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ClientEarth Communications

21st February 2017


Public money for public goods

As the UK prepares to leave the EU, it will need to find a replacement for the Common Agricultural Policy (CAP). This replacement must avoid the perverse subsidies and environmental damage of the CAP. One way to achieve this is through making sure that public money is invested in public goods: a message we have often heard as people discuss what should replace the CAP, and one that the UK government has previously supported.

But, as MPs have pointed out, we need to be clear about what exactly ‘public goods’ are. Public goods are things that are not provided through markets. Food production, though obviously of great value and importance and a legitimate public policy objective, is not itself a public good. But the way we manage land can provide many other public goods, which must be funded by the government.

What are public goods?

The technical economic definition of a ‘public good’ is one that is:

  1. a) ‘Non-rivalrous’- this means that one person using it does not prevent another doing the same; and
    b) ‘Non-excludable’ – this means that access to the good cannot be prevented.

Street lighting and flood protection are examples of public goods. A less technical definition of public goods is things that are of value to the public as a whole, and which everyone benefits from.

Most things that we buy and sell are not public goods: if something costs money, then those not paying can be excluded from using it. And things that get ‘used up’ are not public goods: only a limited number of people can make use of them.

For example, food is not a public good. I cannot walk into a bakery and take a loaf of bread, because it is excludable. And if I eat the loaf of bread, you can’t eat it too, because it is rivalrous.

Because of the nature of public goods, there is normally no market for them. We need the government to step in to effectively protect and/or provide these public goods and access to them.

Environmental public goods

Many public goods are provided by or related to the natural environment. Flood protection is a good example: it’s something that a whole town can benefit from. And if someone else moves to the town, then they too will reap the benefits without diminishing anyone else’s enjoyment. It’s important that the government makes sure that people benefit from these public goods.

Other examples of environmental public goods are clean air, public green spaces, and public rights of way. When you catch your breath after cycling up a hill – or look out to the sea’s horizon – or spot the signpost showing you the way home – you don’t prevent the next person having the same experience. Nor do you want the experience to be limited to some subset of people: everyone can and should have access to a healthy and diverse environment.

These experiences are part of the reason why people need and love nature. Nature can provide us with connection, solace and meaning. Nature's value is enormous, multiple and clear.

Nature can provide us with flood protection, recreational opportunities, improved health, and so much more.

So, which public goods should a new UK land management policy focus on?

This will no doubt vary from place to place as the state of the environment and people’s needs vary. This is to be welcomed, and managing the natural world according to natural divisions (such as catchments) makes sense.

But we must be careful to avoid focusing too much on a narrow range of ecosystem services. Nature is diverse, and we should not try to straight jacket it into producing distinct packages of public goods for us to consume.

To avoid this, our policies should encourage diverse and resilient ecosystems. Many environmental public goods and ecosystem services come hand-in-hand with better biodiversity. More biodiverse ecosystems means better functioning ecosystems, means greater provision of a range of public goods, from flood protection to recreation.

Perhaps most importantly, nature must not be constrained. We must support, encourage and enhance biodiversity not just in nature reserves (where we can provide habitat for some of our most precious species), but across our cities and countryside too. It’s good for us humans, and it’s good for all the other living beings that we share this planet with too.

Land management policies

The UK’s replacement for the CAP (and also the EU’s reform for the CAP) must prioritise investing public money in public goods over subsidising farmers simply for owning farmland. In particular, it should recognise and endorse the value of biodiversity. It should reward land managers for creating and maintaining diverse ecosystems, for example through managed rewilding projects.

The next thing to look out for is the release of the UK government’s frameworks for the 25 Year Environment Plan and the 25 Year Food Farming Plan. It’s crucial that these do not contradict each other, and that they set out a pathway towards a resilient, diverse, abundant and thriving natural world. ClientEarth will be fighting for the plans to be ambitious, robust and empowering.