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The One Where Rachel tries to Score a Cheap Deregulatory Hit – but actually undermines business and investor confidence

This pursuit of cheap deregulation headlines is getting exhausting, writes The Wildlife Trusts' Chief Executive Craig Bennett...

Here we go again. They’ve used this plot line many times before, and it was boring and frustrating the first time around.  

I remember the one, from way back in 2005, when Gordon Brown decided to scrap the Operating and Financial Review (OFR) on social and environmental reporting just days before it was due to come into force, just for what he thought would be a quick clap at the CBI conference. Businesses had already spent millions of pounds getting ready for it, generally thought the OFR was a good idea, and were incredibly cross when the then Chancellor of the Exchequer decided to get rid of it. Talk about misjudging the room!  

And what about that one when David Cameron decided to “cut the green crap” and so got rid of the Zero Carbon Homes standard which would have made sure that all new homes produced zero carbon emissions by 2016. He did so at just the point that the vast majority of housebuilders were all geared up to implement it, with plenty of energy and insulation specialists losing their jobs as a result. His last minute anti-green spasm also added an estimated £2.6 billion to the energy bills of homeowners in new builds between 2025 and 2022 according to Carbon Brief. Yeah, thanks Dave!  

Chancellor Rachel Reeves stood at a podium giving a speech. A sign on the podium reads Let's get Britain's future back

Rachel Reeves giving a speech © Shuttershock/Martin Suker 

And now we have The One Where Rachel tries to Score a Cheap Deregulatory Hit but, yet again, pulls the rug from under investors in the green economy. I’m not talking about the character Rachel Green from the 1990s sit-com Friends, of course. No, the Rachel I mean is anything but green, given her disingenuous and diversionary attacks on bats and newts these last few months. 

I am, of course, talking about Chancellor, Rachel Reeves, and the latest instalment of how Downing Street can so easily become a place where politicians lose touch with the reality of what business needs to grow and invest, namely a bit of consistency and predictability. 

Sadly, that’s not what we’ve had this last year on Biodiversity Net Gain (BNG). As recently as last December and January, in a number of statements and “Working Papers” published in the run-up to the publication of the Planning and Infrastructure Bill, the Government insisted how it was “committed to Biodiversity Net Gain”.  

And yet by May, just four months later, it had announced a consultation proposing the scrapping of BNG for those small sites that make up over 70% of all housing development. One of the worst kept secrets in Whitehall is that this consultation was forced onto the Ministry of Housing, Communities and Local Government and the Department for Environment Food and Rural Affairs by the Chancellor. 

Yet again, it threatens to undermine the vast efforts that industry is putting into getting policies off the ground for politicians to later weaken or scrap schemes. This pursuit of cheap deregulation headlines is getting exhausting.  

An open letter to the Prime Minister was published recently - from industry leaders and environmental charities - urging the UK Government to get BNG back on track across England. Reported in Business Green and elsewhere, its signatories included the likes of Knight Frank, Schroders Wealth Management and Triodos Bank who, alongside The Wildlife Trusts, are concerned by the Government’s recent proposals to weaken requirements for minor and medium-sized developments to deliver 10% net gain for biodiversity.   

As the signatories wrote, “Our collective voice sends a clear message: weakening BNG would come at a high cost, setting back this fast-developing economy and more widely threatening business confidence in nature policy.”  The Office for Environmental Protection has also recently entered the fray, stressing that any step backwards on BNG would carry “significant risk” for the environment whilst also shaking investor confidence and stalling mobilisation of private sector green finance.   

We can’t afford to stall on this when all the evidence shows that investing in and avoiding harm to nature does more than just boost its recovery; when restored and protected, thriving ecosystems and wildlife provide multiple other co-benefits, including solutions to growing climate challenges such as flooding and drought, improved health and wellbeing, and financial savings throughout supply chains.   

Common Bird's-foot-trefoil

Bird's-foot-trefoil ©Philip Precey

Take Flack Field in Cambridgeshire where nearby major development has funded the creation of native wildflower grasslands for the benefit of insects and bird life and has boosted habitat connectivity in the area. Elsewhere, Duxford Old River floodplain in Oxfordshire is being restored with funding from BNG to reinstate natural processes which boost wildlife as well as increase resilience to flood events.  

These flourishing habitat ‘banks’, and many others like them, are the result of actively funding nature’s recovery.  Since it was introduced 18 months ago, over a hundred sites are now working to create habitats and greenspaces alongside new homes and infrastructure across England, and the BNG sites register is ever-growing alongside new jobs and increased investment in rural and coastal areas. In fact, research shared recently highlighted that tighter exemption restrictions and an improved BNG market would stimulate additional investment in nature compensation and recovery of up to £180 million, with £112 million in economic output and over 1,000 new jobs created.  

If developments up to and including 1 hectare are exempt from the BNG requirement, an area equivalent to the size of nearly 35,000 football pitches of extra developed land will not be required to deliver any mitigation for damage done to wildlife and habitats.   

This would also represent a loss of funding for nature’s recovery equivalent to around £250m per year – a figure which cannot be ignored in light of the Government's target to mobilise at least £500 million in private finance for nature recovery annually by 2027. A failure to capitalise on this size of economic potential through BNG would destabilise the solid foundations on which the market is growing. Without it, politicians will only have themselves to blame if private investors think twice about investing in the green economy under this Labour government.  

This article was originally published by Business Green.

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