In this Guest Blog, Bill Chisholm reveals the extraordinary story of how one former burgh in the Borders has outperformed all the rest in terms of its common good funds. That burgh is Berwick and it is now, of course, part of England.

Bill Chisholm was The Scotsman’s Borders correspondent from 1969 to 2005. He has taken a keen interest in the fate of the eight common good funds in the Borders burghs.

Scotland’s oldest and wealthiest burgh is thriving (in England)

Bill Chisholm 20 August 2013

Scotland has a very long history of community ownership of land and assets dating back to the founding of the Royal Burghs. The common good consisted originally of common land and grants of land by Royal Charter. Later in the 19th and 20th centuries additional land was acquired from neighbouring landowners and gifts of land were made by wealthy industrialists to form some of the famous parks in our towns and cities. In addition, a wide range of furnishings, paintings, regalia and other moveable property accumulated as part of the assets of the Common Good Fund.

The Common Good Act of 1491 remains on the statute book and states that the common good of all the Royal Burghs be observed and kept for the common good of the town and spent on the common and necessary things of the burgh.

Over hundreds of years, Scotland’s common good has been subject to poor management primarily due to the rampant municipal corruption and nepotism that prevailed as a consequence of town councils being responsible for electing their successors – a state of affairs that continued until the Burgh Reform Act of 1833. Genuine “local government” in Scotland was eventually abolished in Scotland in 1930 (parish councils) and 1975 (town councils) and responsibility for managing the common good passed first to District Councils in 1975 and then to the existing local authorities in 1996.

Scottish Borders Common Good Funds

Many people who take an interest in the status and performance of Scottish Borders Council Common Good Funds find it difficult to understand why an organisation with significant  land, investments and other assets consistently fails to achieve healthy annual profits. (1) This failure to secure a worthwhile financial return from the potentially lucrative commons means residents in the eight former burghs where the Common Good survives are missing out on their rightful inheritance. I thought it was perhaps a good time to take look at what has happened to these funds and as I did so, I made a remarkable discovery.

The unaudited accounts (1.3Mb pdf here) of the Council for 2012/13 reveal that the eight funds (Duns, Galashiels, Hawick, Jedburgh, Kelso, Lauder, Peebles and Selkirk) have combined net assets of £9.8 million and generated a collective deficit of £90,000. Of the eight, only Duns (£2000) and Lauder (£95,000) generated a positive return. By way of comparison, were the funds to generate a rate of return of 5%, this figure should be £490,000.

Burgh Income Expenditure Surplus/Deficit Net assets
Duns 2000 5000 -3000 30,000
Galashiels 2000 0  2000 26,000
Hawick 112,000 154,000 -42,000 3,032,000
Jedburgh 28,000 76,000 -48,000 1,371,000
Kelso 5000 35,000 -30,000 950,000
Lauder 269,000 174,000  95,000 1,031,000
Peebles 67,000 73,000 -6000 1,063,000
Selkirk 72,000 130,000 -58,000 2,336,000
TOTAL 557,000 647,000 -90,000 9,83,9000
No figures are reported by Scottish Borders Council for Coldstream, Eyemouth, Innerleithen and Melrose.
Income, Expenditure & Assets for 8 Border burghs
Source: Unaudited accounts 2012/13

It should be borne in mind that the sizeable areas of land held by the Borders Common Good Funds are, when taken together, equal in acreage to some of the larger privately owned estates in the region. Hawick has over 800 acres of farm land plus an unspecified acreage for the golf course and woodlands, Selkirk’s three farms alone cover 1300 acres while Lauder Common, one of the largest in Scotland, extends to some 1700 acres. The overall total possibly exceeds 5,000 acres.

Unfortunately, despite previous promises and pledges, there is still no sign of a public asset register clearly setting out everything that is included in the eight funds. However in February 2013 the council did, in response to a Freedom of Information request, provide details of the fixed assets (buildings and properties) and moveable assets (e.g. provost’s chains) in each of the funds. Perhaps the most striking aspect of this revelation was the fact that many of the items listed have been given no book value whatsoever, including Selkirk Town Clock, a number of common good open spaces, fishing rights on the Tweed at Peebles, and virtually all of the moveable assets.

