ANNUAL REPORT & ACCOUNTS

2019 2020 Annual Report 2019-2020 Contents

Laid before the Scottish Parliament in pursuance of Section 20 PERFORMANCE REPORT 02 Schedule 2, paragraph C of the Land Reform (Scotland) Act 2016. A review of the work of the Scottish Land Commission in 2019-20, including an analysis of our delivery and To the Right Honourable Nicola Sturgeon performance, and our position at the end of the year. Her Majesty’s First Minister Overview 02 Foreword 02 Who we are 03 Dear First Minister What we do 03 How we do it 04 We have the honour to present the third Annual Report and Accounts of the Scottish Land Commission covering the year 2019-2020. Performance analysis 08 Financial Position 08 Yours sincerely What we have achieved 10 Tenant Farming Commissioner 13 Andrew Thin, Chair Our Organisation 15

ACCOUNTABILITY REPORT 17 This report contains key statements and reports that enables the Scottish Land Commission to meet accountability requirements Hamish Trench, Chief Executive and demonstrate compliance with good corporate governance. Corporate Governance Report 18 Directors’ Report 18 Statement of Accountable Officer’s Responsibilities 20 Governance Statement 21 Remuneration and Staff Report 28 Parliamentary Accountability Report 35 Independent Auditor’s Report 36

Financial Statements 39 Accounts Direction 51 Longman House, 28 Longman Road, Inverness, IV1 1SF

[email protected] 01463 423 300 www.landcommission.gov.scot

Annual Report 2019-2020 01 OVERVIEW

Foreword Who we are From the Chief Executive and Chair of the Scottish Land Commission The Scottish Land Commission is a non- departmental public body (NDPB) established on 1 April 2017 by the Land Reform (Scotland) Act 2016. The Commission has five Land Land is central to Scotland’s Commissioners and one Tenant Farming ambitions for its economy, climate Commissioner, all of whom are appointed change and tackling inequality. by Scottish Ministers. Over 2019-20 the Scottish Land The organisation is based in Inverness and Commission has engaged widely employs a team of 16 staff (as at 31 March 2020) led by Chief Executive, Hamish Trench. We are fully across Scotland with the public funded by the Scottish Government with a budget and stakeholders, informing our of £1.526m for 2019-20. recommendations to the Scottish The Land Commissioners: (left to right) Megan MacInnes, Professor David Adams, Government and our work to Andrew Thin (Chair), Dr Bob McIntosh Hamish Trench speaking at the Commission’s (Tenant Farming Commissioner),

PERFORMANCE REPORT PERFORMANCE REPORT stimulate changes on the ground. PERFORMANCE REPORT Scottish Land & Economy conference Dr Sally Reynolds and Lorne MacLeod

In October 2019 we held our second land As a result of COVID-19, Scotland now finds reform conference, focused on the role of land in itself in a dynamic period of rapid change and Scotland’s economy. The wide range of participants adaptation. Scotland’s recovery and renewal, is a signal of the increasing awareness of the for our economy and society, will be a priority What we do opportunities for land reform to unlock benefits for for all public bodies and the Commission will people in both urban and rural Scotland. adjust our priorities to respond to the challenge. The way that land is owned and used is central to between Scotland’s land and its people. Reforms to the ownership and use of land will some of the big ambitions in Scotland including It underpins the work of the Scottish Land Through the year we have delivered significant be even more significant in shaping an economic tackling climate change and creating a fair Commission, providing the legislative context progress against our Strategic Plan, including: recovery that delivers productivity and wellbeing economy. We are shaping and driving a coherent in supporting change and clear expectations for the people of Scotland. programme of land reform spanning both urban for the way our land is owned and used. • Engaging on recommendations for measures and rural land, to improve the productivity, diversity to address concentration of land ownership This will be our focus as we shape our next and accountability of the way Scotland’s land is Supporting this work and the operation owned and used. We are stimulating fresh thinking • Practical changes to transform the way Scotland three-year Strategic Plan. of the Commission are our core values: and change so that the way we own and use land tackles its legacy of vacant and derelict sites in Scotland helps to make the most of our land for • Reviewing significant land supply issues the benefit of everyone. INTEGRITY affecting delivery of housing We work for and are accountable to the people of Scotland • Providing leadership in the expectations of land rights and responsibilities, through Vision protocols, guidance and advice CHALLENGE Our vision is a fair, inclusive and productive We challenge ourselves • Publishing Tenant Farming Commissioner system of ownership, management and use Codes of Practice and Guidance and Andrew Thin and others to lead change of the land that delivers greater benefit for undertaking associated casework. Chair all the people of Scotland. INNOVATION For more details please see page 10. Our role combines leadership and change on We develop ambitious and progressive thinking We continue to shape an empowered and fast- the ground with statutory functions to review and paced organisation, putting significant emphasis advise on legislation and policy change. on being open, accessible and public-facing. This EMPOWERMENT year we have also put increased emphasis on The Land Rights and Responsibilities Statement, We motivate ourselves and others the actions we can take as a public body to help Hamish Trench published by the Scottish Government sets the to realise Scotland’s ambitions achieve Scotland’s ambitious climate targets. Chief Executive vision for a strong and dynamic relationship through land reform

02 Annual Report 2019-2020 Annual Report 2019-2020 03 OVERVIEW

Strategic Objectives Contributing to the National Outcomes Our work is guided by three strategic objectives: The Scottish Government’s National Performance Framework sets out the high-level National Outcomes to make Scotland a better place to live and a more prosperous and successful country. PRODUCTIVITY DIVERSITY ACCOUNTABILITY The Land Commission’s long-term outcomes for land reform contribute to four national outcomes: To drive increased To encourage a more To ensure decision- economic, social diverse pattern of land making takes account Our long-term outcomes Contributes to and cultural value ownership with the benefits of those affected and for land reform National Outcomes: from our land. of land spread more inclusively. responsibilities are met. Fewer land constraints to effective Strategic Priorities public interest-led development and place-making Economy Communities The Commission’s three-year Strategic Plan, published in 2017, outlines four key priority areas of work covering both urban and rural land: Supply of land for housing less constrained by land tenure and LAND FOR LAND LAND USE AGRICULTURAL land values HOUSING AND OWNERSHIP DECISION- HOLDINGS Economy Communities DEVELOPMENT MAKING

PERFORMANCE REPORT PERFORMANCE REPORT Net area of vacant and derelict Reduce constraints to Diversifying land Improve the quality Increase access to

land falling PERFORMANCE REPORT redeveloping vacant and and accountability land for new and ownership to create Economy Communities Environment derelict land for housing opportunities for of decision-making, developing farm and other productive a wider range of and the practical businesses and improve uses, improve land people to own implementation of the relationships Levels of concentration in land supply for housing, and manage land. Land Rights and between agricultural ownership pattern falling and stimulate a more Responsibilities. landlords and tenants Economy Communities Human Rights active approach to to support a vibrant developing land in agricultural sector. Number of communities exercising the public interest. ownership or control of land rising Communities Human Rights

Level of community involvement in How we do it decisions about land rising Communities Human Rights Environment We are delivering our objectives and We are coming to the final year of the priorities through: Commission’s Strategic Plan 2018-21. The • Engagement and communications: objectives of the Strategic Plan are supported Number of agricultural units managed by a Programme of Work setting out the key through lease or joint venture rising stimulating awareness, collaboration Economy and change on the ground areas of activity to contribute to the long term outcomes for land reform. This is delivered • Research and evidence: commissioning through an Annual Business Plan detailing Relationships between agricultural and collating the research and evidence the work and outputs for the year including necessary landlords and tenants are improving resources and performance management. Economy • Guidance and Codes: developing guidance and Codes of Practice to shape change on The Commission has progressed and completed the ground outputs contributing to the Annual Business Plan, National Outcome Key • Making recommendations for change strategic objectives and long-term outcomes in legislation, policy and practice. (see table opposite for more detail). We value, enjoy, protect We have a globally competitive, entrepreneurial, and enhance our environment inclusive and sustainable economy STRUCTURE OF DELIVERY We respect, protect and fulfil human We live in communities that are inclusive, rights and live free from discrimination empowered, resilient and safe STRATEGIC PROGRAMME ANNUAL PLAN OF WORK BUSINESS PLAN

04 Annual Report 2019-2020 Annual Report 2019-2020 05 OVERVIEW

Key issues and risks we face Like all organisations the Commission had to delivery plans and ways of working. We will be manage the impact of the COVID-19 pandemic operating in a highly disrupted environment for Key Risk Risk Mitigation at the end of the financial year. It impacted not the foreseeable future and the implications for this only the way we work and operational delivery but need to be identified and managed. Adjusting to Individual members of staff are Continuously seek to improve the working had a significant impact on staff wellbeing. From a ‘new normal’ in the year ahead, and to longer absent due to illness, etc resulting in environment by monitoring and improving 17 March 2020 the Commission switched to all term recovery will carry risks, and opportunities, loss of capacity for critical elements staff satisfaction and absence levels, in staff working at home and adjusted our systems, for the organisation and its governance. of business systems and delivery. particular with managing the impact of COVID-19. Good internal communication and provision of desk instructions for business- We consider the following issues to have the greatest critical functions. Reprioritisation of tasks influence over the way we deliver our work over the next year. where needed. They were all identified as increasing at the end of 2019-20: Over-reliance on a small number of Proactively build relationships with research Key Risk Risk Mitigation sector consultants and researchers in institutions; ensure realistic budget provision securing the expertise to deliver high for research; research quality framework in Change in work priorities, competing Continue to embed values of integrity by being quality research/contracts resulting in place. Annual National Student Award to expectations or insufficient prioritisation open and transparent keeping all staff informed delay or a gap in delivery. COVID-19 stimulate interest. PERFORMANCE REPORT PERFORMANCE REPORT PERFORMANCE REPORT PERFORMANCE REPORT impacts on staff wellbeing. of strategic direction and changes in priorities/ increases risks of contractor capacity focus. Current capacity under pressure due to and delivery. COVID-19 response, the organisation maintains a strong focus on staff wellbeing. Staff skills and capacity review planned for 2020. The Commission has mitigated against these risks through the risk management framework, budget management, relationship management, horizon scanning and the organisational development strategy. We continue to have business continuity plans in The Commission fails to deliver to Set appropriate budget allocations to the Strategic place and keep the risks under review. its allocated budget, resulting in Plan for long term planning and the Annual reputational, administrative and Business Plan. Rigorous authorisation procedures governance failures. and delegated limits. 2020-21 Annual Business Plan agreed with over programming of budget and quarterly board monitoring in place. Monthly profiling to manage spend evenly through the financial year and to be kept under review as COVID-19 response impact of COVID-19 to budget becomes clear. In March 2020 we revised internal procedures to An account of our risk management in enable effective working from home, increased 2019-20, alongside a description of the Manage relationship across Scottish Close communication with Scottish Government the frequency of management team meetings principal risks and uncertainties we face, Government so that Commission’s work to keep aware of the reprioritisation of work due to monitor staff, governance and delivery is provided in the Governance Statement is understood and recommendations are to COVID-19 response. Regular sponsorship implications of the COVID-19 response measures. on pages 21-27. well received. & policy team liaison in place, Strategic Plan The Board is keeping under review the governance to be aligned to the economic recovery plan. implications, including risks and staff wellbeing. Engagement between the Commission and the Cabinet Secretary for Land Reform.

