Peat is the new gold mine for landowners

Two weeks ago, the Gazette asked the Scottish Government a straightforward question – could they provide a list of estates which have registered to take advantage of its £250 million Peatland Restoration Scheme.

By Brian Wilson
Monday, 30th May 2022, 11:58 am
Updated Thursday, 2nd June 2022, 9:32 am
Estates and land-owners are being subsidised for environmental work.
Estates and land-owners are being subsidised for environmental work.

As a supplementary, we asked specifically about the position in the Western Isles. Which estates, it seemed reasonable to enquire, had positioned themselves to be beneficiaries of this huge exercise in public largesse.

The response from a Scottish Government Senior Media Manager was not helpful: “I have looked into this for you and can confirm that the Scottish Government does not hold this information. However, NatureScot should be able to provide it if you are able to submit a Freedom of Information request”.

This week, after a couple of requests and without resort to FoI, Nature Scot (or Scottish Natural Heritage as we used to know it) came back with some names and the promise of more to follow, but no mention of money. Where landowners are concerned, the concepts of transparency and accountability are always alien.

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It seemed a bit bizarre that the Scottish Government should suggest that a Freedom of Information request to one of its quangos was required to extract what should be public information about the allocation of public money. But then the whole business of Peatland Restoration is a shady, under-exposed affair.

It took the New York Times to sum up what is going on around us: “In effect, Scotland has said ‘Bill us for the digging and keep all the gold you can mine”. Information about who the gold miners are is, as ever, shrouded in secrecy for those who do not want to reveal it.

The certainty is the sudden realisation that degraded peatland is an asset that can be turned into money has taken the inglorious history of Scottish land ownership into a new and lucrative phase. Yet it has been the subject of almost no public debate and, for the purpose of setting any public interest trajectory, Holyrood might as well not exist.

The New York Times devoted a 3,000 word investigation to what is going on, drawn to the story by the fact that Scotland has a higher proportion of peat bog than anywhere else in the world and also the least regulated market in land – a combination that has made it a global magnet for speculators. In that respect, nothing has changed.

“The peat part of this operation is relatively new”, noted the New York Times. “Until recently, peat bogs were derided as useless swampland — ideal, perhaps, for burying bodies in a murder mystery, but not much else. Landlords in Scotland often drained peatland to plant trees, or stocked it with sheep and let them hoover up the top grass.

“In the last few years, however, peatland’s cachet has soared as the world grasped that nothing on earth is more efficient at locking up carbon, potentially for thousands of years if properly maintained”.

That could have created an opportunity for communities to benefit from the new-found value of the peatlands which surround them. Instead, as the New York Times observed: “Private landholders who restore peatlands will see 80 percent of their outlays reimbursed by the government, and then keep the profits from carbon-credit sales.

“Those snapping up property in Scotland include life insurance companies, private equity funds and a brewery and pub chain called BrewDog. The amount of money invested in Scottish land doubled last year, climbing to $330 million…

“For the vast majority of Scots, though, the frenzy is like a party in their backyard that they can’t attend. The influx of money has tripled the price of choice rural plots in recent years, putting them beyond the financial reach of locals”.

While all of this has attracted the astonished interest of the New York Times, as well as the global speculators, it is remarkable how little political awareness – or embarrassment – there is in Scotland about an extreme transformation of the land market which is being driven by public money but without the slightest hint of community benefit.

In an effort to highlight and correct this, Community Land Scotland – the umbrella body for community owned estates – commissioned a report from two economists, Laurie Macfarlane and Miriam Brett, which has now been published.

Community Land Scotland has a strong vested interest in this debate because one its immediate effects has been to make community buy-outs far less likely, even where the will exists. No community can compete in the current land market, which helps explain why the buy-out phase of 20 years ago has ground to a halt.

Indeed, one has to wonder if the crofting estate landowners – mainly in the Western Isles – who were willing to facilitate community buy-outs at that time would have done so now. In that respect, the islands’ community landowners just got in on time but there is very little prospect, without enabling legislation, for any more to happen.

The report for Community Land Scotland noted an abiding truth about Scottish land ownership – that while big money estate sales attract the headlines, the great majority of Scottish land remains in the same hereditary hands. In other words, the same interests that have presided over generations of land degradation are now being invited to cash in on its restoration.

As Macfarlane and Brett put it: “It is important to note that while this paper focuses on recent land acquisitions in Scotland, a substantial proportion of carbon credits and grants being issued are going to incumbent landowners that have owned land for decades and sometimes centuries”.

They also spell out the pace at which the land market is going in only one direction. Their report continues: “Overall it is clear that there is the potential for land values to increase significantly in the years ahead if prices in the voluntary carbon market continue to rise. This could be further fuelled by the emergence of new natural capital markets in the near future, which could create additional revenue streams for landowners in Scotland”.

Having “ highlighted how Scotland’s carbon sequestration and natural capital potential could generate significant economic value over the coming decades”, the researchers warn: “Recent trends in Scotland’s land market indicate that there is a significant risk that the financial rewards from Scotland’s ‘natural capital’ potential could end up flowing to a small number of private landowners rather than generating inclusive prosperity for Scotland’s rural communities and local economies.”

They continue: “These dynamics could also have profound impact on Scotland’s land market – making it increasingly difficult for rural communities to fulfil their economic potential and constraining opportunities for development… In order to address the growing disconnect between the current trajectory and the Scottish Government’s stated policy objectives, fundamental reforms to the ownership and governance of Scotland’s land market are required.”

The report argues that “scaling up a Community Wealth Building approach to land reform can help deliver on a number of policy objectives, including delivering a just transition to net zero, promoting a wellbeing economy, and tackling the cost of living crisis. In order to achieve this however, fundamental reforms to the ownership and governance of land in Scotland are required.”

However, such “fundamental reforms” seem as far off as ever – and a lot further than 25 years ago. For all the lip-service paid to “community” initiatives, this grossly inflated market in land has been encouraged without any controls. You buy the land. You harvest the public money. You sell the carbon credits to anyone who can use them to “offset” their polluting activities. Communities do not benefit while landowners, old and new, cash in. It is 19th century capitalism in a 21st century setting.

The report for Community Land Scotland lists a series of worthy recommendations, many of which have been around for years. It states for instance: “A new statutory power to apply a public interest to all landholdings in Scotland above a certain scale and/or concentration should be introduced, backed up by the power to issue compulsory sale orders for existing landholdings that fail to meet the test’s criteria as a last resort”.

Or how about: “The Scottish Government should explore new measures to enhance transparency in the land market and prevent off market land sales happening under the guise of secrecy. It should also increase efforts to establish accurate, up to date data on land values, ownership and use across Scotland. The lack of transparent and publicly available information about land ownership and transactions remains a barrier to community knowledge and participation, and so hinders the ability of communities to influence land-related decisions impacting them.”

There is no reason, if any political will existed, that these well-worn conclusions could not have been acted upon years ago. Yet the same old system continues. Only a couple of years ago, in the part of Lewis where I live – desperately in need of land for housing - one rich man sold 50,000 acres to another rich man without a vestige of community consultation or awareness. It will be interesting to see if that vast property empire cashes in on its abundant degraded peatland.

Fifty years ago, consciousness was raised about land ownership through a play called ‘The Cheviot, the Stag and the Black, Black Oil’ and other forces. We are now living through ‘The Peatland, the Subsidies and the Green, Green Rip-off” without a political finger being lifted . In fact, the Scottish Government via NatureScot is its sponsor.

Has nothing been learned from history? Is it too late to call halt and think again?