Britain - Big landowners - capitalist interests under a "feudal" cloak

nov 1999

No-one is more secretive than the rich about their wealth - and they are prepared to pay a high price for their secrets to remain hidden. In fact an entire industry is exclusively devoted to massaging accounts and finding legal loopholes in order to conceal the whereabouts of their assets. One obvious reason for this is, of course, tax evasion. But the small number of big capitalists who control most of the economy are even more concerned to keep the corrupt tricks they use to build up their wealth hidden from the eyes of the working people whose labour they exploit. And for good reason. If the few millions of pounds that the privatised utilities' "fat cats" awarded themselves caused such a scandal, what would the reaction of the public be if all was revealed as to the scale of the wheelings and dealings of people like Blair's friend Lord Sainsbury , and others like him, whose fortunes are valued in billions?

However, while shares, cash, jewels and other valuables are easy to hide, land assets are not. Yet land makes up a significant part of the wealth of the British bourgeoisie. This is why who owns which piece of British soil is the best kept secret of all.

There is no national register of land ownership in Britain. The Queen's Land Registry Office, which has references for all London properties, does not provide information to the general public. Conveyancing solicitors are permitted access, but only to details concerning the property they are dealing with. Similarly, although open to the public, the Edinburgh "Register of Sasines ", which contains references to most heritable titles of Scottish land ownership since the 17th century, is useless for the purpose of obtaining data on a particular individual's assets or the real owners of a large estate. And the Scottish Land Register, which was set up in 1979 in order to provide a more usable replacement to the "Register of Sasines ", is not anywhere near completion, as properties are registered only when they are sold - which is seldom the case for the large estates for instance.

To date there have been only two full official surveys of land ownership - the Domesday Book in 1086 and the New Domesday Survey in 1873! Since then, nothing. However, the last Labour government did set up a Royal Commission on the distribution of income and wealth in the 70s , known as the Diamond Commission. One of its findings, before it was disbanded by Thatcher in 1979, was that the concentration of land in the hands of a very small minority in Britain was by far the highest in Western Europe.

So, this is what the thick veil of secrecy over land ownership is really hiding. And although the estimates of the Diamond Commission are over twenty years old, there is no reason to believe that things have changed significantly in that respect - on the contrary.

This high concentration of land ownership originates from the way in which the English bourgeoisie took over political power in the 17th century. Time and again governments have attempted to reform the land ownership laws inherited from this period , which have had all sorts of negative social, economic and political consequences. But because of the vested interests involved, most of these attempts have been half- hearted and the resulting reforms have been significantly watered down under pressure from the landowning lobby. In any case, they have failed to bring about significant changes, except in a few specific areas such as town planning, and even then, within limits.

Today, Blair's Labour government, and its Scottish counterpart, Dewar's Scottish Executive, have pledged to have another go at reforming land ownership. While the issue may seem somewhat different in England and Wales from what it is in Scotland, the vested interests involved are the same, however. And already there are obvious signs that these reforms will be in the same league as the past ones - i.e. primarily designed to preserve the interests of the very wealthy.

The unfinished English Revolution

The decisive factor in shaping land ownership, both in England and Wales, and in Scotland, was the political context in which the abolition of the feudal system of land tenure was implemented. In 18th century France, this was done against the background of a revolutionary mobilisation of the poor masses. Not only did the French Revolution abolish all feudal titles, but it also stripped the feudal lords of their rights over the land - and the poor peasantry went on to implement these decisions by taking over the land themselves. But in Britain, this revolutionary element did not exist.

In England and Wales, the replacement of the feudal system was finally carried out in 1660, after the radical phase of the English Revolution was already over, by an alliance of the feudal landlords and the emerging capitalist class. Feudal titles over the land were abolished by an act of Parliament, thereby freeing the land from the authority of the monarch. But instead of the feudal landlords being stripped of their land, they remained the exclusive owners in the modern sense of the term, while the status of the independent peasants, who had formed the backbone of Cromwell's army, remained as insecure as before.

But once the post-revolutionary reaction had settled in with the "Glorious Revolution" of 1688, the new landowners, together with a caste of merchants and lawyers with good government connections, proceeded to go on a land-grabbing spree. As Marx described in Capital, to illustrate the ruthlessness of the process of capital accumulation:

"The "glorious Revolution" brought into power, along with William of Orange, the landlord and capitalist appropriators of surplus-value. They inaugurated the new era by practising on a colossal scale thefts of state lands, thefts that had been hitherto managed more modestly. These estates were given away, sold at a ridiculous figure, or even annexed to private estates by direct seizure. All this happened without the slightest observation of legal etiquette. The Crown lands thus fraudulently appropriated, together with the robbery of the Church estates, as far as these had not been lost again during the republican revolution, form the basis of the to-day princely domains of the English oligarchy. The bourgeois capitalists favoured the operation with the view, among others, to promoting free trade in land, to extending the domain of modern agriculture on the large farm-system, and to increasing their supply of free agricultural proletarians ready to hand. Besides, the new landed aristocracy was the natural ally of the new bankocracy , of the newly-hatched haute finance, and of the large manufacturers, then depending on protective duties."

This large-scale theft and the brutal enclosure of common land that went with it, gave birth to the enormous estates which made capitalist farming aimed at the national and European markets possible. But the independent peasants were unable to resist such competition and those who resisted were forced out. Within less than a century, they had been ruined, their land had been taken over by the large landowners and rented out to tenant farmers or leaseholders. From then onwards, all that remained in the countryside was the landowner class and a layer of dependent peasants, tied to the landowners by various forms of leases which imposed on them all kinds of duties not dissimilar to those imposed on vassals in the feudal days. Only this time, in the name of capitalist property.

These changes in the form of land ownership which occurred at the end of the 17th century are still reflected in today's situation in England and Wales. On the one hand by the importance of the very large estates, not just in rural areas but also in cities. And, on the other hand, by the survival of a lease system which maintains a chain of dependency links between, for instance, the actual owner-occupier of a house, flat, or piece of land (the leaseholder with a time-limited lease) and the legal owner of the land itself (the freeholder).

Scotland's non-revolution

In Scotland, on the other hand, things went differently, if only because there was no bourgeois revolution in the first place, but also because the feudal system itself was never as developed as it was in England. By the time of the English Revolution, the Scottish feudal system was still superimposed on much older forms of social relations, based on the clan system, in which the land was the collective property of the clan. In the Highlands though, the clan system was probably still predominant.

The first change came in 1603 when England and Scotland were first united under the same monarch. The establishment of this new authority over the heads of the clan chiefs began to erode the existing social relations which were still largely based on kinship. The duty to take up arms to defend the clan chief was replaced with a duty to pay this chief a kind of "tax" or rent, while the land which had been so far the reward for armed defence evolved into a marketable and soon, heritable, commodity. Thus, slowly and partly independently from what was taking place in England, Scotland's mixture of feudal and clan-based relations transformed themselves into market relations.

This slow pace reflected the backwardness and remoteness of the Scottish economy. It was also due to the fact that the small Scottish bourgeoisie, which was concentrated in the Southern towns, had little interest in the large stretches of undeveloped land in the North, being much more attracted by the possibilities offered by the English and colonial market. But on the other hand, the absence of a social revolution in any way comparable to that in England meant that at no point were feudal titles formally abolished and replaced by capitalist property rights. Instead the old forms of ownership evolved into the new ones, the new content retaining the old shell.

But once this process had gathered pace it eventually penetrated every corner of Scotland, including the most remote parts of the Highlands. A ruthless concentration of the land took place there as well, more than a century after it did in England, but in an even more brutal fashion. In an article written in 1853, in which Marx exposed the hypocrisy of the Duchess of Sutherland's stand against slavery in America, he described how she had turned her Highlands estate to capitalist farming:

