Biodiversity and Ecosystems

The Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services’ call for transformative change provides a yardstick against which action to address biodiversity loss should be measured. The global response to biodiversity loss has so far been inadequate. Piecemeal conservation efforts, and increases in the efficiency of production, cannot tackle the wholesale deterioration of the natural environment the world is now experiencing. Fundamental changes in the production and consumption of natural resources must be made. Without urgent, substantial action, ecosystem tipping points will be exceeded and the global biosphere will be left beyond repair.

We recommend that the UK Government play a leadership role in addressing global biodiversity loss by demonstrating what ‘transformative action’ to address biodiversity loss in an advanced industrialised economy looks like. This should entail the production of credible plans, which include measures to phase out economic incentives which threaten conservation and restoration, with a view to meeting the 2030 Biodiversity Framework, once agreed, and the development of robust means to ensure that these plans are owned and implemented across Government. Assessments of the potential impact of Government actions on biodiversity loss must be introduced for all Government departments.

The UK has established a sophisticated public policy mechanism to tackle the effects of climate change by driving sustained long-term reductions in harmful emissions. This comprises legally binding interim and long-term targets authorised by Parliament, and an independent Climate Change Committee to advise Parliament and Ministers on the actions required to ensure such targets are met.

No such system yet exists to restore the UK’s greatly depleted natural environment. It is thus unsurprising that the UK failed to achieve at least 14 of the Aichi Biodiversity Targets, and the Government is not on track to achieve its goal to provide the next generation with a better natural environment.

We welcome the Government’s announcement of a ‘State of Nature’ target on species abundance for 2030. This goes some way in providing a legal mechanism to achieve nature goals, but for this to translate into urgent, transformative action, the target must capture other aspects of biodiversity and include interim targets.

We recommend that the Government introduce, preferably via the Environment Bill currently before Parliament, a mechanism for statutory interim targets to ensure that its proposed species abundance target is met to halt the decline of nature by 2030. We further recommend that the scope of the proposed 2030 target be extended to encompass legally binding outcome measures on species distribution, extinction risk, habitat extent and condition: it must also reinstate the expired target for Sites of Special Scientific Interest. (Paragraph 61) Biodiversity in the UK: bloom or bust? 115

We recommend that the Government introduce mechanisms to ensure that each Government department and non-departmental public body is required, by their policies and actions, to contribute to reaching the targets set out above. The Office for Environmental Protection should be responsible for ensuring their enforcement.

Invasive species contribute significantly to the decline in biodiversity levels in Great Britain. By its own admission, the Government has failed to prevent the arrival and continued spread of damaging invasive species. None of our predecessors’ recommendations on tackling invasive species—on funding, setting up an inspectorate, and creating a ‘nature volunteer force’—were adopted by Ministers: yet the incidence of invasive species, tree pests and diseases continues to increase.

Invasive species continue to cost the economy £1.8 billion per year. It is significantly cheaper to prevent invasive species from establishing, rather than tackling them once they are established.

We strongly recommend that Ministers urgently review the recommendations of the Committee’s report on Invasive Species made in October 2019 and implement them without further delay. This includes increasing the proportion of biosecurity funding directed at countering invasive species to at least £3 million a year. (Paragraph 69) Measuring biodiversity

Public expenditure on measures to promote biodiversity has been cut in real terms over recent years. As a result, levels of monitoring have been scaled back, and the capacity for assessing the state of protected areas and vulnerable species nationally has been reduced. Government bodies do not have enough skilled ecologists to provide comprehensive expert monitoring, and these bodies are over-reliant on the voluntary sector to fill the gaps which arise. Currently, local authorities do not have enough in-house ecologists to provide the monitoring which is expected to underpin the Government’s policy on biodiversity net gain.

We recommend that Ministers make a material increase in levels of investment in training and skills for chartered ecology and associated disciplines. This ought to form an element of the Government’s promised investment in Green Jobs.

The relationship between environmental monitoring and remedial action is far too weak. This must change. Data on biodiversity levels must inform decision-making in Government far more substantially than at present.

We recommend a formal mechanism be established to review and act on the information provided in the Environmental Accounts.

The Government’s new species abundance target for 2030 provides a potential mechanism for the measurement of progress on addressing biodiversity loss, and a driver for consequent actions. We recommend that once the target is established, regular, formal reviews of progress against the target should be required to be made, to feed into decision-making at senior levels in all Government departments. Ministers 116 Biodiversity in the UK: bloom or bust? should also report regularly to Parliament on projected and current performance against the target and associated biodiversity outcome measurements on species distribution, extinction risk, habitat extent and condition.

The efficient management of data relevant to assessing levels of biodiversity is made difficult due to the sheer variety of data systems used to monitor UK biodiversity.

We recommend that the Government implement a preferred approach to data management and monitoring, to strengthen a consistent evidence base on the UK’s natural capital. The Government should also make greater use of earth observation data as a cost-effective means of filling gaps in the data obtained from terrestrial monitoring.

If Marine Protected Areas continue to be poorly managed and monitored, with little enforcement of their protected status, there is a risk that the Government will have established a network of ‘paper parks’. According to monitoring data, the condition of MPAs is much the same as our predecessors observed in 2019: this must call into question the effectiveness of the Government’s approach to managing biodiversity in the UK’s territorial waters.

