Biodiversity Net Gain: What are the implications for you?

Speaker

Dialogue

Alan Kirby

Thanks Aidan. We’ve got a couple of questions in already. One on exemption. I think from Jeff Taylor that we would like to leave till the end because I think James will pick up on some of those issues. But one from Stuart at Northumbrian Water that I’ll ask you now, if that’s alright, and it reads: Will the Biodiversity reporting requirement also apply to other public bodies like the water industry? As they are a public body identified in the NERC Act.

Aidan Thomson

And do you know, I think and this is a point that I think James will cover later on. I think, not to steal too much of James’ thunder, is that a lot of this Legislation is still to be padded out by regulations yet to be made by the Secretary of State. So there’s an awful lot of stuff still to come. And I think things like that aren’t necess-, aren’t clear yet. It will just have to wait for things to or for the Secretary of State to start making the regulations in accordance with the Bill or the Act when it becomes an act. And those sort of details will be fleshed out.

Alan Kirby

Alright. Thanks Aidan.

Aidan Thomson

OK.

Alan Kirby

OK. So, onto my slides, so very quickly, I will just be going through how net gain is calculated and applied. The benefits as I see them are of a mandatory system and then the opportunities that this new system provides the developers. I really think that you shouldn’t just see this is a, an additional burden on development but more of the opportunities it can provide as well. So, how does the net gain metric work? At the moment we’ve got beta test version that is published by Natural England. It’s free for anybody to download. There is going to be a final version that is due to be published before Christmas this year. There will be some changes, but in general what I’m talking about will remain the same. So, it’s a standard metric which is being thought  of   as   being   used   across   all   projects,   across all     local authorities   to  make   sure   that   the   playing   field  is   levelled   for everybody and it’s there to calculate both the losses of Biodiversity of any proposed developments but also the gain both on and offsite. As Aiden was talking about earlier, it’s based on certain measures, so each habitat has a distinctiveness and that is how rare or complex a habitat is. Its condition, which usually refers to how well managed it might be. Its strategic location, you know, is it close to other areas that support good Biodiversity as well as its connectivity around the local landscape, i.e., how useful is it to species that might move around the landscape. All of those things as well as the size or the lengths of certain habitats is used to calculate their values so that the losses of any development can be calculated. But when it comes to understanding the gains and how those are calculated, they use the same measures of distinctiveness and condition etc. But they also take into account a range of risk factors also known as multipliers here that effectively discount the value of the gain that you’re creating based on things like how far away it is from the development site, how difficult a habitat is to create. So, it relatively straight forward to create a semi improved grassland, for example. But it’s much more difficult to create an active raised bog and therefore the metric factors in how that level of difficulty to make sure that if things don’t go as according to plan, that there is still a contribution to Biodiversity being made. Also things like time to reach target condition is, plays quite big in the metric. So it’s relatively quick to create a grassland but it takes quite a long time to get to a material woodland; and these multipliers really do encourage the Biodiversity metric to be used within the design process to make sure that those habitats that are either difficult or time consuming to create or a very high value of the start are avoided through design. One of things that’s really key here is that the Biodiversity Metric 2.0 is underpinned by the U.K. Habitat classification; but this is a new way of or a newish way of classifying habitats across the U.K. that’s being developed and it is effectively a replacement for the phase one habitat surveys that people are very familiar with. This is also allied with Natural England’s own method for accessing habitat condition. But what it does mean is that when specifying scopes for development projects, it’s key to understand that if this net gain approach is being used that the right data is collected. Phase one habitat survey, without any condition data at all will mean that further work will be required.

So, as well as being a, you know, numerical tool, an accounting tool, there is a series of principles and rules that sit behind the use of this metric. And this is to make sure that it isn’t simply used to calculate you know effectively profits and loss and move on. So the Biodiversity Net Gain metric and its delivery has to sit within the existing legal and policy framework. So, in terms of the legal framework, that’s around things like protected species, European protected species licensing, the preservation of [inaudible] but also things around irreplaceable habits. So particularly here, around things like ancient woodland and veteran trees. The metric also sits within the mitigation hierarchy and that is the first avoid then mitigate and then compensate. And that was obviously quite a common thing that’s being expressed in planning policies for many a year. But the use of the metric really drives forward the need to demonstrate that. So first of all you’d note as a design goes forward, you need to make sure that it is clear that things are being avoided where possible and that the right mitigation is put in place; and this isn’t to ensure that there is no what some people have termed a licence to trash, where somebody could turn up on a particular site, work out its value from a Biodiversity point of view and how much that would cost financially to offset somewhere else and then simply bull doze the site flat. The idea here is to make sure that wherever possible, things are being maintained onsite and the design is sympathetic to Biodiversity. The other thing that it does is make sure that it encourages the avoidance of loss onsite rather than trying to push everything, you know, to places more remote.