"It was only after 1811 that the ultimate and real usurpation was enacted, the forcible transformation of clan-property into the private property, in the modern sense, of the Chief. (..) When the Countess of Sutherland inherited these estates, (..) the population of them was already reduced to 15,000. My lady Countess resolved upon a radical economical reform, and determined upon transforming the whole tract of country into sheep-walks. From 1814 to 1820, these 15,000 inhabitants, about 3,000 families, were systematically expelled and exterminated. All their villages were demolished and burnt down, and all their fields converted into pasturage. British soldiers were commanded for this execution, and came to blows with the natives. An old woman refusing to quit her hut was burned in the flames of it. Thus my lady Countess appropriated to herself 794,000 acres of land, which from time immemorial had belonged to the clan. In the exuberance of her generosity she allotted to the expelled natives about 6,000 acres - two acres per family. These 6,000 acres had been lying waste until then, and brought no revenue to the proprietors. The Countess was generous enough to sell the acre at 2s 6d on average, to the clan-men who for centuries past had shed their blood for her family. The whole of the unrightfully appropriated clan-land she divided into 29 large sheep farms, each of them inhabited by one single family, mostly English farm-labourers; and in 1821 the 15,000 Gaels had already been superseded by 131,000 sheep."

The result of all this was that the number of landowners went down sharply throughout the 18th and 19th century, as the former clan dignitaries expelled clan-men from the traditional land of their clans. By the mid -19th century, 1,500 landowners owned 90% of Scottish land. They had turned a large part of this land into sheep farms and game reserves, which they ran like capitalist businesses for the benefit of the Edinburgh and Glasgow well-to- do. A significant part of the Scottish population had emigrated to England or America. Therefore, the system of feudal tenure of land remained in place and has remained so until today, in a capitalist form, together with the predominance of enormous estates.

Today's big landowners

The few contemporary estimates concerning land ownership provide some idea of the social weight of the large landowners. In the late 70s , the Diamond Commission found that 81% of the land in England, Wales and Scotland was owned privately. Out of this privately-owned land, 91% was in the hands of the 8% richest section of the population (whereas this same 8% owned "only" around 40% of total wealth). It also found that the old aristocratic estates (whether still owned by aristocratic families or by others) covered 53% of all privately- owned land, while the very large estates (those of 5,000 acres or more) were owned by just under 200 families. In the case of Scotland, more recent estimates published in a book entitled "Who owns Scotland?", by Andy Wightman , show that, in 1995, properties of 5,000 acres and over accounted for 53% of Scotland's privately-owned land. However, the figures given showed that the size of the biggest estates was much larger than in England and Wales, with 66 estates larger than 30,000 acres.

The cliché of the "poor" aristocratic family barely surviving on its ancestral estate for the sake of tradition is not born out by facts. Such cases do exist but they are certainly not representative of the average big landowner. One should not forget that the English aristocracy, unlike its French counterpart for instance, turned to business for new income long before the English Revolution. By now, they are totally integrated into the bourgeois world, even if they still try hard to draw some competitive advantage from the length of their family trees.

To look at land ownership from another angle, one can use surveys such as the Sunday Times "1000 rich list". In this year's list, 155 names are in land and property as opposed to 142 in industry. Among these 155, 49 individuals own more than 3,000 acres of land each and all but five are aristocratic names. Between them these 49 individuals own over 2,300 square miles, which is more or less the equivalent of the whole of Greater London, Surrey, East and West Sussex put together!

That land is big business can be illustrated by two names among others. The Duke of Buccleuch, a Tory MP between 1960 and 1973, became the largest landowner in the country and in fact in Europe in 1970, when the 1.2 million -acre Sutherland estate was finally broken up. Buccleuch owns 260,000 acres in Scotland (the equivalent of 2/3 of Greater London) but also 11,000 acres in Northamptonshire. He employs over a thousand people permanently (a very large workforce for a farming business), herds 16,000 cattle and produces 50,000 tonnes of timber per year. And although this "poor" man is only number 550 on the Sunday Times list, this is due to the low valuation of land in Scotland.

The Duke of Westminster, on the other hand, is number four on the Sunday Times list, weighing £1.75bn on his own. His land assets include 100,000 acres in Scotland, 15,000 in Cheshire and 14,000 North Wales, not to mention £300m worth of property abroad. All this and other assets are managed in the most bourgeois fashion by one single big property company, Grosvenor Estates, which is 100%-owned by the Duke.

