The Committees deserve much credit for the efficient performance during the year of a variety of important duties. The success that attended their labours was due in a large measure to the skill and vigour of the members and of the Executive Officers. The Board are satisfied that up to the time when the provisions of the Corn Production Acts relating to the control of cultivation lapsed-at 1st October 1921-the Committees were instrumental in securing an improvement in the general standard of farming in their districts. With the repeal of these provisions, to which reference is also made. elsewhere in this Report, the greater part of the work falling to Committees came to an end. The Board were accordingly compelled, in the interests of economy, to terminate the employment of the salaried Executive Officers and to give up the Committees' offices. All records and stores in the hands of the Committees were returned to the Board. The Committees continue, however, to be the statutory bodies empowered to deal with the matters which are referred to in detail above; and in order to enable them to perform these duties it was necessary for the Board to arrange that, so far as practicable, the services. previously rendered to Committees by the Executive Officers should as from 1st October 1921 be performed by the staff of the Board. This arrangement may at times be productive of some little inconvenience and delay, but in view of the urgent need for economy, it is a serviceable alternative.

IV. LAND SETTLEMENT.

SMALL LANDHOLDERS (SCOTLAND) ACTS, 1886-1919, AND LAND SETTLEMENT (SCOTLAND) ACTS, 1919 AND 1921.

The number of fresh applications for new holdings and enlargements of existing small holdings received during the year was 1416, which included 617 from ex-service men. As compared with 1920, applications from ex-service men show a decrease of 1,122 and those from civilians a decrease of 272. It thus appears that the great majority of ex-service men desiring land had lodged their applications during the preceding two years. On the other hand, civilians may be inclined to defer their applications for the moment in view of the fact that ex-service men have at present a right to preferential consideration.

During the year the number of applicants placed in new holdings or enlargements was 722, including 438 ex-service men. The number of applicants settled during 1921, though exceeding that for any previous year, would have been still higher, had not the heavy fall in the prices of agricultural produce caused a number of applicants to hesitate to undertake the obligations of tenancy. In the case of pastoral holdings where sheep stocks have to be taken over the position will be eased for the intending holders by the fact that in certain cases the Board, on representing the position to the Treasury, have now obtained

authority to dispose of the stocks at prices considerably less than those which they had to pay to the outgoing tenants. At the close of the year negotiations were in progress with the intending holders, who are expected to pay at least 25 per cent. of the fixed prices in cash on delivery of the sheep and to undertake to pay the balance (with interest at five per cent.) within a period of ten years.

In the case of arable holdings the cost of buildings, although still high, is now falling, and a continuance of the fall, with a consequent decrease in the charge for repayment of building loans, will probably encourage applicants to view their obligations with less anxiety.

The Board found great difficulty, arising in part from the causes mentioned above, in disposing of holdings in Caithness. Ultimately, by public advertisement and by individual letters, they invited all the ex-service applicants in the county whose applications had not been met to apply for the holdings. The result was disappointing. Out of 144 applicants, only 50 responded in any way. Of these, 8 took holdings, 17 refused to consider holdings except in certain specified areas where at present the Board have no scheme under development, and 25 declined to take any of the holdings that remained on offer. The question how far this refusal is to be regarded as a forfeiture of the preference to be given to ex-service men is engaging consideration. A rigid line cannot be drawn, since in many cases a holding, while of itself suitable, cannot fairly be said to meet the requicements of applicants whose circumstances compel them to look for holdings near their present houses. In this connection the Board would point out that the rate of progress of settlement of ex-service men is, in some instances, retarded by the virtual exclusion of civilians. It sometimes happens that it is impossible to proceed with a scheme in a particular area for the reason that there is not a sufficient number of qualified ex-service applicants in the district, although it would be posssible to formulate a joint scheme for civilians and ex-service men. The inclusion of civilians would, on the other hand, absorb a considerable part of the limited funds available and reduce the possibility of providing for the ex-service demand. Thus there are difficulties either way. As above indicated, the Board had the matter under consideration at the end of the year, and they propose to review the special requirements of various areas from this point of view.

The schemes on the Board's estates and those under development on private estates will together provide for 1,195 applicants.

The total number settled since the constitution of the Board amounts to 2,464, including 900 ex-service men; the applications not disposed of numbered at the end of the year 11,628, including 4,728 from ex-service men. Detailed statistics are given in Appendix No. 2.

It should at the same time be pointed out that a considerable proportion of the applications are of such a character that in any event they could not be disposed of under existing circumstances. Some applicants are only prepared to accept holdings on particular areas of ground or in particular districts where land is not at present available, while others do not possess sufficient capital or experience to enable them to undertake the obligations which they would have to meet if installed in holdings of the type they desire. The lack of capital and experience is perhaps more often found among ex-service than among civilian applicants, and especially among ex-service applicants of the disabled class. A certain proportion of the applications, particularly those from ex-service men, must also be regarded as ineffective because the applicants were undoubtedly under the impression that the Government would find the capital for stock and equipment, and also because they failed to realise the extent of the obligations and responsibilities that must fall upon them as holders even under the most favourable conditions of State assistance. Cases have already occurred in which applicants have refused to face these obligations and responsibilities when a definite offer of a holding has been made.

