A hundred years' regulation has failed to change crofting's grim reality

Most land reform involves an element of compulsion and is seldom undertaken except in the aftermath of a cataclysmic event. The Highland Clearances were such an event, and the ensuing legislation provided crofters with unprecedented statutory rights: security of tenure, fixed rents and heritable rights. Landlords, by contrast, were deprived of much of their influence and authority and were left with little more than their meagre rents and their sporting rights. This legislation largely determines the allocation and use of croft lands even to this day.

The acquisition of their island by the people of Eigg and the recent purchase of the Orbost estate on Skye by the local enterprise company, following in the pioneering footsteps of the Assynt crofters, has raised again the question of land reform. There is the prospect the magnificent Knoydart may be added to the list. Many see in the extension of communal ownership the solution to Highland problems of declining relative incomes and falling population. But this is to ignore the high degree of autonomy which crofting communities already enjoy.

The creation of crofters trusts and the communal ownership of land has proved hugely popular throughout Scotland and even among descendants of evicted crofters in distant parts of the Commonwealth. There is a widespread feeling that a historical injustice is being redeemed, and that at last crofters may become masters of their own destiny. It is, sadly, an illusion. The relationship of the crofter to the land is precisely the same under a trust as it is under the absentee landlord.

In fact, crofting communities could be worse off under a trust. In the general euphoria it is easy to forget that many Highland estates struggle to break-even, and many more incur financial losses.

Crofters trusts have the difficult task of managing the deployment of communal resources without the benefits of either experience or social conventions governing their use. They have to cope with the myriad of legal and bureaucratic regulations which govern the stewardship of croft lands, and which are inimical to economic and social change. They also have to work within the autonomy which crofting communities have over their common grazings and which so effectively tied the hands of hapless landlords.

But trusts may be confronted with problems unique to themselves, such as the division of a communally-owned resource. This could give rise to disputes between rival townships. It would not be surprising if trusts took the view that such controversial issues are best left alone and that management, in the interest of social harmony, should avoid taking sides. The resolution of disputes would then be left to the disputants themselves. There is the risk that trusts could be left on the sidelines, helpless, able to manage, if at all, only on the basis of unanimity.

The trust with the most experience is that of the Assynt crofters. It is to the credit of the elected management (albeit on a restricted franchise which denies non-crofters any democratic rights) that they have not taken the easier option and adopted a minimalist approach.

They were not, however, able to agree on priorities, and could not prevent the emergence of factions, each bent on pursuing their own agenda. This led to disputes, acrimonious at times, which left ordinary members feeling bewildered and alienated from the decision-making process. These divisions the trust attributes to poor communications. That may have been a contributory factor, but heightened personal relations and their attendant difficulties may be inseparable from communal ownership.

The advantages of communal ownership of land have been grossly exaggerated and given rise to false expectations. This does not necessarily rule out a measure of land reform. On the contrary, the existing system of land tenure dates from legislation which aimed to settle on peripheral land a large population, which no longer exists. The subsequent emphasis on agricultural production has also been overtaken by events, as national shortage gives way to burdensome

surplus. Deprived of its raison d'etre, crofting tenure looks increasingly anachronistic. Few can doubt that it is unlikely to meet the needs of the twenty-first century.

The weakness of the crofting system of land tenure is its lack of flexibility and its reliance on an outdated allocating and administrative system. That crofting has been able to adapt to social and demographic change to the extent which it has, is due largely to informal arrangements of various kinds which individual crofters concluded with their neighbours. This allowed crofters to make use of land otherwise unavailable to them, and enabled them to stay in the locality despite the small size of their crofts.

The remnants of crofting's feudal inheritance is discernible in the allocation of croft lands. The disposal of a vacant croft is not determined by market forces but by a non-price selection process involving the Crofters Commission, the landlord and the local community. Unlike the market, which is impersonal and makes no value judgments, the selection process is judgmental and highly personal. No allocating criteria can cover

every eventuality and must, of necessity, allow for an element of discretion. Regulations are always subject to differing interpretations. The result is that it is almost impossible to avoid a degree of arbitrariness and this invariably leads to charges of inconsistency and partiality. For many the allocating process seems mysterious and exclusive: single women and ethnic minorities feel as if they need hardly apply.