Given the dearth of public information concerning millions of pounds worth of land holdings, investments and buildings, and the lack of detail of the charges levied on the funds by council officials, it is difficult to pinpoint what has gone wrong. But it would certainly seem elected councillors have played their part in allowing the Common Good estate to decline. It seems clear that the administration and development of Common Good assets is nowhere near the top of SBC’s list of priorities. That means the true potential of the multi-million pound operation will never be realised even at a time of austerity when every last penny is vital in sustaining local economies. Just this week, it was revealed that the £2 million cash balance was to be transferred to a “private firm of global fund managers.”

A similar regrettable pattern of Common Good neglect appears to have been developing right across Scotland ever since the abolition of town councils in 1975. A 2009 account of Common Good Funds in Scotland included some 1,600 assets in 144 separate funds with a reported value of £2.5 billion. Yet at national level too these huge assets failed to break even on the income and expenditure front. The Scottish Government’s official financial statistics for local government in 2011/12 showed gross expenditure on Common Good Funds to be £13,696,000 as against income totalling £11,540,000. That equates to an operating loss of £2,156,000.

Would these valuable assets have been better looked after had they remained in local control over the past 38 years? it is impossible to say for sure but it is fascinating to look at what has happened in one instance where that has happened.

Scotland’s first burghs four burghs – Roxburgh, Berwick, Stirling and Edinburgh – were established in 1125.

Roxburgh now lies in ruins.

Stirling and Edinburgh’s common good funds are, in the words of Thomas Johnston, “mere miserable starved caricatures of their former greatness.”

But Berwick is interesting and it is possible to compare the performance and fortunes of the region’s funds with a nearby charitable trust which administers the Common lands presented to this former Scottish burgh more than 600 years ago.

Berwick-upon-Tweed

The burgesses of Berwick-on-Tweed together with their contemporaries in Peebles, Hawick, Selkirk and the other Borders burghs received their Common lands from the Scottish king at around the same time. Today, the acreage under the control of the Berwick-upon-Tweed Freemen Trustees (Charity Commission No. 222154) is 2250 acres.

From the accounts (which can easily be downloaded from the Charity Commission’s website), we can see that the capital value of the investments at March 2011 stood at £4.896 million, and the total funds stood at £17,927,611. That’s almost double the £9.8 million valuation of the combined eight Borders Common Good funds.

Total income for 2010/11 was £437,448 (2009/10 £411,678). Rents yielded £280,853 while investments brought in £147,676. The Trustees generated a 2.4% return on capital

At the same time, the total income of the combined eight Scottish Borders funds in 2012/13 was £557,000 while expenditure totalled £647,000 – a deficit of £90,000.

As stated earlier, the common lands at Berwick-upon-Tweed were transferred to the burgesses and freemen of the then Scottish Royal Burgh at around the same time as the lands which now form part of the eight Borders common good funds.

The 3,280 acres of Common conveyed by a special Berwick Royal Charter of 1604 following the Union of the Crowns was vested with the freemen of the now English borough in perpetuity, although the acreage had gone down to 2,250 by the early years of the 20th century, thanks in part to the involvement of the town council which took control of the lands in 1843. The 1604 Charter had “granted to the burgesses the fee simple of certain lands over which the inhabitants had for centuries previously exercised rights of Common, grazing and other rights”.

But the introduction of statutory local government did nothing for the fortunes of the Berwick estate. The first elected town council melted down all of Berwick’s historic collection of silver, including the town mace…a sign of things to come.

During the 19th century the council often failed to pay the income from the estate to the freemen; financial accounts were not made available for public inspection; the town council attempted to alter some of the farm leases, and even leased farmland without advertising the leases.

