Biodiversity

Baroness Penn Excerpts

Wednesday 28th April 2021 Grand Committee

[Baroness Penn (Con)]

My Lords, it is a privilege to close this debate on behalf of the Treasury and the Government. I thank noble Lords for their many insightful and constructive contributions. Perhaps unsurprisingly, there has been a significant degree of consensus—although not complete consensus—on the importance of this issue and on the action that needs to follow on from the report.

The Government’s position is simple: protecting and enhancing our natural assets and the biodiversity that underpins them are crucial to achieving sustainable, resilient economies. That is why the Government commissioned the independent and globally focused Dasgupta Review on the economics of biodiversity. As the noble Baroness, Lady Boycott, noted, the review has particular significance as the first such review commissioned by a finance ministry.

I thank Professor Sir Partha Dasgupta for his landmark review. It makes a clear and compelling case for nature as vital for the health of our economies as well as that of our planet. The Government welcomed the publication of the review, not least as a strong example of UK thought leadership on an important environmental issue with clear but often overlooked economic implications. We are now reviewing and examining the review’s findings and encouraging international partners to do the same. We will respond formally in due course. I assure noble Lords that action on many of the issues raised by the review is already under way and need not await the Government’s response.

The Government have already legislated to reach net-zero carbon emissions by 2050, as we all know. Through the Environment Bill, we will deliver on our commitment to be the first generation to leave the environment in a better condition than how we found it, as set out in the 25-year environment plan. The Bill includes setting a new and ambitious domestic framework for environmental governance, embedding environmental principles in future policy-making, setting legally binding targets for environmental improvement—including on biodiversity—and strengthening environmental oversight with the new office for environmental protection scrutinising progress and enforcing compliance. The Bill also includes: measures to reduce waste, including single-use plastics; the creation of a deposit return scheme; strengthened power for locals authorities to address air quality issues; improving the sustainable management of our water resources; and creating a mandatory requirement for biodiversity net gain in the planning system.

This strengthens the action already taken to reform farm payments and create the environmental land management scheme to promote sustainable agriculture by paying farmers for work that protects and restores the environment, which a number of noble Lords touched on in their remarks. The noble Lord, Lord Curry, and my noble friend Lady McIntosh asked specific questions about the operation of those schemes, which I am happy to write on.

The noble Baroness, Lady Walmsley, asked about the economic value of soil and what plans we have to address soil degradation. In 2022, we will start rolling out some elements of the environmental land management scheme. The sustainable farming initiative will support sustainable approaches to farm husbandry to deliver for the environment, such as actions to improve soil health.

The noble Baroness, Lady Parminter, asked a question in relation to the Bill on the fact that taxation, spending and the allocation of resources are excluded from the remit of the principles contained in the Bill and the work of the office for environmental protection. This provides maximum flexibility in respect of the nation’s finances. I assure noble Lords that this exemption will apply only to the allocation of funding between multiple policies or programmes to or between departments. It is not an exemption for any policy that requires spending. Further, the Treasury takes environmental impacts into account in the Green Book, which guides policy-making decisions at fiscal events. The Treasury is undertaking work to strengthen those guidelines on environmental policies, including biodiversity. In particular, there is a current review of the environmental discount rate and work is under way on biodiversity evaluation, which the noble Baroness, Lady Young of Old Scone, rightly noted as essential so that we can measure the impact of our policies on biodiversity.

My noble friend Lady McIntosh of Pickering also asked how the Treasury would contribute to the Environment Bill. That work on biodiversity valuation is one example of how it will do so, as it is an essential part of the requirement for biodiversity net gain included in the Bill that the planning system should be able to measure what biodiversity net gain there is.

The noble Baroness, Lady Jones of Moulsecoomb, and many others asked about GDP and role of biodiversity and natural accounting in our national accounting. GDP remains one of our most important economic indicators, because it correlates closely with employment, income and tax receipts and helps guide economic policy. However, the Government recognise that it has its limitations. Indeed, those were acknowledged in Sir Charles Bean’s Independent Review of UK Economic Statistics in 2016. The Government have fully supported the recommendations of that review, including through providing the ONS with an additional £25 million to support its Beyond GDP initiative to address the limitations of GDP. As part of that work, the ONS published comprehensive natural accounts last year and has started to publish human capital accounts as well, both of which are central to the Dasgupta Review’s “inclusive wealth” concept.

The noble Baroness, Lady Jones of Whitchurch, asked about government investment in green jobs. The Treasury has supported a green recovery at the spending review and in this year’s Budget. The spending review backed our Ten Point Plan for a Green Industrial Revolution with £12 billion of government investment to create highly skilled green jobs in the UK, and spur over three times as much private sector investment by 2030. The spending review also increased Defra’s budget by almost £1 billion, helping it to harness the power of nature in the fight against climate change, and to connect people with green spaces by creating habitats and investing in national parks. We have also committed more than £600 million to the nature for climate fund in England, which will support our objective to plant 30,000 hectares of trees a year in the UK by 2025 and to restore more peatlands. During the pandemic, we also set up the £80 million green recovery challenge fund to help our environmental NGOs and their partners invest in a wide range of natural capital improvement projects, including tree-planting and habitat restoration, while protecting jobs.