The other principle around the Biodiversity Net Gain system is to make sure that if you’re losing distinctive habitat, so, this might be a nice woodland for example or some calcareous grassland, that it’s not replaced with just any other habitat that might be easier or quicker to create. So those distinctive habitats need to be replaced broadly on a like-for-like basis. So if you are going to be you know essentially losing woodland then Natural England will be expecting a woodland that is of equal value or better to be replaced either on the site or somewhere else.

So I guess, you know, the crux here for me is, is this net gain system a welcome change? It is true to say that for many development, this will be an addition in terms of cost. Although some of those costs would already be being realised through things such as the provision of mitigation for Biodiversity, but to me, I think there is a real win-win here. So, from a point of view of the environment, you’ve got a reversal of the current losses to Biodiversity in England. So Biodiversity is being, you know, going down, with a downward trend for many years, and this system, in my mind, does provide the opportunity to halt, and then start reversing those losses. It may take a few years, but, you know, I, I, think it, it looks good for that. It is also looking to focus the money that’s spent by developers, you know which is, you know, even at this point, a lot of money each year, but to make sure that it is spent to provide Biodiversity that’s, ropu-, robust is spatially coherent, so that any offsite Biodiversity unit creation is being provided in areas where it has the most value.

From a developer’s point of view, it, it, looks to streamline the planning process with regards to biodiversity, so that you don’t, you reduce the risk of unexpected delays in costs that might come up from the, you know, the last-minute discussions with various stakeholders wanting this mitigation or that type of compensation. This provides a framework where everybody knows what the position is, and everybody is, is more or less signed up to see that this is a, a positive way forward. It’s also quite a transparent system, so each developer will have to use the same metric, and it’s therefore creating a level playing field for that policy delivery and ensuring that everybody is able to view, review, and raise questions about the approach, should they see fit; and I think in general, you know, there’s a look here that, that developments will become greener, and therefore more desirable with the potential that they’re then more valuable. There is detractors on, of the systems on both sides so you’ve got those who would suggest that the creation of a financial market around Biodiversity will provide a licence to trash, i.e., that you can just spend money to destroy Biodiversity and then move on and then there’s also those who look to think that there is the potential that it will be an expense that threatens the viability of some projects; but to me the system really does provide good opportunity. New opportunities come in various guises and I’ll just take you through a few of those now. The first being stakeholder engagement. As Aiden was alluding to earlier, the Environment Bill is still some way from royal assent. It was hopeful for being placed by the end of this year but I think their some way off; and when that bill comes in, there is also a transition period before the net gain becomes mandatory of two years but that doesn’t mean that the stakeholders who are seeing government strategy as being policy are not already interested in net gain and making sure that they represent that desire as they respond to planning application. So from the stakeholder perspective, they are very much already requesting the use of this metric across large and small projects and you can see this in scoping responses and in other consultation responses that are received by project. It’s also championed by natural England themselves obviously as they have developed it and also is mentioned quite a lot by individual LPAs. The other thing about this pressure from stakeholders to adopt it, is that the Biodiversity metric and the way it works is likely to change the way that they view mitigation and compensation. This is because up until now mitigation and compensation is a, tends to be a fine line on many projects outside the arena of things like habitat regulation and because of that there’s a lot of professional judgment involved. An example of that would be a pipeline going across an arable field. Previously I think most would of judged that, that the restoration of that arable field would simply be mitigation. Whereas the Biodiversity metric says that although it is a low value habitat because there is a time penalty involved, it is not simply total mitigation to do a restoration. Because of this, stakeholders will start to view the mitigation compensation offered through the lens of the metric regardless of whether it’s used or not and therefore will be asking for more.

Those are the pressures but there is also opportunities here. You know, it’s a transparent system that can be employed early. You can use it within the design process and it helps to reduce any potential conflict and also manages the expectations of those stakeholders. So, everybody is aware of, you know, effectively, where the line is being drawn. It reduces the likelihood of third-parties using the metric to undermine mitigation. So, this comes back to how, what I said a minute ago, how people view mitigation and compensation going forward. The metric is available to anybody to use and therefore, you know, if there is data published within the S chapter as a form of representation, somebody could use that metric to suggest whether the developer was providing adequate mitigation or not. It’s also positive in the sense that it’s going to show the positive relationship building because developers are committing to Biodiversity early in the process and it’s reducing the overall consent risk for general Biodiversity issues. You know, from an examining authority or planning inspector’s point of view, by demonstrating a net gain with the regulator’s own metric is a very positive way to make sure the policy is being shown to be delivered.

When talking of policy here, this slide is just looking at the policy opportunities, policy compliance and what we have is a quote from the National Planning Policy Framework which already is embedding the idea of net gain for Biodiversity as an aim. It’s expected that the NPPF will be reworded following the Environment Bill to be stronger than this but at the moment there is obviously still a policy push; and even though development consent on a project will be exempt from provision of a mandatory net gain, you can see in the way that these policy documents are evolving over time that there is more and more emphasis on the use of Biodiversity metrics in the provision of net gain. So, good examples of this are in the Airports National Policy Statement which has recently been reinstated. That talks about the use of Biodiversity metrics, the draft water resources NPS talks about provision of net gain using metrics, and in the consultation document around the siting criteria and process for the new National Policy Statement that will be coming forward for nuclear power. It’s very clear that net gain needs to be provided and is going to be provided through a metric at the project level. So, therefore, an early adoption here regardless of whether the system is mandatory or not provides an opportunity to demonstrate policy compliance very strongly.