06 Annual Report 2019-2020 Annual Report 2019-2020 07 PERFORMANCE ANALYSIS

Financial Position Financial Overview The Scottish Government allocated the There was an increase in staff costs from budgeted 2019-20 2018-19 Scottish Land Commission a budget (known to support our work on Regional Land Use Summary of out-turn £000 £000 as Departmental Expenditure Limit or DEL) Partnerships. There was an increase from budgeted of £1.526m. The Land Commission operated to actual spend in Corporate Services due to DEL Budget 1,526 1,400 within its cash allocation for 2019-20 by additional IT equipment being purchased for drawing down £1.456m of the £1.526m Commissioners and new staff. The difference in Total Operating Expenditure (1,458) (1,281) allocation, out-turn against budget represented the spend for land use decision-making was due to an underspend of £68k. the restructure of the land rights and responsibilities Surplus/(Deficit) Against Budget 68 119 reviews as a result of limited interest in the tender Grant-in-Aid (GIA) drawn down 1,456 1,315 (see page 10 for further detail). Other Income 0 0 Surplus/(Deficit) against GIA drawn down (2) 34 Budget allocation of resources by Actual allocation of our resources by priority area of work in 2019-20 priority area of work in 2019-20 On an income and expenditure accounting basis, spend in the final quarter due to the impact

PERFORMANCE REPORT PERFORMANCE REPORT the financial outcome for the year on normal of COVID-19 and a number of events being PERFORMANCE REPORT business activities has resulted in an underspend cancelled. This did not significantly impact the % 6% % 6% against budget of £68k. Some of this underspend achievement of the Commission’s objectives for 6 4 is attributed to planned contracts not proceeding this year. The Commission received £1.456m of its % due to a lack of bidders for the tenders. As a Grant-in-Aid allocation from Scottish Government, % 12 15 result of this, certain workstreams were redesigned net expenditure against this was £1.458m, which to deliver the outputs in different ways including resulted in a cash overspend of £2k against the % 26 % BUDGET 9 ACTUAL 28% partnership working. There was also reduced Grant-in-Aid drawdown. % ALLOCATION ALLOCATION 9 OF RESOURCES OF RESOURCES The Fannichs, Ross-shire 17% 17% 12% 14% 9% 10%

Commissioners’ costs Land for housing & development

Staffing costs* Land ownership

Corporate Services Land use decision-making

Communications & events Agricultural holdings

*Staffing and project costs are allocated against Programme of Work priorities, this shows remaining core staffing costs.

08 Annual Report 2019-2020 Annual Report 2019-2020 09 PERFORMANCE ANALYSIS

What we have achieved Key Performance Indicators Business Key performance Measurement Achieved The Annual Business Plan for 2019-20 identified We expanded the Commission’s team during the activity in each of the four priority areas of 2019-20 to provide essential resource across area indicator work spanning both urban and rural Scotland. the organisation and ensuring effective delivery Delivery of our Business Plan is monitored and of the Annual Business Plan and the Strategic End of year out- Percentage level 4.4 % reported throughout the year in our quarterly Plan. The Commission has rigorous financial turn to be within 5% of year-end spend underspend progress reports to the Board. Key Performance management controls, including budget profiling underspend of total against budget in end of year Indicators (KPIs) were agreed by the Board for and monitoring to ensure any under or over Finance allocated budget allocated accounts the first time in December 2019. This is the first spend is identified as early as possible so it can year the Commission has been working towards be addressed. Following its establishment year KPIs to monitor performance and achievement in 2017-18, the Commission has continued Level of staff absence Average number Average levels are reported to the Board. to improve its budget out-turn to within 5% to be below national of days of sickness number underspend in 2019-20. average (6.3 days) absence per of days The workstreams detail each area in turn and Staff wellbeing employee is 3.44 show how the actions in the Business Plan support The Commission considers its medium-term the Strategic Plan’s long-term outcomes. Our financial planning in developing Annual Business performance monitoring processes identify the Plans, and a three-year financial plan will be Delivered 90% of Percentage number %

PERFORMANCE REPORT PERFORMANCE REPORT medium-term outcomes and indicators that will developed in the review of its next three-year outputs identified in the of outputs delivered 96 PERFORMANCE REPORT allow us to track our progress and we will report Strategic Plan. Annual Business Plan and completed as of delivery against these across our Strategic Plan cycles. outputs Delivery detailed in the The Commission held an extensive Annual Business Plan achieved The majority of 2019-20 KPIs have been programme of engagement with achieved, illustrated opposite. One output in stakeholders and the public to engage the Business Plan which has not been achieved on the potential of land reform to help Increased effectiveness Achieve over 40% Not Available involved looking at tax and fiscal options for deliver ambitions for both urban and of the Tenant Farming for very effective Due to Scottish Government’s land, due to in-year reprioritisation. This area rural communities in Scotland: Commissioner (TFC) and extremely of work has been moved into the 2020-21 role in encouraging effective in annual review of the Business Plan and does not impact the good relations between Tenant Farming functions of the achievement of other activities. landlords and tenants Advisory Forum TFC in 2020, of agricultural holdings (TFAF) survey it was decided This has been a successful year for the to postpone Commission, achieving its KPIs, and managing the TFAF survey its spend in order to deliver across its key areas of 18 public meetings Continued engagement to 2021 work (see highlights page 12). There are a number held across Scotland with stakeholders of risks and uncertainty facing the Commission in 427 people including holding and achieving these KPIs; these are closely monitored Increased profile Year on year attended attending regular Increased by: and managed through the risk management stakeholder events of the Commission increase of: framework, and reviewed by the Audit and across workstreams Risk Committee and the Board (see page 24). Communications Due to the specialist nature of some of the Media coverage % workstreams the risk of over-reliance on a small by 5% 60 pool of specialist suppliers was realised when the Commission did not receive any bids Social media followers % for contracts tendered. This resulted in a change by 25% 52 in approach, and although this led to some Launched a Working with delays in outputs and reduction in budget spend, campaign to engage stakeholders to progress it ensured the work progressed. The delivery with young people key areas of work and Interactions % KPI for the Tenant Farming Commissioner is to find out what inform land reform by 10% 8 to be reviewed for 2020-21 due to the delay their thoughts and debate, such as strategic in the survey as noted in the table opposite. aspirations are for partnerships with Central In the meantime, stakeholder responses to our land to help Scotland Green Network Newsletter subscription % the Scottish Government Review provided a develop our next and Development Trusts by 20% 60 qualitative insight to the same area of delivery. Strategic Plan Association Scotland

10 Annual Report 2019-2020 Annual Report 2019-2020 11 PERFORMANCE ANALYSIS

Throughout 2019-20 we have delivered a substantial programme of research and engagement, providing recommendations to Government and guidance to a range Tenant Farming Commissioner of stakeholders and communities. Here are some of our highlights: A thriving and prosperous tenant farming sector Case Work relies on a strong and constructive relationship between tenants and landlords and a positive and LAND USE MODERNISING professional approach by intermediaries acting on The TFC provides information to tenants and DECISION-MAKING LAND OWNERSHIP behalf of landlord and/or tenant. Such relationships landlords regarding the Codes. The TFC received need to be based on mutual respect and shared 112 enquiries over the year, an increase of 6% LAND RIGHTS & RESPONSIBILITIES COMMUNITY OWNERSHIP values and a common approach to fairness and from 2018-19. STATEMENT (LRRS) Report published on the different approaches reasonableness. The Tenant Farming Commissioner The Good Practice Programme launched with to successfully fund community ownership (TFC) has made significant progress over the year in a new website, protocols and guidance for land and development. a number of areas for tenant farming. owners, managers and communities to strengthen realisation of land rights and responsibilities. COMMON GOOD LAND Second LRRS protocol published looking at the Research identified that Common Good assets % transparency of information on land ownership in Scotland have the potential to deliver much 112 6 and decision-making. greater public benefit than they do currently. Codes enquiries in increase from & Guides 2019-20 2018-19 PERFORMANCE REPORT PERFORMANCE REPORT REGIONAL LAND USE PARTNERSHIPS SCALE AND CONCENTRATION PERFORMANCE REPORT Work begun to develop proposals for Scottish OF OWNERSHIP Six Codes of Practice have Government on the establishment of Regional Engagement with stakeholders to progress the been published to date: Most contacts have been made by tenant farmers Land Use Partnerships to maximise the potential recommendations made to Scottish Ministers and their representatives (73%), with enquiries from of Scotland’s land in taking action on climate for legislative and practical measures to • Agreeing and Managing Agricultural Leases landlords, landlords’ representatives and other change. professionals representing 19% of enquiries. address the concentration of land ownership. • Amnesty of Tenants’ Improvement COMMUNITY ENGAGEMENT • Late Payment of Rent Baseline community engagement surveys show • Planning the Future of Limited Partnerships 2019-20 the need to promote greater communication • Sporting Rights and understanding between landowners and % communities. • Maintenance of the Condition of Tenanted 8 Agricultural Holdings. 19% They are intended to guide and shape the behaviours and procedures which LAND FOR HOUSING AGRICULTURAL accompany the interactions and negotiations AND DEVELOPMENT HOLDINGS between landlords and tenants, including agents 73% and intermediaries acting for either party. tenants and tenants’ TRANSFORMING SCOTLAND’S APPROACH We are continuing to work to increase access representatives TO VACANT AND DERELICT LAND to land for those who want to farm and reduce barriers to new entrants. Working as Three Guides were published to Taskforce Statement of Intent details actions landlords and part of the Scottish Government’s Farming provide information to both tenant landlords‘ needed at a national level to tackle vacant and 2018-19 Opportunities for New Entrants (FONE) farmers, land owners and agents: representatives derelict land. In-depth research and analysis to group, the Commission supported the creation other help understand the nature of derelict sites, the • A Guide to the Professional Conduct of of a new, dedicated land matching service. % challenges of bringing them back into use and Agents and How to make a Complaint 17 the harm they are causing to communities. We also published a report looking at the • A Guide to Transfer of Tenancies by LAND VALUE CAPTURE role of business incubators for agriculture and Assignation & Succession % exploring how they can be used to reinvigorate 22 61% % Recommendations made to Scottish Government Scottish agriculture. • A Guide to the Use of Tenanted Agricultural 61 calling for a fundamental rethink of Scotland’s Holdings for Non-Agricultural Purposes speculative and market-driven approach to (Diversification). allocating land for development. Continued page 14

