HomeGreening the economyGreenness and prosperity go hand in hand

Greenness and prosperity go hand in hand

English village_Fotolia_127880522_M.jpgThis post is by Dieter Helm CBE, professor at the University of Oxford and fellow of New College, Oxford. He is the independent chair of the Natural Capital Committee.

The decline of Britain’s countryside and wildlife has been meticulously documented by some of the best naturalists in the world. The insects have largely gone, farmland birds have been decimated, and our rivers, uplands and urban green spaces are all in less than a happy state. We can’t turn back the clock, but we can and should do a lot to halt further declines and start to enhance our natural capital.

Most of this damage is well known, and so increasingly are the adverse economic consequences. The environmental damage has adversely affected our health and well-being, physically and mentally. We pay water bills to water companies to clean up the pollution that spills into our rivers. We pay farmers to own land. We pay to deal with the problems of air pollution. The lack of green spaces for children to play inside cities means we pay for the costs to their lungs and their development. We pay to clean up the waste and lots and lots of volunteers try to fight back against the tide of plastic on our beaches. Most of this is simply a waste of money: it causes serious economic damage.

We all have ideas about what a green and pleasant land would look like. The key point is that this can also be a green and prosperous land. It makes good economic sense to stop the degradation of our countryside, and to start enhancing it for the next generation.

The right agriculture policy is good for farmers and the environment
Where to start?  The obvious place is agriculture, not least because it covers 70 per cent of our land. Get agricultural policy right, and we will be on the way to leaving the environment in a better state for the next generation.

Almost all that could be wrong with the CAP is in fact so. Agriculture is, proportionately, the most subsidised industry in Britain. It only has a total output worth around £9 billion, 0.7 per cent of GDP. To get this £9 billion, we put in £3 billion of direct subsidies, exempt farmers from paying for most of their pollution and give exemptions from business rates and inheritance tax and offer half price ‘red’ diesel (whilst regulating and taxing carbon for much of the rest of the economy). We spend so much and get so little public goods in return

The sad fact is that this has not even been good for farmers. The industry, even with all this support, is not very profitable, and most of that profit comes from the subsidies. The average age of a farmer is 60. The perverse subsidies are capitalised in inflated land prices, and made it all but impossible for young farmers to get a first rung on the ladder.

Economic opportunities throughout the environment
It is of course not all about agriculture. In my forthcoming book, I give lots of further examples of the economic opportunities that abound in the river catchments, in the uplands, the urban areas, and the marine and coastal fringes.

River catchments are currently managed in a fragmented way, wasting money in the process. River quality is not getting better, even if the narrower water quality might be going up. We need to take on the catchments as a whole, on an integrated systems basis.

The uplands remain precious bits of our remaining natural capital, and the scope for improvement is massive. Our national parks could be developed to enhance biodiversity, access, and all the economic benefits that could be obtained from exposure to their green spaces. They could be prosperous green national parks.

Our cities are obvious places to look for natural capital enhancements. Trees are good ways to handle air pollution, and greenness has its obvious mental and physical health benefits. Greening cities has the added advantage of touching the lives of many people. Most of us live in them. We can have greener urban spaces, better parks, tree-lined streets and children should have a right to be within a short distance of a green space to play, and we should all be able to enjoy genuinely green Green Belts.

Marine protected areas are good for biodiversity, and good for fisheries too because they help sustain fish populations. The coastal path around England offers big recreational opportunities, and it could be further enhanced with a green belt alongside most of it, matching a marine blue belt.

Higher returns than physical infrastructure
Some of the best economic projects on offer are in greening the countryside: urban, rural and marine. Lots have higher returns than some of the much promoted physical infrastructures, and are key to addressing climate change too.

But they do need to be based on sound economic principles. Public money should not be used for private benefits. Polluters should not be subsidised to pollute. Polluters should pay. Developers should not be allowed to damage the natural environment without paying proper compensation. There should be net environmental gain. This is just good 101 economics.

My book sets out the prize on offer, to us and the next generation, and many practical examples of how to do it. It explains how these great investment opportunities can be paid for and brought together into an overarching framework.

A green and prosperous land: a blueprint for rescuing the British countryside by Dieter Helm will be published by HarperCollins on 7 March.

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Green Alliance is a charity and independent think tank focused on ambitious leadership and increased political support for environmental solutions in the UK. This blog provides space for commentary and analysis around environmental politics and policy issues as they affect the UK. The views of external contributors do not necessarily represent those of Green Alliance.