In the Highlands and Islands the demand from ex-service men is hardly to be differentiated in character from the civilian demand in that area. Men who would in any case have applied for holdings have by their war service earned the right to special consideration. In the Lowlands ex-service men fall mainly into two groups, one consisting of agricultural workers who might in any case have made application for settlement even without the invitation made to them as exservice men, and the second consisting of men who, suffering from a greater or less degree of disablement, have turned their thoughts to an open-air life in the country.

Towards the end of the year 1920, as was mentioned in the Board's last Report, a Cabinet Committee of the Government made a close investigation into the policy and finance of Land Settlement in Great Britain. At that time the fund provided for Scotland by the Act of 1919 was nominally £2,750,000; actually it was understood that not more than £2,417,000, representing the Scottish share of a total grant of £20,000,000, would be provided.

The Board were in a position to show that the land settlement problem in Scotland is in many respects different from that in England. In England there is nothing corresponding to the Highland land question. Rural conditions in the Lowlands of Scotland also differ essentially from those in England. In many parts of England the demand for land is met by the allotment of a field or two to a villager who already has a house from which he can conveniently work the land apportioned to him; while in Scotland it is in most cases necessary to provide small

B

holdings fully equipped with buildings suitable for the proper working of the holdings.

The cost of settling a smali holder in the Lowlands of Scotland is therefore necessarily a more expensive matter than the cost of settling a holder in England.

In the Highlands the financial outlay on equipment is less because the crofters have been accustomed to building their own houses and new holders are usually satisfied if they obtain a small loan to enable them to provide material; on the other hand, heavy outlays have to be incurred in acquiring Highland pastoral lands, including the cost of acquisition of sporting rights over the land and also of taking over sheep stocks which are in most cases acclimatised and bound to the ground.

These differences between England and Scotland were recognised in the decision of the Government which was announced in January 1921, and published in the press in the following terms :1. The Government have been closely investigating by means of a Cabinet Committee the whole situation in regard to Land Settlement for ex-service men in Scotland. They find that the money provided for this purpose has proved insufficient because the number of applicants has been greater than was anticipated, and because the cost of all kinds of buidings. nas enormously increased. The Government have now decided, subject to the necessary Parliamentary authority being obtained, to provide during the financial year 1921-22 further funds for this purpose.

2. The financial provision contemplated consists of the balance of monies provided under the Land Settlement (Scotland) Act, 1919, amounting to £330,000, which has only now become available, together with a further sum of £750,000, making a total of £1,080,000.

3. Apart from the increase in the number of applicants and the increased cost of building, the national financial situation calls for the most rigid economy in all Departments. For this reason, and also in order that as many applicants as possible may share in the benefit of this further provision, the Government have decided that it is essential to reduce materially the average expenditure per holding. To secure this result it will be necessary to limit the size of individual holdings and provide only the minimum equipment.

4. The sum of £330,000 having, as already explained, been placed at his disposal, th Secretary for Scotland has directed the Board of Agriculture for Scotland to proceed with the utmost expedition to provide new holdings and enlargements of existing holdings for ex-service men, subject always to a strict observance of the instructions as to economy in the administration of these funds which, by direction of the Government, have been issued to the Board.

5. No applicant will be eligible for the preference given to exservice men unless his application has been received by the Board on or before 1st March 1921.

6. The Government have instructed the Board of Agriculture for Scotland to remove from their lists of ex-service applicants the names of men who are not prepared to accept holdings which, in the opinion of the Board, are suitable. In order to avoid heavy capital expenditure out of the funds on the purchase of lands by means of lump sum payments, and to conserve the funds for expenditure on actual settlement, the Board were also instructed to confine the methods of acquiring land under Part I. of the Act of 1919 to feuing or to purchase by means of annual payments (to include principal and interest) over a period of years.

These instructions have been the governing factor in the Board's administration during the year. At the outset a review of the schemes in hand was undertaken, and as far as possible, but not without considerable opposition on the part of applicants who had expected much more generous treatment, the cost of buildings was cut down by modification of the plans.

SETTLEMENTS UNDER THE LAND SETTLEMENT (SCOTLAND) ACTS, 1919 (PART I.) AND 1921.

The year's efforts were mainly directed towards the adaptation of the lands which had been acquired previously, but six new properties were purchased, viz., Gretna in Dumfriesshire, Scorrybreck in Skye, Balranald in North Uist, Stove in Orkney, East Pilmore in Perthshire, and Keoldale in Sutherland. In addition, a feu was arranged in respect of the farm of Knockvolegan in Mull, which had been made available by the owner for the settlement of three holders at Martinmas 1919, on the condition that a feu would be arranged in terms of the Land Settlement (Scotland) Bill, 1919, in the event of that Bill receiving Royal Assent.

The area comprised in these new properties is 60,696 acres.

The Board's estates, acquired for the purposes of the Land Settlement (Scotland) Acts, now number 39, with an area of 299,895 acres, of which 26,513 acres are arable. The total capital expenditure involved is £431,109, while an annual charge of £23,248 has been incurred in the cases where the alternative scheme is in operation. Particulars of these estates are given in Appendices Nos. 3 and 4.

The following notes on each of the properties are furnished :—

Estates acquired during 1921.

Gretna (Dumfries 3nire).—This is the largest area of arable land that the Board have acquired for settlement. The property was taken over in two portions from the Disposal and Liquidation Commission, one section, comprising 4,161 acres, at Whitsunday 1921, and the other, comprising 474 acres, at Martinmas