By 1909 income was reduced and by now the local authority was spending all of the money it collected from the estate on council matters. The history of the estate also records that in 1916 the council wanted to lease the town’s ancient market rights to themselves at a rent of £5 per annum although the annual profit to the estate was £150. Such was the scale of council mismanagement that the estate fell into debt and by the 1950s the financial position was so dire one of the farms had to be sold for £9,000.

The local authority and the freemen were engaged in numerous legal disputes in the 20 years up to 1994 as the Borough Council attempted to plunder estate assets and proposed radical increases in annual administration fees from £5,000 to £18,000. Since 1994 the freemen Trustees and the Borough Council and Town Council have worked well together and as a result the estate has flourished. (2)

The retiring and new Town Mayor of Berwick-upon-Tweed. Note the “Scottish”purple ceremonial robes dating back to granting of Royal Charter by David I in contrast to English red robes.
© 
All rights reserved by Berwick-upon-Tweed Town Council

Map of Town Council of Berwick-upon-Tweed which includes the 2250 acres of land owned by the Freemen Trustees.

Concluding thoughts

What is fascinating about the above is the fact that one of Scotland’s oldest burghs survives today with a self-governing town council, £17 million of assets and an annual income of £437,000. At the same time, eight neighbouring burghs have half the assets and lost money last year.

The difference between this successful and relatively prosperous burgh (or borough) and the burghs of the Scottish Borders is that Berwick-upon-Tweed is in England. That simple fact raises all sorts of interesting questions about how local democracy and the commons have survived on both sides of the border.

So, perhaps as the Scottish Government holds one of its summer cabinets in Hawick, it might reflect on 900 years of Scottish history and ponder how to rebuild democracy in Scotland’s communities.

(1) All 8 Scottish Borders Common Good Funds are administered collectively as a charity No. SC031538

(2) Following the abolition of the Borough Council in 2009, a new Town Council was established.

15 Comments

  1. What a superb article!

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  2. I second Brian Wilson’s remark!

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  3. Bill, you are carrying the banner for all of us in what you have said and what is published today. Failed undertakings, property manipulations and contrived financial deductions from the Common Good Funds by local authorities have characterised the ‘management’ of CGFs by LAs for decades. It is as if the LA and its staff are oblivious to the desires of the communities who pay for them and whose best interests they should represent and instead only strive to sustain their own position and their own secure employment. As you rightly hint, it is down to our Scottish Government to put a reforming gale through the mindset of LAs reluctant to observe their legal obligations. The emphasis on the spirit of administering the common good for the benefit of the citizens, which most Local Authorities have forgotten, needs a strong govermental reminder. Your article will help.

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  4. An excellent report on an area much neglected since the reorganisation of Local Government in 1975. Clearly there is a strong case for the return of the administration of Common Goods to the local communities. Local government reform and large multi member wards which are no longer identified solely with the old Scottish Burghs means that Councillors have less interest in such parochial matters. There is potential for these assets, if properly managed, to be put to far better use in their own communities and give a welcome boost to local economies.

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  5. 1:30

    How ironic this of all websites carries an article praising a landowner which owns 30% of the Berwick town council area and derives the majority of its income from 6 figure sums of rent out of an investment in 1,000s of acres of land occupied by tenant farmers.

    Look at the accounts and you’ll see the Berwick Freemen have also been speculating in the housing land market (planning permission for up to 300 houses).

    I’d also be very suspicious about linking the Berwick Freemen with local democracy. The Berwick Town Council looks like little more than the sort of Scottish community council Andy Wightman reviles so deeply (all their website links seems to go through to the true source of power, Northumberland County Council).

    More importantly, the Berwick Freemen – a totally separate organisation – seem very opaque. I spent quite a lot of time looking at their website today and I gather (though I stand to be corrected) their benefits (all that rent from the tenant farmers) only extend to 54 people – freemen enrolled on the residents’ roll I think they’re called.