Aristocratic or not, most big landowners are first of all plebeian capitalists, mostly in agro-business. For his 26,000 farming estate in Suffolk, the Earl of Iveagh admitted receiving a "nice six-figure cheque" in European subsidy as part of the Common Agricultural Policy (CAP). This admission is a reminder of the fact that big landowners are the main beneficiaries of CAP payments which are calculated according to the size of herds and flocks, and cultivable land. Many have also benefited, on top of this, from the billions in compensation paid to farmers by the state as a result of the BSE crisis.

Most of these big landowners are certainly not in need of cash. Especially not the Earl of Iveagh , who is, after all the head of the powerful Guinness family. Many other aristocratic names are thus directly involved in non-agricultural business. Some got involved in finance as Lloyd's "Names". Others, went into the media business, like Viscount Cowdray who now heads the Pearson group (owner of the Financial Times). Others still, went into agro-connected business, like Lord Vestey , whose Vestey Group is involved in shipping and food processing.

But among the very large landowners are names which have no connection with aristocratic blood. Famous examples of recent acquisitions are those of Hans Rausing , the owner of the Tetra- Laval packaging group and richest man in Britain, who bought 48,000 acres in Scotland under his daughter's name. And the Fleming family, which controls the Robert Fleming merchant bank, who acquired 89,000 acres, also in Scotland.

There is indeed a good reason for very rich capitalists to acquire very large estates, specially in Scotland, where the sparseness of the population makes landownership less prone to troubles with the local population. And this reason is tax evasion. Land is one of many instruments that can be used to stash large sums of money away from the claws of the tax man. It has the advantage of offering significant tax reductions for alleged investment supposedly aimed at improving agriculture or the environment - which is very difficult for the tax man to control. Besides, thanks to centuries of efforts by the landowning bourgeoisie, there are well-established and perfectly legal ways of completely avoiding inheritance tax on land.

London's overlords

The anachronistic and reactionary nature of big landownership is best demonstrated by the situation in London where most of the ground, outside the areas used directly by publicly-owned organisations, is effectively privately-owned. Again one can get a broad idea of this from estimates published by researchers in 1986.

The bulk of the Duke of Westminster's wealth, for instance, comes from the so-called 300 "golden acres" he owns in Mayfair and Belgravia. In fact, a few aristocratic families own most of what is worth owning in Central London: the Howard de Walden, Grosvenors , Portmans , Cadogans , Russells , Bedfords and a few others, including prince Charles who personally owns 45 acres in Kennington including the Oval cricket ground. Of course the Queen also owns a large part of wealthy London. But apart from a few acres alongside the Thames, part of the Lancaster estate which she owns personally, the rest is run by the Crown estate which gives the proceeds to government in exchange for the Queen's civil list. However, the Crown estate controls just about everything around Regent's Park, the Millbank estate, most of the area between Regent Street and Haymarket, part of Oxford Street, Victoria Park in east London, etc..

But the biggest share of wealthy London, in terms of value, is owned by big business rather than individuals. The two biggest landowners are two insurance companies - Prudential and Legal & General - followed by three property companies - Land Securities, which is the largest of its kind in the world, MEPC ( Metropolitan Estate and Property Corporation) and Hammerson .

Obviously such concentration of ownership means that the owners are in a position to resist pressures put on them to do anything that might be useful for planning purposes. This is why despite the drastic planning laws and the duties on landlords introduced after World War II (drastic on paper, at least), London remains such an urban nightmare half-a-century later. Of course, it is not unusual for people in working class neighbourhoods to be ordered to destroy a garden shed or a house extension, for failing to have the required planning permission. But when it comes to dealing with the Pru , the Portmans , let alone the Queen, it is an entirely different matter.

England's "feudal" capitalists

What makes things even worse is the system of ownership itself. The unfinished business of the English Revolution also means that ownership is still run along the lines of the old property relations. Behind each property, specially in the old urban areas, is a chain of leases. At the far end is the freeholder who, in law, is the only owner. And between the freeholder and the actual occupier of the property is a chain of intermediaries. Each intermediary is bound to his overlord by a lease of varying length (anything between 20 and 122 years and sometimes more). At the same time he has a certain amount of control over what the leaseholder below him can or cannot do with the property and gets a rent out of him. And of course, at every level, the property can be split into several sub-leases.