We reiterate the conclusions and recommendations of our predecessor Committee’s 2019 inquiry into Sustainable Seas. (Paragraph 97) • Ministers must urgently set out a timetable to put management plans and monitoring in place for all MPAs. • Different categories of destructive bottom trawling should be banned or restricted in all MPAs, and more MPAs should be established as ‘no-take’ zones with benefits for the local fishing industry and for marine biodiversity. • MPAs established by the Blue Belt programme need to meet international best practice guideless, set by the International Union for Conservation of Nature for designation. • MPAs need to be monitored to deter illegal activity and to establish if species and habitats are recovering, to inform future designations and adaptive management decisions. • The Government should make better use of data from automatic identification systems installed in vessels operating in MPAs to understand the activity in these areas; the operators of vessels with these systems installed ought to be under an obligation to keep the systems active when in areas requiring monitoring. • The Government should establish a fully integrated monitoring and surveillance regime for satellite tracking of illegal, unreported and unregulated fishing in UK territorial waters.

Healthy soils are essential to biodiversity; and yet the data and indicators to measure soil health do not exist to the degree required to ensure effective monitoring. Without credible arrangements for monitoring and measuring soil health, the Biodiversity in the UK: bloom or bust? 117 Government will not meet the soil health commitments made in its own 25 Year Environment Plan. The Government must therefore urgently address this large data gap.

We support the recommendations of the Natural Capital Committee that the development of soil indicators should be fast-tracked; that a shadow target for soil health should be established urgently; and that a legally-binding target for soil health ought to be established as soon as monitoring data allows. Healthy soils should be a priority outcome for the Environmental Land Management Schemes, so as to encourage farmers to adopt beneficial agri-environmental practices. (Paragraph 105) Funding biodiversity

To deliver the Government’s environmental vision to improve the environment within a generation, arm’s length bodies and departments need to have the funding to do so. Budget cuts to biodiversity expenditure over the last decade have hindered this.

We recommend that the Government urgently review the funding allocated to bodies with responsibility for monitoring, protecting and increasing levels of biodiversity in England, consistent with its goals for nature recovery under the 25 Year Environment Plan. In the next Spending Review the Chancellor of the Exchequer must back the Government’s ambition for nature recovery with a funding settlement for Natural England which properly reflects its statutory responsibilities and the tasks it is expected to perform.

As the Public Accounts Committee has recently observed, there is no single point of responsibility within government for monitoring overall expenditure on environmental goals, and the Government does not have a good understanding of the total costs required to deliver its environmental goals. It is difficult to determine how much of the funding announced by Ministers for these goals has so far been spent, and thus whether the Government’s funding commitments will in fact be met.

We support the recommendations of the Public Accounts Committee and the National Audit Office made in their work on Achieving government’s long-term environmental goals. The Government must provide a comprehensive, consistent, and time-bound record of funding for the 25 Year Environment Plan. In its response to this report, the Government must set out in detail the funding committed to biodiversity since the announcement of the 25 Year Environment Plan; how much has been announced or otherwise promised to date; and how much has in fact been spent.

Between 2013–14 to 2019–20 Natural England’s baseline funding reduced by 49 per cent. The body considers that it can no longer deliver its statutory duties to a good standard as a direct consequence of these cuts. The cuts have fallen disproportionately on Natural England’s budget for monitoring and information provision.

The Government increased Natural England’s baseline funding by £11.3 million in in 2020–21 and has committed to increasing this by a further £75 million. Whilst 118 Biodiversity in the UK: bloom or bust? the funding increase is welcome, it does little to provide the consistent multi-year investment required for Natural England to deliver its duties and new responsibilities for nature recovery.

In the next multi-annual spending review, we recommend that Natural England receive a materially greater contribution in annual funding, in line with its 2020 Comprehensive Spending Review bid.

We welcome the funding announcements and increased public expenditure on international biodiversity, however international conservation funding is still greatly outstripped by subsidies which cheapen the exploitation of the natural environment. The Government cannot spend more exploiting the natural environment than conserving it if climate change and biodiversity are to be tackled in any meaningful way. Information on the extent of subsidies harmful to biodiversity is absent from the public domain, despite this information being necessary to achieve Aichi Biodiversity Target 3.

We recommend the Government commission a review of the operation of ‘perverse subsidies’ in the UK economy. This must entail the identification, assessment and tracking of public expenditure harmful to biodiversity, and the publication of data on the extent of such subsidies. Once such subsidies have been identified, Ministers must act to readdress the balance, removing harmful subsidies and re-directing money to nature conservation and recovery. (Paragraph 135) Domestic biodiversity policy and legislation

The Government is not on track to achieve its objective of improving the environment within a generation, and its 25 Year Environment Plan does not provide sufficient direction to change this. Despite repeated calls in the last five years by this Committee, the National Audit Office, the Public Accounts Committee and the Natural Capital Committee, the Government is yet to establish a baseline to measure progress against environmental goals. In the meantime, the UK’s natural capital assets appear to be continuing to deteriorate.