As I’ve probably mentioned a couple of times already, I think one of the real keys to making the most of the use of this metric is to embed it in the design process. It’s a tool that, you know, is often talked about at the end of projects for accounting purposes. You know, what are the gains, what are the losses? But if you use it to help guide the design it can be very useful in understanding the, you know, the best options from a Biodiversity and a cost perspective with regard to both components of individual masterplans but masterplan variants as well. So, you can compare how they do in terms of Biodiversity unit loss and gain and it helps to then embed the whole process within the design to avoid abortive early design work. So, typically, most projects will come forward with a design – a good example might be flood storage which would often start life as a grass depression of varying sizes depending on the size of the project and those are being engineered with all the pumps and other things, an outlet on an idea of sort of value, you know, a value driven functional requirement and it is only later that the ecologists get involved and seek to change the design. Whereas, if this is embedded in at the start, we can work hand-in-hand with the various engineering disciplines to ensure that we’re providing functional infrastructure which is also providing Biodiversity Net Gain and therefore reducing that amount of cost for individual elements to meet that net gain target.

Although the metric provides things in terms of Biodiversity unit, it’s quite easy to understand the different cost differentials here as you look at the difference in the saving of a particular engineering option versus the additional cost that that might incur from Biodiversity Net Gain and it gives therefore the project accountant a better understanding of where the pros and cons are. So, this is really encouraging multifunctional design to make sure that every acre of land that’s in a particular development footprint really does deliver for the function that it might need to do be that recreation, be it flood storage, built heritage but it’s also delivering as much as it can from a Biodiversity point of view because every piece of grass, you know, regardless of whether it’s a lawn or it’s a meadow type does provide some value back into the metric. And it also, you know, this whole process then makes it much clearer and enables that narrative around the mitigation hierarchy I was talking about earlier to be followed all the way through from project inception to application stage.

So, there’s also other opportunities, especially for those that have large land holdings and this might be, you know, utilities as well as larger land owners from farmers, etc. Because there is the land available to create Biodiversity unit, those could be used, for example, by utilities to create an internal market so for their own capital delivery project. They would have units on board and generally in good locations to be able to deliver their capital projects more easily without having to go to outside providers as Biodiversity units and be subject to the vagaries of the market; and you can look to tailor the type of strategies that could be put in place to ensure that the future develop needs are met. So, if you could start creating the right habitats for example if you have a forward look at the type of capital projects that will be coming up over the next period.   It also provides an ability to monetize some of the non-operational assets by selling Biodiversity units on the open market and then that money could be used to fund the direct land management that’s currently being incurred as a central overhead. As well as that, there is opportunities to deliver some of these probably to a lesser degree but alongside existing tenants, you know, various farm tenants on the land and doing certain activities can be beneficial to both parties.

So in summary just before handing over to James, from my point of view, the Biodiversity Net Gain system is really positive. It’s positive if it’s adopted as early as possible and integrated into the rest of the design process; and it does provide a really good opportunity for those with large non-operational estates.   So I think that’s everything from me and I shall just pass over to James. 

Oh, I’d say yes. Sorry, James. Thanks for that. I have a poll question so that we can all just interact since we’re all here.  So I’ll read the question and then I’ll give you a little time to answer. So the question is, do you think generally – the question just disappeared off my screen.   Do you think generally that the opportunities provided by a mandatory Biodiversity Net Gain system are outweighed by the potential cost of delivery? And the options are A: Yes, the majority of projects will have viability challenge; B: it will be dependent on the type of project; or C: No, the benefits outweigh any additional cost.

If you’d all like to fill that in, press submit, that would be great. Thank you... So, we have a quite sort of a binary 50/50 here. So, we have 44% saying it depends on the project and I think, you know, certainly some very large projects or some very small projects might struggle but then we’ve got another 55% here with noting that the benefits of the system outweigh any additional cost and I think that that’s a real positive and that’s quite a big percentage certainly before a scheme is actually adopted and used in anger if you like on the ground. So, thank you very much. I’ll pass over to James.

Speaker

Dialogue

without having to go to outside providers as Biodiversity units and be subject to the vagaries of the market; and you can look to tailor the type of strategies that could be put in place to ensure that the future develop needs are met. So, if you could start creating the right habitats for example if you have a forward look at the type of capital projects that will be coming up over the next period.   It also provides  an ability to monetize some of the non-operational assets by selling Biodiversity units on the open market and then that money could be used to fund the direct land management that’s currently being incurred as a central overhead. As well as that, there is opportunities to deliver some of these probably to a lesser degree but alongside existing tenants, you know, various farm tenants on the land and doing certain activities can be beneficial to both parties. 

So in summary just before handing over to James, from my point of view, the Biodiversity Net Gain system is really positive. It’s positive if it’s adopted as early as possible and integrated into the rest of the design process; and it does provide a really good opportunity for those with large non-operational estates. So I think that’s everything from me and I shall just pass over to James.

If you’d all like to fill that in, press submit, that would be great.

Thank you... So, we have a quite sort of a binary 50/50 here. So, we have 44% saying it depends on the project and I think, you know, certainly some very large projects or some very small projects might struggle but then we’ve got another 55% here with noting that the benefits of the system outweigh any additional cost and I think that that’s a real positive and that’s quite a big percentage certainly before a scheme is actually adopted and used in anger if you like on the ground. So, thank you very much. I’ll pass over to James.

James Good

Thank you, Alan. Good morning, everybody. Before we just go on to my section, there are a few questions which have come in. There’s one observation. This sounds very much like an act turned up by civil servants who live in Pimlico. It will be fee breeding ground for lawyers and planning consultants, discuss. Well, I’m not prepared to talk about lawyers in that context but perhaps planning consultants we will do. Anyway, I think that is quite an interesting observation.

It’s something I’m going to come back to as well. There is one direct question here which I think we can probably deal with now, Alan. I think it’s for you. Some local authorities have supplementary planning guidance that targets specific Biodiversity environments and exclude others, i.e.,  woodland. Will the application and the Biodiversity Net Gain metric supersede the SPG and include all Biodiversity restoration proposals? I don’t know if you want to just provide some observations on that, Alan.

Speaker

Dialogue

Alan Kirby

Sure.  I mean in the way that the principles around the metric are structured, if you’re losing habitat of as I was saying particularly of distinctiveness or type, you’ll be looking to re-provide that habitat in the same or a better form.  So, you know, if you’re losing a relatively sketchy woodland then you would be expected to put back a woodland that’s a better quality and the same is true of grass and moor heathland. It’s only those sort of habitats that are deemed to  have low Biodiversity value such as, you know, arable fields for example where the rule is simply replace it with a better type of habitat whatever that might be. So in the way the system works, it will push people to imply, not imply, but replicating the general nature of the site that they are developing. When the metric becomes used more widely, it will start to, you know, bring about a coalescence and be like what LPAs are doing because many at the moment use their own metrics or have their own local policy on net gain and there will be a movement toward, you know, the use and the application here. The one thing that will be done and I think James will come onto this is that there is local nature recovery strategies that will be created by each responsible body probably at the scale of the local planning authority and they will identify the best areas for the investment in Biodiversity but they should be wide enough to allow a whole range of habitats to be created.

James Good

Okay, thanks, Alan. There’s another one here. Here we go.This is

from Toby [inaudible]. Are we missing a trick? Instead of the credit system costing more so as to encourage onsite or at least develop a [inaudible] Biodiversity Net Gain, shouldn’t development be seen as a way to facilitate the implementation of the myriad of national and regional Biodiversity enhancements?

Alan Kirby

Thanks, Toby.  Yes, in the way that these local nature recovery strategies will be put forward, I think they are going to be developed very much on that sort of positive idea that they are going to help contribute quite majorly to various targets both around the habitats they’ll create but also the type of species that those habitats might attract and because it’s going to be that sort of strategic overview I think it very much lends itself to that narrative and view that this is positive overall for the environment as opposed to being simply a tax on each development that, you know, may be spent unwisely and not cared for over the years. Whereas, this way very much provides that coordinated approach that is going to give a greater good for the environment and therefore us as the people that live within it.

James Good

Okay, there are some other questions there but I think what we’ll do is I’ll go on to my section of the webinar and then we’ll pick up those questions and any others which come in at the end. It’s worth saying that if we don’t get to all the questions, we will provide written answers to those that we can’t get to in the time available and those will be circulated to everybody. Okay.  o, I’m going to talk about  some of the emerging issues and implications that come from the

Environment Bill and the proposals it sets out. It’s worth saying that there were a number of cross-cutting issues here and there are a number of common themes and they vary in their complexity and quite frankly they vary in their level of our understanding of them at the moment.   I’ll come back to why that is in a minute. What I’ve tried to do is to pull together some what I think are the more interesting or key aspects of this. I think it’s worth saying from the outset that the Environment Bill or the Environment Act as it will become is just the starting point and what follows is key and common to a lot of government legislation nowadays, the bill really sets up a framework within which a very detailed system is going to operate and the rules for that detailed system are going to be set in regulations. Obviously, the bill hasn’t become an act yet either so there is still scope for that overall framework to be adjusted but probably not significantly amended given the stage which the bill has reached. As Alan said, it is expected that it will be coming to force sometime next year. The last thing I heard from [inaudible] was they were saying Q1 next year but it might be, that might be a little bit optimistic. It will probably be later and then there are certain bits of the bill which become into effect immediately it receives royal assent but very large chunks of it are then due to come in probably two years after the royal assent is achieved.

