That the Grand Committee takes note of the economic value of biodiversity and the report The Economics of Biodiversity: The Dasgupta Review, published on 2 February.
My Lords, I thank my colleagues on the Cross-Benches for choosing this debate. I am delighted. It means that many others are as concerned about this issue as I am. Sadly, we live in a society that respects wealth more than issues of contentment and well-being, so much of which is provided by the world around us: our air, clean water, abundant oceans, the minerals from the earth, out of which we make more or less everything we have, and the fertility of the soil, which grows all our food and, indeed, everything else. This is provided entirely for free and is taken entirely for granted, but it is essential for life as we know it on earth. It is often quiet, silent and completely invisible to the naked human eye.
The Dasgupta report was commissioned by the Treasury, which is why it is so important. There is nothing fluffy or sentimental in it. It is not about Easter bunnies; it is about money. For the first time, we are putting a value on nature and asking the hard, tough questions about what natural services we have taken for granted for so long and for free.
Since I was born, just about 70 years ago, the world has changed beyond recognition. The number of people in poverty has reduced from 60% to 10% while populations have exploded. Life expectancy has increased. I do not mourn that, but I mourn the fact that this progress has been at the expense of the world around us. If we are to think of nature and progress as assets, we paid for progress by taking an overdraft out with nature, and we are almost at bankruptcy. Economists often say that we need to live within our means, and this is definitely the case with our biosphere. There is only one. You cannot order another online.
Globally, the pandemic has devastated economies and lives. Its cause was our faulty interaction with nature. Some 96% of all mammals on earth are now either us or the animals we chose to eat—60 billion of them fretting in feedlots and cages, fed on food grown on monocultures. It is not a good system in any way. Some 30% of the world is still hungry, 30% is getting fat and 30% of all the food grown is wasted. In 2019, the global assessment report on biodiversity concluded that 25% of species in animal and plant groups are threatened with extinction in the next few decades and more than 85% of global wetlands, which store huge amounts of carbon, have been lost.
Professor Dasgupta estimated that as a planet we spend about $500 billion a year on environmentally damaging subsidies. He also acknowledges that this is probably an underestimate. In contrast, subsidies considered to be biodiversity positive total just $890 million a year and subsidies considered beneficial stand at just €2.6 billion. If we include other public finance expenditure associated with the conservation of biodiversity, it gets us to just under $68 billion, so, even at a conservative estimate, environmentally damaging subsidies are dwarfing the protection of the environment at a rate of 7.5:1. We are losing this battle. We can still win the war, but we need to act now.
My Lords, I declare an interest as chairman of the Woodland Trust and as patron or vice-president of several environmental organisations. As the noble Baroness, Lady Boycott, outlined, the Dasgupta Review makes it absolutely clear that if we continue to destroy nature at the rate we are, not only will we risk the survival of all species but there will be catastrophic consequences for our economy, our well-being and our very survival. As an example, the Woodland Trust’s recent report on the state of the UK’s woods and trees emphasised the critical role of our native woods and trees in supporting our future prosperity, including in locking up carbon, improving our health and well-being, and reducing pollution and flooding.
It is good to see the Government championing the review internationally. This must be backed by an ambitious approach to its implementation domestically. We have literally a once-in-a-century opportunity post Covid to rebuild the ecological foundations of our wealth and well-being. The Treasury will have a key role in embedding the Dasgupta principles into the UK economic framework for local and national government, and for business. Government incentives, regulation and guidance will be important too. Measurability will be key: we need a clear framework for measuring nature, as clear as we have for measuring climate change and carbon reduction. To prevent further damage to our already precarious ecosystems, we need legally binding targets in the delayed Environment Bill to halt—and to begin to reverse—declines in nature by 2030.
Lastly, as the noble Baroness, Lady Boycott, said, let us learn from the hugely influential Stern report on the economics of climate change. Nicholas Stern—the noble Lord, Lord Stern—worked his socks off to see his report implemented nationally and internationally. Whatever he did right, let us see a similar sustained effort for the Dasgupta report.
My Lords, I thank the noble Baroness, Lady Boycott, for her powerful opening speech, articulating the values of this report at a time when the evidence shows that nature’s resilience is being severely eroded, yet our economy, livelihoods and well-being all rely on nature. The Government need to use the opportunities they have this year at the G7, CBD COP 15 and COP 26 to showcase the report’s findings and their framework for nature. To do that credibly, they must respond formally, before the start of these events, and show how they are using all opportunities to deliver, despite the National Audit Office’s report that there is still a long way to go before we can have confidence that the Government have the right framework to deliver on the aspirations in their 25-year environment plan.
There are a number of areas where the reality is not in step with the Government’s stated ambitions. In the short time that I have, I will raise just one: the proposed exemption for Treasury Ministers from having due regard to the Government’s policy statement on environmental principles. This policy statement is a key tool to drive delivery across government of the 25-year environment plan. The duty for Ministers to have regard to it does not give undue weight to the environment but just embeds consideration of the importance of policy on the environment in decision-making.
Professor Dasgupta argued for a new vocabulary to factor the value of the environment into our economy. This exemption shows that the Treasury is not even prepared to open the dictionary. If the Government were to remove it before the Environment Bill returns to Parliament, that would be a powerful symbol of business not as usual. Without that, there is little hope of embedding nature into decision-making and delivering the protection for the natural resources on which we all depend.
My Lords, there is a scene in “The Simpsons Movie” where the dysfunctional family arrives in Alaska and is handed a wad of money, and the border guard says, “Here is $1,000. We give everyone in Alaska this, in exchange for letting us destroy the environment”. It seems that that is the view a lot of people take of the tension between growth and nature—that, somehow, man is a pollutant or despoiler and that capitalism is intrinsically bad for the natural world.
When I got to visit Alaska with my children a few years later, I was very surprised to see that there had been a most extraordinary rise in biodiversity there. We saw virtually every one of the characteristic animals. We saw sea otters, which were almost extinct at the beginning of the 20th century and now cutely hold hands as they float on every surface. We also saw whales, whose recovery has been one of the untold stories of the past 30 years, bears and eagles—the works. This is not only true in Alaska. When you have a country where there is sufficient economic progress that people want to shoot with cameras rather than guns, it creates a space.
It is an observable fact that you are breathing cleaner air and drinking cleaner water in London, as compared to Lahore, because it is a wealthier place. I do not think I had seen a red kite in the wild before my 30s; now, they are as common as eagles in Alaska—I was about to say, “as pigeons”. I had never seen an otter in the wild until five years ago; I would have doubted my eyes, except that you can hardly mistake an otter for anything else. The Thames was biologically dead in the 50s; now, you can fish salmon in it.
The point I am making is that economic growth creates a space for environmental protection—this is a luxury that poor and developing countries do not have. My noble friend Lord Ridley has a nice phrase, which is that 50 years ago, wolves, tigers and lions were all endangered; now, wolves have rebounded, tigers are flatlining and lions remain endangered. Why? Because wolves live in rich countries, tigers live in middle-income ones and lions live in poor ones.
My Lords, I thank the noble Baroness, Lady Boycott, for sponsoring this debate and for her very persuasive and articulate opening comments. My interests are as recorded in the register, but, in particular, as far as this debate is concerned, I note that I chair Cawood Scientific, an analytical company whose range includes soil testing et cetera.
The Dasgupta Review is extremely helpful, and I fully endorse its conclusions on the seriousness of the issue of biodiversity loss and the decline of ecosystems. We must take action. The report calls for “transformative change” and suggests
“insisting that financiers invest our money sustainably, that firms disclose environmental conditions along their supply chains … and even boycotting products that do not meet standards.”
This assumes that, in time, the market will influence behaviour and enable pull-through. However, at present, this is not the case; the concept of natural capital accounting is in its infancy and not developed. It will take time for market pull-through.
Until such time, the Government have only two key tools at their disposal to address the concerns identified in the report: legislation and incentivisation. As stated in the report, this is a global challenge that will be addressed only if local action is taken on the ground—literally, on the ground. What legislation might the Government be considering through the office for environmental protection within the Environment Bill? What incentives might be available through the environmental land management scheme for farmers and growers? Will this require an environmental audit for each farm to target the actions required to enhance natural capital and biodiversity gain? It would be helpful if the Minister could consider these questions.
My Lords, the Dasgupta Review reminds us that the trappings of neoliberal capitalism, its unrestrained pursuit of growth, consumption, exploitation and accumulation of private wealth, have brought humanity to the edge of disaster. Paradoxically, the review seeks a solution to the crisis of nature and biodiversity within the framework of neoliberal capitalism, which is unlikely to make a significant difference. For example, it emphasises the need to correct what it calls “pricing distortions” because, currently
“most of Nature’s worth to society—its accounting prices—are not reflected in market prices”.
It recommends that natural capital be brought into national accounting mechanisms; that is, that the externality of nature be expressed in terms of money. One consequence of this will be to treat nature as a tradeable commodity and to unleash a different kind of crisis. The use of terms such as “capital” is problematical, as it signifies something which is to be exploited and privately appropriated.
There is also a fundamental error in the review. Just because something is priced does not mean that it will not be exploited, at least by those who can afford to pay. Does financialisation deliver the desired outcomes? Carbon pricing generates a lot of revenues, but it has not significantly reduced global resource consumption or emissions. To save humanity and all living things, we need a transformation of education and society. Equitable distribution of income and wealth and stakeholder capitalism are the first necessary stepping stones towards that goal. I hope that the Government will embrace them.
I congratulate the noble Baroness, Lady Boycott, on getting this debate and on her excellent introduction. When I first saw the title of the report, The Economics of Biodiversity, I was a little conflicted, because there is the overwhelming sense that our economic system has always hugely undervalued the natural world, which has led to huge damage and very poor decision-making. The second feeling is one of concern that, by looking at the natural world through the lens of economics, we risk repeating exactly the same mistakes that got us into this mess. The answer is not more banking, more financial engineering and more big business.
I was elated to see that the Dasgupta Reviewrecognised exactly that; in fact, the report almost reads like a Green Party publication in its criticisms of the status quo, so much so that the Government have glossed over some of its biggest sections. In particular, they seem completely to have ignored Dasgupta’s criticism of gross national product as an economic measure:
“The contemporary practice of using Gross Domestic Product (GDP) to judge economic performance is based on a faulty application of economics.”
It goes on to say that GDP ignores
“the degradation of the natural environment”
and
“is wholly unsuitable for appraising investment projects and identifying sustainable development.”
Perhaps even more importantly, it states that
“in recent decades eroding natural capital has been precisely the means the world economy has deployed for enjoying what is routinely celebrated as ‘economic growth’”.
This has been obvious to Greens for decades; it is one of their foundational principles that sets green philosophy apart from other political parties and movements. Politicians have to end their obsession with economic growth and understand that we are on a finite planet with finite resources.
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What are the hidden costs? Let me give the Committee a couple of vivid examples. The first has always stuck in my mind. It is a picture of a vast Chinese apple orchard where the workers are laboriously brushing fluffy paint brushes across apple blossoms to pollenate them. They are doing this because they have managed to kill all the bees by the increasing use of pesticides.
In India, which we see so much of right now, vultures used to keep the streets clean, but they have fallen foul of the anti-inflammatory drugs injected into cattle and buffalo. Now, when you drive through villages, there are piles of rubbish; there is more illness. At the towers of silence, where the Parsis bury their dead—they used to have their bodies picked to pieces by the vultures—they have actually had to install solar panels to shrivel and desiccate the corpses.
Closer to home, our vast fields of wheat and cereal crops grow in endless acres. It might look good, but what happens when you smell or listen? You will hear nothing—no birds and no insects—and there will probably be no trees. In short, what you are looking at is a factory—one loaded with chemicals to enable the crops to grow as fast as possible, and in the process destroying the soil beneath them. As that soil weakens, denied the chance to form new life forms in its natural cycle because of the deep ploughing and intensive farming, more money needs to be spent on chemicals to make those crops grow. It is a vicious cycle.
We have always thought that we can do better than nature, that human ingenuity could overcome shortfalls, and that we could bust through the natural limits imposed by nature’s constraints. In the process, we never asked the simple question: “What does nature do for us?” Now is the time for that question. Now is the time when we need to understand that we live in a world which is brilliantly organised and interconnected, full of different life forms which, together, enable species—including us—to flourish. From the act of photosynthesis, which combines sunlight, carbon and water to create the plants we live on, everything—until now—has had a place in this complexity, doing its bit for the community of life. Now we are literally pulling it apart, believing that it is, for instance, more productive to tear down a rainforest and plant a monocrop to feed ourselves. The results are clear: fires, floods, changing rainfall and temperature, and it is getting worse.
The future does not need to be like this. The Government have committed to this being the first generation to leave nature in a better condition, but we need to have policies in place to make this a reality. We could live in a country that does not use chemicals or practice monoculture farming, and which has adopted agroecology and agroforestry. It could be a country with nature corridors between wild areas, where the flora and fauna we have relied on could flourish. We could have communities with local food networks, with clean rivers we could swim in and beaches we could be proud of. Very importantly, it could be a country where children are educated as to the power of nature and the environment, and where citizens are empowered to understand these issues and make the right choices, and, in turn, purchase products safe in the knowledge that no orangutans have been hurt or habitats compromised.
The Treasury has posed three big questions: what are the economic benefits of biodiversity; what are the economic costs when biodiversity is lost; and what practical actions can be taken to enhance economic prosperity and biodiversity. Last week, the noble Lord, Lord Goldsmith of Richmond Park, said in a debate on biodiversity:
“Ultimately all economic activity is derived from nature.”
I could not agree more. He went on to say that he was,
“absolutely convinced that this can be the year that change begins in earnest.”—[Official Report, 22/4/2021; col. GC 416.]
I hope that this is the case, but if we do not accept this report’s recommendations and we continue running roughshod over nature, this will not be the year of change. Nothing other than a decisive steer off our current trajectory will do the trick. To take this crisis seriously, the Government need to adopt the recommendations of this report to ensure that what the Stern review did for climate change and energy, the Dasgupta Review can do for biodiversity loss.
What can we do? It is a question that I often ask myself: how best can we affect change? Globally, the problems are immense, but that is not to say that there are not huge improvements that must be made here. For many reasons, countries still look to the UK as a bellwether or indicator, so implementing the best policy here at home will have ramifications abroad. We did it with the Climate Change Act and we can do it with this. We must send out a clear message through our foreign policy and our trade policy, and through our financial markets, to lead the world by valuing the economics of biodiversity.
When the Environment Bill comes to this place next Session, we must work together to include a robust and legally binding framework that will ensure that we keep to the targets. Some are calling this a state of nature target. We need to push other countries to do the same. On this, the Minister said last week:
“We are pressing hard for the highest possible ambition and, crucially, we are pushing for inclusion of mechanisms to hold Governments to the promises they make, which currently is lacking.”—[Official Report, 22/4/2021; col. GC 414.]
He is, of course, completely correct, but so far we lack this mechanism, and we cannot ask others to do something we will not do ourselves.
With the competing priorities of government it can sometimes be easy to put something off, if it is not absolutely immediate, but it falls to all of us to hold the Government’s feet to the fire to make the case for policies to stop the twin threats of climate change and biodiversity loss. If the Government are serious, then implementing the report’s contents is too good an opportunity to pass up. This is about saving not just the planet but humans’ place on it. It is 100% in our self-interest to mobilise everything at our disposal to stop what will otherwise be inevitable.
I say to finance ministries around the world: the future is genuinely in your hands. Only you can charge other ministries and create domestic budget oversight bodies ensuring environmental compatibility with spending. If we are to have truly sustainable economic growth and development, or at least a good life, then we have to understand that our long-term prosperity relies on balancing our demands on the planet. We have to account for what our impacts on nature really cost. It is a balance sheet—one in which economics and ecology must stand side by side. Nature is not separate from the economy, a drag on growth or an expensive, luxurious distraction. It is not, as I said, about fluffy rabbits or nice animals on TV. It is, essentially, our economy; it is where we get everything from.
This is such a crucial year. We have the G7 and COP 26 ahead of us, as well as the CBD meeting. It would be a waste and a mistake to confine climate change to COP and biodiversity to the CBD. They both come from the same source: our failure to understand the interconnected nature of our world. They must be solved together. This is the year that we have the chance; please let us seize it.
Let me close by mentioning one technology that is not plugged in the Dasgupta Review. It talks about using GM and so on as a way of freeing up more space, but I note the ability we now have to fabricate meat—not meat substitute but actual cells that are grown, as it were, so that you can grow the chicken breast without the head, feathers, feet and all the rest of it. Think of how that will free up those ghost acres and barren landscapes of which the noble Baroness, Lady Boycott, spoke. Think of how that will free up the space that we use for feed growth and animals. Is it not a wonder that technology will continue to deliver these marvels to an ungrateful world?
My question and challenge to the Minister is: what are the Government doing to replace GDP with proper economic measures that do not make trashing our planet look like economic success?