The Government must urgently establish a baseline for the Outcome Indicator Framework. Defra’s planned Natural Capital and Ecosystem Assessment pilot, and any subsequent baseline exercise, must focus on measuring a clear set of representative natural capital assets across England. The Treasury should ensure the baseline assessment is properly funded at the next Spending Review.

At present there is no strategy to tie the reporting framework for the 25 Year Environment Plan to the ten 25 Year Environment Plan goals. Nor does the plan explain how it will be delivered by local government and arm’s length bodies or how key environmental policies, like the Environmental Land Management Scheme, will seek to deliver on the Plan’s goals. We look forward to the new monitoring and reporting cycle introduced by the Environment Bill and will be assessing whether it addresses previous issues with the reporting framework and delivers tangible improvements on the ground. (Paragraph 154) Biodiversity in the UK: bloom or bust? 119

In all future progress reports on the 25 Year Environment Plan, information provided should relate to the Plan’s ten goals. Priority actions must be assessed year on year, as must local delivery of the plan through arm’s length bodies. From 2022 onwards the Government should set out indicators for how the Environmental Land Management Scheme and Local Nature Recovery Strategies will be assessed to measure how these policies are delivering the aims of the Plan.

The 25 Year Environment Plan is not yet supported by clear, ambitious, quantified statutory targets and milestones. The Environment Bill will provide a statutory underpinning for five of the goals in the Plan, but government has not set long-term objectives for the other five plan areas or how its goals will be met. The current significant improvement test for targets within the Environment Bill is ultimately decided by the Secretary of State. We agree with the Natural Capital Committee that the test is highly subjective.

The Government must address how it will set long-term objectives for all ten of the Plan’s goals. As agreed to in 2018, the Government must publish how these goals and objectives relate to pre-existing national and international environmental targets. We reiterate our recommendation that the Office for Environmental Protection’s powers, budget and staffing reflect its responsibility to monitor the Government’s delivery of the 25 Year Environment Plan and its enforcement of environmental law.

We welcome the Government’s pledge to protect 30 per cent of the UK’s land and seas by 2030, but simply designating areas as protected is not enough. The UK’s protected areas are poorly managed. More focus must be given to preserving and enhancing the quality of protected areas. There are also significant differences in the treatment and status of Areas of Outstanding Natural Beauty compared to National Parks. Over a year and half ago the Glover Review identified these issues and recommended actions to address them: as we consider this report, a full Government response to the Review is yet to be issued.

The Government should not count its wins early: protected areas should only be reckoned to contribute to the 30 by 30 pledge if they are effectively managed and improved. We recommend the Treasury ensure that all bodies involved in the monitoring of 30 per cent of the UK’s land and seas receive funding allocations sufficient to allow comprehensive monitoring to be undertaken. We note it is far less expensive to conserve nature than to restore damaged or degraded resources and the costs involved are small compared to the financial and wider health and well-being benefits.

The Government should provide a full response to the Glover Review before the 2021 summer recess.

We welcome the Government’s efforts to secure biodiversity gains in development: but the biodiversity net gain policy, in its current form, does not go far enough in contributing to the transformative change necessary to address biodiversity loss in the UK. A series of deficiencies with the policy have been identified over the course of this inquiry.

The Government has failed to define what it means by net environmental gain as set out in the 25 Year Environment Plan, as its ambition for future development. The 120 Biodiversity in the UK: bloom or bust? failure to move towards a system of net environmental gain risks undermining the government’s plans for a green recovery and allows developers to focus entirely on biodiversity, rather than treat the environment as a system. This could lead to severe habitat fragmentation.

We welcome the extension of the biodiversity net gain policy to include Nationally Significant Infrastructure Projects. We received overwhelming evidence in support of this and note the potential the policy now has to contribute to nature’s recovery. We will be examining the implementation of the policy change as it progresses.

Nature recovery does not happen overnight and must be maintained and built upon for generations. The proposed 30 year minimum to maintain biodiversity net gains will achieve little in terms of delivering long-lasting nature recovery.

The Government’s Planning White Paper could have implications on the delivery of the biodiversity net gain policy. We believe planning reforms should not weaken or undermine biodiversity protection.

To allow the biodiversity net gain policy to fulfil its transformative potential within the UK’s built environment we recommend that: • The Government should explain how and when it will move to embedding environmental net gain in the planning system, with clear actions and milestones provided to achieve this goal. • Mandatory gains should endure, rather than only being maintained for the stated 30 year minimum. • The Government should strengthen local authority capacity and enforcement mechanisms to deliver biodiversity net gain and developers should demonstrate their environmental performance and implementation of mitigation measures as part of good Environmental, Social and Corporate Governance. • The National Planning Policy Framework should be reviewed to ensure reforms strengthen biodiversity restoration and protection and any proposals which undermine biodiversity be addressed.

Effective Environmental Land Management Schemes will only be possible if farmers and land managers are brought into the process of policy design. This must include reaching out beyond the ‘usual suspects’ of big farming unions and environmental groups.