The regulations when they come are going to have to be quite complex and they’re going to be probably several sets of them and how they relate to each other is going to be quite key. I hope the government will put all the regulations out at the same time so it’s easier. Well, there will be a lot to read and lots to digest but at least then you can see where the links are between the regulations and how it all fits together as an overall sort of considered piece of legislation. The regulations will have to be subject to consultation though and that is the opportunity for everybody to get involved and try and define a system which is a good as it possibly can be and I think it will be important to monitor those draft regulations that come out and the developers and [inaudible] companies and the regulators and Natural England and environment agency and all those sorts of organisations, you know, do need to consider them and they do need to respond; and I think there is inevitably going to be a pressure coming that some people will want a system sort of watered down and the regulations possibly provide the opportunity for that sort of thing to happen. There is a lot of discretion within the Environment Bill for example around what the Secretary of State could exempt from this system. I noticed that one of the questions which has come in so far was about at what scale is this going to apply further to that automatic planning condition? Will it apply to domestic [inaudible] as well? There is the ability within the bill to exclude certain types of development and I think it’s probably the case but small residential extensions would get excluded but, you know, we can’t be certain about that at the moment. Sitting below all the Act and the regulations is inevitably going to have to be a lot of policy and that will operate at a national, regional and local level and some of it I’m sure will be set to specific. There’s always this thinking that policy is relevant to the public sector but the private sector is going to have to develop its own policies on this as well whether that be via company-by-company basis or whether, for example, utilities with a common act of interest so, for example, water wants to develop a policy which [inaudible] across all the water companies. Then, once we have all that in place, it’s inevitable that good practice will start to be developed and Alan has already spoken quite a lot about that and I think that will happen sort of naturally and as people get a handle on how the system is meant to operate and they get a greater familiarity with it. What is interesting about good practice is generally it leads to increasing complexity over time. So, if you think about how the environmental impact assessment regimes develops over time or habitats regulations assessments or health impact assessments which is gradually becoming more and more complicated and the most recent one is equalities impact assessment which again is getting more complicated. So, the likelihood is that as this system develops things will get more complicated but that shouldn’t necessarily be a negative. It might be, to put it another way, it gets better.

One of the things which is going to have to be considered here though is within regulated sectors. There are going to be some quite important implications for this and those who are regulated and those who do the regulating need to be thinking about that. On large schemes which require a lot of Biodiversity Net Gain, there is a major CapEx implication for this. Now, Alan has spoken about how, you know, you can work that through your design system but ultimately, you know, Biodiversity Net Gain does have to be paid for and even if you can make it, you know, some of the habitat is dual purpose, etc [START HERE]. so you are incurring cost efficiently you are nevertheless incurring cost and it will have to be fed into the CapEx calculations on schemes. It has to be monitored. It has to be worked on and that will have long term OpEx implications. If a utility company were to put an area of habitat into a Conservation Covenant, they have to commit to that for 30 years so, you know, that incurs an OpEx cost which goes through several rounds of funding and, you know, the regulators will need to understand that. This isn’t going to be, you know, an OpEx for a five year period or a ten year period. It’s 30 years of operation expenditure and that’s important, an important consideration.

I think that the last two bullet points on this slide sort of go together and it sort of poses the question of the second bullet point on the slide – how long is this going to take to make a difference? Now, habitats take time to develop. Developments take time to come forward. So, you know, this isn’t going to be a panacea overnight or over a few years. This is probably going to take five or ten years and a 25 Year Environment Plan sort of anticipates that is the length of time over which this system is really going to start delivering. That raises the question of does the continuity of will and resource exist to bring about that objective? Now, several government ministers, conservative government ministers have spoken very positively about the 25 Year Environment Plan. Theresa May spoke about it very positively about it when she was prime minister. The introduction to the Plan makes it clear that they think it is a very positive thing. Michael Gove said similar things when he was Environment Secretary. Jack Goldsmith has made several quite bullish statements about the environment and the benefits that Brexit will bring forth. But it does raise the issue of politics and this is something which has been brought forward by a conservative administration which is historically conservatives have been more concerned about the economy than they have about the environment. It’s quite unusual they’re bringing this forward. The Labour administration would have historically been more sympathetic to the environment but it does, you know, raise the question in a very difficult economic time post the pandemic will this system get the funding it needs and that’s something I’m going to come back to in one of the later slides.

Okay, so, the Biodiversity gain objective – now something which a lot of companies and organisations are looking at at the moment is environmental social governance and there is increasingly expectation that commercial organisations and other organisations as well will take this very seriously and develop their own environmental social governance and that pressure comes from the public from lobbying groups, etc, etc. So where does Biodiversity gain fit into this? Well, it’s definitely environmental. That’s beyond dispute. It is probably also social. So, for example, if you had a development coming forward and you have a green space which is going to be affected by that development and that green space is utilized by a particular group of individuals with a particular group of needs so, for example, is it close to a home which looks after people with mental or physical disability, are they using that space for a particular purpose over and above what a general member of the public would use it for? You know, you take the space out and then you re-provide it plus 10%, does that have a social benefit as well? Can an organisation claim that as a social enhancement which they’ve brought about further to their ESG policies? So that is a question I raised and I think you probably could make a case it was a social benefit which comes as a Biodiversity Net Gain and certainly the Environment Plan talks about net gain being an environmental and social benefit so I think that’s probably a legitimate argument that could be made.

