“What’s the economic value of woodlands in the UK? Hmm? Come on, I haven’t got all day. Yes, you at the back there – £720 Billion you say? That sounds like a made up figure.”
An imagined conversation perhaps, but actually the figure comes from a Woodland Trust report published earlier this year. Andrew Lilico of Europe Economics wrote it. Lilico is a regular columnist on the far right neoliberal/libertarian Conservative Home website. This is appropriate as Lilico sits neatly between neoliberal and right-libertarian, especially in his attitude towards the environment – perhaps he is an extreme ecomodernist like Owen Paterson and his brother in law Viscount Matthew “King Coal” Ridley.
Take this for example:
“But the point remains that the earth – at least on the land – is a human-created environment moulded for our convenience – as is only right and proper. After all, the model attitude humans have adopted to the environment since ancient times was that of the steward of the Garden of Eden. Note that: a garden – a designed environment, not a wilderness.”
It’s worth reading this article in full just to get a flavour of the extraordinary and truly terrifying perspective Mr Lilico has on the world and especially the natural world. And apparently he is an expert economist or econometrician, sufficient for the Woodland Trust to pay (presumably handsomely) for his services.
I searched high and low through “The Economic Benefits of Woodland” for things like “intrinsic value” or the “irreplaceability of ancient woodland”, but I could not find any mention of these. Instead, Mr Lilico entertained us with the notion of “biodiversity existence value” a sum made up using contingent valuation, itself a widely condemned approach to valuation. Biodiversity Existence Value or BEV is the value people place on a woodland for its biodiversity, just to know that that biodiversity exists, in the same way that we value a whale in the Antarctic Ocean, because it is there. Leaving aside whether it’s realistically possible to come up with a monetary value for such a thing, Mr Lilico calculated that BEV for a lowland ancient woodland was only worth just over three times as much as an upland conifer plantation; and only about 34% more than a newly planted lowland plantation.
Evidently Mr Lilico take a much harder line than Owen Paterson, who famously suggested that one could compensate for the loss of an ancient woodland by planting a hundred trees for every one cut down. Lilico reckons its only 1.3 trees planted for everyone cut down.
This is of course arrant nonsense and it’s extraordinary that the Woodland Trust would put its name against such econometric meretriciousness. One wonders whether Lilico was quietly chuckling at the thought that he had led an environmental organisation into such an elephant trap. Perhaps they had not noticed? Lilico works at Europe Economics (which is itself a neat piece of truthspeak as Lilico is an arch europhobe who works alongside another leading europhobe Matthew Sinclair, former Chief Exec of the Tax Payers Alliance).
Lilico looks at the monetary value of woodlands as a policy tool – and comes up with the main benefit being to “facilitate housing development”. Now given the Woodland Trust’s campaign to save ancient woodlands from threats such as err housing development, this is econometric gymnastics. Just as well he only valued ancient woodland biodiversity value a third higher than newly planted woodland. In terms of housing development Lilico also suggests that planting forest in a catchment could reduce flooding risk to such an extent that it could allow housing development on “marginal land” – yes he is talking about the floodplain.
The overall picture is that the main element of the £270Bn is in carbon storage at £16000 per hectare (in perpetuity), while the monetary value of a woodland seen in passing by a commuter is calculated as £9500 a hectare. Aggregate all these together and you get to that figure of £720Bn, in perpetuity.
It’s this aggregate value thing again, which I mentioned yesterday. The idea that you can simply add together all the different economic values, calculated using different methods, to come up with one big figure.
I was talking at a conference a couple of weeks ago, and asked the audience “what is the aggregate natural capital of the badger?” Well, it might seem like a silly question, but is it any sillier than “what is the natural capital of the UK’s woodlands?”
To a dairy farmer in Somerset, it cost £5000 per badger to kill them. Much of that cost fell to the taxpayer, anyway we have to put that figure on the “cost” side ie it’s a negative value.
But for Somerset Wildlife Trust members, who pay £36 a year to be members, presumably they place a positive value on those badgers, even if their new Vice Presidents don’t.
To the 10,000 or so Dairy Farmers in England and Wales, for which bovine TB costs around £100M a year (although much of the cost is borne by the taxpayer), I would imagine they would also place a negative value on badgers.
What about a badger in London, or somewhere else in the country where there is no bovine TB. Do these have a positive value? How much is a visit to your patio by a badger to eat peanut butter or whatever it is you’ve put out to entice them, worth? I’m sure Mr Lilico would be able to come up with a figure.
And when all those badgers and all their credits and debits have been calculated, they can all be summed, to provide the aggregate natural capital of badgers in the UK.
But what if the aggregate sum was negative? It seems likely that it would be. Surely this would be a cast iron economic case for eradicating the badger entirely from these Islands.
“But what if the aggregate sum was negative? It seems likely that it would be.”