12 Annual Report 2019-2020 Annual Report 2019-2020 13 PERFORMANCE ANALYSIS

Our Organisation A wide range of enquiries has been received by the Three formal inquiries into alleged breaches Staff Sustainable, social and TFC over the last year with 40% of new enquiries of Codes of Practice were submitted to the TFC. about the amnesty on tenants’ improvements. Relating to the Codes of Practice on Late Payment The Commission has continued to build the staff environmental overview This was the last full year of the tenants’ amnesty of Rent, Maintenance of the Condition of Tenanted team through a robust, fair and open recruitment In line with the Scottish Government, the and the Commission, along with stakeholders, Agricultural Holdings, and a third not directly process. The organisation has grown from a team Commission is placing economic, social and ran campaigns throughout the year reminding relating to a Code. The TFC cannot proceed with of 13 staff in 2018-19 to 16 in 2019-20, which cultural human rights at the heart of our work. tenants to complete the process. Advice on repairs an alleged breach that doesn’t relate specifically has enabled the organisation to increase its delivery It is embedded in our Strategic Plan and and maintenance obligations, end of tenancy, to a Code of Practice. Two of the alleged in key areas such as land rights and responsibilities Programme of Work with a particular focus new tenancy, succession and assignation was breaches related to a period of time before and land for housing and development. on the realisation of human rights through also regularly sought. the Codes had been published. Under the Scotland’s framework for land reform. procedures for an alleged breach as set out The organisational development strategy has been in the Land Reform Act (2016) the TFC was implemented and is currently under review in the The Scottish Government has ambitious carbon Type of enquiry unable to proceed with the alleged breaches. year ahead to ensure that the way we are working reduction targets for the public sector, and following They are being processed as cases. 2019-20: is effective in delivering our next Strategic Plan. the declaration by the government of a climate To help link delivery across the organisation we % emergency, there has been a renewed focus on the Amnesty 44 40 have implemented a project team approach to public sector leading the way in reducing carbon PERFORMANCE REPORT PERFORMANCE REPORT working. Project teams have been established in emissions. The Commission committed to having PERFORMANCE REPORT Repairs & maintenance 12 key workstreams with representation from all teams. about the a Climate Action Plan in place by April 2020 Other 12 amnesty setting out our net direct emissions targets and As part of the organisational development strategy on tenants’ a routemap to how we will achieve them. the Commission sought approval from Scottish End of tenancy 11 improvements Government to develop its own pay remit, enabling The Commission is located in a Scottish New tenancy 10 the organisation to have the flexibility, within public Government building and we are actively pay policy, to implement pay policy that better suits involved in the building’s user group looking at Succession/assignation 7 the evolving organisation. Governance procedures sustainable transport options and environmental were developed to support this move and to improvements. Our focus is also on addressing Rent review 4 ensure annual pay awards are costed, consulted, internal factors such as greener travel, resources, negotiated, agreed and implemented in a robust and procurement and awareness. Forestry 3 transparent manner; this included the establishment of the Staffing and Remuneration Committee. Community and charity work by staff can bring Waygo 3 several benefits to the wider community. We support It is important for a young organisation to those who wish to undertake community or charity Sporting 2 continuously review our processes and procedures activities and commend our staff for their efforts, to ensure they are effective, responsive, and provide all staff took part in a local beach clean for the Landlord’s obligations 2 Learning from international experience – value for money. The Commission carried out its first staff away day. Staff can also participate in a Payment of rent 2 produce growing on a French incubator farm annual staff survey in 2019-20 resulting in a clear ‘give as you earn’ scheme and donate a proportion action plan for addressing areas for improvement. of their salaries to charities of their choice.

Scottish Land Commission staff away day – Fortrose beach clean

14 Annual Report 2019-2020 Annual Report 2019-2020 15 PERFORMANCE ANALYSIS

Best Value Planning ahead Contents The Commission’s Board provides the vision and At the beginning of 2020, we engaged with our leadership to ensure that it is satisfied that the stakeholders and staff about the future of land organisation is making the best use of public reform in Scotland, considering what the priorities money. We are committed to delivering best value and opportunities for land reform are and who else ACCOUNTABILITY REPORT through clear governance and accountability, should be involved. Findings from these workshops will help to shape the Commission’s next Strategic effective performance management, partnership This report contains key statements and reports that enables Plan, due to be submitted to Ministers in September and collaborative working, maximising efficiencies the Scottish Land Commission to meet accountability requirements and building sustainability into how we operate. 2020. Land reform has a key part to play in Scotland’s recovery and renewal post COVID-19, and demonstrate compliance with good corporate governance. In delivering best value we are committed to unlocking opportunities in land for greater fairness and equality of opportunity and have economic, social and environmental wellbeing Corporate Governance Report 18 policies and procedures in place to ensure this for people in both urban and rural Scotland. The Commission will be shaping its future work Directors’ Report 18 is achieved. We also fully recognise our legal Statement of Accountable Officer’s Responsibilities 20 responsibilities, particularly in respect of race and organisational development to respond effectively to the post-COVID-19 challenges. Governance Statement 21 PERFORMANCE REPORT PERFORMANCE REPORT relations, age, sex and disability discrimination.

The Commission has an Anti-Fraud Policy in place Remuneration and Staff Report 28 and there have been no reported incidents of corruption or fraud. Remuneration Policy 28 Staff Report 33 Summary of Performance Parliamentary Accountability Report 35 This year has seen the Commission reach a number of significant milestones in the delivery of the Annual Business Plan and Strategic Plan. Independent Auditor’s Report 36 Operationally, the Commission has also developed significantly in terms of its culture, people and systems. New systems have been embedded into the organisation such as a new finance system and a case management system, to help build Financial Statements 39 an innovative and dynamic organisation. Hamish Trench Statement of Comprehensive Net Expenditure 39 Statement of Financial Position 40 Overall it has been a successful year in which the Commission has made important progress in Statement of Cash Flows 41 delivering our strategic priorities and a programme Statement of Changes in Taxpayers’ Equity 42 of land reform, positioning the Commission well to move in to the next phase for the organisation with Chief Executive and Accountable Officer Notes to the Accounts 43 our next Strategic Plan. 1 September 2020 Accounts Direction 51

16 Annual Report 2019-2020 Annual Report 2019-2020 17 CORPORATE GOVERNANCE REPORT

Directors’ Report Pensions Board of Commissioners Management Team Scottish Land Commission staff members are eligible to be members of the Principal Civil Hamish Trench Service Pension Scheme. Details of the scheme Left to right: Megan MacInnes, Chief Executive and and details of the pension entitlements of the Professor David Adams, Andrew Thin (Chair), Accountable Officer Scottish Land Commission’s senior managers Dr Bob McIntosh (TFC), Dr Sally Reynolds Responsible for the strategic are given in the Remuneration Report (page 29) and Lorne MacLeod leadership and operational and note 1.7 (page 44) to these accounts. management of the Full details of the Commissioners’ organisation and supporting Register of Interests can be found Commissioners in fulfilling Freedom of on our website their functions. Information requests www.landcommission.gov.scot/about-us/ The Scottish Land Commission received nine commissioners Posy MacRae Freedom of Information requests during the year Head of Communications 2019-20. Details of these can be reviewed on and Corporate Services the Scottish Information Commissioner’s website ACCOUNTABILITY REPORT ACCOUNTABILITY Andrew Thin (Chair) Lorne MacLeod Responsible for leading stats.itspublicknowledge.info/. REPORT ACCOUNTABILITY Andrew has over thirty years of experience Lorne was a founding director, and latterly Chair, the Commission’s in leadership roles in the public, private and of Community Land Scotland, and has been a communications and third sectors. He coordinated the work of the director of the community land buyout groups in corporate services including Data Protection Agricultural Holdings Legislation Review in Eriskay, South Uist & Benbecula, and the Isle of corporate governance. 2014. His previous public sector roles have Gigha. He was Highlands & Islands Enterprise’s There were no data losses during the year. included Crofters Commissioner, Chair of the first Director of Strengthening Communities. Cairngorms National Park Authority, Chair He is a chartered accountant, and director of a Shona Glenn of Scottish Natural Heritage and Andrew is retail and distribution business in the Isle of Skye. Payment Practice Code Head of Policy currently Chair of Scottish Canals. & Research – Land In line with Scottish Government policy, the Megan MacInnes Responsible for leading the Scottish Land Commission requires that all Dr Bob McIntosh CBE Megan has over 15 years’ experience working suppliers’ invoices not in dispute are paid within (Tenant Farming Commissioner) on land reform internationally, particularly programme of research and policy on land for housing 10 working days of receipt. The Scottish Land Bob is a retired public servant with extensive throughout Southeast Asia, with community and development, land Commission aims to pay 100% of invoices, experience in public policy, in particular in groups, NGOs, governments, international ownership and land use including disputed invoices, once the dispute land management and forestry. Bob was the organisations and large agribusiness companies. decision-making. has been settled, on time in these terms. Scottish Government Director for Environment She has considerable expertise in protecting During the year ended 31 March 2020, the and Forestry between 2012 and 2015 and land rights, land management, community Scottish Land Commission paid 95% of its served as the Director of Forestry Commission empowerment, natural resource governance Sarah Allen invoices within these terms. Scotland. He was a partner in a 650-acre hill and human rights. She grew up on Skye and Head of Tenant Farming farm for 15 years. He is also currently a Board is now part of a crofting family in Applecross, and Land Rights Member of Highlands and Islands Enterprise. and until May 2020 was the Land Advisor with & Responsibilities Non Audit Fees the international NGO Global Witness. Responsible for the Good Dr Sally Reynolds Practice team supporting The Auditor General for Scotland has appointed Sally is an Agricultural Consultant (with Professor David Adams the principles of the Land Audit Scotland as the external auditor. Details of a PhD in mathematical ecology); she is David Adams is Emeritus Professor in Urban Rights and Responsibilities the audit fee for the year to 31 March 2020 are currently working within the Community Land Studies at the University of Glasgow. A Fellow Statement, and providing disclosed in note 3 (page 46) to the accounts. Sector as Development Officer with Carloway of the Royal Town Planning Institute and the support to the Tenant Audit Scotland were not engaged or paid for Estate Trust (Urras Oighreachd Chàrlabhaigh). Royal Institution of Chartered Surveyors, David Farming Commissioner. any non-audit work during the year. An active crofter and livestock keeper, she was previously an adviser to the Land Reform contributes to a number of activities which Review Group and has researched and published benefit the community. widely on urban land problems.

