Are Local Communities Going to Pay for Natural Capital?
This article is the six in our series of LLB student essays, bringing together a selection of writings from our ‘Law and Sustainability in the Anthropocene’ course.
To find out more about this Honours course, visit our UofG Course Catalogue.
By Sophia Kustatscher
Can you put a price on nature? This fundamental question has been asked by conservationists, economists and environmental policy makers for decades. The commodification of nature, in theory, would ensure that living things remain safe from overexploitation because there would be recognition that they are worth more alive than dead. However, this line of thought is highly contested.
Natural capital at first, seemed like a good idea. However, it has proved difficult at the implementation stage, the government seems to have given up and, as always, local communities are paying the price. If the natural capital is to be used by governments and decision makers it needs to be backed up with vigorous policies to protect individuals, communities and nature.
The argument in favour of commodification highlights that nature is currently not part of economic equations and is automatically valued at zero. Kathy Willis, an Oxford professor, suggests that we must put a price on nature so that people will start to value it, she states that this is the pragmatic approach and that opposing views are idealistic. While it is accepted that implementation will be difficult, there are many who remain optimistic to this approach while highlighting a need for closer cooperation between economics, ecology, politics and the law.
Others argue that putting a price on nature is simply impossible, as its intrinsic value cannot be calculated. Inaccurate valuations could then cause problems in biodiversity offsetting especially where appraisal is skewed against cultural attachments, resulting in developments going ahead where nature is deemed to be less profitable. A former director of ecosystem economic studies in the United States Environmental Protection Agency has also pointed out that this system may undermine other efforts to preserve the natural world.
Regardless of the critiques, the UK government was at the forefront of attempting to value nature and its services. This first attempt revealed that nature is worth over £30 billion to the UK alone, a discovery which, at first, was hailed as ‘truly significant’ and ‘groundbreaking’. However, it seems that this and subsequent studies have been largely forgotten.
The 2011 Natural Environment White Paper, aimed at securing the value of nature for the next 50 years, was reviewed frequently until 2014 where reviews suddenly stopped, presumably due to the change in Government in 2015. Furthermore, the Natural Capital Committee found limited evidence of natural capital being considered in policy appraisal. With their chair commenting, in 2020, that the ‘absence of progress since 2011 is more notable than the successes’. It is worth mentioning that there have been advances in natural capital accounting with aims to integrate natural capital into national accounts but the impact of this remains to be seen.
So why does the implementation of natural capital fail in local governance?
Natural capital could be used to preserve local green spaces but a lack of government policy has left a gap in implementation for local councils.
Recently, Glasgow City Council announced plans to introduce a fee for visitors of the Botanical Garden’s Green house, nicknamed ‘the Kibble’. For the council, the Kibble represents a way to create an income of £185,000 per year. Glasgow’s inhabitants, however, see a place for families to connect and a place to enjoy vibrant nature in the middle of winter.
Applying (very basic) natural capital logic we see that the fee introduction is estimated to prevent around 150,000 visits to the Kibble per year but we don’t know if the Kibble is more influential to people’s mental and physical wellbeing than the botanical garden alone. Specifically, we would have to calculate its economic impacts on NHS costs and balance this with the estimated income.
However, regardless of the outcome, the council has a £50 million hole in their budget which they need to fill. This highlights the missing role of environmental governance. The council have stated themselves that are not the ones benefiting financially from the green spaces and, therefore, have less incentive to protect them. And, even though, they consider these ‘hidden’ financial benefits, they assert that there needs to be more cooperation with central government, public sector agencies and communities, for them to implement natural capitalbased policy.
This highlights a lack of follow through on policy aims which could be reflected on a larger scale in future if valuations are not sufficiently backed up by accountability mechanisms. With countries following in the UK’s footsteps, most notably the United States, we can only hope that we learn from our mistakes. The danger is that while commodifying nature looks practical on paper, problems with implementation are drastic and if methods of environmental law and governance don’t catch up, the system is likely to be misused at the cost of local communities everywhere.