The consequence of this is a complete dilution of responsibilities, not to mention the difficulties involved in reconstituting the leasehold chain when it is hidden by such strict secrecy rules. Hence the growing dereliction of houses in some inner-cities, in London and elsewhere, due to the refusal of the various leaseholders involved to fork out the necessary funds for maintenance, etc.. Thatcher even ended up making public funds available to landlords after the 1981 inner-city riots in order to entice them into doing something about it. With chains of leaseholders playing constantly at putting the ball in each other's court, property and town planning laws have been a bounty for lawyers, providing them with an unlimited source of court cases. But they have been largely useless in terms of benefits to the general public.

From the point of view of the freeholders, on the other hand, this is a most ideal system. Of course, the ground rents paid on very long leases tend to become low by the time the lease matures. But arrangements can often be made with leaseholders - for instance when the leaseholder agrees to a larger ground rent in exchange for the freeholder giving his go-ahead to a redevelopment and an extended lease. Lease extensions of course have to be paid for separately as well (the number of years times the current ground rent usually) and this can represent significant amounts of money. And in any case, ultimately, the leases end one day and the freeholder regains full ownership of his property at the current much inflated prices.

In 1967, however, the Leasehold Reform Act allowed leaseholders actually occupying a property to buy their freehold under restrictive conditions (basically they had to be in very poor state), even if the current freeholder was unwilling to sell. In London, this is no more than a symbolic gesture given the exorbitant price of land. Nevertheless the Duke of Westminster was so outraged that he went to the European Court of Human Rights for redress - and lost.

And Scotland's capitalist " feudals "

In Scotland too, the same system based on chains of leaseholds (or " feus " in Scotland's legal language) remains in place, with the same inefficiency from a social point of view and the same privileges for the small minority of large landowners. But these chains differ from those in Britain in that feus are often hereditary. As a result there are cases where the upper links in the chain have long lost interest in the land and yet can, in theory, and sometimes do, re-emerge at some point to exercise their prerogatives as overlords, or "superiors".

Moreover, there are all sorts of duties (called "real burdens") left over from the past centuries that can be imposed by superiors on their leaseholders (or "vassals"). These can include restrictions on the way the land is used (in terms of redevelopment or construction, but even in terms of what can be grown). They can involve the compulsion to maintain certain facilities for the benefit of the superior. These burdens allow the owners of very large estates, which usually include villages and small towns, to regulate the way of life of all inhabitants.

The "Report on abolition of the feudal system" published in December 1998 by the Scottish Law Commission, explained how the system of feus and real burdens "has degenerated from a living system of land tenure with both good and bad features into something which, in the case of many but not all superiors, is little more than an instrument for extracting money. Superiors who have no actual interest in the enforcement of real burdens can extract money from vassals for granting waivers of their right to insist on observance. This practice has continued notwithstanding the power of the Lands Tribunal to vary or discharge unreasonable or unduly burdensome land obligations. A burden on the vassal's title which is on the face of it enforceable by the superior has a nuisance value even if the burden would in all probability be discharged by the Lands Tribunal. Superiors are still able to charge a sum which takes into account the trouble, delay, expense and uncertainty involved in seeking a variation or discharge from the Tribunal. Indeed even burdens which are manifestly invalid or unenforceable have a nuisance value to the superior which can be turned into money."

Not surprisingly, therefore, this report concluded that all "superiorities" and "real burdens" should be abolished and that all chains of feus should be reduced to their last link, that is to the vassal who actually occupies or rents out the land.

Labour's tame reforms

Both in England and Wales and in Scotland past attempts at reforming the landownership system have been primarily aimed at restricting further developments of the defects mentioned above, rather than actually bringing them to an end. To some extent they have frozen the situation without actually changing anything as to what already existed.