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Statement of Accountable Officer’s Responsibilities Governance Statement

In accordance with section 19(4) of the Public Finance and Accountability (Scotland) Act 2000 Statement by Background Scope of Responsibility and section 19 of the Land Reform (Scotland) Accountable Officer The Governance Statement records the As Accountable Officer, I have responsibility for Act 2016, Scottish Ministers have directed the stewardship of the Scottish Land Commission maintaining a sound system of internal control Scottish Land Commission to prepare a statement As Accountable Officer, I am responsible for and supplements the annual accounts. This that supports the achievement of the organisation’s of accounts for each financial year in the form the regularity and propriety of the public finances statement also draws together statements and policies, aims and objectives, set by Scottish and on the basis set out in the Accounts Direction for which I am answerable, for keeping proper evidence on governance, risk management and Ministers, whilst safeguarding the public funds issued by the Scottish Ministers. records and for safeguarding the Scottish control, to provide a coherent and consistent and assets for which I am personally responsible, Land Commission’s assets, as set out in the reporting mechanism. in accordance with the responsibilities set out in The accounts are prepared on an accruals basis Memorandum to Accountable Officers for the Accountable Officer’s Memorandum. and must give a true and fair view of the Scottish Parts of the Scottish Administration issued by Land Commission’s state of affairs at the period Scottish Ministers. In the discharge of my personal responsibilities end and of its operating costs, recognised gains I ensure organisational compliance with the and losses and cash flows for the financial period. Scottish Public Finance Manual (SPFM). The Disclosure of Information SPFM is issued by the Scottish Ministers to provide In preparing the accounts, the Accountable guidance to the Scottish Government and other Officer is required to: to the Auditors

ACCOUNTABILITY REPORT ACCOUNTABILITY relevant bodies on the proper handling and REPORT ACCOUNTABILITY • Observe the Accounts Direction issued by As Accountable Officer, as far as I am aware, reporting of public funds. It sets out the relevant Scottish Ministers including the relevant there is no relevant audit information of which the statutory, parliamentary and administrative accounting and disclosure requirements, Scottish Land Commission’s auditor is unaware. requirements, emphasises the need for economy, and apply suitable accounting policies I have taken all reasonable steps to make myself efficiency and effectiveness, and promotes good on a consistent basis aware of any relevant audit information and to practice and high standards of propriety. • Make judgements and estimates on a establish that the Scottish Land Commission’s reasonable basis auditor is aware of the information. • State whether applicable accounting standards as set out in the Government Accountable Officer Financial Reporting Manual have been followed, and disclose and explain any Confirmation on the material departures in the accounts Annual Report and Accounts • Prepare the accounts on a going concern basis. As Accountable Officer I confirm that the annual report and accounts as a whole is fair, The Permanent Secretary and Principal balanced and understandable and I take personal Accountable Officer of the Scottish Government responsibility for the annual report and accounts has appointed the Chief Executive of the Scottish and the judgements required for determining that Land Commission as Accountable Officer. it is fair, balanced and understandable.

20 Annual Report 2019-2020 Annual Report 2019-2020 21 CORPORATE GOVERNANCE REPORT

Governance Framework Board of Commissioners during 2019-20 Attendance at Board The Board Audit and Risk Committee Commissioner Board Position Meetings 2019-20 The Chair leads the Board of Commissioners Andrew Thin Chair 7/8 A minimum of two Commissioners are appointed and the Chief Executive leads the executive by the Board to serve on the Audit and Risk Megan MacInnes Commissioner 8/8 management of the Scottish Land Commission. Committee. Given the relatively small size Professor David Adams Commissioner 7/8 of the organisation and Board, an external The Board comprises six Commissioners; five are member has been co-opted to the Audit and Land Commissioners and one a Tenant Farming Dr Bob McIntosh Tenant Farming Commissioner 5/8 Risk Committee to ensure additional expertise Commissioner, all of whom are appointed by and effective scrutiny. This Committee met four Dr Sally Reynolds Commissioner 7/8 Scottish Ministers. times during the 2019-20 year. Lorne MacLeod Commissioner 8/8 More information on the Commissioners can be found on page 18. The external and internal auditors normally attend Audit and Risk Committee Members during 2019-20 all Audit and Risk Committee meetings. They are The role of the Board is to provide strategic given the opportunity to speak confidentially to the Audit and Risk Attendance at Committee leadership for the organisation, setting the Committee members. The purpose of the Audit Committee Member Committee Position Meetings 2019-20 policy direction including development of a and Risk Committee is to monitor and review risk, Strategic Plan and Programme of Work to be Lorne MacLeod Chair (Commissioner) 4/4 control and corporate governance. It operates agreed with Scottish Ministers. They also oversee independently and reports to the Board. the performance of the organisation and the Megan MacInnes Member (Commissioner) 4/4 ACCOUNTABILITY REPORT ACCOUNTABILITY Chief Executive is accountable to the Board REPORT ACCOUNTABILITY The Audit and Risk Committee terms of reference Yvonne McIntosh* Member (Co-opted) 4/4 for its performance. can be obtained from the Commission’s website * Date of co-opted appointment 26 June 2017; www.landcommission.gov.scot. During the 2019-20 year the Board focused on: Date when appointment is due to end/become eligible for renewal 26 June 2021. • Overseeing delivery of the Strategic Plan Staffing and Remuneration Committee Members during 2019-20 and Programme of Work Staffing and Remuneration Committee • Extensive public and stakeholder Attendance at Committee engagement including regular public A Staffing and Remuneration Committee was Commissioner Committee Position Meetings 2019-20 meetings across Scotland established in May 2019 to oversee and monitor the remuneration systems put in place for the Andrew Thin Chair 3/3 • Quarterly performance monitoring Commission, including the annual pay remits. Megan MacInnes Commissioner 3/3 addressing delivery, financial, risk and The staffing and remuneration committee is a governance performance committee of the Commission. The members of Professor David Adams Commissioner 3/3 • Board member development and training. the staffing and remuneration committee are the Board of Commissioners chaired by the Chair of Dr Bob McIntosh Tenant Farming Commissioner 2/3 The Board is supported by an Audit and the Land Commission. The Committee met three Dr Sally Reynolds Commissioner 3/3 Risk Committee to maintain oversight of times during the 2019-20 year. internal and external audit, financial, risk Lorne MacLeod Commissioner 3/3 and governance performance, and a Staffing and Remuneration Committee. Senior Management Team 2019-20 More information on the Senior Management The Board is committed to high standards Team can be found on page 19. of corporate governance and believes that • Hamish Trench a sound governance structure engenders a (Chief Executive and Accountable Officer) The Senior Management Team meets regularly to successful organisation. co-ordinate operational management. The Senior • Shona Glenn (Head of Policy and Research) Management Team consists of the Chief Executive The Board’s standing orders can be and the Heads of Service. The Senior Management obtained from the Commission’s website • Sarah Allen (Head of Tenant Farming/ Land Rights and Responsibilities) Team is committed to high standards of corporate www.landcommission.gov.scot. governance and provides the leadership, strategic • Posy MacRae (Head of Communications oversight and the control environment required to and Corporate Services) deliver the Scottish Land Commission’s key aims.

22 Annual Report 2019-2020 Annual Report 2019-2020 23 CORPORATE GOVERNANCE REPORT

The Scottish Land Commission follows the Scottish Risk and Control Delivery Conflicts of Government policy on Information Security and Framework • Risk that the Commission has an over- has a Senior Information Risk Owner in place to Interest Procedures reliance on a small number of sector manage information risk. All bodies subject to the requirements of consultants and researchers in securing the The Scottish Land Commission operates strict and the Scottish Public Finance Manual (SPFM) expertise to deliver high quality research/ The risk and control processes applied within the comprehensive procedures to deal with potential must operate a risk management strategy in contracts resulting in delay or a gap in delivery Scottish Land Commission accord with guidance conflicts of interest. A register of interests, covering accordance with relevant guidance issued by Commissioners and staff, is held and updated on • Risk that the Commission is unable to given in the SPFM and have been in place for the the Scottish Ministers. year ended 31 March 2020 and up to the date of an annual basis. This is available for examination demonstrate/measure change against by any member of the public wishing to do so, and agreed outcomes and objectives the approval of the annual report and accounts. The risk and control mechanism is based Commissioner’s information is published on the on an ongoing process designed to identify • Risk of loss of systems resulting in the During the year, and up to the date of signing the Scottish Land Commission’s website. the principal risks to the achievement of the Commission not being able to operate accounts, the following governance arrangements Scottish Land Commission’s policies, aims and as an organisation were in place: Commissioners record any potential conflicts of objectives; to evaluate the nature and extent • Risk that the Commission is unable to interest at the start of every Commission meeting of those risks and to manage them efficiently, react quickly in matching resources to • Whistle Blowing Policy and where appropriate absent themselves from effectively and economically. changes in priorities. decisions on any matters in which they have an • Anti-Fraud Policy interest. These declarations are recorded in the The Scottish Land Commission maintains a Reputational • Updated Finance Desk Instructions minutes of the meeting. Strategic Risk Register which records internal • Risk that emerging issues result in reactive and external risks and identifies the mitigating The Commission’s risk management framework policy making and relationship management actions required to reduce the threat of these states that risk management training will be External Audit

ACCOUNTABILITY REPORT ACCOUNTABILITY risks occurring and their impact. The Strategic • Risk of inconsistency in joining up the provided to all staff every three years. Risk REPORT ACCOUNTABILITY The Auditor General for Scotland has appointed Risk Register is regularly updated and reviewed Commission’s outputs in clear narrative and management training which should have taken Audit Scotland as the Scottish Land Commission’s as a standing item by both the Senior linking to the wider land reform agenda place in March 2020 had to be postponed due to external auditor for a four-year period from Management Team and the Audit and Risk lockdown restrictions of COVID-19. This training • Risk of ineffective management of strong 1 April 2017. Committee. Each individual risk is allocated relationships with key stakeholders in policy has been rescheduled and will take place in an owner who ensures that mitigating action development and in identifying opportunities September 2020. is carried out. The Risk Register is presented for collaboration, reducing the potential of Internal Audit to the Board on a quarterly basis. relationships with a range of stakeholders The system of internal control will continue to be reviewed to ensure effective assurances as • Risk of ineffective management of relationships The internal audit function is an integral part of The principal risks identified during the year the organisation matures and develops. to 31 March 2020 can be categorised under across Scottish Government and restricts the internal control system. The Scottish Land four main headings: the chance of the Commission’s work being Commission’s internal audit service for the understood and recommendations well received. financial year 2019-20 was provided by BDO LLP, who undertook work based on an analysis of Compliance Best Value the risk to which the Commission was exposed. During 2019-20 BDO LLP reviewed and evaluated The Commission’s Governance Framework • Risk that the Commission fails to have in the Scottish Land Commission’s processes in the ensures that by following best practice principals place or adhere to statutory or non-statutory following areas: corporate governance policies or procedures and guidance across the organisation we continue to secure best value in our operations • Risk that the Commission fails to deliver to its • Corporate Governance and procurement of services and contracts. allocated budget, resulting in reputational, • Financial Planning For example, the Commission has entered into administrative and governance failures. shared service arrangements for effective and • Communications and Stakeholder Engagement Staffing efficient provision of corporate services, including • Workforce Planning for 2019-20 provision of HR by Cairngorms • Follow-up of recommendations. • Risk that individual members of staff are National Park Authority. The Commission’s absent due to illness, etc resulting in loss Organisational Development Strategy includes The findings are presented in the reports issued of capacity for critical elements of business review and further tailoring of shared service during the year to the Senior Management Team systems and delivery provision to meet the Commission’s developing and the Audit and Risk Committee. These include • Risk that changing work priorities, competing culture and business needs. an opinion on the adequacy and effectiveness expectations or insufficient prioritisation of the system of internal control, together with impacts on staff wellbeing. recommendations for improvements.