It’s also going to have implications with governance. Whether that be governance organisations going back to the point I made about the cost of this, organisations are going to have to develop their governance so that they can make decisions around Biodiversity Net Gain. What are their objectives? Some note, they could, for example, set an objective which is higher than the 10% established in the bill. So, there are going to be implications for governance organisations. Now, one of the questions which I frequently get asked is how widely will Biodiversity Net Gain apply? So, at the moment it’s drafted that it applies to all planning permissions but, as I said, there are a number of caveats around that. Firstly is the ability to exclude certain types of planning permissions [inaudible] from the regulations. There is also the ability to make regulations which define how you deal with Biodiversity Net Gain. For example, in long term phased developments or in outlined consents which have detailed coming forward at a later stage. So, those regulations will be important and are almost certainly going to have major implications for those who are bring forward that sort of long term phased developments whether it’s mixed use or purely residential or whether it’s, you know, business parks, etc, etc. So, that will need to be kept around. Planning permissions which have failed development orders are exempted from this. Now that [inaudible] PD rights, potential developmental rights [inaudible] of net gain will not apply to them. And when you think about it, that sort of makes sense because of how would you ever police [inaudible] existing [inaudible] development rights is is very difficult to see how you could do that without impairing costs on an actually enormous [inaudible] for example. And, and a themed planning permissions are caught by this so [inaudible] would be caught. My only concern is uncaught [inaudible] talk about [inaudible] some of them talk about an environmental net gain, which must be certainly something different from [inaudible] net gain. I think it must mean Ryder, so it means that it would catch for example cultural heritage or geological [inaudible] and things like that. We’ll come back to that in a minute and talk about conservation conveyance. I think there is also a question mark about how [inaudible] net gain would be delivered under the sort of proposals [inaudible] about a zoned planning system. Presumably it will have to be a condition on conducting development within the zone that we provide [inaudible]. It seems the logical way of doing it, however, and then on the [inaudible]. I agree with Adam. I think this is positive, it does look at the environments in a way that hasn’t been looked at before. And I think it does [inaudible] prevent [inaudible] the adoption of the evaluation of the chain [inaudible]. It should lead to improvements, but, it’s undoubtedly going to have an effect on the gravity of some developments, particularly large developments. And how that is costed and over what period that is costed. Do you work it out or [inaudible] development? You have to make assumptions over how long a development is before you [inaudible]. So, viability assessments are going to have to take some [inaudible] and it will be interesting to see how that is done and contentious an issue that becomes. [inaudible] It is complicated [inaudible] and you will need to monitor it closely. There is an interesting example in the court sector at the moment where the approach to replacing the title habitat. The metric there is significantly [inaudible] operations where I have heard it said that if that metric is allowed to go through [inaudible], it is unlikely that any court will be able to meet it with the way it’s currently calculated. I haven’t actually looked it in detail, but I have heard several people in that sector say that the metric is a significant concern. So it does need to be monitored very carefully. The other interesting thing about this whole system, is that, this is an initiative which is being brought forward by Dekra [SP]. It appears it is going to be policed by largely by local planning authorities. Which for within responsibility, then towns, communities, and local governments and on [inaudible] the whole system has to be funded by Treasury. Now, it’s yet to be seen whether the Treasury or how much the Treasury is going to put in this, and whether they will do that? Or will they encourage responsible bodies, regulators, regulators I assume [inaudible] farm agency [inaudible] responsible to seek the funding for this system from the developers. So that when they come forward for [inaudible] with their game plan and there’s a requirement to monitor a habitat, over a considerable amount of time. They look to the developers to fund the monitoring including the staff cost when regulated, etcetera, etcetera... It seems to me, in times of extreme fiscal hardship, it is likely that a lot of pressure is going to come onto developers who are to fund in the public sector to do this or get involved in it. And also to develop it. It’s not just the funding for example [inaudible] or responsible body, it’s also their own internal resources. They are going to have to have people who have managed this habitat, [inaudible]. Will they contract it out? Will they keep it in-house? But, even if it is contract out, the responsibility will still lay with the developer. So presumably they has to be somebody within the developmental organisation looking out for the habitat, making sure it’s maintained, making sure that the contracts [inaudible] are enforced properly... and then finally, I put down land debt, because these developments have to provide a 10% net gain, land is a valuable resource. How you make [inaudible] planning decisions in this country is at times extremely controversial. And so, there is going to be quite a significant debate to be had as to what is the best use to put to land. Because once it becomes [inaudible] or a conservation problem, it’s in there for a very long period of time. So you really need to make those upfront decisions about what is the best use for that land carefully.