Why then, in the time-honoured way, one would find another economist who reaches a conclusion more in accord with one’s own! 😉
“Nor is there much satisfaction in contemplating the world with nothing left to the spontaneous activity of nature; with every rood of land brought into cultivation, which is capable of growing food for human beings; every flowery waste or natural pasture ploughed up, all quadrupeds or birds which are not domesticated for man’s use exterminated as his rivals for food, every hedgerow or superfluous tree rooted out, and scarcely a place left where a wild shrub or flower could grow without being eradicated as a weed in the name of improved agriculture. If the earth must lose that great portion of its pleasantness which it owes to things that the unlimited increase of wealth and population would extirpate from it, for the mere purpose of enabling it to support a larger, but not a better or a happier population, I sincerely hope, for the sake of posterity, that they will be content to be stationary, long before necessity compels them to it.”
But I’m afraid my current knowledge of economics as an academic discipline is as out of date as one might expect of a 1970s Zoology graduate with more of an interest in art and history:
‘Principles of Political Economy with some of their Applications to Social Philosophy’ (1848 et seq), John Stuart Mill (1806 – 1873)
thanks Dave. And so let the battle of econometricians commence. Except of course, by its very nature, econometrics will be wedded to the monetary valuation of natural capital.
One thing for sure, the Woodland Trust or is that Truss won’t be seeing my membership again. I’m looking forward to the Derek Ratcliffe story for Christmas to console myself in a warm glow of times past when the natural world and the people at the helm cared, that is really cared simply because what we have is wonderful. Nature, wildlife,biodiversity whatever you want to call it is priceless. The cost of not recognising this is the destruction of vast forests, poisoning of the see and continued nibbling away of what’s left. I’m tempted to swear but that’s not allowed but when the NGO’s go down this route I realise why people join the neo-conservation pressure groups. Enough is enough…more gloves off Miles.
I’ve received these comments (via Linkedin) from Jonny Hughes, Chief Exec at the Scottish Wildlife Trust and organiser of the World Forum on Natural Capital. Jonny is a keen advocate of Natural Capital.
“The idea of Natural Capital is based on the assumption that there will be an underlying ethical framework within which people and companies will operate”.
I think what you mean here is we could do with an ethical framework for natural capital mechanisms? Such a framework is in development by IUCN members and will hopefully be consulted on and adopted globally. We are calling it the Natural Capital Charter: an ethical framework for the application of natural capital mechanisms.
My hope is the Charter will help dispel myths around this (very broad) subject and enable us to get on with making businesses part of the solution to the global environmental crisis they’ve co-create with us, the restless consumers ever anxious for a procession of novel goods.
Regarding the protesters. There were six – though personally I would have welcomed six hundred (the number of delegates inside the building). Here’s what I said to the BBC ‘there’s a place within the environmental movement for placards and banners on the streets but the movement also needs to be prepared to work constructively with government and business’. A spectrum of engagement is important.
One question too. Given human population will rise to at least 9 billion by mid century there WILL be massive conversion of land to agriculture and built infrastructure – that’s a given. Are you saying that there should be NO compensation for the damage to nature this causes? (After the application of the mitigation hierarchy?)
Here’s the link to the BBC article. http://www.bbc.co.uk/news/science-environment-34910901
Thanks for your comments Jonny.
I have to say it’s usually the National Farmers Union that invokes the “feed the world” argument so it’s a bit of shock to hear it from a conservation leader.
There are a multitude of problems associated with food production and consumption. But here are the headlines:
Globally 1/3 of food is lost or wasted.
2 billion or 27% of the worlds population in 2010 were overweight or obese, with that figure predicted to rise to 30% by 2025.
So with the population projected to rise by yes 30% by 2050, there is plenty of food to go around these 9.6 billion already; and there are two ways of achieving that – reduce loss after harvest, and reduce overeating. In fact, if both of these problems are successfully tackled, we could end up using 30% less land for food production with 30% more people.
In terms of infrastructure, the issues are on a different scale altogether. Around 65 million people live in the UK – what proportion of the UK is covered by housing and infrastructure? 7%. Yes its just 7%. 75% of the UK is agricultural land, 13% is forestry.
I am also keen to see society and business work together to help find solutions to our environmental problems. The difference is that I do not think that the natural capital approach being advocated at the moment is going to provide those solutions.
Your final point is about the mitigation hierarchy. Now I am fully in favour of the mitigation hierarchy. What I am not in favour of is it being replaced by a natural capital accounting procedure. And this is the real risk of the natural capital approach; we will see the notion of regulation which underpins the mitigation hierarchy, being replaced by accounting and trading. This has been made abundantly clear by the Government in their attempts (currently shelved) to introduce biodiversity offsetting. This is why former Secretary of State for the Environment explained that destroying an ancient woodland was fine as long as you plant a hundred new trees for every one that was lost.
I will be interested to see the Natural Capital Charter and will look forward to writing about it in future.
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What an extraordinary & troubling statement from Mr Lilico. If you’ll forgive me for being obscurely theological, he’s getting his Book of Genesis very wrong. The whole point about the Garden of Eden was that humans WEREN’T stewards but were just part of the fauna, until they arrogated god-like powers to themselves, thereby enraging God and bringing about their separation from the rest of the biota. I’m not especially religious myself, but I can’t help admiring how perceptive the writers of that story were all those years ago, and how little we seemed to have learned since.
Thanks Chris. I’m afraid this is typical of Lilico. What genuinely stuns me is how the Woodland Trust could have commissioned him and his neolibertarian mates without having looked at what they are up to.