24 Annual Report 2019-2020 Annual Report 2019-2020 25 CORPORATE GOVERNANCE REPORT

A total of 18 recommendations were made Data and Information Governance Focus Management Assurances throughout the year which ranged from medium Management Looking Ahead to low risk, with no high risk recommendations The Accountable Officer’s review of the identified. Procedures are in place to ensure compliance effectiveness of the system of internal control and The key governance challenges going forward with data and information management risk management arrangements is informed by: Each year the Internal Audit provider issues an centre on delivery of outcomes in the context of obligations. The Commission has had no recorded annual report which includes an opinion on the Scotland’s economic recovery from the COVID-19 1. Letter of assurance supported by a completed or reported instances of data loss or breaches system of internal control. The findings of the pandemic and will involve: internal control checklist, agreed by the during the year. The Commission has taken steps review of the Commission’s risk management, Heads of Service identifying controls and to ensure compliance with GDPR obligations. • Achieving delivery of the Scottish Land governance and internal control processes if applicable stating areas of concern The Commission has a dedicated Data Protection Commission’s Programme of Work and provided the Commission with reasonable Officer, Information Asset Owners and Senior contributing to Scotland’s recovery through 2. The work of internal auditors, including assurance that there are no major weaknesses Information Risk Owner. a new Strategic Plan in-year reports to the Scottish Land in the internal control systems for the areas • Shaping effective ways of working during the Commission’s Audit and Risk Committee reviewed in 2019-20. The Commission recognises the importance of remaining phases of COVID-19 restrictions (this includes their independent and objective ensuring cyber resilience and has continued to opinion on the adequacy and effectiveness In their annual report, Internal Audit stated • Maintaining oversight of changing risks and work with Scottish Government to ensure that our of the Commission’s systems of internal that they found a strong level of commitment opportunities resulting from changes in ways digital technologies are in line with the Scottish control together with recommendations and effort from the Commission in clearing as of working due to COVID-19 Public Sector Action Plan on Cyber Resilience. for improvement) many outstanding recommendations as possible The Scottish Land Commission achieved Cyber • Full integration of tailored information and 3. Comments made by external audit in from previous audit reports. In particular they Essentials certification in February 2020. financial systems to support the efficient and their reports recognised the completion of the Agriculture effective achievement of corporate objectives Casework recommendations, such as the 4. The annual report, and quarterly updates, • Further developing the scheme of delegation as provided by the Chair of the Audit and Risk ACCOUNTABILITY REPORT ACCOUNTABILITY implementation of a casework management REPORT ACCOUNTABILITY the Scottish Land Commission evolves to ensure system. They followed up 10 recommendations Significant Committee to the Board, detailing the work it operates in an efficient and effective way from 2018-19 and five recommendations Governance Issues of that committee during the year from 2019-20. Eight of the recommendations • Continued development of performance 5. Quarterly reviews by the Audit and Risk had been fully implemented, four had been During 2019-20 there were no significant management information including key Committee of the organisation’s risk register partially implemented, and three had not governance issues to report. performance indicators and the work of internal audit in assessing been implemented due to changes in the • Ongoing programme of training and effectiveness of risk management arrangements project management approach and a delay development for Commissioners based 6. Letters of assurance from the Cairngorms in the budget profiling to the rescheduled on skills and development requirements National Park Authority who provide a Scottish budget. • The effective governance of the Staffing and shared HR service to the Scottish Land Remuneration Committee overseeing and Commission. monitoring the remuneration systems put in place for the Commission, in particular the The Internal Auditor’s annual assurance pay and grading system. report finds that the controls framework in place provides a reasonable assurance regarding the effective and efficient delivery of the Commission’s strategic objectives.

Conclusion

Based on the sources of assurance identified above, and the continuous review of corporate governance practices in line with the SPFM best practice principals and guidance, I am satisfied that appropriate governance controls are in place and these are operating effectively. The framework of control will continue to be developed to ensure it is proportionate and effective as the organisation matures.

26 Annual Report 2019-2020 Annual Report 2019-2020 27 REMUNERATION AND STAFF REPORT

The Remuneration and Staff Report is subject to audit except for the Remuneration Policy, Board Remuneration Gender Note, Sickness Absence data, Staff policies with regards to Equal Opportunities, Disability and Diversity, Fairness at Work, and Learning and Development Policies, which Commissioners were due remuneration as follows are reviewed by Audit Scotland for consistency with the audited accounts. Commissioners who held office during 2019-20 2019-20 (£) 2018-19 (£) Andrew Thin (Chair) 12,624 12,384 Remuneration Policy Megan MacInnes (Land Commissioner) 7,028* 6,972 Professor David Adams (Land Commissioner) 5,040 4,944 Board Members Staff Dr Bob McIntosh (Tenant Farming Commissioner) 20,160 19,776 The Scottish Land Commission Board All permanent and fixed-term staff are employees Dr Sally Reynolds (Land Commissioner) 5,040 4,944 comprises six Commissioners. Commissioners’ of the Scottish Land Commission. For 2019-20 Lorne MacLeod (Land Commissioner) 5,040 4,944 remuneration is approved by Scottish Ministers the Commission has adopted Scottish Government and is determined according to the Public pay grading and policy to determine salary Commissioners’ appointments are non-pensionable. Sector Pay Policy for Senior Appointment levels and review with the Staffing and *Benefit in kind payments totalling £1,987 are included in the above (see www.scotland.gov.uk/publications Remuneration Committee approving the remuneration for Megan MacInnes made during the year (2018-19: £2,028). for further detail). proposed annual pay remit in line with Scottish Scottish Land Commission Chair is committed to four days per month. Government pay policy. Account is taken of the Current Board Member appointments are non- need for pay to be set at a level which will ensure Tenant Farming Commissioner is committed to eight days per month. pensionable. All the current Board Members the recruitment, retention and motivation of staff. Land Commissioners are committed to two days per month.

ACCOUNTABILITY REPORT ACCOUNTABILITY have been appointed from 19 December 2016. Also taken into account are the Government’s All Commissioners were appointed from 19 December 2016. REPORT ACCOUNTABILITY Four members have been appointed on five-year policies on the Civil Service and public sector pay terms (Andrew Thin, Chair; Dr Bob McIntosh, and the need to observe public spending controls. Tenant Farming Commissioner; Dr Sally Reynolds, Performance of all staff is monitored through a and Lorne Macleod, Land Commissioners) and performance appraisal system. Remuneration of Senior Staff two members have been appointed for four-year terms (Megan MacInnes and Professor David The following section provides details of the remuneration and Adams, Land Commissioners). Audit and Risk Committee pension interests of the senior staff of the Scottish Land Commission The Scottish Land Commission’s Audit and Risk Salary Pension benefits Total committee is comprised of two Commissioners £000 £000 £000 and one co-opted member from an external organisation. The co-opted member is not in 2019-20 2018-19 2019-20 2018-19 2019-20 2018-19 receipt of any remuneration and therefore is not included in the following report. Chief Executive Hamish Trench 70-75 70-75 33 41 105-110 110-115 Senior Management Team Posy MacRae*1 40-45 35-40 18 16 60-65 55-60 Full-time equivalent (55-60) (45-50) Sarah Allen*2 35-40 30-35 15 13 50-55 45-50 Full-time equivalent (55-60) (50-55) Shona Glenn 55-60 50-55 22 21 75-80 70-75

*1 Works 0.8 FTE *2 Works 0.6 FTE (0.8 FYE from February to March 2020) Salary – includes gross salary, overtime and any other allowance to the extent that it is subject to UK taxation. This report is based on payments made within the year by the Scottish Land Commission. Benefits in kind – There were no benefits in kind within 2019-20. Bonuses – There were no bonuses within 2019-20.

28 Annual Report 2019-2020 Annual Report 2019-2020 29 REMUNERATION AND STAFF REPORT

Compensation for Pay multiples Civil Service Pensions loss of office Reporting bodies are required to disclose Pension benefits are provided through the Civil Employee contributions are salary-related and This value was nil for 2019-20 (2018-19: nil). the relationship between the remuneration Service pension arrangements. From 1 April range between 4.6% and 8.05% for members of of the highest paid staff member in their 2015 a new pension scheme for civil servants classic, premium, classic plus, nuvos and alpha. organisation and the median remuneration was introduced – the Civil Servants and Others Benefits in classic accrue at the rate of 1/80th