To include harder-to-reach farmers and land managers, rural broadband connectivity must be addressed as a matter of urgency, as recommended by the Environment, Food and Rural Affairs Committee in 2019. Defra should also make provision for tailored, farm-specific advice, farm visits, demonstration farms, and other knowledge-sharing activities that support the achievement of biodiversity goals. Defra should identify ‘win-wins’ that deliver production and environmental benefits to encourage early buy- in from farmers to the scheme. The scheme should include sufficient flexibility to allow for alternative land-uses, such as using land for storing carbon, helping to prevent floods, and maintaining beautiful landscapes for people to enjoy and reconnect with Biodiversity in the UK: bloom or bust? 121 nature. The introduction of ELMS should be used as an opportunity to encourage monitoring of on farm biodiversity, with funded audits of soil health, carbon sequestration and wildlife species prevalence forming a routine element of compliance and reporting.

We welcome the Government’s ambition to create a national Nature Recovery Network but believe far more detail is needed to translate this ambition into transformative action. The Nature Recovery Network (NRN) is contained in the 25 Year Environment Plan, but there are currently no duties or actionable plans in place to create it. The Government needs a co-ordinated approach to ensure all the local nature recovery strategies (LNRS) together cover the whole of England. This requires national oversight and strategy. Given local authorities will design and deliver most of the Local Nature Recovery Strategies (LNRS), they must be given greater resource to do so, including to employ local authority ecologists and having better access to ecological data. To realise this national vision the NRN also must be integrated and prioritised within the context of new planning reforms. And the Government needs to set out its thinking on how the host of proposed environmental and planning policies will come together into one cohesive strategy.

To address these concerns we recommend that: a) Defra updates its Nature Recovery Network Policy Paper by the end of the year, explaining how LNRS will be co-ordinated into a national Nature Recovery Network and how local authorities should link LNRS to the NRN. b) Government should establish a Nature Recovery Zone category which would enable local authorities to choose to designate areas where planning permission would in principle be granted for environmental investments and discourage new hard infrastructure at scale. LNRS should designate these zones to be incorporated into local plans. c) LNRS should be used as the spatial planning tool to join up biodiversity net gain, ELMS and the planning system. LNRS could provide information for the planning system’s new land zoning proposal and provide the basis for prioritising the delivery of funds from ELMS and net gain. d) The Nature Strategy should set out specifically how the Government proposes to link environmental and planning policies into one coherent policy approach designed to realise the 25 Year Environment Plan’s goal to improve the environment within a generation. e) Amid concerns that some local authorities do not have the capacity to deliver Biodiversity Net Gain and Local Nature Recovery Strategies, we recommend that the Government makes a formal assessment of capacity of local authorities to undertake this work, with a view to ensuring that all local authorities have the capacity to meet these important obligations.

We welcome the Government’s focus for COP26 on nature-based solutions (NbS) and the increased investment provided by the Nature for Climate fund. Nature- based solutions could substantially contribute to meeting the UK’s net zero goals 122 Biodiversity in the UK: bloom or bust? but must not be seen as a substitute from the urgent task of decarbonising all sectors of the economy, and in particular, the UK’s energy system. It’s also essential that the Government follows best practice standards for Nature Based Solutions. This will ensure biodiversity benefits are delivered as part of NbS, and the trade- offs between cost effectiveness, long and short-term gains and securing different environmental benefits, can be managed through a transparent and inclusive process.

Protecting existing ecosystems, be that ancient woodland, peatlands, or kelp forests provides the most cost-effective and significant contribution to NbS in the UK. Given the majority of the UK’s ecosystems lie outside of protected areas, more needs to be done to lock carbon and conserve biodiversity in these spaces.

Protection and restoration of peatlands have an important role to play in NbS. The Government’s announced ban on rotational burning of peat in protected areas is welcome, as part of the transformational change necessary to meet biodiversity and net zero targets. We commend the consultation on banning the sale of peat products and believe the proposal should be brought in as soon as possible.

We welcome the Government’s Trees Action Plan, and the intention to focus on planting broadleaf native species. The Government must not try to meet its tree planting target solely through commercial timber plantations using non- native species. A balance of tree planting is required to allow increased domestic commercial timber production to reduce reliance on imports. The appropriate mix of tree species will depend on site conditions. Creating woods with more native broadleaf tree species will provide greater biodiversity benefits, carbon stocks, more improved water quality and reduce soil erosion. These benefits can be scaled up through greater public and private investment in NbS.

To realise the benefits of nature-based solutions to climate change, we recommend that: a) The UK adopt a clear definition of NbS and consider using the IUCN definition alongside the IUCN Global Standard for NbS. b) The Government prioritise protection and maintenance of the ecosystems we already have over the creation of new ecosystems. This must include greater efforts to preserve ecosystems found outside of protected areas. c) The proposed ban on the production and sale of horticultural peat be brought forward, as soon as possible before 2023. d) Tree planting should not occur on peat soils and floodplains would be better used for restoring floodplain meadows rather than afforestation projects. e) Tax incentives be given to investors in NbS schemes who have ambitious and credible net zero plans and are working to remove biodiversity loss from their supply chains. (Paragraph 260) Biodiversity in the UK: bloom or bust? 123 The economics of biodiversity

Tackling over-consumption of natural resources is essential to meet the Government’s net zero goals and to reverse biodiversity loss. The first step in doing this is recognising the need to reduce the UK’s overall consumption. We welcome indications that Ministers are starting to consider adopting a consumption-based measure of the UK’s environmental impact.

