Yesterday I went to a meeting hosted by the Natural Capital Committee which was set up by government to help it understand better how the state of the natural environment affects the economy and wellbeing of us all.
Work has begun on producing a balance sheet for natural capital assets which will sit alongside the Treasury’s financial balance sheet of UK PLC. The government hopes to have natural capital accounts in place by 2020. This will help it recognise the value of not just the country’s financial assets but also its environmental assets, such as woods, farmland, soils, water, energy and so on. This in turn will help it make decisions based on true sustainability rather than solely on GDP and economic growth which largely ignores environmental costs.
It was also the day that two reports about HS2 were published. Part of the rationale for HS2 is that it will stimulate economic growth yet the National Audit Office report has queried whether the financial costs and benefits of HS2 were as sound as has been portrayed by its supporters. The other report by HS2 itself set out much more detail on the environmental impact. It looks superficial and incomplete; it also needs the NAO treatment on the green detail. In fact, neither the financial nor the environmental case make HS2 look like a world class exemplar sustainable project.
This set me thinking further about how decisions around HS2 might be different if this project was being discussed in 2020 with natural capital accounting in place. Its claims to be a green transport solution would have been exposed much earlier given it takes no account of the damage to and destruction of large amounts of natural capital, (currently 67 ancient woods along the entire length of the route from London to Leeds and Manchester).
Indeed taking both the economic and the environmental balance sheet into account, instead of being hailed as giving impetus to growth, it might even be seen as pushing us into environmental recession as our total balance sheet of financial and environmental capital becomes further depleted. And it might mean that the Woodland Trust would not have to spend its time fighting the principle of ancient woodland destruction and compensation.
Natural capital accounting has not yet been born but it could be a really powerful policy tool to help us make better more sustainable decisions on behalf of us all. Let’s hope it happens, and soon.