A similar situation exists in relation to crofters who exercise their option to buy. If, as owner-occupiers, they subsequently decide to sell, they too have to find a buyer who is acceptable to the same triumvirate. This includes the local township grazings committee, or similar coterie, who exercise the power of veto at no cost to themselves. It provides ample opportunity for scheming, collusion and nepotism. It forces the separation of house and croft and has an adverse effect on agricultural structure of crofting townships.

The other feature of the non-market allocating system is the enormous power and authority it gives to non-elected officials. The Crofters Commission was set up in 1955 to administer the entire crofting regions. It is a vast area, much of it remote and windswept, where travel and communications can be far from easy. It is a difficult area to administer and might be thought beyond the competence of an organisation with greater resources than that available to the commission.

From the outset, however, the Crofters Commission has not been content with mere administration, but has craved a more executive role. Over the years it launched a number of policy initiatives in a largely futile attempt to find an agricultural solution to the problems of the crofting regions.

Of these, the most dramatic was the fiasco over croft reorganisation in Wester Ross in the 1960s. But there was also the debacle over compulsory owner-occupancy in the 1970s. And there is the current offensive against absentee crofters which suffers from the same defects, even if it has not yet suffered the same fate. It is a measure of the indifference of Westminster that the commission, despite its unenviable record, should not only have escaped political censure but should remain free to plough its ruinous furrow.

The Crofters Commission today stands in grave danger of falling into the trap of believing its own propaganda. Its campaign against absentee crofters depends crucially on an abundant supply of young people who want to become crofters but are prevented from doing so because of a shortage of crofts. The deteriorating age profile of crofting communities is well known. So is the explanation: successive generations have not been prepared to follow in the footsteps of their forefathers. Life on an impoverished croft has never held much appeal for the young. The commission's case rests on an erroneous assumption which is presented as if it were an indisputable fact.

Similarly, the assertion that demand for crofts exceeds supply stands in need of qualification. It is an elementary proposition of economics that demand will always exceed supply for anything which is available for nothing. The function of price is to balance supply and demand and clear the market. To argue that ''proven demand'' exceeds supply when the crucial element of price is omitted from the equation, is to subscribe to a version of economics which would make even a first-year undergraduate blush.

The fluctuating prices of free markets are often looked upon as capricious and illogical by bureaucrats, and the Crofters Commission is no exception. In a recent case in the Hebrides, the commission intervened to prevent the transfer of a croft tenancy to the highest bidder on the grounds that the price was too high and excluded the participation of local applicants. Eventually, the croft was transferred to a local man at what the commission described as a ''realistic price'' - well below the market price.

If price is taken as a measure of a person's commitment, then the community was denied the benefits of the most committed applicant. Worse still, the effect of the commission's intervention is to reduce future supply, for few crofters are likely to offer the tenancy of their croft at a price below the market price. They would look upon that as making a loss. This adverse effect on supply is the opposite of what the commission intended.

These shortcomings highlight the need for land reform. It is a subject which is likely to feature high on the agenda of a future Scottish Parliament.

The aim of reform should be to make the system of land tenure more responsive to social change and provide crofters with greater freedom of choice. The major social change of recent years has been the increase in the number of non-crofters, largely as a result of the revolution in information technology and the tendency towards earlier retirement. Many non-crofters desire land for recreational purposes, or to keep animals as a hobby.

Unfortunately, crofting legislation never recognised the claims of landless cottars, and as a consequence there is no land available other than croft land. Non-crofters are the modern equivalent of landless cottars. Those who commit themselves to a locality and stay long enough will, in general, acquire a

croft, but in the absence of a free market the process can be lengthy, random and unpredictable.

While crofters have the option of buying, only a relatively small percentage have done so. In the west the loss of potential grants and loans available only to tenants are regarded as more important on account of the lower contribution of crofting to household income.

Paradoxically, a crofter who buys his croft is less secure than a statutory tenant. Under crofting law every croft must have a tenant, and an owner-occupier is deemed to be in possession of a croft which does not have a tenant. He may therefore be ordered by the Crofters Commission to install a tenant and could subsequently lose his croft if the tenant he is forced to install should exercise his right to buy. The commission has indicated it is unlikely to issue a reletting order for owner-occupiers who reside on their crofts, the implication being that it would for non-residents. This distinction between resident and non-resident has no place in a property-owning democracy.

