What does the government’s 'A Green Future: Our 25 Year Plan to Improve the Environment' mean for business?
It would be a mistake to dismiss the government’s 25 Year Environment Plan as empty words. It is true that the plan lacks detail and contains few new policy initiatives, but that is somewhat missing the point. It is intended to be read as a statement of intent, setting the direction of travel for future government policy.
To deliver on its ambitions, it will need strong action to follow the strong words, but words are important, and the government will be held to account against the promises it has made. Importantly for business, the plan lays down a blueprint for policies and legislative interventions that will follow. This allows businesses to consider how best to adapt and to make the most of opportunities.
At the heart of the plan is the government's promise not just to arrest the decline of England’s natural resources but to enhance them: to be the first generation to leave the environment in a better state than we found it. The plan makes it clear the government wants to hold the gold standard in environmental protection and enhancement on the world stage, maintaining and, where necessary, increasing EU environmental safeguards after exit from the EU. In making these commitments, the government seeks to answer those who were concerned that Brexit would mean sacrificing environmental protection for short-term economic gain.
Implementation of the plan is of course of central importance to its success and the plan proposes three important developments:
- The setting of metrics to measure performance.
- Annual reporting against those metrics.
- A new statutory body independent of government to hold the government to account.
The government has promised further consultation on these important governance structures throughout 2018 and this will be watched with interest.
So what exactly is in the plan? Plastics pollution has dominated the popular media coverage, but that is only one aspect of the plan. In this briefing we highlight those aspects of the plan that are most relevant to business.
The role of natural capital accounting
- The concept of natural capital permeates the plan. The World Forum on Natural Capital defines natural capital as the world’s stock of natural assets which include geology, soil, air, water and all living things.
- A natural capital approach attempts to put a figure on the intrinsic value of natural capital so that its value can be accounted for in economic decision making. The plan accepts that wrong decisions have been made in the past because natural capital has been undervalued.
- We anticipate that natural capital accounting will play a significant role in the metrics that the plan has proposed to measure performance, and will therefore become one of the main tools to hold the government to account. If so, it is inevitable that these metrics will filter down into the private sector as this government (and successive governments) ensure progress against the metrics.
- Natural capital is not a new concept, and Burges Salmon’s environmental specialists have been looking at natural capital in, for example, pollution response and remediation. While questions remain as to how best to value natural capital in financial terms, tools already exist for natural capital accounting, and the UK can learn from other countries, such as the Scandinavian countries.
- Looking forward, the government is keen to encourage businesses to reflect a natural capital approach in their reporting, standards and accounting. Many leading businesses are already doing so on a voluntary basis.
Environmental net gain in development
- There are suggestions that planning authorities will need to pay greater heed to the concept of “environmental net gain” when authorising developments. Emphasis is placed on enabling planning decisions to be tailored in accordance with local specificities. This is, in effect, a commitment to consult further on a principle that is, to some extent, already applied. Developers will want to monitor the development of these principles closely.
An overhaul of the support mechanisms for agriculture and land use management
- The Rt. Hon. Michael Gove MP, the Secretary of State for the Environment, Food and Rural Affairs, has already set out his vision for a reform of agricultural support, most recently at his address to the Oxford Farming Conference on 4 January 2018, and the plan reiterates the core theme of replacing the EU CAP with “public money for public goods”, addressing environmental enhancement through natural capital metrics.
- Details have been promised in a command paper due in Spring 2018.
- The government will “put in place a robust framework” to limit inputs of nitrogen-rich fertilisers. Further details are lacking and voluntary measures appear to be more likely in the short to medium term.
- There is a commitment to continuing to restrict the use of neonicotinoid pesticides after leaving the EU.
Resource use and minimising waste
- Achieving zero avoidable plastic waste by end of 2042 is a key stated aim of the plan. The government is hinting at reform of the Producer Responsibility systems (including the Packaging Waste Regulations 2007) by “exploring” an extension of the producer responsibility to plastic products not currently covered. Businesses placing such plastic products on the market could therefore find they are caught by the scheme for the first time.
- The plan addresses the issue of management of residual waste but does not suggest concrete measures heralding an immediate or significant impact on Energy from Waste facilities or other concerned businesses.
- A new plan is being developed as part of the government’s resources and waste strategy with a focus on tackling waste crime and the waste sector should watch this with interest.
A strategy for sustainable chemistry
- The government will publish a chemicals strategy in which it will set out its approach to the regulation of chemicals of national concern after the UK has left the EU. The plan does not provide any further details at this stage but does suggests the strategy will be built on “existing approaches”, which is consistent with the government’s position to date. Given the common market approach to chemicals regulation under the current EU REACH regime, prompt attention to this strategy is much needed to enable the chemicals sector to plan business operations after the UK’s exit from the EU.
- Legislation is being brought forward to cut industrial emissions from medium combustion plants and generators, including by setting limits on the levels of air pollutants that they can emit. Businesses that use diesel generators or rely on them for back-up generation should monitor developments closely.
- The government is re-iterating its intention to end the sale of new conventional petrol and diesel cars and vans by 2040. This repeats what was already announced in the Clean Growth Strategy.
- There is little detail on how the current EU-wide approach to integrated pollution control – and in particular the common standards for best available techniques set through the Seville process – will be replicated after the UK leaves the EU, but it appears that the plan envisages a continuation of the current regime of continual improvements through technological advances.
The plan is intended to leave the environment in a "better state than we found it” and taken with the government’s Industrial Strategy and its Clean Growth Strategy, the three together seek to portray a consistent approach across government policy towards clean and green growth.
The plan does not have all the answers: far from it. It does however set out a blueprint for change and promises a flurry of further strategies and policies to deliver the plan, along with a new system of governance and a suite of metrics to measure and report on performance. 2018 looks set to be a very interesting year for environmental law and policy and the business community should be watching closely.