We recommend the Government start the process of setting an environmental footprint target by launching a consultation ahead of COP15 on how to model the overseas environmental impact of UK consumption. This could feed into Defra’s work on international indicators within the Outcome Indicator Framework.

Professor Dasgupta has emphasised that family planning and sexual and reproductive healthcare is a neglected feature of public policy. The unmet demand for family planning is huge and addressing human population numbers is also key to reducing our demands on the biosphere. The UK needs to remain a global leader in supporting family planning and encouraging other countries to do the same. Announced cuts to the UK overseas development assistance threatens this. Given the Government’s intension to take a strategic approach to cuts, and the disproportionate benefits of family planning and sexual and reproductive healthcare compared to other development initiatives, spending in this area needs to be prioritised.

In response to this report, the Foreign, Commonwealth and Development Office should set out the extent to which the announced cuts to the UK’s aid budget will affect overseas development assistance for family planning and reproductive healthcare. We recommend that ODA for family planning and reproductive healthcare be protected: at the very least the percentage allocated to both these areas should be equal or higher than 2019 levels.

Economic models that do not value nature and ecosystems cannot address climate change and biodiversity loss. GDP is a well-established measure of economic activity, but as Professor Dasgupta has highlighted, by itself it is not an adequate way to assesses the UK’s economy. GDP does not account for the depreciation of the natural environment. We are encouraged by the innovative work of the ONS to develop measures and frameworks beyond GDP.

The Government should detail how it intends to move beyond GDP as the primary measure of economic activity, towards a concept of inclusive wealth, which includes consideration of the UK’s produced, human, and natural capital.

Further work is needed on the natural capital accounting and assessment methodology, but this should not stop the Government and businesses using natural capital accounting now. Accounting for natural capital in some way, is better than ignoring it completely because the system is not yet perfect. As a world leader in the development of natural capital accounts, the UK has an important role to play in promoting this practice international.

The UK should work with countries at COP15, COP26 and through the G7 to construct an internationally agreed way to integrate natural capital accounts into core national 124 Biodiversity in the UK: bloom or bust? accounts. This aligns with two of the Government’s COP26 presidency goals: finance and collaboration. The UK should also use its leverage within the IMF, to call for the incorporation of natural capital accounts in macroeconomic surveillance undertaken by IMF.

The Committee acknowledges that currently natural capital approaches cannot capture intrinsic values of nature, but they do serve as a first stepping-stone to valuing the natural environment in existing economic models.

At present, the impact of Government policies and projects on nature is not adequately factored into spending decisions. As a result, the Government is not on track to meet its nature recovery goals. On aggregate, HM Treasury and other departments spending decisions must support not undermine the realisation of the Government’s environmental goals and legal commitments. The Treasury has tried to prioritise the environment better in spending decisions through updating its Green Book guidance on evaluating projects. Through the Treasury’s Net Zero Review, its continuing response to the Dasgupta Review and new guidance on the valuation of biodiversity, the Treasury aims to integrate climate and environmental considerations further into spending decisions. At present, departments are not doing this consistently and environmental considerations are not embedded in the spending review process. The Government’s £27 billion road-building programme is an example of the type of policy decision likely to conflict with goals on nature recovery. Contrary to this Committee’s recommendations, when making policy on spending, taxation and the allocation of resources, Ministers do not have to apply the Environmental Principles. To achieve the transformational change necessary to address biodiversity loss, nature must be considered to ensure the best balance in policy-and decision making. Failure to do so will mean we continue to over-exploit nature, to the detriment of the natural world and ourselves.

We support the recommendation of the Public Accounts Committee that the Treasury’s next Comprehensive Spending Review should set out how the full value of environmental impacts has been taken into account, and the impact of spending decisions on meeting government’s long-term environmental goals. To achieve this, every department needs to account for the costs and benefits to nature when appraising projects and policies. We reiterate the recommendation of the 2017–19 Committee that general taxation and spending should not be exempt from the Environmental Principles.

The Government has the opportunity to create a fiscal framework focused on delivering well-being, sustainability and economic stability. The current fiscal rules focus on managing the budget, public sector investment and debt. There is scope to extend this so balancing our demands on nature with nature’s capacity to meet these demands, becomes central to government’s economic objectives. This can help to deliver a stable economy in the long-term which is resilient to nature- related financial risks. The Treasury has not stress tested the 2021 Budget and 2020 Spending Review against net zero or nature goals. Without sustainability tests on spending decisions, we risk moving further away from realising environmental targets. (Paragraph 317) Biodiversity in the UK: bloom or bust? 125

The Government should include a Net Zero test of the 2021 Budget in its Net Zero Review. Net Zero tests should be refined for future fiscal events to assess the climate impacts of taxation, spending and resource decisions. The Government should develop nature tests to ensure spending packages are aligned with the Post-2020 Biodiversity Framework. A new fiscal rule should be added to the fiscal framework which focuses on balancing our demands on nature with nature’s supply.

Financial systems need to recognise the value of preserving biodiversity. The transformation the financial system has undergone to integrate climate-related financial risks should be used as a roadmap to do the same for biodiversity. The interconnected, complex, and non-linear nature of biodiversity risks makes it difficult to model. But the outsized and extreme financial impact of exceeding ecosystem tipping points, makes work to integrate nature risks all the more pressing. We welcome the Government championing the work of the taskforce on nature-related financial disclosures (TNFD). To accelerate this work, the Government needs to play its part in creating the narrative that robust and imminent policy responses to biodiversity are coming, this can help initiate the management of biodiversity risks within the finance sector.