of the organisation’s workforce. The banded Pension Scheme or alpha, which provides benefits of final pensionable earnings for each year of remuneration of the highest-paid staff member on a career average basis with a normal pension service. In addition, a lump sum equivalent to in the Scottish Land Commission in financial year age equal to the member’s State Pension Age (or three years’ initial pension is payable on retirement. 2019-20 was £70-£75k (2018-19: £70-75k). 65 if higher). From that date all newly appointed For premium, benefits accrue at the rate of 1/60th This was 2.22 times (2018-19: 2.45) the median civil servants and the majority of those already of final pensionable earnings for each year of remuneration of the workforce (excluding the in service joined alpha. Prior to that date, civil service. Unlike classic, there is no automatic Chief Executive) which was £32,644 (2018-19: servants participated in the Principal Civil Service lump sum. Classic plus is essentially a hybrid £29,951.50). Pension Scheme (PCSPS). The PCSPS has four with benefits for service before 1 October 2002 sections: three providing benefits on a final salary calculated broadly as per classic and benefits In 2019-20 no employees received remuneration basis (classic, premium or classic plus) with a for service from October 2002 worked out as in in excess of the Chief Executive. Remuneration normal pension age of 60; and one providing premium. In nuvos, a member builds up a pension ranged from £21,482 to £58,653 (excluding the benefits on a whole career basis (nuvos) with a based on his pensionable earnings during their Chief Executive) (2018-19: £19,562 to £53,965). normal pension age of 65. period of scheme membership. At the end of the scheme year (31 March) the member’s earned These statutory arrangements are unfunded pension account is credited with 2.3% of their with the cost of benefits met by monies voted pensionable earnings in that scheme year and the ACCOUNTABILITY REPORT ACCOUNTABILITY REPORT ACCOUNTABILITY by Parliament each year. Pensions payable accrued pension is uprated in line with Pensions Pension Benefits under classic, premium, classic plus, nuvos Increase legislation. Benefits in alpha build up in and alpha are increased annually in line with a similar way to nuvos, except that the accrual Accrued pension Real increase CETV* CETV Real Pensions Increase legislation. Existing members rate is 2.32%. In all cases members may opt to at pension age as in pension and at at increase of the PCSPS who were within 10 years of their give up (commute) pension for a lump sum up at 31/03/20 and related lump sum 31/03/20 31/03/19 in CETV normal pension age on 1 April 2012 remained to the limits set by the Finance Act 2004. related lump sum at pension age as funded in the PCSPS after 1 April 2015. Those who by employer were between 10 years and 13 years and five The partnership pension account is a stakeholder months from their normal pension age on 1 April pension arrangement. The employer makes a £000 £000 £000 £000 £000 2012 will switch into alpha sometime between basic contribution of between 8% and 14.75% Lump Lump 1 June 2015 and 1 February 2022. All members (depending on the age of the member) into Pension Sum Pension Sum who switch to alpha have their PCSPS benefits a stakeholder pension product chosen by the ‘banked’, with those with earlier benefits in one employee from a panel of providers. The Chief Executive of the final salary sections of the PCSPS having employee does not have to contribute, but those benefits based on their final salary when where they do make contributions, the employer Hamish Trench 20-25 - 0-2.5 - 259 230 15 they leave alpha. (The pension figures quoted for will match these up to a limit of 3% of pensionable Senior Management Team officials show pension earned in PCSPS or alpha salary (in addition to the employer’s basic – as appropriate. Where the official has benefits contribution). Employers also contribute a Posy MacRae 0-5 - 0-2.5 - 28 18 7 in both the PCSPS and alpha the figure quoted further 0.5% of pensionable salary to cover Sarah Allen 0-5 - 0-2.5 - 28 16 9 is the combined value of their benefits in the two the cost of centrally-provided risk benefit cover schemes.) Members joining from October 2002 (death in service and ill health retirement). Shona Glenn 0-5 - 0-2.5 - 31 18 8 may opt for either the appropriate defined benefit arrangement or a ‘money purchase’ stakeholder The accrued pension quoted is the pension the *CETV stands for Cash Equivalent Transfer Value and more information can be found on page 32. pension with an employer contribution (partnership member is entitled to receive when they reach pension account). pension age, or immediately on ceasing to be

30 Annual Report 2019-2020 Annual Report 2019-2020 31 REMUNERATION AND STAFF REPORT

an active member of the scheme if they are CETVs are worked out in accordance with already at or over pension age. Pension age is the Occupational Pension Schemes (Transfer Staff Report 60 for members of classic, premium and classic Values) (Amendment) Regulations 2008 and plus, 65 for members of nuvos, and the higher do not take account of any actual or potential of 65 or State Pension Age for members of reduction to benefits resulting from Lifetime Staff Costs and Numbers alpha. (The pension figures quoted for officials Allowance Tax which may be due when pension Permanent Board Total Total show pension earned in PCSPS or alpha – benefits are taken. Staff Members Others 2019-20 2018-19 as appropriate. Where the official has benefits in both the PCSPS and alpha, the figure quoted £000 £000 £000 £000 £000 is the combined value of their benefits in the Real increase in CETV two schemes, but note that part of that pension Salaries 403 55 76 534 419 may be payable from different ages.) This reflects the increase in CETV that is funded by the employer. It does not include Social security costs 45 2 7 54 36 Further details about the Civil Service pension the increase in accrued pension due to inflation, Other pension costs 117 - 21 138 81 arrangements can be found at the website contributions paid by the employee (including Inward secondment www.civilservicepensionscheme.org.uk. the value of any benefits transferred from another pension scheme or arrangement) and uses and agency staff - - 27 27 22 common market valuation factors for the start TOTAL 565 57 131 753 558 and end of the period. Cash Equivalent Transfer Values ACCOUNTABILITY REPORT ACCOUNTABILITY REPORT ACCOUNTABILITY A Cash Equivalent Transfer Value (CETV) is the actuarially assessed capitalised value of the Average Number of Employees pension scheme benefits accrued by a member The average number of full-time equivalent (FTE) persons employed during the year at a particular point in time. The benefits valued are the member’s accrued benefits and any contingent spouse’s pension payable from the Number 2019-20 scheme. A CETV is a payment made by a pension Senior Management 3 scheme or arrangement to secure pension benefits in another pension scheme or arrangement when Professional, Managerial, Administration and Support 10 the member leaves a scheme and chooses to TOTAL 13 transfer the benefits accrued in their former scheme. The pension figures shown relate to Senior Management represents members of Management Team. the benefits that the individual has accrued as As at 31 March 2020, 75% of staff were on permanent contracts, a consequence of their total membership of comprising 12 permanent staff and four members of staff on a fixed-term contract. the pension scheme, not just their service in a senior capacity to which disclosure applies. The Commission had no consultancy remuneration or off payroll arrangements in the year ended 2019-20 (2018-19: nil). The figures include the value of any pension benefit in another scheme or arrangement which the member has transferred to the Gender Note Civil Service pension arrangements. They also include any additional pension benefit accrued Males Females Males Females to the member as a result of their buying 31 March 2020 31 March 2020 31 March 2019 31 March 2019 additional pension benefits at their own cost. Commissioners 4 2 4 2 Chief Executive 1 - 1 - Employees 2 13 2 11

Employee numbers include part-time staff. The figures above are the total numbers of staff as at 31 March 2020, not full-time equivalents.

32 Annual Report 2019-2020 Annual Report 2019-2020 33 REMUNERATION AND STAFF REPORT PARLIAMENTARY ACCOUNTABILITY REPORT

Sickness Absence pay and benefits, discipline and selection for Losses and special Remote Contingent redundancy. In line with Scottish Government Sickness absence during the year to 31 March policy, the Scottish Land Commission is payments Liabilities specifically required to increase the diversity of 2020 was 55 days, representing 1.6% of the total There were no losses or special payments The Scottish Land Commission is required to staff within the organisation. The Commission number of available days. This equates to an made during the year 2019-20 (2018-19: nil). report any liabilities for which the likelihood of cannot directly discriminate in the selection of average number of days’ sickness per member a transfer of economic benefit in settlement is employees for recruitment or promotion, but the of staff of 3.44 days. too remote to meet the definition of contingent Commission may use appropriate lawful methods, Gifts and Charitable liability under IAS37. There are currently no including lawful positive action to address under- remote contingent liabilities. Exit Packages representation of any group that the Commission Donations identifies as being under-represented in particular There were no gifts or charitable donations There were no exit packages within 2019-20 types of jobs. Employment and development made during the year 2019-20 (2018-19: nil). (2018-19: nil). of disabled persons is covered by our Equal Hamish Trench Opportunities and Diversity Policy and as part of the organisation’s commitment to the Disability Equal Opportunities, Confident scheme: applications for employment received from any candidate who indicates that Disability and Diversity they have a disability will be automatically short- Chief Executive and Accountable Officer Policies listed if they demonstrate that they meet all the 1 September 2020 essential short-listing criteria for the role. The ACCOUNTABILITY REPORT ACCOUNTABILITY REPORT ACCOUNTABILITY The Scottish Land Commission adopts the Scottish Scottish Land Commission will make reasonable Government policies on equal opportunities and adjustments to its standard working practices diversity. The policy on equal opportunity states to overcome barriers caused by disability. that all staff should be treated equally irrespective The Scottish Land Commission undertakes to of their sex, marital/civil partnership status, age, develop all staff, positively values the different race, ethnic origin, sexual orientation, disability, perspectives and skills each brings to our work, religion or belief, working pattern, employment and has adopted a comprehensive learning and status, gender identity (transgender), maternity development policy and fairness at work policy. or paternity status, caring responsibility or trade The Scottish Land Commission is committed union membership. The Commission will seek to delivering its functions in a manner that to avoid unlawful discrimination in all aspects of encourages equal opportunities, aims to eliminate employment including recruitment, promotion, unlawful discrimination and other conduct opportunities for learning and development, prohibited by equality legislation.

34 Annual Report 2019-2020 Annual Report 2019-2020 35 INDEPENDENT AUDITOR’S REPORT

Independent auditor’s report to the members of the Scottish Land Commission, the Auditor General for Scotland and the Scottish Parliament.