Moving onto [inaudible], it’s worth saying that this, the 10% you’ve objected or met, is measured when the development is completed. Now that raises all sorts of questions ‘cause, you know, are you going to commit to a precise build out program on a [inaudible] land commission, so that you know [inaudible] ground for 2022, it will be build out by 2030. That market it takes for which a development comes forth, so I don’t see how that can be dealt with. When do you even define whether the development will be completed or do you have to have a longer term plan which allows for that flexibility and requires you to keep the plan up to date as you build through the phases. So, that’s a question. The other issue is [inaudible] had mentioned, habitats take time to develop. It’s unique to have a habitat fully functioning by the time the grounds is completed. Builders start then to constrain how quickly you can build that development out or will the plans allow for habitats to continue to develop. [inaudible] So the 10% benefit is achieved at some point after the final house has been built for example. That [inaudible] legislation and produce them to have to do something than just talk about [inaudible]. And David Woodland of Clearly Woodland, does not reach maturity in 10 years. So, that needs to be talked about. There also, whe- when talking about that, you have to in that regard also think about what is the guarantee that you are making? What are the implications of [inaudible] sharing of Woodland? Will it be successful? What happens if it’s not? So all of those things are going to have to be thought through [inaudible]. And also, the cost that is possible for section runner for example, have six obligations to be varied after 5 years to be renewed. You can, landowners can enter conservation conveyance but they can also come out of conservation conveyance. Now if, if applied the rest of gain planned, the lives of [inaudible] of a particular land covenant and the land owner suddenly realizes that in the future they need to do something with the land and they take it out of the conveyance, what happens? [inaudible] in that land is lost. Do they have to meet it? Do they have to replace it since they’ve taken it out? Or does the original, essentially the original purchaser of the land [inaudible], do they have to come forward with any replacement activity? And so that raises a number of questions. And of course, if somebody was to take land out of the consolation conveyance and utilize it for other [inaudible], they may not need planning permission to do so. If it was an agricultural land and they wanted to change the cropping. They would not need the compliance commission for that. So, there would be no automatic obligation on them to provide another 10%. So somebody’s going to have to think about how that can be dealt with in methane plants? And then, obviously, [inaudible] methane plants will have to be approved. How long does that take? When do you want to do it? Do you want to incur the cost of developing a quite complicated plan up front when you’re putting your application together? Or do you want to wait and see how the planning permission looks and if it’s actually granted? So there are implications about that as well, about the timing when all of this is done. [Inaudible] the very issue this hasn’t been satisfactory answered as far as I am aware, is how does this link to other regimes?  [Inaudible] captured species. If you had to provide compensation habitat from the habitat regulations, Will you have to provide new species habitat under the same regulations [inaudible]. Can you claim the benefit of that new habitat? The habitats regulations and for Biodiversity Net Gain or does that pronounce a double [inaudible]. I suspect naturally [inaudible] the approach to habitats regulations in particular tends to be trying to extract as much as they possibly can and if they carry on with that process, I think they may be reluctant to see too much [inaudible]. It’s not so it couldn’t be done, [inaudible] couldn’t be made, quick to be done. But that is going to have to be something which is explored with planning authorities [inaudible] etc. And credits, I wasn’t gonna say too much about this really because as Aidan said the bill is really light on detail on this [inaudible] and it’s really not clear how it’s going to work. One of the things I have heard concern raised about, if the costs of buying Conservation Covenant credit [inaudible] buying up land Conservation Covenants so you can [inaudible] up to your development, comes too high. There might...put on the government to reduce the cost of credit which would go against what the bill says about [inaudible] credits in a way which means that people are encouraged to put land and Biodiversity Net Gain register which is [inaudible] Conservation Covenants, one of six agreements. So there’s going to be issue around that as I suspect. The other thing as well, people are going to have to keep time for the system to [inaudible] down. There are a lot of regimes which have been brought forward which have taken an awful long time to really become effective in a way they operate and Aidan and I have talked about it and given a couple of examples there. OK Conservation Covenants and planning obligations [inaudible]. One of the things here is that worth noting is that, Biodiversity Net Gain is one element of what a conservation purpose is. The definition is much wider; it picks up cultural and architectural sites. It picks up geological and other sites [inaudible] as well. So the Biodiversity Net Gain is one element of it and we already touched on this 30 year commitment. That is a very very long period of time. This is a contractual commitment as of 30 years. If you think about most contracts, most of them aren’t being forces after five or six years. So to have one which is gonna be surviving for 30 years and the questions that’s raised about how they will be enforced are really quite key. The thinking about how they are drafted is gonna have to be very carefully thought about because if you’re making commitments over that length of time, there need to be very practical and they also need to capable of being developed to the contractual frame workers as situations changed. And then there’s this idea I’ve mentioned before about what land use decisions are we making and does it have the effect of sterilizing land for the purpose? I gave the example of the farmer who’s gotten land and Conservation Covenant and then taped it out to another purpose and how is that dealt within the Biodiversity Net Gain Plan. If he doesn’t take it out the covenant, it does mean it’s got to be used for that purpose for a long time. An organisation is thinking about putting land into Conservation Covenants are going to think about that very very carefully. If they can create a market for the covenants, which they can sell areas of land [inaudible] covenants between the developers or lease it to them or give them a license report then that represents certain economic opportunities for landowners, it might provide economic opportunities for others as well. But equally it could become bit of a burden because their land is essentially tied up to that purpose for a long period of time. So all of that will need to be thought about as well. It’s also worth noting as well, I think if you’re entering to the Conservation Covenant, you need to think very carefully about which responsible body you [inaudible] here. So for example, would a utility company set up a subsidiary company? Which it would been into the covenant or would that be deemed to be too close to the utility? And that would actually have to be a completely independent organisation [inaudible] that establish a charity, for example. Do that or it could be [inaudible] planning party. But it does need to be thought about because each of the organisations are going to have different interest and different priorities so you do need to think about that carefully. We’ve already spoken about monitoring the [inaudible], it’s a long term thing. It’s going to have implications with governance for organisations and it’s going to have implications with both land owners and responsible parties. The one thing I would observe is that In our versions, enforcement had not worked well in the example we given those, the contaminated land version whether a very detailed framework in which local plan authorities are meant to deal with the decontamination land but they just don’t do it. And so that is going to have to be thought about in this context. Because if this regime isn’t enforced, [inaudible] environment plan [inaudible] and the [inaudible]. So I’ve [inaudible], I think the answer is yes it can but a lot more information is needed to really access the full [inaudible] of this and I really would encourage you to keep a close eye on this because this stuff have the ability to have very significant implications for landowners, for regulated utility companies, for the regulated [inaudible] central local companies as well. So it’s really careful that we do keep an eye on this, we do respond to the consultations on regulations when they come out. And they do try and [inaudible] the framework which achieves what is subjected now but it also capable of being practically operated. OK, I have a poll question. I’ll just read you the question and then I’ll read out the answers while we have a chance to vote. Which of the following statements best sums up your main thought in relations to [inaudible] Biodiversity Net Gain? [inaudible] 1-5-2-5-4 and there are four possible answers here to have option to vote on. It is a great opportunity and we will look to implement a program of works in relation to it as soon as possible. I’m worried about the costs and the [inaudible] of complexity. It could lead to difficulties in implementing delivering schemes that would be in the public benefit. I am concerned with simply accept, that it would become part of the process of delivering development or B, it is greater there that I question whether the government would actually be able to deliver [inaudible] registration and critically funding support to bring about the effective implementation of the system. There ae people who would like to vote on that. I don’t know if people have voted but I’m not getting [inaudible] so...We’ll come back to that hopefully the votes will register in a minute. I think we are gonna go onto the next question. I’m not sure how much longer we’ve got but I think Aidan either gonna lead on this.