To provide the signals needed for the financial system to manage biodiversity risks, we recommend that: a) The Government commit to legislate for mandatory disclosure of nature-related financial risks once the TNFD framework is ready. b) The Government explore how a corporate natural capital accounting system could be set-up to require organisations to measure the impact of operations on natural capital. c) The Bank of England conduct an exploratory exercise into stress testing biodiversity loss. d) The Government should also ensure the National Infrastructure Bank has a mandate for net zero and includes a focus on nature and biodiversity for investment in its objectives. e) The Government commission a review into the Law Commission’s 2014 report on the Fiduciary Duties of Investment Intermediaries, given the developments in the understanding of climate and nature-related risks since the report’s publication. (Paragraph 329) Education and biodiversity

For biodiversity to be protected, it has to be appreciated and valued. But our increasing detachment from nature stops many of us knowing and directly experiencing it. This starts at a young age; children are spending less and less time outdoors. Children from disadvantaged backgrounds and ethnic minorities have particularly low access to green spaces. Education is a crucial lever to address this and mend our relationship with nature. The Government’s Children and Nature Programme went some way in increasing access opportunities, but the impact of the coronavirus has meant even fewer children have had access to nature this year. To address this 126 Biodiversity in the UK: bloom or bust? a transformation in the education system is needed towards one where children from an early age to adulthood are encouraged to experience, celebrate, and learn about nature. Governments, businesses, and organisations also need to recognise the value of nature; this again starts with education.

To increase education on biodiversity we: a) Support the establishment of a Natural History GCSE; b) Recommend the Department for Education re-evaluate the opportunities for nature visits and teaching outside, as part of its support to schools recovering from the education impacts of covid-19; c) Recommend the Department for Education and Defra work together to get school children involved in the Government’s afforestation project; d) Recommend Government emphasise its leadership in increasing knowledge and recognition of the importance and value of nature by requiring every Permanent Secretary across Government and every civil servant and Minister in the HM Treasury to undertake a basic ecology briefing as part of mandatory induction; e) Recommend the Government explore setting up a biodiversity education charter to increase knowledge of biodiversity risk within the finance sector. (Paragraph 342) Appendices Frog peeking out of watering can. Photo: Tony Bond 128 Biodiversity in the UK: bloom or bust?

Consumption patterns in the UK are unsustainable. Addressing these patterns is key to the UK’s contribution to the alleviation of global biodiversity loss. The first step is to recognise the need to reduce the UK’s overall consumption. We welcome that the Government has commissioned the Joint Nature Conservation Committee to develop a global environmental footprint indicator, but we are disappointed that the Government has not then committed to setting a global footprint target using this indicator to track progress in order to reduce the UK’s global environmental footprint.

In 2018 the Government announced it would devise an indicator on the overseas environmental impacts of UK consumption of key commodities. It appears that little to no progress has been made in developing this indicator. This is disappointing and shows a lack of prioritisation in addressing one of the biggest drivers of land conversion, biodiversity loss and carbon emissions at a global scale.

We recommend that the Government urgently prioritise the development of the indicator on overseas environmental impacts of UK consumption of key commodities, since a better understanding of the environmental impacts of imported products is crucial to meeting the Government’s objectives in this regard. The indicator ought to be prepared for release not later than the date of the next Outcome Indicator Framework update. We also recommend that the Government commit to setting an environmental footprint target using this indicator once developed.

Ministers should consider how best to encourage behavioural change towards more sustainable and ethical patterns of consumption. Subsidies, environmental tax measures and tax reliefs are some of the financial and fiscal tools available to government. The Public Accounts Committee has criticised the Government’s grasp of the potential for tax measures to bring about environmental change and has recommended that from the next budget, the Treasury should: assess the environmental impact of every tax change considered; and publish the expected environmental impact for each tax measure in the budget, including the extent of behavioural change, alongside forecasts for tax receipts. The Treasury have since rejected these recommendations as impractical and not cost-effective. We consider this to be a short-sighted approach; it will be more costly to the environment and the economy to not consider fully the environmental impacts of policy and tax changes. The approach calls into question the extent to which environment costings are properly considered in developing and setting tax policy.

The Committee looks forward to seeing an ambitious approach from Government to embedding Net Zero in all policy decisions in its forthcoming Net Zero Strategy.

In the Net Zero Strategy, the Government should commit to evaluating all taxation changes against how well they deliver on the Government’s environmental objectives. 48 The UK’s footprint on global biodiversity The Government’s approach to how taxation changes will be developed and assessed to achieve this should also be set out in the Strategy.

The Net Zero Strategy should include an explicit commitment to Net Zero stress test all future fiscal events and a commitment to develop a nature stress test to be used for fiscal events. The Net Zero Strategy must be published before the start of COP26.

