Alan Carter asks, could Brexit be an opportunity to craft a sane economic vision for our uplands?

In 2011, consultants from the Scottish Agricultural College began a study into the comparative economics of commercial forestry and hill sheep farming in the Southern Uplands. They took a specific area of forest around the village of Eskdalemuir as the focus of the study.

The researchers built up a detailed picture of the economics of the Eskdalemuir forest, then compared it with figures for the income and expenditure of hill sheep farms in comparable areas. To make the comparison fair, they did not just look at current figures, since these would have been wildly biased in favour of the foresters who were just starting to fell a glut of wood planted in the 1970s. Instead they used the figures they obtained to work out an average income over the whole period of the forty-year life of a timber plantation. As the single-age stands of large plantations like Eskdalemuir are slowly restructured to have the same area in each age range, the real annual figures will tend to converge on this notional amount. It is important to emphasise that while the study tells us a lot about upland areas similar to Eskdalemuir its results cannot be generalised to sheep farming and forestry in dissimilar areas where the figures might be quite different.


320px-now_in_the_scottish_borders_6743126291The results of the exercise are striking, and should make us think hard about the future of our uplands. The study published its latest figures in 2014. These show the forestry making a profit of £150 per hectare, with a modest public subsidy of £16 per hectare. On a comparable area of hill sheep farm, the farmer makes a loss of £22 per hectare on the farming itself, but is rescued by £94 of public subsidy on every hectare. On the face of it, these figures would make anyone wonder why anyone would keep hill sheep (except for the subsidy) and why we as a nation would pour money into sustaining a loss-making industry while a profitable one waited in the wings to replace it, hampered only by land prices kept artificially high by those same subsidies.

However, the theme of this Journal is ‘Upstream, Downstream’, in recognition of the fact that what happens in the uplands doesn’t necessarily stay in the uplands. Before rushing to judgement we should ask whether the public goods produced by the two industries alter the picture substantially. These come in many forms, so let’s look at flooding, water quality, carbon storage, wildlife habitat, landscape, employment and the support of rural communities.

flood_at_crosshill_-_geograph-org-uk_-_291406Flooding has been much in the news recently and is only likely to get worse with a warming Atlantic. Overall, floods are made worse by anything that hurries water down from the uplands, like drain-dredging, burn-straightening and the creation of hard, non-absorbent surfaces. They are made less severe by land practices that keep water in the uplands, smearing out and reducing the flood peaks. Sheep farming gives little benefit, creating the kind of landscape that water runs off easily and quickly. Commercial forestry can make things even worse if drains are badly planned, but tree-covered landscapes tend to form deeper soils that hold more water and have better infiltration – that is, the water seeps into them rather than running off the surface. Neither sheep pasture nor commercial forestry are great for water quality.

With carbon storage there is a clear winner. Sheep-bitten landscapes store little carbon; a timber plantation will store around 100 tonnes of carbon per hectare on average, although the carbon benefits can be reduced or even reversed if trees are planted on peat. With wildlife and landscape we are back to a more mixed picture. Neither sheep pasture nor plantation are especially valuable wildlife habitat. The open landscapes created by sheep farming are probably more loved than even-aged Sitka plantation, but restructuring is improving the old even-aged plantations and a new aesthetic is becoming more aware of bare hillsides as stark and unnatural.

320px-yorkshire_dales_sheepAt least the Eskdalemuir study provides clear data on one area of public benefit. It turns out that forestry provides approximately the same amount of employment as hill sheep per hectare, and twice the amount of spending in the local economy. This means that forestry is better overall and over six times better per pound of public subsidy at supporting local communities and keeping local shops, schools and facilities open. It has long been assumed that because of the labour intensive nature of sheep farming, it would be the best way of providing rural employment but this turns out not to be true for Eskdalemuir, and the sheer unproductiveness of hill sheep means that it is not the industry to support if you want to put resources into rural communities.


Or what about a third option, not assessed by the Eskdalemuir study: letting the land go back to nature or ‘rewilding’ it? This has few immediate, direct economic benefits but trumps the both sheep farming and plantation forestry in virtually every category of public goods. Permanent open woodland creates ideal conditions for water to soak into soils and slowly builds the capacity of those soils to hold larger amounts of water. Rewilded areas would also make excellent habitat for beavers, whose dams have been shown both to reduce flood peaks and to act as giant water filters. Native woodland locks up more carbon than plantation over the long term since the carbon is not all released every forty years by felling. Almost by definition rewilding makes for better wildlife habitat and many would say that it gives a more attractive landscape than sodden sheep pasture or serried ranks of spruce.

In many countries rewilding has been the result of the collapse of rural communities and the loss of rural employment, but this is a political choice and doesn’t have to be so. Today, hill sheep farmers are effectively government employees as their entire income comes from subsidy. Being a hardworking and independent lot, sheep farmers will not want to hear this but it is true. The farming itself only serves to fritter away some of the subsidy. As a society we could choose to direct that subsidy into the care of rewilded uplands producing public goods just as easily as we currently choose to direct it into converting all those public goods into sheep. If the subsidy were maintained there would be no loss of rural employment or communities.


So, you might expect me to say that we should have done with hill sheep, stop throwing good money after bad and allow commercial forestry or rewilding to dominate our uplands. Well, not entirely. To do this would be to repeat the mistakes of the past. Let’s use this crisis in hill sheep farming to make our uplands more resilient, not to replace one monoculture with another. The plantations at Eskdalemuir are classic ‘bog brush’ forestry, mostly of wall-to-wall spruce. Extending this level of monoculture over vast areas would be a disaster waiting to happen, as one novel pathogen or pest could leave the timber industry looking for an even bigger bailout than the ones we have become used to providing to livestock farmers. I also doubt whether seeing our uplands disappear under blanket spruce would be a popular option with the general public.

Fortunately, we are not really faced with an either/or choice between only hill sheep, only commercial forestry or only rewilding. A much better option would be to intelligently integrate livestock farming, forestry and rewilding together. The synergies between the different land uses and the fact that the kind of land each requires is different means that this would be a win-win-win situation: a win for the environment, a win for the economy and win for rural communities.

The optimum mix of these land uses, in areas like Eskdalemuir, would devote a lot less land to sheep and a lot more to trees than at present. This would not be the disaster it sounds for sheep farming: as Chris Badenoch explained in issue 52 of Reforesting Scotland, sheep farming is still profitable on improved in-bye land but heavily loss-making on extensive land. Putting the latter land to both commercial forestry and rewilding would be no great loss to sheep farming and would provide considerable benefits in terms of shelter.

There are also synergies between plantation forestry and rewilding. A network of natural woodland along watercourses and on steep slopes where harvesting is difficult secures water quality and provides wind-firm edges that help to stop the crop trees blowing over. It also provides a great network for walking and greatly reduces the landscape impact of the plantations. Such a network has been shown to allow wildlife to make better use of the adjacent crop trees as habitat and at a landscape level it provides corridors between larger rewilded areas.

All this raises the question of why we are stuck in such a lose-lose-lose situation at present. The root of the problem seems to be the EU’s Common Agricultural Policy (CAP), which is what ensures that the grant system is so skewed in favour of sheep and against trees. The CAP was designed to keep agricultural land in production in countries where abandoned land reverts to forest. The open-ness of land is therefore used as a proxy for whether it remains productive. What it was not designed for was a situation where open land can be deeply unproductive and tree-covered land productive; unfortunately it has not shown the flexibility required to deal with Scotland’s differing climate and ecology.

I am writing this in the ‘interesting times’ immediately after the Brexit vote, at a time when the only certain thing is uncertainty. The Brexit campaign was viciously ugly and rejected by a majority of Scots voters, but now that it has won one silver lining might be the chance to seize the opportunity for an evidence-based policy for the uplands that works for rural communities, nature and the public alike.