    Daughters of “freemen” were only included in 2010 and at the same time grandsons were excluded “to prevent a sudden large surge in the numbers entitled to take up the Freedom”. Does this remind anyone of primogeniture and the debate about succession to farm tenancies in Scotland?

    I may have misunderstood all this but at the very least, the Berwick Freemen have got a lot of work to do in communicating their message better. Meantime, it makes Applecross look like a model of transparency!

    So the statement in the article: “one of Scotland’s oldest burghs survives today with a self-governing town council, £17 million of assets and an annual income of £437,000.” is not true. And the conclusion “the difference between this successful and relatively prosperous burgh (or borough) and the burghs of the Scottish Borders is that Berwick-upon-Tweed is in England” is just so *********** ******* that I might almost vote for independence after all if that’s the sort of thing people are saying! (Brian Wilson – did you actually read the article all the way to end??)

    Meanwhile, back in Scotland, if SBC is serious about turning round the performance of its common good fund in order that its “true potential is realised at a time of austerity when every last penny is vital” then probably the best advice would be to sell that rag-bag hotch-potch of properties revealed in the FOI to be invested in a more rational portfolio. But that would bring down a firestorm of protest against “alienating our common heritage”. The public have to make up their minds – do they want the Common Good fund to deliver a positive return on investment or do they want it to be a repository of museum pieces? If the latter, they must accept it will run at loss to maintain these liabilities.

    I don’t envy SBC having to make that decision. Consider how the Stirling Common Good fund became a political football when it turned down an investment in land (King’s Park) because of political axes being ground in what some people described as the CG fund being “raided”.

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  6. The whole point of the article is that berwick has all this common land BECAUSE it is in england, and escaped the mass appropriation of common land which happened in circa1696 in scotland.

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  7. hector, with respect, you might be mixing up two separate things, namely, “commonties” and “common good”. Division of commonties began with an Act in 1695. England did not escape mass appropriation of common land. The same thing happened there where commonties are called “commons” and the division of them was called “enclosure”. In fact, England ended up worse off in this regard in that Scotland still retains more common land than England (nearly twice as much considered as relative to their respective areas). I don’t know anything about the English equivalent of common good but the 2,250 acre estate referred to in the article doesn’t belong to “Berwick” (in the sense of a democratically elected local authority) but to this rather opaque charity called the Freemen Trustees.

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  8. Neil,Each division of commonty in england required an act of parliament, wheras all commons in scotland were dealt with in one act.
    As far as i know, there are next to no commons in scotland, but quite a few in england.

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  9. England got a Scottish style “general enclosure act” in 1845. I take your point that there were differences of legal procedure between Scot and Eng but the end result was substantially the same.

    There are 590,000 hectares of common land in Scotland (about 7.5% of land area) They’re called common grazings nowadays. There’s about about 550k ha in England and Wales (about 3.5% of area).

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  10. This is a guest blog by Bill Chisholm. Comments should be courteous and relevant to the subject matter of the blog. I wish to encourage others to submit guest blogs. Thank you.

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  11. Neil, if you look at the grazing value of the commons, england may have a smaller area, but it will be worth a lot more per hectare.

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    • I’ll defer to your judgement on that hector as that’s something you will know far more about than I do. All I’m saying is that to suggest that Scotland has no common land or that England has never suffered appropriation of commons is just not the case.

      Your point about the respective significance of area as against value is well made, though. I had exactly the same reaction to the famous 432:50 statistic which is only about area. Does anyone the equivalent statistic as regards value of land?

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  12. It should be thriving in Scotland.

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  13. I’m glad to see the article on Borders Common Good Funds which Andy kindly published last week has attracted such a wide range of views and comments. I feel the administration of these valuable assets by our local authorities continues to fall well short of the mark, and the funds could be producing additional revenue for local communities.

    There was no intention on my part to “praise” the owner of the common lands of Berwick. I am only interested in the way the lands and properties are administered for the common good of local people. The fact that Berwick’s assets consistently yield more income than the combined income from the eight funds on the Scottish side of the Border surely demonstrates that something is amiss.

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