For the Government to make good on its support for environmental sustainability to be at the heart of global production and trade, it needs to mainstream biodiversity considerations more consistently into its trade agreements and operations. Leaving the European Union has provided an opportunity to promote the highest environmental and social standards in trade. We welcome Ministers’ willingness to use future trade agreements as market signals for sustainably produced commodities and their support for considering the environmental impacts of agreements. We also welcome the Government’s leadership in establishing the Wildlife Financial Taskforce.

We recommend that sustainability impact assessments be conducted for all future trade agreements and that as part of the Government’s Nature Strategy the Government consider how to monitor and deliver environmental net gain in trade deals. In response to this report the Government should set out how it intends to widen participation in the Wildlife Financial Taskforce, whether through proposing a statutory obligation on businesses of a certain size, or through other means.

We welcome and agree with the Secretary of State’s analysis that addressing the sustainability of the UK’s global supply chains will be one of the most powerful ways in which the UK can reduce its adverse impact on levels of international biodiversity. The degradation of ecosystems brings supply chain, market and financial risks. Monitoring the impact of UK activities abroad presents obvious challenges: nevertheless, efforts must be stepped up to make overseas biodiversity monitoring a reality.

Sustainable government procurement presents a pathway to increasing the sustainability of supply chains. Yet Government performance against existing sustainable procurement policies has been unimpressive. The removal of the mandatory reporting obligation by Government departments against the Greening Government Commitments has led to a dearth of data and has hampered the monitoring of compliance with the Government Buying Standards, to the extent that it appears at present impossible to know whether departments have improved their sustainable procurement performance. In the run up to COP15 and COP26, and at a time when the Government should be showing leadership on sustainability issues, its departments appear instead to be moving backwards. This increased opacity over departmental sustainability practices is unacceptable.

We welcome the news that the Department for Environment, Food and Rural Affairs is considering restarting the routine reporting of levels of compliance with Government buying standards. We also note with approval the effect that Government commitments on the importation of sustainable palm oil has had on the supply chains of companies importing palm oil to the UK. (Paragraph 53) The UK’s footprint on global biodiversity 49

To increase sustainability within UK global supply chains, we recommend that: a) in its response to this report, the Government should set out a clear and accessible definition of sustainability within the context of the Government Buying Standards; b) the Government reinstate the Greening Government Commitments for mandatory reporting on sustainable procurement as part of the Government Buying Standards by the end of 2021; c) the Government Buying Standards should require all acquired forest-risk commodities (in addition to palm oil and paper) to be certified as sustainably produced; and d) the Government Buying Standards should be mandatory for all large public bodies, like the NHS and prisons. Annual reporting on compliance against public procurement policies should be mandatory for these large public bodies.

A natural capital approach to valuing agricultural products provides another way to increase the sustainability of supply chains.

Within the National Food Strategy the Government should consider how a natural capital approach could be adopted without placing a disproportionate financial burden on farmers or consumers.

90% of respondents to the Government’s consultation on new laws for forest-risk commodities believed proposals should be extended so that it is illegal for UK businesses to use any key commodities related to deforestation in their supply chains. We agree with stakeholders that global deforestation and the UK’s contribution to it cannot be tackled without bold and ambitious action. This should include moving to deforestation-free supply chains. The finance sector should be included in due diligence obligations if the UK is to avoid funding deforestation through lending and investments.

To increase the sustainable use of forest-risk commodities we recommend that the Government make it illegal for UK businesses and the finance sector to use commodities linked to deforestation and, at the very least, include the finance sector within the scope of the provisions on forest-risk commodities in the Environment Bill. (Paragraph 58) Biodiversity in the UK overseas territories

The UK Overseas Territories are home to 94 per cent of British endemic species and 90 per cent of the biodiversity for which the UK Government has responsibility. The territories are also of global importance given the large proportion of the world’s albatross and penguin species found in these territories. Given this, environmental preservation and the improvement of these territories must be a priority for the UK Government. We welcome the impressive global leadership the UK has demonstrated through the establishment of the Blue Belt Programme, and the Global Ocean Alliance. (Paragraph 74) 50 The UK’s footprint on global biodiversity

To further improve the state of biodiversity in the Overseas Territories, we recommend that gaps in their protection be rectified. Namely, we recommend that: a) Ministers assure and set out the long-term funding plan for the Blue Belt Programme. In response to this report the Government should set out the programme’s long- term timetable, budget, and status following the Government’s 2021 Integrated Review of Security, Defence, Development and Foreign Policy. b) Ministers review the environmental funding gap implications for the Overseas Territories following the UK leaving the EU. In response to this report Ministers should set out how the UK could fund landscape scale environmental projects with the potential for transformative biodiversity restoration. c) In the Government’s response to this report, Ministers should evaluate the feasibility of an environmental research portal for Overseas Territories. d) Ministers should consider opportunities to use increasing global aerial surveillance capabilities from high altitude or space to monitor the Blue Belt Programme. (Paragraph 75) International development and biodiversity

Consideration of natural capital must be a priority in the assessment of overseas development assistance projects. Nature sustains all of us and becomes even more critical in a developing country context. We welcome the Government’s announcement of a new International Biodiversity Fund and its commitment to nature-proof all overseas development assistance expenditure. We now need to see the detail of how the Government intends to achieve this and how the Government will mainstream consideration of biodiversity across development, trade, security and foreign policy. We regret that the Government’s international climate finance commitments, including its commitment to £3 billion on nature-based solutions to climate change, is not new and additional funding, but rather a redirection of the existing and reduced aid budget.

