Recommendation 5

HM Government Accepted

As confirmed in the Net Zero Strategy, we have boosted the Nature for Climate Fund with a further £124 million of new money, ensuring a total spend of more than £760m by 2025 on tree planting, establishment and management, and peatland restoration. The fund aims to enable the Tree Programme to deliver the following investment objectives by 2024/25: • Put tree-planting in England on the trajectory required for the UK to meet government’s net zero target, increasing annual tree-planting rates across the UK to 30,000 hectares per year, with England planting at least 7,500 hectares per year by March 2025; planting 28,728 hectares of new woodland between 2020– 21 and 2024–25; sequestering 8.75 million tonnes of CO2 equivalent by 2050. • Contribute to the Nature Recovery Network by creating high-quality habitats that recover wildlife and provide wider environmental, social, and economic benefits, including climate mitigation (shared objective with peatland restoration). • Restore more than 24,000ha priority new habitat including on newly created woodlands and restored peatlands, and in adjacent land, particularly in Areas of Outstanding Natural Beauty and National Parks (shared objective with peatland restoration). • Deliver a variety of other environmental benefits in support of the 25-Year Environment Plan objectives including: Ȥ Air quality: Achieve additional annual pollutant removal of 342 tonnes of PM10; 174 tonnes of PM2.5; 109 tonnes of SO2; 119 tonnes of NH3; 41 tonnes of NO2; 2,123 tonnes of O3. Ȥ Biodiversity: Deliver an additional £333 million in biodiversity benefits over the period 2020 to 2069. Ȥ Recreation: Increase recreational visits to woods by 5.5 million visits per year (shared objective with peatland restoration). • Improve people’s access to nature for the benefit of people’s physical and mental health and to develop visitor economies by ensuring activity close to where people live. • Improve the future financial sustainability of woodland creation by supporting the development of green finance and markets to increase private investment in these nature-based solutions. Support further development of private investment to pay for and support the wider ecosystem services that trees can provide. • Position the UK as a global leader on nature-based solutions to climate change, maximising ecosystem services from tree activity. The additional funding from October 2021 was specifically allocated to support identified gaps in delivering the Government’s ambition. This includes for example, additional funding to support increased capacity in the tree nursery sector and the forestry skills and workforce we will need for the future. The England Woodland Creation Offer (EWCO) payment rate and 10-year payment period are based on the activity required to maintain newly created woodland during the years when such activity is most vital and intense. The current EWCO maintenance offer is deliberately aligned to payment rates and lengths in the Countryside Stewardship woodland schemes (now closed to new entrants) to follow the principle that we use consistent standard costs across Defra group grant offers. Defra and the Forestry Commission are aware of views from some stakeholders that a longer period of maintenance payments may encourage more planting and improved establishment rates plus give greater assurance of the longevity of the trees invested in by government, before Felling licence regulations apply. This will be taken into consideration in future reviews of maintenance payments. The maintenance payment rate was recently increased from £200 to £300 per hectare based on a reappraisal of the standard costs of maintenance activity which had increased since setting the rate previously. EWCO offers Additional Payments for woodland designs that deliver additional public benefits such as recreational access or flood risk mitigation. Where other sources of funding may be available for a public benefit, applicants may choose not to apply for the additional contribution for this benefit and receive that alternative source of funding, again subject to the rules of that alternative source of funding. These Additional Payments do not include carbon as funding for carbon is expected to come from private finance, such as the Woodland Carbon Code. The EWCO application process is designed to gather the information required to enable applicants to voluntarily register with the Woodland Carbon Code (WCC), which is needed to access private funding for ‘Woodland Carbon Units’ and to apply to the Woodland Carbon Guarantee (WCaG). If eligible, carbon payments are one form of private finance allowed under EWCO that could bridge the gap between maintenance payments ending and timber revenues starting. As set out in the 2019 Green Finance Strategy, Defra aims to use public funds to leverage private investment into the projects, technologies and infrastructure which will deliver