Fear of retrospective legislation driving decline in tenanted land, survey finds

Press Release

A new survey by rural business organisation Scottish Land & Estates (SLE) has revealed that a lack of trust in government policy and fear of retrospective changes to legislation are the biggest barriers to land being let for farming in Scotland.

The SLE Agricultural Holdings Member Survey 2025, conducted among estates and farming businesses across the country, found that 84% of respondents currently let land through secure or modern limited duration tenancies – yet many are questioning their continued involvement in the tenanted sector.

When asked to identify the main barriers to letting land, the top concern – selected by 88% of respondents – was fear of retrospective legislative change or lack of trust in government policy. This outweighed other factors such as loss of control of land (76%), complex legislation (49%), and taxation (31%).

The findings come as the Scottish Parliament prepares to debate the final stage of the Land Reform (Scotland) Bill, which includes controversial proposals to link compensation due to tenants, when the owner resumes some of the land, to the capital value of that land - a major shift from current arrangements and would retrospectively change many existing agreements. If approved, the mechanism would apply to both 1991 Act secure tenancies and fixed-duration tenancies.

The survey also found that only 12% of respondents described themselves as optimistic about the future of the tenanted sector, while more than 70% said they were pessimistic. The vast majority cited ongoing political uncertainty, repeated legislative intervention and an erosion of trust as the key reasons behind their outlook. Furthermore, 74% said the proposed changes in the Land Reform Bill would make them less likely to let land in future.

Many landowners are instead providing access to land through alternative routes beyond traditional agricultural holdings leases. Annual grazing lets were used by 76% of respondents, while 49% operated through contract farming agreements and 11% through joint ventures. Respondents said these options offer greater flexibility, simpler administration, and lower legal risk compared with the Agricultural Holdings Act framework.

The findings support data from the Central Association of Agricultural Valuers (CAAV), which last year reported a 43% reduction in 1991 Act tenancies between 2008 and 2020, alongside a 147% increase in SLDTs over the same period. The Scottish Government’s own statistics show there has been a loss of 500,000 acres while the owner‐occupied sector has grown by towards 375,000 acres between 2012 and 2023, a significant net decline in tenanted land even after accounting for those tenants who have acquired previously tenanted farms. The huge surge in SLDTs is evidence that owners want to let land but are not confident enough to enter longer term leases. SLE has concerns that with the SLDT model now seeing increased risk due to retrospective changes, it is likely that their utility and popularity will reduce.

Stephen Young, Director of Policy at Scottish Land & Estates, said:

“This survey provides clear and sobering evidence that confidence among those who make land available for tenant farming is at a low ebb. The fear of retrospective legislative change has become the defining factor shaping decisions across the tenanted sector.

“It is clear that previous changes to legislation have caused a detrimental impact on the amount of land in Scotland being let and on the length of tenancies available. It appears we have not learnt from that, and further harm will be inflicted on the let sector in Scotland, with little thought for future tenants.  By contrast, England and Wales have not seen this huge drop off in land available for rent.

“Owners of land are not looking for special treatment – they are looking for stability, fairness and trust in government policy. Without that, the tenanted sector will continue to contract, to the detriment of the next generation and the wider rural economy.

“There are many landowners who want to let more land, but the current political climate is pushing them in the opposite direction. Our findings mirror those of CAAV - fixed-duration tenancies such as SLDTs are seen as safer because of the reduced risk exposure. If the Scottish Government proceeds with resumption-for-capital provisions against the advice of most of the farming sector, it will only accelerate the decline in these tenancy options.

“Ultimately, we can either wring our hands about the lack of land being let, or we can look at the key driver and try to improve it. If ministers genuinely want to encourage diversity in land tenure, they must first rebuild trust with those who make land available. Only by doing that can we create the stable, fair framework needed to open up opportunities for the next generation of tenants.”