What’s peculiar about the North East? That’s not peculiar as in unusual or odd, rather what is unique to the North East region?
It’s a question we’ve been asking ourselves as we’ve conducted our MEPs’ consultation on Brexit. As the leave negotiations get underway is there anything that we need to be alert to because no other region of England has this asset? Yes, Nissan is incredibly important to our region but other regions also have car plants, such as the Midlands with Jaguar Land Rover.
One area where we do seem to be ahead of the English pack we think, and hence we need to be sure it’s protected, appreciated and ideally incentivised in the exit negotiations, is natural capital.
Natural capital is an interesting concept that is making steady headway in being recognised as of huge value to society. Historically, especially in economic terms, we’ve talked of human capital - the workforce, of financial capital - the money, and industrial capital - the factories. All fine, but it’s an approach that forgets the environment, without which none of the others could exist.
Quantifying natural capital is an attempt to bring together all of the components of the wider environment, and putting economic value on them, with the intention of thereby enabling natural capital to ‘compete’ on a level playing field with human, financial and industrial capital – so it’s not forgotten about, not undervalued, but rather given its true status.
Such an approach has resulted in a value of £3.4billion being placed on the forest cover of Northern England. This is a value far in excess of the value of the timber, rather it seeks to place a financial value on such additional aspects as; the forests contribution to cleaning and filtering the air we breathe, the sequestration by the trees of CO2, hence making a significant contribution to tackling climate change, its provision of a home for the majority of England’s red squirrel population, the recreational benefit afforded by a place to walk and ride and relax, and so the list goes on.
So we are currently pondering the proposition that the North East is the English region with the highest ratio of natural capital. For instance we have 12% forest cover above the average of 8%, we have the best salmon and sea trout river, the biggest red squirrel population, a healthy bat population, peat bogs, 80% of the black grouse population, pine martins, dark skies, low air pollution, the cleanest water and a disproportionate amount of it! With a world warming due to climate change our water surplus will become an increasingly valuable asset both financially and environmentally.
At a national level there is strong cross party support for the goal of being the first generation to leave our natural environment in a better state then we found it. There is a 25 year plan over seen by the Natural Capital Committee chaired by Prof Dieter Helm, who is the guru of natural capital.
Helm is right to point out that the UK leaving the EU and its Common Agricultural Policy presents a major opportunity to take a massive step forward on improving our environment.
Helm’s view is that, “There is no good general case for subsidising farmers, especially for simply owning land.” Rather he advocates public money for public goods, hence, “Contractors, including farmers, could then bid for these contracts, and the income that goes with them. Where farmers are well placed to improve the natural environment, they will gain the specific contracts.”
Such an approach could really help the North East to maintain and build its reserves of natural capital with a specific emphasis on increased forest cover, including urban forests close to where the majority of the population live, better soils and improved water management, leading to increased biodiversity.
In turn this would put the North East in the driving seat as the English region leading on the development of a post Brexit British environment, food and agriculture policy. The ultimate prize being that we could be the first English region to leave for our children an environment that’s better than the one our parents left for us. Now that would be capital.