Jeremy's Blog 12/11/20: From Agriculture Act to a Green Recovery?
This article by Jeremy Moody first appeared in the CAAV e-Briefing of 12th November 2020:
Although we wait to see the shape of the UK’s future relationship with the EU as negotiations of historic importance run beyond injury time, post-Brexit polices are moving from speculation to action.
The Agriculture Act 2020 is the first post-Brexit policy statute and the first Agriculture Act since 1947. Taking effect in January, it will among many things enable the President of the CAAV to appoint arbitrators to tenancy disputes in England and Wales and pave the way for measures to improve farming productivity; that is its efficiency and competitiveness. The CAAV is involved with work with government on that.
The government’s larger theme is environmental improvement, with much policy framed by the 25 Year Environment Plan. This is not only for the net zero imperatives of climate change mitigation and adaption but also biodiversity and the quality of water and air. All these impinge on rural land management.
The Environment Bill will set important high level principles, targets, enforcement and local nature recovery strategies. The Agriculture Act gives DEFRA powers to develop ELM, with more details to come in the next few weeks and the first phase of the pilots in 2021. A regulatory baseline will come to replace cross compliance, saying what the law will require.
However, this is not only about schemes and public money but also harnessing the power of private finance, increasingly aware of the risks and opportunities here, and markets. Markets will move values and, as the Stone Age did not end for lack of stone, so the talk is now of “stranded assets” left behind and devalued by these changes. The Chancellor took a further step on Monday, outlining post-Brexit financial services legislation with:
- requiring large companies and investment institutions to publish their impact on climate change, moving beyond the current voluntary process, with effects likely to ripple along supply chains from supermarkets and major food processors. This process is already affecting investors’ views of fossil fuels while data is now showing investors where flooding is a risk for property.
- replacing the EU’s regulation of insurance and pension companies so that they can invest more in infrastructure, renewable energy, housing and climate change measures.
- informing markets with rules classifying how far investments and companies are “green”
- creating green bonds markets to fund climate change and environmental action
With biodiversity net gain another such mechanism, watch for the government heralding a “green recovery” with such carrots and sticks.