Report on the audit of Basis of opinion Risks of material misstatement intentional omissions, misrepresentations, or the override of internal control. The capability of the financial statements I conducted my audit in accordance with I have reported in a separate Annual Audit Report, the audit to detect fraud and other irregularities applicable law and International Standards which is available from the Audit Scotland depends on factors such as the skilfulness of on Auditing (UK) (ISAs (UK)), as required by website, the most significant assessed risks of Opinion on financial statements the perpetrator, the frequency and extent of the Code of Audit Practice approved by the material misstatement that I identified and my manipulation, the degree of collusion involved, I have audited the financial statements in the Auditor General for Scotland. My responsibilities conclusions thereon. the relative size of individual amounts annual report and accounts of the Scottish Land under those standards are further described manipulated, and the seniority of those individuals Commission for the year ended 31 March 2020 in the auditor’s responsibilities for the audit Responsibilities of the Accountable involved. I therefore design and perform audit under the Land Reform (Scotland) Act 2016. The of the financial statements section of my report. Officer for the financial statements procedures which respond to the assessed financial statements comprise the Statement of I was appointed by the Auditor General on 26 risks of material misstatement due to fraud. Comprehensive Net Expenditure, the Statement of January 2018. The period of total uninterrupted As explained more fully in the Statement of Financial Position, the Statement of Cash Flows, appointment is three years. I am independent Accountable Officer’s Responsibilities, the A further description of the auditor’s the Statement of Changes in Taxpayers’ Equity of the body in accordance with the ethical Accountable Officer is responsible for the responsibilities for the audit of the financial and notes to the accounts, including a summary requirements that are relevant to my audit of preparation of financial statements that give a statements is located on the Financial of significant accounting policies. The financial the financial statements in the UK including the true and fair view in accordance with the financial Reporting Council’s website www.frc.org.uk/ reporting framework that has been applied in their Financial Reporting Council’s Ethical Standard, reporting framework, and for such internal control auditorsresponsibilities. This description preparation is applicable law and International and I have fulfilled my other ethical responsibilities as the Accountable Officer determines is necessary forms part of my auditor’s report. Financial Reporting Standards (IFRSs) as adopted in accordance with these requirements. Non- to enable the preparation of financial statements by the European Union, and as interpreted and audit services prohibited by the Ethical Standard that are free from material misstatement, whether ACCOUNTABILITY REPORT ACCOUNTABILITY Other information in the REPORT ACCOUNTABILITY were not provided to the body. I believe that the due to fraud or error. adapted by the 2019-20 Government Financial annual report and accounts Reporting Manual (the 2019-20 FReM). audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. In preparing the financial statements, the The Accountable Officer is responsible for the In my opinion the accompanying financial Accountable Officer is responsible for assessing other information in the annual report and statements: Conclusions relating to going the body’s ability to continue as a going concern, accounts. The other information comprises the concern basis of accounting disclosing, as applicable, matters related to going information other than the financial statements, the • give a true and fair view in accordance with concern and using the going concern basis of audited part of the Remuneration and Staff Report, the Land Reform (Scotland) Act 2016 and I have nothing to report in respect of the following accounting unless deemed inappropriate. and my independent auditor’s report. My opinion directions made thereunder by the Scottish matters in relation to which the ISAs (UK) require on the financial statements does not cover the Ministers of the state of the body’s affairs as me to report to you where: other information and I do not express any form of at 31 March 2020 and of its net expenditure Auditor’s responsibilities for the • the use of the going concern basis of assurance conclusion thereon except on matters for the year then ended; audit of the financial statements accounting in the preparation of the prescribed by the Auditor General for Scotland to • have been properly prepared in accordance financial statements is not appropriate; or My objectives are to obtain reasonable assurance the extent explicitly stated later in this report. with IFRSs as adopted by the European Union, about whether the financial statements as a whole • the body has not disclosed in the financial as interpreted and adapted by the 2019-20 are free from material misstatement, whether due In connection with my audit of the financial statements any identified material uncertainties FReM; and to fraud or error, and to issue an auditor’s report statements, my responsibility is to read all that may cast significant doubt about its ability that includes my opinion. Reasonable assurance is the other information in the annual report and • have been prepared in accordance with the to continue to adopt the going concern basis a high level of assurance, but is not a guarantee accounts and, in doing so, consider whether the requirements of the Land Reform (Scotland) of accounting for a period of at least twelve that an audit conducted in accordance with ISAs other information is materially inconsistent with Act 2016 and directions made thereunder months from the date when the financial (UK) will always detect a material misstatement the financial statements or my knowledge obtained by the Scottish Ministers. statements are authorised for issue. when it exists. Misstatements can arise from in the audit or otherwise appears to be materially fraud or error and are considered material if, misstated. If I identify such material inconsistencies individually or in the aggregate, they could or apparent material misstatements, I am reasonably be expected to influence the economic required to determine whether there is a material decisions of users taken on the basis of these misstatement in the financial statements or a financial statements. material misstatement of the other information. If, based on the work I have performed, I conclude The risk of not detecting a material misstatement that there is a material misstatement of this other resulting from fraud is higher than for one resulting information, I am required to report that fact. from error, as fraud may involve collusion, I have nothing to report in this regard.

36 Annual Report 2019-2020 Annual Report 2019-2020 37 INDEPENDENT AUDITOR’S REPORT FINANCIAL STATEMENTS

Report on regularity of Matters on which I am required Statement of Comprehensive expenditure and income to report by exception I am required by the Auditor General for Scotland Net Expenditure Opinion on regularity to report to you if, in my opinion: • adequate accounting records have not been In my opinion in all material respects the For the year ended 31 March 2020 kept; or expenditure and income in the financial statements were incurred or applied in accordance with any • the financial statements and the audited part 2020 2019 applicable enactments and guidance issued by of the Remuneration and Staff Report are not the Scottish Ministers. in agreement with the accounting records; or Note £000 £000 • I have not received all the information and Staff costs 2 770 576 Responsibilities for regularity explanations I require for my audit. Other operating expenditure 3 688 705 The Accountable Officer is responsible for ensuring the regularity of expenditure and I have nothing to report in respect of these matters. Total operating expenditure 1,458 1,281 income. I am responsible for expressing an opinion on the regularity of expenditure and Conclusions on wider scope income in accordance with the Public Finance responsibilities Net operating expenditure 1,458 1,281 FINANCIAL STATEMENTS and Accountability (Scotland) Act 2000.

ACCOUNTABILITY REPORT ACCOUNTABILITY In addition to my responsibilities for the annual report and accounts, my conclusions on the wider The notes on pages 43 to 50 form part of these accounts. Report on other requirements scope responsibilities specified in the Code of Audit Practice are set out in my Annual Audit Report. Opinions on matters prescribed by the Auditor General for Scotland Use of my report In my opinion, the audited part of the Remuneration and Staff Report has been This report is made solely to the parties to whom it properly prepared in accordance with the is addressed in accordance with the Public Finance Land Reform (Scotland) Act 2016 and directions and Accountability (Scotland) Act 2000 and for no made thereunder by the Scottish Ministers. other purpose. In accordance with paragraph 120 of the Code of Audit Practice, I do not undertake In my opinion, based on the work undertaken to have responsibilities to members or officers, in in the course of the audit: their individual capacities, or to third parties. • the information given in the Performance Report for the financial year for which the financial statements are prepared is consistent with the financial statements and that report has been prepared in accordance with the Land Reform (Scotland) Act 2016 and directions made thereunder by the Scottish Ministers; and Maggie Bruce • the information given in the Governance Senior Audit Manager Statement for the financial year for which the Audit Scotland financial statements are prepared is consistent The Green House with the financial statements and that report Beechwood Business Park North has been prepared in accordance with the Land Inverness, IV2 3BL Reform (Scotland) Act 2016 and directions made thereunder by the Scottish Ministers. 1 September 2020

38 Annual Report 2019-2020 Annual Report 2019-2020 39 FINANCIAL STATEMENTS

Statement of Financial Position Statement of Cash Flows

As at 31 March 2020 For the year ended 31 March 2020

2020 2019 2020 2019 Notes £000 £000 Notes £000 £000 Non-current assets Cash flows from operating activities Property, plant and equipment 4 4 6 Net operating expenditure (1,458) (1,281) Trade and other receivables 5 2 0 Depreciation charge 4 2 1 Total non-current assets 6 6 (1,456) (1,280) Current assets Movements in working capital FINANCIAL STATEMENTS FINANCIAL STATEMENTS Trade and other receivables 5 18 16 Increase/(decrease) in trade and other payables 7 4 (25) Cash and cash equivalents 6 120 120 (Increase)/decrease in trade and other receivables 5 (4) (16) Total current assets 138 136 0 (41) Current liabilities Net cash flow from operating activities (1,456) (1321) Trade and other payables 7 (102) (98) Financing activities Total current assets less current liabilities 36 38 Grant-in-Aid 1,456 1,315 Total assets less current liabilities 42 44 Net cash flow from financing activities 1,456 1,315 Taxpayers’ equity Investing activities General reserve 42 44 Purchase of property, plant and equipment 4 (0) (7) Net cash used in investing activities (0) (7) The Accountable Officer authorised these financial statements for issue Net (decrease)/increase in cash and cash equivalents - 13 on 1 September 2020. Cash and cash equivalents at beginning of year 6 120 133 Only events up until the authorised for issue date are reflected in these accounts. Cash and cash equivalents at end of year 6 120 120 The notes on pages 43 to 50 form part of these accounts.

The notes on pages 43 to 50 form part of these accounts. Hamish Trench

Chief Executive and Accountable Officer 1 September 2020

40 Annual Report 2019-2020 Annual Report 2019-2020 41 FINANCIAL STATEMENTS

Statement of Changes Notes to the Accounts in Taxpayers’ Equity 1 Accounting policies 1.1 Accounting Convention These accounts have been prepared under the The financial statements have been prepared For the year ended 31 March 2020 historical cost convention modified to account for in accordance with the 2019-20 Government the revaluation of property, plant and equipment Financial Reporting Manual (FReM) issued by and intangible assets. Residual values are General Reserve £000 HM Treasury and the Accounts Direction (page 51) reviewed annually so that they are stated in the issued by Scottish Ministers. Balance at 01 April 2018 10 Statement of Financial Position at fair value. The (FReM) sets out the format of the annual accounts. Grant-in-Aid (GIA) is included in the 1.2 Intangible Assets Year ended 31 March 2019 General Reserve in the Statement of Changes Expenditure relating to IT software and software Grant-in-Aid 1,315 in Taxpayers’ Equity rather than included in the Statement of Comprehensive Net Expenditure. developments is capitalised if the asset has a All other income and expenditure is included in cost of at least £5,000 or considered part of a

FINANCIAL STATEMENTS the Statement of Comprehensive Net Expenditure. collective group of interdependent assets with a FINANCIAL STATEMENTS Comprehensive net expenditure for the year (1,281) total cost exceeding £5,000. General IT software The accounting policies contained in the FReM project management costs are not capitalised. apply International Financial Reporting Standards All assets are recorded at cost and the estimated Balance at 31 March 2019 44 (IFRS) as adapted or interpreted for the public useful lives and residual values are reviewed sector context. annually in line with the asset management policy. The Scottish Land Commission does not have any Year ended 31 March 2020 Where the FReM permits a choice of accounting intangible assets that require to be capitalised policy, the accounting policy which is judged within this financial year. Grant-in-Aid 1,456 to be the most appropriate to the particular circumstances of the Scottish Land Commission for the purposes of giving a true and fair view 1.3 Property, Plant and Equipment Comprehensive net expenditure for the year (1,458) has been selected. Expenditure on office refurbishments, office furniture and fittings, office equipment, IT The particular policies adopted by the Scottish equipment and infrastructure is capitalised if Land Commission are described below. They Balance at 31 March 2020 42 the asset has a value of at least £5,000 with a have been applied consistently in dealing with useful life of more than one year. Individual assets items that are considered material to the costing less than £5,000 are capitalised when The notes on pages 43 to 50 form part of these accounts. financial statements. considered part of a group if the total cost exceeds £5,000. General IT project management costs The financial statements included in this are not capitalised. The assets are recorded at report have been prepared on a going concern cost and the estimated useful lives and residual basis. The Accountable Officer has considered values are reviewed annually in line with the asset the budget and associated grant-in-aid allocation management policy. for 2020-21 and considers the Scottish Land Commission to have adequate resources to continue in operational existence for the foreseeable future.