Speaker

Dialogue

Aidan Thomson

Yes, yes. And I hope everyone can hear me. Yes, we have unfortunately run up against time. And just one question for you though, James, which came in while you were speaking which you might just be able to answer quickly. Which is, how will planning obligations like Section 106 agreement, be impacted? Is it reasonable to assume that they will in time take on these requirements?

James Good

Certainly for land to go onto the Biodiversity gain register, the commitment has to be made either when it comes to Conservation Covenant or in a Section 106 agreement. I guess it’s eventually up to the developers as to how they will stir it. But I think local planning authorities are probably going to be more familiar with Section 106 obligations, so they may well require this to be dealt with in Section 106 obligations. Conservation Covenants are an opportunity for landowners to commit their land to Biodiversity benefits and I think a lot of the thinking behind that is that then gives them the opportunity to develop the habitat and then either release or license it to developers for use to meet their Biodiversity gain objective in relation therein [inaudible] developments. I hope that’s OK. But if anybody else is going to want some more detail on that, let them know just get in contact with us [inaudible].

Aidan Thomson

OK. Thank for the answer James. Yet there are a few questions that are being asked. I don’t think we are gonna have time to go through them now. But we will respond to you after the webinar. There is one that I can deal with very very quickly which is that somebody wants to know what the penalty might be for breach of an [inaudible] one of these Conservation Covenants and that’s set out. It’s not an offense, it’s a civil thing. And the civil remedies all apply specific performance injunction and damages. [Inaudible] interestingly, it does say that a landowner can be made to pay an exemplary damages award. So an award of damages that sort of far out strips the harm done if you’d like. So I hope that answers that question. But [inaudible] there are two or three more questions which are unfortunately haven’t gotten around to. But we will respond on those. I think we are just a minute or two over now so we’ll call it a day and just to finish then, I say I hope you all found that very informative and interesting and thanks from the three of us for tuning in today. Thanks in particular to Alan, our guest speaker for his perspective on Biodiversity Net Gain and to wish you all from all of us here all a very best [inaudible] this season. Thank you very much.

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