ONCE again Iain Macaskill Smith has written a brilliant but ultimately flawed Herald Essay on the dilemmas of crofting and the need for ''land reform'' (May 16).

He is right that non-market solutions to low croft incomes can do more harm than good. Communal ownership and administration of land can be as arbitrary and oppressive for tenants under its jurisdiction as was thraldom to individual estate owners.

The rent may be lower and tenure more secure. But the hidden price for the privileged insiders is greater regulation and control, while outsiders face discriminatory non-price barriers to entry both from the Crofters' Commission and because grants are available for tenant crofters but not for non-crofters (nor for tenants who buy their crofts, which explains why few do).

Also grants are available for farming but not for those who wish to pursue other types of activity, economic and non-economic, on these lands. But, says Macaskill Smith, subsidies for small-scale farming in marginal and sub-marginal areas cannot be the main solution. Improvements on ''intra-marginal'' land permit crops to be grown at lower and lower cost and price. Marginal land, increasingly unable to compete, is made sub-marginal and can be supported for farming only at increasingly heavy subsidy.

So Macaskill Smith's idea of land reform is not to give more subsidies for farming, nor to make it easier for tenants to buy, nor for more crofters' trusts, but for a bonfire of regulations and a freer price system to allocate land and determine its use.

This analysis is fine so far as it goes. But, like Lord Sewel's recent consultation document on land reform, it does not extend its purview nearly far enough. For the problem of rural poverty goes beyond the relatively few who work on remote crofts and its solution goes beyond agriculture.

The land question is an interconnected urban and rural one and there is a common solution. The communally created value of all of the land and natural resources of Scotland is our common birthright. By contrast, the fruits of our own labour and enterprise are our individual right as free citizens. That our tax system forces from us part of what we ourselves produce is an improper restriction of freedom and a sure recipe for less work, less enterprise, less jobs, less wealth.

Let us, in our new Parliament, instead shift to a system whereby we pay the community for the right to exclusive possession and use (subject to reasonable planning controls) of our common heritage, the land of Scotland. Those who occupy very valuable land would pay more than those on less valuable land. Households, shops, and offices in exclusive neighbourhoods and commercial areas - mainly urban - would pay (as they willingly do when tenants to private landlords) much; if in areas with fewer amenities, less; if crofters in remote rural areas earning a bare living wage, much less, perhaps nothing.

But the communal revenues raised would belong to us all as fellow citizens. We would have an equal entitlement to the benefits of subsidised education, health, transport, law. If the communal rental revenues are spent disproportionately in one area, there rental values would rise and residents and businesses would accordingly and properly pay an increased due to the community; and land would be more fully used.

In this way urban sprawl would be reduced, more land made available for agriculture and other uses, the burden on crofters reduced, and opportunities greatly enhanced to move to new activities unencumbered by the destructive tax system that currently holds us all back.

Roger Sandilands,

35 Banavie Road, Glasgow.

May 16.

Maxwell Macleod's letter (May 14) regarding the pier at Arisaig shows just how seemingly arbitrary action by a feudal superior can delay development and frustrate the wishes of the local community.

There now seems to be a consensus that some action is needed on land reform but a lot less agreement as to what form such action should take and how it is to be achieved. In this argument the questions of the abolition of the feudal system and land use have become intertwined. They are not, however, necessarily the same thing.

It is worth repeating that the mere abolition of the feudal system will not in itself deal with many of the perceived problems of land use in Scotland. It would, for example, deal with the problems of feudal superiors who refuse or obstruct development. It would not, however, prevent the sale of large estates to absentee landowners nor would it prevent landowners from either neglecting their land or using it in ways detrimental to the local population or economy.

If we wish to deal with these matters then we will have to look at much more far-reaching land reform and the development of a system that will take into account the public interest and the needs of the local communities.

Michael Weir,

8 Latch Road, Brechin.

May 17.