Scotland's Land Tenure Reform Explained

Scotland’s landownership structure remains one of the most concentrated and inequitable in the developed world, making it a global anomaly. Just 421 landowners control half of Scotland’s private rural land, while less than 3% is owned by local communities. This disparity highlights a deep-rooted imbalance in land distribution that continues to shape the nation’s social and economic landscape.

In recent decades, the rise of investor landowners has exacerbated this issue. These entities prioritise portfolio returns for distant shareholders over local needs. For example, Gresham House Ltd Partnerships, an international asset manager, owns over 53,000 hectares of Scottish land—equivalent to nearly 75,000 football pitches. Increasingly, vast areas are being acquired by companies and wealthy individuals based in tax havens or abroad, including the US, Scandinavia, and the Middle East.

This concentration of ownership has historical roots dating back to the Highland Clearances of the 1700s and 1800s, when wealthy landlords evicted tenant farmers en masse to pursue more profitable ventures like sheep farming. Although reforms such as the abolition of feudal land tenure in 2000 have been introduced, monopolised landownership continues to hinder local voices and development. It impedes progress on housing, climate action, biodiversity restoration, and equitable agriculture—issues critical to Scotland’s future.

The Land Reform (Scotland) Bill presents a rare opportunity to address these challenges. However, while some aspects of the Bill are promising, it falls short of delivering the transformational change required to truly reform Scotland’s flawed landownership patterns.

The Land Reform (Scotland) Bill aims to tackle concentrated landownership and empower communities by introducing new regulations on how land is used, bought, and sold across Scotland.

The Bill consists of two main parts:

• Part One: Focuses on transparency and community engagement regarding large landholdings. It includes measures to make it easier for community groups to purchase land when it comes up for sale.
• Part Two: Addresses agricultural and environmental uses of leased farmland.

While these provisions are designed to make land more affordable and attainable, similar to measures in previous land reform bills passed in 2003 and 2016, they yielded limited success. The ILC member, Community Land Scotland (CLS), a key stakeholder in this debate, argues that while the current Bill contains important steps forward, it lacks the ambition needed to truly transform Scotland’s inequitable landownership system.

Despite its shortcomings, according to CLS, there are aspects of the Bill that deserve support:

• Transparency in Land Sales: The Bill proposes public notification for sales of landholdings over 1,000 hectares. This change prevents large estates from being sold off-market without public awareness—a practice that accounted for 61% of Scottish land sales in 2020-2021.
• Lotting Large Estates: Breaking up enormous estates into smaller parcels could enable broader ownership opportunities. Lotting could facilitate community-centric benefits such as housing developments, new crofts, or community forestry initiatives. This approach spreads wealth while promoting collaborative management practices.

While there are positive elements within the legislation, CLS argues that significant gaps remain:

• Thresholds Too High: The Bill introduces mechanisms like a ‘Transfer Test’ (assessing community sustainability during sales) and mandatory Land Management Plans for estates over certain thresholds—1,000 hectares for sales and 3,000 hectares for management plans. These thresholds are far too high to effect meaningful change across Scotland’s landscape. Lowering them to 500 hectares would bring more holdings under regulation and increase the impact of these reforms.
• No Assessment of Buyers of Land: It had been anticipated that the Bill would feature a Public Interest Test to assess who is buying significant landholdings in Scotland and whether their ownership worked in the public interest. This would provide much needed oversight of who owns land in Scotland as well as allowing communities or the public sector to intervene if private landownership was not in the public interest.
• Urban Areas Excluded: Urban Scotland has been largely ignored by this Bill despite benefiting from previous legislation since 2016. Cities like Glasgow and Edinburgh have thriving community-led initiatives addressing urban land issues such as vacant or derelict sites owned by absentee developers. By focusing solely on large rural estates, the Bill misses an opportunity to reform damaging urban landownership practices—a strategic misstep given Scotland’s broader challenges with housing and development.

Land reform is foundational to building a fairer society where communities have equitable access to resources and decision-making power over their surroundings. While the Land Reform (Scotland) Bill makes progress toward this goal, its lack of ambition risks perpetuating existing inequalities rather than dismantling them.

Scotland has a rare opportunity to redefine its relationship with landownership—a chance not only to undo centuries of inequity but also to foster sustainable development for future generations.