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Natural Capital – Change is Coming

By Roy Pinnock and Ralph Kellas
August 3, 2020
  • Biodiversity Net Gain
  • Environment Bill
  • Natural Capital
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The Environment Bill is emerging back into the daylight having survived the General Election.  Slow burning changes in how we value natural resources are going to reshape how we plan, design and deliver development. In this series of blogs, we explore the way that Natural Capital, Biodiversity Net Gain and Local Nature Recovery Strategies will impact on planning.

Ecosystem accounting – Natural Capital

Government has been set on valuing the way that ecosystems provide natural capital – food, clean air and water, wildlife, energy, wood, recreation and protection from hazards since the 25 Year Environment Plan in 2018. The aim is to recognise hidden ‘environmental services value’ that affect wellbeing, health and economic prosperity. 

This is reflected in DEFRA’s initial 2007 valuation guidance, the UN’s ecosystem accounting approach (2012), Treasury revised Green Book (2018) and DEFRA’s 2020 Enabling a Natural Capital Approach guidance.

The ONS now issues accounting updates, measuring this ecosystem account.  For example, it shows that England’s woods and forests deliver ecosystem services of c. £2.3 billion (90% of which is from ‘hidden’ social value – recreation, air pollution removal and CO2 sequestration).

We are therefore moving into a regime where monitoring the size and condition of ecological assets to understand the quantity and value of the services supplied should begin to genuinely inform policy.

Statutory Changes – Net Gain

The 25-Year Environment Plan noted the existing policy requirement (under the 2012 NPPF) for the planning system to provide biodiversity net gains. It committed to exploring strengthening this requirement, to require planning authorities to

  • ensure environmental net gains across their areas;
  • make gains mandatory;
  • allow authorities to develop locally-led strategies.

The 2012 NPPF requirement was rarely implemented. The Natural Environment and Rural Communities Act 2006 (and before it the Countryside and Rights of Way Act 2000) also simply required authorities to have regard to biodiversity conservation in decision making.

As the value of ecosystem services becomes clearer, the Environment Bill’s proposed requirements relating to Local Nature Recovery Strategies and to achieve biodiversity net gain in planning decisions will therefore be real changes.  They offer challenges for plans and promoters but also opportunities to demonstrate the value of thinking big and daring to invest.

The following blogs explore how the legislation will work through in practice.

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Roy Pinnock

About Roy Pinnock

Roy is a partner in the Planning and Public Law team, bringing his experience of working on regeneration projects within local government and as a consultant to his legal practice.

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Ralph Kellas

About Ralph Kellas

Ralph is an associate in the Firm's Planning and Public Law team in London. Ralph acts for developers, local authorities and community groups on housing and regeneration projects.

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