Nature’s Future series: How much for a Nature Positive future?

Aerial view of Marazion Marsh RSPB reserve, near Penzance, Cornwall, England (c) David Wootton (rspb-images.com)

This blog is the second in an exciting mini-series exploring the funding needs behind achieving a nature positive future. RSPB Principal Economist, Paul Morling looks at how much we need to spend to save nature in the UK and the role of public and private finance in filling the current gap.

In response to the Dasgupta Review, The UK Government committed to delivering a ‘Nature Positive future, in which we leave the environment in a better state than we found it, and reverse biodiversity loss by 2030.’ At the heart of that is biodiversity protection and enhancement.  

Protecting biodiversity, and ensuring that the species we share the planet with have space to thrive and flourish is an ethical imperative, its value to us extends well beyond what price economists can put on it. In economic terms, it is also a public good for which markets cannot account for all dimensions of its importance to us. 

So how are we doing? 

Below are 3 different estimates to help understand what we need to be spending to achieve a Nature Positive future. These estimates look at:  

• Current UK spend and scale of need to achieve habitat and species priorities  
• The estimated overall costs of meeting environmental land management priorities in the UK 
• The overall finance gap for UK nature 

Estimate 1 

Over the past decade, the UK Government has been world-leading in providing estimates of what it spends on nature and what is needed to meet national objectives. Such estimates are not easy but experience over the years and the consistency of assumptions underlying these calculations mean we can be pretty confident about the scale of financial need.  

Current estimates suggest the Government spends £552m across the UK, roughly equivalent to the national budget for pothole repairs. Recent welcome funding announcements should see this figure go up in future years, but we are well short of needs to meet our current species and habitat targets, which alone we estimate will require £1.8bn a year.  

Current spend and scale of need to achieve habitat and species priorities (£m per annum) 

Source: Estimates based on various sources, including Biodiversity Indicators for England and UK, departmental reports, charity accounts, and unpublished studies including JNCC Biodiversity Indicator E2. Expenditure on UK and international biodiversity for actual spend.  

Estimate 2 

From a land management perspective, a different but related appraisal of the funds needed to meet the land management priorities in the UK estimates that a total of £2.8bn was spent during 2019 to support environmental land management in the UK. However, this estimate doesn’t include all necessary actions needed to address the current targets for priority species and habitats. 

The RSPB current estimate is that during the next decade, a total of £3.9bn annually will be required to support agriculture to achieve environmental priorities, in excess of the Government’s current commitment to provide £3bn. An effective new ELMs programme could achieve the nature targets if genuinely based on the principle of public money for public goods. 

Estimated overall costs of meeting environmental land management priorities in the UK (£m per annum over 10 years) 

Source: Paying for public goods from land management: How much will it cost and how might we pay? (Rayment, 2019) 2021 estimates were updated to include the latest available data on output prices and input costs.  

Estimate 3 

Last year, a report commissioned by the Green Finance Institute assessed the current financing shortfall – the funding needs above current estimates of spend – for a wider range of environmental priorities including biodiversity needs but also other needs such as natural flood risk management, climate mitigation biosecurity and access to nature. According to the report, the mid-point for the overall annual need over the next 10 years is £5.7bn (see map below). 

The overall finance gap for UK Nature (£bn per annum) 

Source:  The Finance Gap for UK Nature (GFI, EFTEC, Rayment Consulting) 2021  

How do we fill the gap?

The last decade has seen a step-change in understanding the vast array of public and private benefits that nature provides to society, and that understanding has led to explorations of how these values can be captured through new markets, business models and value propositions. The prospects are tantalising and the UK government has announced new ambitions to create new environmental markets and leverage new private financing into nature conservation. Ambitions we support and will help deliver but private financing will not, especially in the short term, fill the funding gap. 

Saving and restoring nature has two fundamental requirements: 

1. We need a transformation in government, business and financial decision-making to internalise their impacts on nature, stop the drivers of loss and ensure we, as consumers, face a ‘better choice of nature positive options’. 
2. We need to see an increase, and redirection, of financing to actually achieve our collective ambitions to be a Nature Positive economy and achieve our goal to protect and manage 30% of land and seas for nature by 2030. 

Government first and foremost has the responsibility to achieve its nature positive ambitions and that will require frontloading public investment now to have any chance of achieving a Nature Positive future by 2030.