A number of noble Lords—the noble Lord, Lord Carrington, the noble Earl, Lord Devon, and my noble friend Lord Lucas—raised education. Nature is covered in the national curriculum, and schools have the autonomy to explore the topic further. What is more, in 2017, we introduced a new environmental science A-level which will enable pupils to study topics that support their understanding of climate change and how it can be tackled. An economics A-level also requires the study of the allocation of scarce resources, which could include the effects of economic decisions and activity on the environment.

My noble friend Lord Lucas has raised with me before OCR’s proposal for a new GCSE in natural history. The Department for Education is exploring that and has held an initial discussion with OCR, but I should say that it has made no commitment at this stage to introduce such a GCSE.

The noble Baroness, Lady Miller, raised the question of consumer responsibility in the Environment Bill, and the noble Earl, Lord Devon, asked about information and labelling for consumers to improve their understanding of the products they buy. There is an important connection between the products we buy and their wider environmental footprint. The Environment Bill will help consumers to make purchasing decisions that support the market for more sustainable products through powers to introduce clear product labelling that identifies products that are more durable, repairable and recyclable and informs consumers about how to dispose of used products. Clauses will also enable us to set minimum eco-design requirements for products and require the provision of information to buyers to support a shift towards more sustainable products. The Bill also includes an amendment to tackle illegal deforestation in agricultural commodity supply chains.

The noble Baroness, Lady Wheatcroft, and others asked about the role of finance. We absolutely acknowledge the importance of encouraging financial institutions to understand and disclose the impact of their activities on nature. To this end, the Government have offered their support to the Taskforce on Nature-related Financial Disclosure, which looks to do just that.

That is some of the work that we are undertaking at home but, as noble Lords have noted, biodiversity loss is a global crisis. Biodiversity underpins all economic activities and human well-being. It is estimated that $44 trillion-worth of economic value generation—more than half the world’s total GDP—is moderately or highly dependent on nature, yet global capital accounts show that from 1990 to 2014 almost 90% of countries have seen declines in their natural capital per head of population.

That is why arresting and reversing the fast decline in biodiversity also requires concerted and co-ordinated action internationally. As the noble Lord, Lord Teverson, noted, this year is critical. As co-host of the COP 26 climate conference, we have made nature one of the core themes that we will raise. As president of this year’s G7, the UK will ensure that the natural world stays right at the top of the global agenda, although I cannot speculate on the cast list or invite list for the G7 at this time.

As noble Lords have also noted, the international summit on the Convention on Biological Diversity, to be held in China this year, will see the world come together to agree long-term global biodiversity targets, and as such is a key opportunity to set nature on the path to recovery. The Government have committed to playing a leading role in the development of an ambitious set of global biodiversity targets under the convention. The Government are demonstrating genuine leadership in other ways too, and have so far committed to spend at least £3 billion over five years on nature and nature-based solutions in developing nations as part of our £11.6 billion commitment to double our international climate finance from 2021 to 2025.

We also committed in the UK’s green finance strategy to ensure that our ODA is aligned with our commitments under the Paris Agreement for climate change. Also, as we a signatory to the Leaders’ Pledge for Nature, the Prime Minister has committed to mainstreaming nature into all government policy and investment, so officials are also undertaking work to explore how we can nature-proof ODA, not just climate-proof it, and indeed make it nature positive. We have striven to raise ambitions on the international stage as pioneers of the Leaders’ Pledge for Nature, which has now been signed by more than 80 countries. Signatories have committed to 10 critical actions to reverse biodiversity loss by 2030. At the same time, the High Ambition Coalition for Nature and People, co-chaired by the UK, has managed to get more than 50 countries to pledge their support for the 30x30 targets to protect at least 30% of the world’s land and ocean by May 2030. Of course, the UK has signed up to that itself.

I have tried to cover an immense amount of ground, but I have not managed to cover all the ground noble Lords did in this debate. I apologise to those whose points I did not manage to address directly. I will happily write to all those who have taken part in this debate to pick those up afterwards.

I close by saying that this has been an incredibly important debate. I think it is welcome that a finance ministry, the Treasury, is engaged on these issues. That shapes how we approach our action as a Government on biodiversity and climate change, which, as many noble Lords have said, are two sides of the same coin. I thank noble Lords for their contributions and, finally, make the Government’s position clear: biodiversity loss is an issue of critical importance on which we are determined to continue taking action, at home and internationally.