Significant amounts of public money are being spent supporting powerful private investors and absentee developers to "exploit Scotland’s natural resources for profit", a group representing landowners has claimed.

Community Land Scotland (CLS) said national policy on nature restoration and carbon capture projects is too heavily weighted towards major developers.

It is concerned that there may be a shift from grants to public money being used to 'de-risk' private investment in an industry that is still in its infancy.

The market is underpinned by carbon offsetting schemes where big companies buy carbon credits from peat-restoration or tree-planting schemes to compensate for their carbon emissions.

CLS said the industry is being driven by unrealistic figures about the amount of finance required to support the burgeoning industry.

Scottish Government planning reflects assessments in a 2021 report from the Green Finance Institute which identified a ‘gap’ of about £20 billion in what was needed to develop natural capital in line with Net Zero targets, and a more recent figure which states an ambition of securing £12.5 billion in private investment.

CLS believes the figure is discredited, pointing to a Future Economy Scotland report which calculated the funding gap could be as small as £118 million per year, although this figure is also an estimate.

"There is an idea that the main problem in terms of achieving these nature restoration targets is a financial one and there's the huge finance gap of billions and billions of pounds and the only way to address that is through private finance," said Dr Josh Doble, policy manager for CLS.

The Herald:

"If we accept that there is a £20billion finance gap - and we don't accept it -  if the thinking is that there is this gap, obviously the public purse can't pay for that.

"What we are saying is that this finance gap is not credible and it's basically being used to drive this market.

"We are just asking the government to consider the fact that these figures are not credible and there needs to be a more credible approach because private finance models are not going to keep wealth in Scotland."

The organisation wants to see 10% of Scotland brought into community ownership by 2030.

The Scottish Government has published draft legislation on land reform which could see large areas about to be sold or passed on being broken up into smaller parts.

The policy, known as lotting, is designed to allow more farmers, community groups, businesses and smallholders to buy land.

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Dr Doble said there is concern that the private finance models being spoken about are "not building community wealth" or helping address concerns such as the rural housing shortages that are fuelling depopulation.

The paper calls for public subsidy to prioritise natural woodland development rather than commercial coniferous planting..

"The key issue for us is that the grant mechanisms that exist to do nature work, tree farming and so on, that's in danger of being lost because so much money is going to under-write private investment," he said.

"So you've got grants being taken away and instead it's going to be private loans for landowners to do the work.

"The idea being that those landowners can sell carbon credits for those projects for profit and if the government does this it will show support in the market and the market will become stronger and the credits will become more valuable.

"It's a bit of a gamble and we think [the government should be] keeping the grant mechanisms and introducing regulations and making sure these projects are delivering.

"Public money should not be spent to support underdeveloped and speculative carbon markets."

Land Reform Secretary Mairi Gougeon said: “Public investment alongside responsible private investment in our natural environment will be key to delivering our Just Transition to net zero and we must ensure that local communities and wider society benefit from an increase in natural capital investment.  

“We do not think it is right that ownership and control of much of Scotland’s land is still in the hands of relatively few people.

“Our recently introduced Land Reform Bill also sets out ambitious proposals to allow the benefits of land ownership and decisions about how it is owned, managed and used to be more widely shared.”