on the priorities and actions of the new landowner after purchase, rather than being inherent outcomes of the policy itself. Therefore, whilst the proposal has the potential to lead to positive biodiversity and geodiversity outcomes, it does not guarantee them.

5.14 The Land Use Tenancy proposal introduces greater flexibility in the way land can be used, including a greater focus on activities contributing towards the transition to net zero and climate adaptation. It would facilitate customised land management approaches aligned to the local context, including diversification of activities that support climate change mitigation and adaptation. These include activities that increase carbon sequestration, produce renewable energy, or increase resilience through land-based adaptation strategies. The proposal provides opportunities to leverage integrated place-based solutions that balance production with sustainability to achieve positive climate mitigation and adaptation outcomes. It may also provide opportunities for small landholders to access emerging environmental markets.

5.15 Overall, given that all three proposals perform very well under the climate change SEA theme, major positive significant effects are anticipated relating to both mitigation of and adaptation to climate change. Unlike with the biodiversity and geodiversity SEA theme, the impetus on both nature-based climate solutions and renewable energy uses will benefit the climate change SEA theme. However, it is noted that the Right to Buy Proposal does not guarantee positive biodiversity and geodiversity outcomes.

Landscape and historic environment

5.16 The Diversification (non-cultivated activities) proposal, by allowing small landholders to pursue non-agricultural activities such as tree planting, habitat restoration and other nature-based solutions, has the potential to reinforce and enhance landscape character and enhance the special qualities of landscapes, including those associated with nationally designated landscapes such as National Scenic Areas. However, it also has the potential to negatively impact on the special qualities of local landscapes that are traditionally characterised by agricultural land uses. In this respect, activities such as tree planting would create new features that are not been typically associated with the landscape. The proposal could also result in mixed effects on the historic environment. Whilst it may support the conservation of traditional agricultural landscape features, such as hedgerows and stone walls, moving land away from agricultural use may risk the loss of traditional practices and lead to changes in local character. This has the potential to affect the setting of the historic environment. However, it is noted that diversification may provide a greater level of income for small landholders, and this may allow for resources to be used to restore or better reveal the significance of heritage features within the landscape.

5.17 The Right to Buy proposal provides opportunities to empower small landholders who hold valuable place-based expertise, generational knowledge and intrinsic connections with the land. In this respect, it can create a platform for smallholders with generational ties to the area to apply their traditional and local knowledge in managing the landscape and historic features in an empathetic, place-responsive manner. This has the potential to support land and asset management which reflects and reinforces local character and engages with the historic environment resource. However, any landscape and cultural heritage benefits remain partly contingent on the actions of the incoming landowner. As a result, positive outcomes are not guaranteed.

5.18 The Land Use Tenancy proposal introduces greater flexibility in the way land can be used, including a greater focus on activities contributing towards nature restoration and woodland creation, which contribute to the landscape. It would facilitate integrated place-based management approaches which are relevant to the local context, allowing diversification of activities that balance production with landscape and heritage conservation and enhancement.

5.19 Overall, whilst the benefits under all three proposals with respect to the landscape and historic environment SEA theme are recognised, uncertainty is noted at this stage. This is because activities such as tree planting could alter landscapes that are historically characterised by arable and agricultural land use. In addition, renewable energy uses have the potential to impact on landscape character, as well as negatively impact the setting of important heritage assets and historic areas. It is also recognised that the Right to Buy Proposal does not guarantee positive outcomes with respect to landscape and the historic environment.

Soil and water quality

5.20 The Diversification (non-cultivated activities) proposal will maintain and enhance soil and water quality by enabling regenerative agriculture techniques which support regulating ecosystem services. This includes, potentially, through facilitating participation in environmental markets. Specifically, this would allow small landholders easier access to emerging carbon, water quality and biodiversity markets that provide payments for practices like cover cropping, riparian buffers and habitat restoration. However, proving additionality (i.e. that the benefits delivered are additional/ new to what is being currently provided) and stacking of ecosystem services (i.e. where multiple ecosystem services or benefits are being claimed by one intervention) would need to be addressed to ensure the integrity of these environmental markets is upheld.

5.21 The Right to Buy proposal provides small landholders with potential long-term control over land management, which could encourage activities which support soil and water quality. However, any soil or water quality benefits remain largely dependent on the priorities and actions of the incoming landowner, not the policy itself. In this respect, the proposal does not inherently dictate outcomes. Small landholders may focus on intensive agriculture rather than diversification after purchase. Due to this, negative outcomes are just as likely to be delivered as positive outcomes.

5.22 The Land Use Tenancy proposal would likely facilitate integrated place-based management approaches, allowing the broad implementation of context-specific practices that result in improvements to soil and water quality. For example, it would enable the broad adoption of regenerative practices, such as cover crops, to enhance soil health, or allow activities such as wetland restoration to protect water quality. Therefore, the proposal provides opportunities to improve soil and water quality through solutions that are sympathetic to the local context. It may also provide opportunities for small landholders to access emerging environmental markets.