42 Annual Report 2019-2020 Annual Report 2019-2020 43 FINANCIAL STATEMENTS

1.4 Depreciation 1.6 Employee Benefits 1.10 Cash and Cash Equivalents 1.13 Critical Accounting Judgements Capitalised assets will be depreciated/amortised Salaries and employment-related payments are Cash and cash equivalents in the statement of and Key Sources of Estimation on a straight-line historical cost basis as follows. recognised in the year in which the service is financial position comprise cash with the bank In the application of the Scottish Land received from employees. The cost of annual leave and on hand. Commission’s accounting policies as described Property, plant and equipment: and flexible working time entitlement earned but in Note 1, the Accountable Officer is required not taken by employees at the end of the year is to make judgements, estimates and assumptions Furniture and fittings: recognised in the financial statements to the extent 1.11 Grant-in-Aid about the carrying amount of assets and liabilities that employees are permitted to carry forward • Office refurbishment – 10 years The Scottish Land Commission receives Grant- that are not readily apparent from other sources. • Furniture – 10 years leave into the following year. A liability and an The estimates and associated assumptions are expense are recognised for accrued but unused in-Aid from the Scottish Government to finance • Office equipment – 5 years its net expenditure. Grant-in-Aid is credited to based on experience and other factors that are annual leave and flexi leave balances at 31 considered to be relevant. Actual results may differ March, in accordance with the underlying policy. the general reserve in the period in which it Information technology: is received. The net cost of the Scottish Land from these estimates. The estimates and underlying These costs are shown in the Remuneration and assumptions are reviewed on an ongoing basis. • IT equipment – 3 years Staff Report. Commission is charged to this fund. • IT infrastructure – 3 years Revisions to accounting estimates are recognised in the period in which the estimate is revised if the Intangible assets: 1.12 Adoption of New 1.7 Pension Costs revision affects only that period, or in the period FINANCIAL STATEMENTS and Revised Standards FINANCIAL STATEMENTS • Software licences – 3 years of revision and future periods if the revision affects Pension costs as reported in the Scottish Land • Developed software and website – 3 years At the date of authorisation of these financial both current and future periods. The Accountable Commission’s accounts relate to the period during statements there were the following Accounting Officer is required to make judgements, estimates which it benefits from the employee’s services. Office refurbishments and furniture is written Standards issued, but not yet effective, which and assumptions in relation to work in progress This includes amounts covered by the provisions off over the remaining life of the lease (the relate to the Scottish Land Commission: at the year end. The estimates and associated date of the first lease break) if below 10 years. of the Principal Civil Service Pension Scheme assumptions are based on historical experience IT software, including developed software, is (PCSPS), a defined benefit scheme, which are paid • IFRS 16 Leases – effective for accounting and work to date statements. Other than the written off over the expected life if less than by the Scottish Land Commission to the PCSPS periods beginning on or after 1 April 2021. above, the Accountable Officer does not consider three years. The estimated useful lives and on an accruing basis. The Commission is unable This standard specifies how to recognise, there to be any critical judgements or sources of residual values are reviewed annually. to identify its share of the underlying assets and measure, present and disclose leases. estimation uncertainty requiring disclosure beyond liabilities and therefore the liability for payment Application and disclosure details are to application of the policies stated above. of future benefits is a charge on the PCSPS which be provided and a full assessment will be 1.5 Value Added Tax prepares its own scheme statements. undertaken at that point. The application of this standard is expected to increase total 1.14 Leases Irrecoverable VAT is included with the expenditure by less than £1k, Right of Use relevant costs and charged to the Statement 1.8 Trade Receivables assets totalling £46k and will be brought Leases where most of the risks and rewards of of Comprehensive Net Expenditure in the onto the Statement of Financial Position, ownership of the asset remain with the lessor are period in which it is incurred. All material amounts due as at 31 March with an associated lease liability of £46k. classified as operating leases. Operating lease 2020 have been brought into the Statement The application of this standard will also payments are recognised in the statement of of Comprehensive Net Expenditure irrespective lead to the Commission’s budget allocation comprehensive net expenditure on a straight-line of when actual payments were received. of Grant-in-Aid specifying a capital element basis over the lease term. The effective date of for the first time. IFRS 16 leases is now deferred to 1 April 2021. 1.9 Trade Payables

All material amounts due as at 31 March 2020 have been brought into the Statement of Comprehensive Net Expenditure irrespective of when actual payments were made.

44 Annual Report 2019-2020 Annual Report 2019-2020 45 FINANCIAL STATEMENTS

2 Staff Costs 4 Property, Plant and Equipment

Permanent Board Total Total Information Technology 2018-19 Staff Members Others 2019-20 2018-19 Cost £000 £000 £000 £000 £000 £000 At 1 April 2018 0 Salaries 420 55 76 551 437 Additions 7 Social Security costs 45 2 7 54 36 At 31 March 2019 7 Other pension costs 117 - 21 138 81 Depreciation and impairment Inward secondment and agency staff - - 27 27 22 At 1 April 2018 0 TOTAL 582 57 131 770 576 Depreciation charged in the year 1 At 31 March 2019 1

FINANCIAL STATEMENTS 3 Other Operating Expenditure Carrying amount FINANCIAL STATEMENTS At 31 March 2019 6 2020 2019 At 31 March 2018 0 £000 £000 Accommodation expenses 35 34 Research & Policy 278 337 Information Technology 2019-20

Information systems & Telecommunications 21 18 Cost £000 Training 25 15 At 1 April 2019 7 Public meetings and conference expenses 25 11 Additions 0 Travel & subsistence – Commissioners 21 19 At 31 March 2020 7 Travel & subsistence – staff 35 32 Depreciation and impairment Communications Activity 87 82 At 1 April 2019 1 Human Resources Shared Services 13 13 Depreciation charged in the year 2 IT Service 51 51 At 31 March 2020 3 Legal and professional fees 35 20 Carrying amount External Auditor’s remuneration 25 25 At 31 March 2020 4 Internal Auditor’s remuneration 18 19 At 31 March 2019 6 Other running costs 17 28 Depreciation 2 1 Total other operating expenditure 688 705

46 Annual Report 2019-2020 Annual Report 2019-2020 47 FINANCIAL STATEMENTS

5 Trade and Other Receivables 8 Commitments Under Other Non-cancellable Agreements Total minimum future payments under contracts entered into prior to 31 2020 2019 March 2020 are given in the table below for each of the following periods. Amounts falling due within one year £000 £000 Obligations under these contracts from 31 March 2020 comprise:

Other receivables - 1 2020 2019 Prepayments and accrued income 18 15 Projects £000 £000 Amounts falling due after one year £000 £000 Not later than one year 257 78 Prepayments and accrued income 2 0 Later than one year and not later than five years 98 9 TOTAL 20 16 Later than five years - - FINANCIAL STATEMENTS FINANCIAL STATEMENTS 6 Cash and Cash Equivalents 9 Related Party Transactions

£000 The Scottish Land Commission is an NDPB disclosed in the Changes in Taxpayers’ Equity sponsored by the Scottish Government and statement. In addition, a significant amount was Balance at 1 April 2019 120 considers the following bodies to be related paid to the Scottish Government for the provision parties: of accommodation, and for the services of a Net change in cash & cash equivalents - seconded employee. Balance at 31 March 2020 120 During 2019-20 the Scottish Land Commission’s Sponsor Directorate changed from the Scottish The Cairngorms National Park Authority is also Government’s Environment and Forestry an NDPB sponsored by the Scottish Government directorate to the Scottish Government’s and provided the Commission with HR and payroll The following balances at 31 March were held with the Government Banking Service and cash in hand 120 Sustainable Land Use and Rural Policy Directorate services during the year. (the Sponsor Directorate) and the Scottish Land Balance at 31 March 2020 120 Commission had significant material transactions None of the Commission’s members or key during the year with both. Financial transactions managerial staff have had any related party with the Directorates comprised Grant-in-Aid as transactions during the year.

7 Trade and Other Payables

2020 2019 £000 £000 Accruals 102 98 Other taxation and social security - - TOTAL 102 98

48 Annual Report 2019-2020 Annual Report 2019-2020 49 FINANCIAL STATEMENTS ACCOUNT DIRECTION

10 Financial Instruments Due to the non-trading nature of the Scottish when the contractual rights have expired, or the Land Commission’s activities and the way in which asset has been transferred. The Scottish Land Government departments are financed, the Scottish Commission has no financial assets other than Land Commission was not exposed to the degree cash and trade receivables. Trade receivables of financial risk faced by business entities. The do not carry any interest and are stated at their Scottish Land Commission has no borrowings and nominal value less any provision for impairment. relies on grants from Scottish Government for its cash requirements. The Scottish Land Commission Financial liabilities are recognised in the Statement is therefore not exposed to liquidity risks. It has of Financial Position when the Scottish Land no material deposits and all material assets and Commission becomes party to the contractual liabilities are denominated in sterling, so it is not provisions of the financial instrument or, in the THE SCOTTISH LAND COMMISSION exposed to interest rate risk or currency risk. case of trade payables, when the goods or services have been received. Financial liabilities DIRECTION BY THE SCOTTISH MINISTERS Financial assets are recognised on the Statement are derecognised when the liability has been of Financial Position when the Scottish Land discharged, that is, the liability has been paid or 1. The Scottish Ministers, in accordance with Section 19 of the Land DIRECTION ACCOUNTS

FINANCIAL STATEMENTS Commission becomes party to the financial has expired. The Scottish Land Commission have instrument contract or, in the case of trade no financial liabilities other than trade payables. Reform (Scotland) Act 2016, hereby give the following direction. receivables, when the goods or services have Trade payables are not interest bearing and are been delivered. Financial assets are derecognised stated at their nominal value. 2. The statement of accounts for the financial year ended 31 March 2018, and subsequent years, shall comply with the accounting principles and disclosure requirements of the edition of the Government Financial Reporting Manual (FReM) which is in force 11 Commitments Under Leases for the year for which the statement of accounts are prepared. 3. The accounts shall be prepared so as to give a true and fair view Total future minimum lease payments under operating leases are given of the income and expenditure and cash flows for the financial year, in the table below for each of the following periods. Obligations under and of the state of affairs as at the end of financial year. operating leases from 31 March 2020 comprise: 4. This direction shall be reproduced as an appendix to the statement 2020 2019 of accounts.

Buildings £000 £000 Not later than one year 36 36 Signed by the authority of the Scottish Ministers. Later than one year and not later than five years 36 36 Later than five years - - 10 May 2018 The Scottish Land Commission’s Lease at Longman House is currently held until March 2022.

12 Subsequent Events Events taking place after the date the financial information about conditions existing at 31 March statements were authorised for issue are not 2020, the figures in the financial statements and reflected in the financial statements or notes. notes have been adjusted in all material respects Where events taking place before this date provided to reflect the impact of this information.

50 Annual Report 2019-2020 Annual Report 2019-2020 51 Glasgow Commonwealth Games Athletes’ Village © Tom Manley

Contact us Scottish Land Commission Longman House 28 Longman Road Inverness IV1 1SF

[email protected] 01463 423 300 Find us on: www.landcommission.gov.scot