We recommend that in response to this report the Government detail how it intends to nature-proof overseas development assistance, and how compliance with this commitment will be monitored. (Paragraph 89) The UNCBD COP15

The UN Convention on Biological Diversity (CBD) COP15 summit presents an opportunity to create a transformative Post-2020 Global Biodiversity Framework that will ‘bend the curve’ of biodiversity loss. The UK has a crucial role to play in promoting a transformative, ambitious agenda that pairs with its ambitions for the UNFCCC COP26 summit and provides a clear way forward from both events. Parties to the CBD failed to achieve the Aichi Biodiversity Targets set in 2010. The same mistake must not be repeated. (Paragraph 127) The UK’s footprint on global biodiversity 51

We reiterate our welcome for the UK Government’s leadership in establishing the Global Ocean Alliance and signing the Leaders’ Pledge for Nature. We also welcome the establishment of nature as a key theme for COP26.

The publication of the first draft of the Post-2020 Global Biodiversity Framework provides a promising starting point, but elements of the draft lack ambition. • The 2030 mission should be clearer and stronger, and should align with the Leaders’ Pledge for Nature and G7 2030 Nature Compact to halt and reverse biodiversity loss by 2030. • The species goal (Goal A) is too weak. It should aim to stop human-induced extinctions and the goal should be made into a SMART target. • Target 8 on ecosystem-based approaches to climate change mitigation and adaption should include reference to nature-based solutions to climate change, so that more explicit links can be made between the UNCBD and UNFCCC processes. • The framework must address the need to reduce unsustainable consumption and production patterns from developed countries. We have already recommended that the Government start the process of setting an environmental footprint target by launching a consultation ahead of COP15 on how to model the overseas environmental impact of UK consumption.

The Post-2020 Framework’s goals and targets will be meaningless if not properly implemented. The CBD ought to adopt a regular review mechanism, such as that adopted under the Paris Agreement of the UNFCCC, which encourages Parties to ‘ratchet’ the level of ambition of their National Targets so that, over time, their collective commitments are matched with global targets. We agree with environmental stakeholders that the implementation mechanism should start immediately after the adoption of the framework, instead of being agreed separately after COP15. We are encouraged that Ministers are seeking to establish a nature version of the Paris Agreement at COP15.

Mainstreaming biodiversity considerations across government departments will be crucial to meeting the Post-2020 Biodiversity Targets. The UK’s past performance on cross-departmental co-ordination on nature has been disappointing. We have nevertheless been encouraged to observe the willingness of Ministers to work across Government to address biodiversity loss and climate change. We will continue to monitor the effectiveness of cross-departmental working on the environment in the run up to COP15 and COP26 and beyond.

The policy statement on environmental principles, to be prepared under the Environment Bill, ought to be a powerful tool for mainstreaming environmental concerns, including biodiversity, across Government. So the Government’s response to the recommendation of our previous report—arguing that general taxation and spending should be exempt from the statement of environmental principles—was disappointing. We are concerned that the Government’s approach to this issue shows a lack of commitment to the genuine mainstreaming of environmental considerations across all Government departments. (Paragraph 132) 52 The UK’s footprint on global biodiversity

The global biodiversity funding gap is huge. It cannot be tackled with contributions from the Global Environment Facility alone. A dedicated financial mechanism for biodiversity action, as has already been set out and agreed by Parties under the CBD, is essential. We welcome the UK’s commitment to spend £3 billion of its International Climate Finance allocation to support nature-based solutions to climate change.

As host of COP26, the UK has an instrumental role to play in pairing the UNCBD COP16 and UNFCCC COP26. We are encouraged by Ministers’ assurances that there is a close working relationship with their Chinese counterparts regarding efforts to join the two COPs together. Agreeing a working definition and principles for nature-based solutions can provide a tangible way to link the two conferences and their outcomes. The UK can also support China by sharing its experience in conducting international environmental negotiations.

In promoting a transformative Post-2020 Biodiversity Framework, we recommend that the UK Government advocate: • A strengthening of the Post-2020 Biodiversity Framework’s 2030 mission to align with the Leaders’ Pledge for Nature and G7 2030 Nature Compact to halt and reverse biodiversity loss by 2030. • A more ambitious, SMARTer species goal (Goal A) which commits to stopping human-induced extinctions. • Inclusion of reference to nature-based solutions in Target 8, so that the UNFCCC and UNCBD processes can be better linked. • Stronger wording on the need to reduce unsustainable consumption and production patterns amongst developed countries. • An ambitious Paris-style review mechanism for biodiversity, which encourages Parties to ‘ratchet’ the level of ambition of their National Targets at regular review intervals. • A dedicated financial mechanism for the UNCBD.

To help pair the UNCBD and UNFCCC COPs, we recommend the UK explore opportunities to support China on leading international environmental negotiations. We also recommend that China and the UK collaborate on how to integrate nature- based solutions across both COPs; and we recommend that the UK encourage China to sign the Leaders’ Pledge for Nature as a demonstration of its environmental leadership ahead of COP15. (Paragraph 136) The UK’s footprint on global biodiversity 53