This notion of natural capital, I think, is really quite a powerful idea. I think everybody in the room will understand the notion of financial capital and how if we look after our capital assets, we get a flow of dividends and interest long into the future.
And of course, if we blow our capital, we go bankrupt. So it goes with natural capital and the extent to which, today confirmed by this report, we have drifted deeply into the red over the years. And this is now something which poses a source of risk. The state of natural capital very much confirms the need to grow Nature as a prerequisite for health, wealth and security. Indeed, with economic growth identified as an overriding national priority, it will be necessary to grow the natural assets needed to underpin that.
The report gives a clear snapshot of the state of these assets, and gives us a logical baseline from which to measure growth over time. It highlights the extent to which we rely on Nature, which gives us life's essentials of fresh water, air and food. In fact, with 90% of the world's food reliant on just 20 species, we ignore this at our peril. Nature also provides places to relax, resources to build with, and mitigation of the climate change impacts ever more visible on the planet.
In short, if we look after Nature, Nature will look after us, but the truth is, that we haven't been. The web of life is in critical decline. Ninety percent of the UK's wetlands have been lost in the modern era and over 97% of lowland semi-natural grasslands have been lost in the last century, taking with them countless birds, butterflies and bumblebees. Nature is being wiped off the face of our supposedly green and pleasant land. Yet we continue to act as if we were oblivious to the warning signs from a planet that is evidently struggling.
Impacts like these exacerbate many of the most serious threats to society. Nature loss and climate change fuel one another, so losing wildlife and habitat helps drive changes to weather systems to unprecedented extremes, which in turn forces more species to flee their traditional ranges and for some to be wiped out altogether.
For years, we have taken Nature for granted and taken more than it can sustainably supply. We are, in effect, running down those capital assets as we strip away Nature's ability to provide clean water and carbon storage by degrading soils, which increases water pollution and sends harmful emissions into the atmosphere, affecting human health and adding to consumer bills. Those degraded soils and lost wetlands reduce landscapes' ability to regulate temperature, hold water and to slow the flow of rivers, amplifying flooding downstream. Not only does this cause widespread human misery, it puts businesses and services out of action and adds considerably to insurance premiums.
It's interesting to note in the wake of Hurricane Helene, which smashed through the southern states of the United States a couple of weeks ago, how many of the properties there were uninsured because they were not deemed to be in areas prone to flood risk. Thereby revealing a series of not only serious economic consequences, but also social ones, and the costs of degradation can be measured not only economically but in lives lost. Almost 3000 excess deaths occurred across the UK in 2022 as a result of extreme heat and this is also seen in the impacts of agriculture with flooding causing losses to farming income in England to drop by a fifth in 2023, leading to a £1 billion blow to this country's GDP.
The decline of Nature is not only visible in the countryside, of course, but also in our towns and cities and villages, particularly amongst the most disadvantaged communities. Evidence gathered in the State of Natural Capital Report indicates that lower risks of sick days are associated with increased access to green and blue spaces. However, according to Natural England's Green Infrastructure research, we see that around one in three people, 38%, do not live within 15 minutes of the green space, and they tend to be from more disadvantaged communities. The link between social and equalities and differences in health outcomes is thus strong and persistent.
The upside of this disturbing picture is that we can work together across society to recover Nature and unlock solutions to these pressing challenges For that to happen, information regarding the value we all derive from Nature needs to be put into the hands of those who decide on actions that shape our country at both national and local levels, and that's where this research comes in.
It gives decision makers a vivid picture of these close dependencies between the social well-being and economic resilience and the ecosystems which underpin those essentials of our society. Taking a natural capital approach highlights the extent to which our mountains, wetlands, sea bed, soils and rivers are just as critical to business success and community wellbeing as roads, railways and broadband.
These natural assets add up to a national wealth service, providing a steady stream of essential goods and benefits upon which our economy and population rely. Setting them out so clearly as we're doing today allows them to be moved out of the shadows and onto an extended balance sheet where companies can see their true value and act to protect these priceless and essential assets. This allows us to progress beyond just seeing the health of our economy and country in terms of GDP and to incorporate the health of our natural capital and its ability to sustain our economy into our understanding of the condition of our nation. It's time we treasured this 'National Wealth Service' as much we do as we do the National Health Service.
What I hope people will understand as a result of this State of Natural Capital Report is that Nature isn't some rather quaint, distant notion that inevitably gets trampled by progress, or occasionally holds it up. Nature is a dynamic, vigorous multilayered force that can provide so many of our essential needs today and into the future, if we take this opportunity to understand it better, to treat it with respect.
For these reasons, a thriving natural world means Nature flourishing across landscapes - hills, valleys, towns and cities, seas and shores, where people can be active, inspired and fulfilled. Healthy rivers and wetlands providing clean water and homes for wildlife and reducing the risks of flooding and drought. Restored peatlands and sea beds, storing vast quantities of carbon instead of releasing it into the atmosphere. Trees, shrubs, parks and rivers, cooling cities and some are bringing urban dwellers closer to Nature, reducing crime and encouraging businesses to invest. Hedgerows and flower-rich margins, ensuring a plentiful supply of pollinators for crops underpinning food security.
All of these benefits provide us with security and resilience in an uncertain world. Put them together and it's very clear that Nature isn't different to growth, it is at the heart of it. You cannot grow the economy if you don't grow Nature. According to recent estimates, the value of the UK's stock of natural capital assets is just over £1.5 trillion.
Is it wise to blow that capital and to not think about tomorrow? Or should we try to grow that capital to thereby grow the dividends and interest that we will get into the future?
The evidence presented in this report reveals the answer and how investing in Nature recovery pays the upfront costs many times over. However, each decade doubles the costs of restoring the damage, meaning that the longer we leave this process of Nature recovery, the more expensive it will become.
This report thereby offers an important resource for policymakers, making the invisible visible and providing the missing evidence needed, guiding the action that we require to achieve sustainable use of our natural assets. The case for Nature recovery as a result of this work, makes it an even stronger agenda. I encourage those of you here today not to read the report only and to be informed by it, but to use it in your future decision-making processes and to create a stronger positive outlook for our economy and society by doing so.
Notes
- A video of the speech can be viewed here:
