Advisory Team Discusssion on Natural Capital
On the 19th May the Dartmoor Tests & Trials (T&T) Advisory Team had a call to discuss the concept of natural capital and the feasibility of using a natural capital approach for local priority setting under the new Environmental Land Management scheme (ELMs).
If you're not familiar with the term then natural capital refers to a framework for managing the natural world based on economics. Natural assets which are provided to humanity for free are quantified and ascribed a financial value with the intention of improving their management. Within the natural capital framework the idea of Public Goods was developed, these are natural assets which have a social and economic value but for which there may be little to no financial market because they are or should be widely accessible to as many people as possible such as clean air, for example. Defra have outlined that the priority for ELMs will be to fund public goods.
What follows are the notes from that call:
Reference material circulated prior to the call
A draft paper exploring "What is the feasibility of using a natural capital framework approach for local priority setting and landscape-scale planning: how could we use it for our own priority setting and DNPA Management Plan?" This will be made available when finalised.
Suggested webinar presentations from the Land Management 2.0 series
Not overwhelming enthusiasm for the concept of natural capital, rather acceptance that if this is the approach government is taking then the farming community needs to ensure it is developed and delivered in a workable format.
Who defines what constitutes a natural capital asset?
Who and how is the value determined?
Who “delivers” it? Will this mean non-farmers start to receive support which should be going to farmers?
Will the money available vary depending on the area/amount of land included?
Could maintenance of grazing stock be supported if it’s demonstrated that it’s needed to deliver natural capital?
That the idea of natural capital could be used negatively against the farming community e.g. clean air as a public good could be used to penalize livestock production for producing methane.
How can we know that this is the right approach before we fully commit to it?
There seems to be significant challenge around measuring data across all possible natural capital assets. Do we have the expertise to do this?
We lack a robust baseline of natural capital data from which to develop our approach.
How can we be sure that any data gathered is accurate? If one doesn’t have the expertise how do you know you’re reporting the information correctly?
That Commons makes the whole idea more complicated because it has to be delivered by a group.
That there may be little scope for enhancing natural capital.
That management of natural capital assets either sits with the landlord or could “fall through the cracks” if Defra don’t correctly understand and address the dynamics of the various grazier/tenant/landlord roles.
That landscapes are dynamic both in terms of the environment and people, where land occupancy changes, relationships between individuals change, how do we ensure landscape schemes can cope with change without collapsing?
That if food production isn’t supported and becomes financially nonviable it won’t happen.
That a natural capital emphasis could lead to decision making which negatively impacts stock welfare.
How do we ensure natural capital assessments are objective?
If only enhancing natural capital receives support it could lead to landscape degradation where no maintenance support is available.
Popular and often used examples of Natural Capital involve change of land use e.g re-wetting and tree planting and in a lot of cases will reduce a holdings Utilizable Area so increasing the Fixed Costs per Ha across the rest of the holding. Costs would either need to be reflected in a rent reduction on a tenant farm, if the landowner is receiving payments for natural capital, or in an area payment which covers the impact which is paid directly to the farmer.
With less land, smaller holdings could have less natural capital assets and also, in having less land, if any land becomes un-utilizable due to natural capital enhancements it could have a more significant impact so it’s important that any scheme design doesn’t penalise smaller holdings.
Food production has to be recognised by the scheme or elsewhere in government policy, recent events have highlighted how important a resilient national food supply is.
Ideas about the way forward:
Dartmoor already delivers a lot of natural capital. It’s important that there is a payment for the maintenance of existing assets and then an additional payment for enhancement.
Good advice and support would be needed so that farmers have a very clear understanding of what to do and how to work together across a landscape scale to do it.
Having a structure which enables farmers to select the right natural capital goals for their farm and /or commons is important. Each land parcel will have different natural capital assets.
It would help if natural capital options were broken down, clarified and then tiered in terms of priority, such an approach would help focus management. If there was then the option of maintenance payments or increasing payment through enhancement it is workable as long as it’s kept simple.
If data gathering can be demonstrably robust and science based that would provide greater reassurance.
It needs to be workable at a farm scale level.
Keep it simple.
Holistic Planned Grazing put forward as a way of delivering for the business and natural capital.
What’s required is a model with a clear framework, which works with livestock, where assets can be scientifically assessed, with well determined values and fully comprehended by all (not threatened by subjective interpretation).
We should lead on determining which natural capital assets are included and what they’re worth.
This is our opportunity to demonstrate and communicate all the good we do.
Where there was a divergence of opinion:
There was interest in doing more monitoring and data recording, particularly on the common, but also concern that if every minute detail needs to be recorded then that becomes too costly and laborious to be feasible.
Whether natural capital accounts should ever be integrated into farm accounts. Whether that detracts from the core farm business or demonstrates the full value of what the business delivers and all assets need to be kept together to demonstrate that they’re interdependent.
How natural capital is managed across home farms and commons: if your individual agreement is tied in with the commons does that become a mess; what if you have different assets on different sites; does it make a difference to your perspective if your home farm is commons adjacent or much further afield. The alternative view being that if a scheme can be designed so it includes options which can fit both home farm and commons, possibly outlined by either govt. or the national park, and you can select different priorities that could work. There would need to be a safety net to fall back on though if one or two individuals ruined it for the common you wouldn’t want that to affect the home farm.
That this gives the impression that food production is sidelined and farmers are being asked to produce something totally different. Alternatively this is just about a whole farm approach and that the right farming system can easily deliver on natural capital and food production.
For a full list of Advisory Team members please refer to the Dartmoor ELMs Test and Trial homepage.