For England and Wales, various possibilities for leaseholders to buy their freeholds were introduced by law in the past. As mentioned before they were impracticable for most town-dwellers, except the richest. Besides they were only applicable when the freeholder was willing or when the lease came to an end. So that today, according to the government's own Consultation Paper on the subject published at the end of 1998, "there are some 900,000 leaseholders of houses in England and Wales, and over one million leaseholders of flats. Leasehold tenure is heavily concentrated in particular regions: over half of all leasehold houses are in the North West/ Merseyside , and over half of all leasehold flats are in London and the South East. Leasehold is a very long-established tenure for houses, and by the 1960s many house leases were approaching the end of their original term. But large-scale leasehold flat-ownership is a relatively recent phenomenon, and, for 80% of flats, the lease still has 80 years or more to run".

Although insisting in this Consultation Paper that the leasehold system is "a fundamentally unsatisfactory tenure", the Labour government is not actually planning to ban it altogether, nor even to ban the creation of new long-term leases. Of course, if they did, it would upset not only the large landowners and property companies, but also the capitalists who depend on the high level of housing prices in London, not to mention the section of the middle-class which owns the freeholds of many flats and houses in the suburban areas of the South-East. So instead, Blair only plans to streamline existing arrangements and relax the rules under which leaseholders can buy their freeholds, individually in houses and collectively in flats. But what if they cannot afford to buy? Why should leaseholders who have already paid a hefty price for their house or flat have to pay yet again for its freehold? And why should landowners who have been repaid already many times over for the price of their land get yet more money for it?

In Scotland, likewise, the draft bills published earlier this year stop short of addressing the fundamental issues. True, it is planned to "abolish feudal tenure". But what is actually behind these big words, which are primarily designed to be repeated by the media? Under the draft bill, all feus are to be abolished. But superiors will have to be compensated for their lost feus (i.e. the rent they get from their vassals), the amount of the compensation being the equivalent of 20 years of payments with a 2.5% interest. Likewise for at least some real burdens, even though the preliminary report admitted their extortionist nature. Ironically, despite the claim to abolish feudalism, there is no plan to abolish the titles of "baron" and "baroness" - they may be no longer be associated with the land they used to represent, but no doubt, it will be still possible to buy them (apparently the current asking price is £60,000!). Likewise, there is no plan to affect the Crown's general prerogatives, particularly that of taking over automatically all properties which have no owner, whatever the reason may be. In other words, while not affecting significantly the property of the big landowners, this bill may provide some of them with a fairly large bonus, depending on the number of their vassals.

The striking point in both cases - but of course, this is not much of a surprise coming from this government - is that there is nothing which aims at weakening the grip of the large capitalist landowners. There is not even an attempt at putting an end to the veil of secrecy behind which they conceal their parasitism. In fact the draft bill for Scotland explicitly says that property titles will only have to be registered when a sale takes place - without actually saying how this will be enforced.

On the contrary, every effort is made to stress the need for "compensating" landowners - as If the land sharks who have been living off the population for so long should be compensated for anything.

No, they should be made to compensate the working population and the jobless for centuries of parasitism, by putting their enormous land assets into collective ownership! It is not just feudalism which is a thing of the past, but capitalism itself. And these big landowners are just as representative of capitalism as the Sainsburys , the Hansons or any other big names of industrial or finance capital. They sustain the same decrepit system, they make up the same parasitic class, in fact they are often the same people.

The issue is not for us to advocate here, as some Scottish nationalists do, the redistribution of the large estates among the Scottish population. Rather, as Marx argued in a memorandum written in 1869, "the future will decide that the land cannot be owned but nationally. (..) The nationalisation of land will work a complete change in the relations between labour and capital and finally do away altogether with capitalist production, whether industrial or rural. Only then will the class distinctions and privileges disappear together with the economical basis from which they originate and society will be transformed into an association of 'producers'. To live upon other people's labour will become a thing of the past. There will no longer exist a government nor a state distinct from society itself. Agriculture, mining, manufacture, in one word, all branches of production will gradually be organized in the most effective form. National centralisation of the means of production will become the natural basis of a society composed of associations of free and equal producers consciously acting upon a common and rational plan. Such is the goal to which the great economic movement of the 19th century is tending."

There is nothing in these words that needs changing.

31 October 1999