5.23 Overall, all three proposals perform well under the soil and water SEA theme by supporting activities which contribute towards improved soil and water quality. Due to this, major positive significant effects are anticipated. However, it is recognised that the Right to Buy Proposal does not guarantee positive outcomes with respect to soil and water quality.

Cumulative effects

5.24 A range of positive cumulative effects across the SEA themes are anticipated as a result of the in-combination effects of Small Landholdings and Land Use Tenancy proposals and other plans and strategies. In this respect, the proposals (and framework they sit within) complement and reinforce the objectives and actions of Scotland’s Environmental Strategy, Climate Change Plan, National Strategy for Economic Transformation, NPF4 and other key plans and strategies nationally. No negative cumulative effects are anticipated in terms of the implementation of the proposals.

Conclusions and recommendations

5.25 Three of the four SEA themes considered through the appraisal are considered likely to lead to major positive significant effects – these are biodiversity and geodiversity, climate change, and soil and water. The proposals support activities which maintain and enhance biodiversity, contribute to climate change mitigation and adaptation, and improve soil and water quality through enabling the facilitation of a range of regenerative activities including nature-based solutions. With respect to climate change, renewable energy use also plays a key role. Nevertheless, it is recognised that the Right to Buy Proposal does not guarantee positive outcomes.

5.26 Uncertainty is noted with respect to the landscape and historic environment SEA theme because activities such as tree planting could alter landscapes that are historically characterised by arable and agricultural land uses. In addition, renewable energy uses have the potential to impact the special qualities of valued landscapes as well as negatively impact the setting of important heritage assets and historic areas. In light of this, it is recommended that the proposals clarify that activities, particularly non-agricultural activities, must give due consideration to the local landscape and historic context, with activities only being supported where they maintain or enhance local landscape character and/ or the setting and significance of the historic environment.

5.27 Furthermore, there are a number of actions the Scottish Government can take to alleviate this uncertainty and support and encourage small landholders and tenants to undertake diversification on their land. For instance, detailed guidelines and case studies for small landholders can play a key role in demonstrating the landscape and heritage benefits that can be delivered through diversification and alleviate concerns about a changing baseline. These guidelines could profile land use options landholders could consider, for instance in terms of regenerative agricultural practices like cover cropping and riparian buffers. Guidance should include specific examples which provide advice on how the landscape features may differ to conventional approaches. This will help support clarity for small landholders whilst helping to alleviate concerns. For example, cover cropping differs from the bare fallow fields of conventional agriculture by planting cereals, legumes and brassicas between crop cycles to protect soil. When strategically planted and terminated, cover crops increase organic matter, fix nitrogen, and break pest cycles. Additionally, riparian buffers establish vegetation strips along waterways rather than cropland directly adjacent to streams. The buffers filter agricultural runoff, stabilize banks, and create wildlife corridors. Showcasing these and similar practices through guidelines and highlighting the benefits can provide visual and peer reviewed evidence of how biodiversity, climate soil and water benefits can be delivered through multiple land management routes. This guidance could be delivered as part of the implementation of changes to the Land Use Tenancy.

5.28 In addition, to address perceived uncertainties around the risks of moving to different land use practices, a piloting phase could be undertaken, focusing on demonstrator projects that provide a roadmap for agricultural tenants, how diversification can be achieved and evidence of successful implementation within a similar context. The demonstrator projects could be based on key themes relating to diversification options, for instance:

• Nature enhancement and restoration
• Net zero technologies
• Eco tourism
• Regenerative agriculture

5.29 Monitoring at the landholding level will also be a key element to demonstrate how diversified land uses not only contribute to national biodiversity and climate targets, but also deliver productivity benefits. Monitoring can be a complex and detailed process but will be critical to ensure diversification away from traditional intensive agriculture is delivering on objectives. As such, the Scottish Government should endeavour to develop robust monitoring guidance to help small landholders and tenants understand how to track habitat, soil, carbon sequestration, and other environmental improvements over time. Possibilities for monitoring could include aspects such as assessing soil organic matter content annually, monitoring species diversity and habitat surveys every three years, or undertaking soil analysis every five years to measure carbon sequestration rates and progress. From a wider landscape or national perspective a complete biodiversity inventory mapping habitat connectivity every ten years could examine the full impact of the system.

5.30 Finally, given the cultural importance of the agriculture sector, tight margins and established practices, small landholders and tenants should continually be encouraged and supported to deliver land use changes. Offering ongoing incentives could motivate adoption of diversification in line with climate and conservation goals and alleviate any perceived risk. Incentives could include initiatives such as tax reductions, cost-shares, low-interest loans and guidance and support to help small landholders and tenants access environmental markets relating to biodiversity, carbon, soil and agriculture and other ecosystem services.