'Natural accounts' get green light

7 Jun 11
David Walker

The environment white paper is chock-full of good ideas including plans for ‘green reporting’ that could start to shake up conventional ideas of audit and accounting

Environment Secretary Caroline Spelman seems to have concluded that, to make a success of the brief, it pays to be green. Her new environment white paper contains attractive proposals for nature improvement areas, biodiversity offset and protection of habitats.

She has even gone as far as resurrecting the Tory old stager John Gummer, now Lord Deben, to head a high-level panel that, were it to follow the letter of the white paper, would create a set of national environmental accounts to challenge and subvert conventional measures of GDP and national income.

The white paper even has a red edge: it gives favourable mention to the work of inequalities researcher Sir Michael Marmot and the need to get children from poorer households into parks and the outdoors. Rescinding cuts in Sure Start children’s centres would be a good place to start.

After her unfortunate encounter with the trees of Olde England, provoking backbench Tory MPs to fury, Ms Spelman kept a low profile. The government’s plan to privatise Forestry Commission holdings has not been abandoned, but it has been parked in the foliage.

Instead, the Department of Environment, Food and Rural Affairs has quietly been building on work it did under Labour to sketch out a set of proposals to protect England’s natural assets, stop or slow their degradation and – not a contradiction – put them to use for the benefit and health of townies.

A cynic will comb the white paper and keep finding interesting proposals that will only work under two conditions. One is public money, which is problematical as long as George Osborne’s Plan A holds.

The other is as tricky. Despite mentions of volunteering and the Big Society, it’s obvious Defra’s plans require more not less government – to designate more sites of special scientific interest, to insist on access, to compile the new ‘natural accounts’ and apply them to public policy. And, as we know, the Cameron government is not ideologically predisposed to give government a bigger role.

Still, let’s accentuate the positive. This white paper is chock-full of good ideas and, unacknowledged, shows welcome continuity of approach with Labour.

The most remarkable proposition is for John Gummer to head a ‘Natural Capital Committee’ reporting to the Cabinet’s Economic Affairs Committee. Given the government’s uncertainty last year over the fate of the Climate Change Committee, it’s reasonable to doubt how much clout this new panel will have, but the opportunity is there.

It could insist that depreciation is built into investment decisions, including depreciation of natural resources. Accounting for sustainability has made progress in recent years and carbon balance sheets are waiting to be drawn up. But wouldn’t that be ‘regulation’; how might it fit the political necessity of seeing growth return to the UK economy?

Still, the difficulties of reconciling growth, business friendliness and the environment should not detract from one thing this white paper ought to accomplish without much pain – the provision of richer and deeper environmental information – and the chance it affords to shake up and start to replace conventional ideas of accounting and audit.

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