If the aim of land reform is greater flexibility and choice, deregulation is the mechanism. A croft has been described as land surrounded by regulations. Crofters should have the right to deregulate, which would change the pattern of land use in accordance with market demand. It would also relieve the pressure on common grazings. The historical distinction between crofters and landless cottars cannot be allowed to continue in perpetuity.

The Scottish Crofters Union is opposed to decrofting for fear it might lead to a reduction in the level of government support, and in their own effectiveness as a pressure group. It is opposed, too, by the Crofters Commission, which has to approve all applications for decrofting. This opposition is based on a spurious notion of demand, even to invoking interests of future generations, though how is a mystery to all but the commission.

Nevertheless, it is true that the crofting regions of the Highlands and Islands rely heavily on Government support. In percentage terms the cost to the national exchequer is relatively modest. Even so, it may not be sanguine to suppose it will continue in future, even at existing levels.

If that is the case, then the region may have to look increasingly to private capital, not necessarily that of large corporations or pension funds, but to private investors who commit not only their capital but their enthusiasm and expertise. The benefits of a free market are considerable, but the price of land on either open or regulated markets seldom bears much relationship to the expected rate of return on agricultural production. It is distorted, for instance, by housing grants available to crofters but not to others. Even the ''croft entrant scheme'' introduced to encourage young people into crofting is, in effect, a cheap housing scheme for crofters. Only crofters with regular employment outside crofting can afford to take advantage of it, and they are not necessarily the worst off in society.

A disproportionate share of Government support continues to be directed to agriculture. This imbalance needs to be redressed, not merely because of its effect on land values, but in the interests of social justice.

It is easy to postulate that land reform stimulates an increase in investment and productivity through the incentives provided by the private ownership of land. But this is to overlook the security of tenure and autonomy over their common grazings which crofters already enjoy. It is doubtful, in the circumstances, if it would have any noticeable effect on the level of production. The claims made for land reform are frequently much exaggerated. It will not turn a peat bog into a green oasis. Rather, land reform does away with the worst features of an outdated system which has become a major source of social inequality.

Land reform is marginal to the fundamental problems of crofting, which derive from the barren soil, the unforgiving climate and the dominating influence of diminishing returns to croft land. Elsewhere, farmers are able to counter the effects of diminishing returns by technological progress, but most crofts are too small, and the terrain often too difficult to justify the cost of technology. The inevitable result is low productivity and low croft incomes. Without an offset to diminishing returns there can be no agricultural solution to problems of crofting.

There is no escape from the fact that marginal land can continue to support fewer and fewer crofters. Any attempt to increase the number without an increase in productivity, can only result in average croft incomes being driven ever lower. To ignore this, as the Crofters Commission does consistently, is to create a dependent population reminiscent of discredited nineteenth-century landlords.

The difficulty for policy is that crofting regions do not present a homogeneous whole. A policy appropriate for one area, could be inappropriate for another.

It is clear that the Crofters Commission continues to regard crofting as small-scale farming. This may be true of crofts in Easter Ross, or Caithness, or Orkney, but it is not generally true of the gneiss lands of the western seaboard and the Hebrides. Here crofters took advantage of depopulation to turn from small-scale farming to small-scale ranching. Given the land and climate, they found it more profitable to raise sheep rather than grow crops.

But crofters who are graziers need more land than those who farm. It is another reason why the land can support fewer crofters. Land which may be described as ''under-utilised'' when viewed from the standpoint of the cultivator, might equally be described as ''over-utilised'' when viewed from the standpoint of the pastoralist. The dilemma for crofting: there is no turning back. In a hostile environment, increases in productivity are hard to accomplish and are seldom sufficient to cover the additional costs.

A hundred years of regulations have failed to change crofting's grim reality. It is time that people in the Highlands and Islands, too, think the unthinkable.

n Iain Macaskill Smith was formerly an economics lecturer at the University of Newcastle upon Tyne.