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The Environment Bill: A case of unintended consequences?


The draft Environment (Principles and Governance) Bill’s approach to biodiversity net gain could have unintended consequences, says Paul Wakefield.

The environment bill is due to be published later this year, following pre-legislative scrutiny and consultation. Its draft version envisages that developers will be required to pay for biodiversity offsetting at sites where habitats could be damaged.

While any attempt to protect the environment is worthwhile, the changes will inevitably increase the cost of new developments and could, if administered poorly, actually lead to a net habitat loss. So how significant will the new rules be and what do UK planners need to be aware of?

As the UK is due to leave the EU on 31 October, the bill will aim to address the environmental governance gap posed by Brexit. A key part of the proposed bill relates to planning policies encouraging “biodiversity net gain” – an approach to development that leaves biodiversity in a better state than it was before.

This builds on recent revisions to the National Planning Policy Framework, which emphasise that planning should “identify and secure opportunities for securing measurable net gains for biodiversity”.

"The bill will aim to address the environmental governance gap posed by Brexit”

The approach outlined by government for achieving a net gain to biodiversity is based on a ‘mitigation hierarchy’, which requires developers to avoid, minimise, remediate and, as a last resort, compensate for adverse effects on biodiversity. Where developers are unable to do this, they would be required to pay a cash tariff, covering the costs of replacing and maintaining lost habitats, calculated using a newly created biodiversity metric.

As the success of the Extinction Rebellion campaign has shown in recent months, the public’s environmental conscience is greater than ever before. In this sense, the proposals are certainly a positive step, aiming for better-designed schemes that work harder to enhance the environment.

However, from a planning perspective, the requirements will introduce new costs for developers, which will inevitably be passed on to consumers by way of higher property prices. They may also lead to additional costs for local authorities, which will need to employ ecologists to assess applications and devise suitable mitigation strategies.

One potential risk of the draft legislation is the opportunity for unscrupulous developers simply to bypass the mitigation hierarchy by claiming that they have exhausted options to minimise or remediate negative impacts on biodiversity. This could see them pushing for the compensation route instead, which would then rely on local authorities scoping out and investing in replacement habitat to balance the area affected by the development.

"If local authorities are unable to keep up with demand and this money is therefore not translated into replacement habitat, the measures could, ironically, result in a net biodiversity loss"

If local authorities are unable to keep up with demand and this money is therefore not translated into replacement habitat, the measures could, ironically, result in a net biodiversity loss. If so, it will be essential for government to consider how to ensure that compensation is used only as a last resort, rather than allowing it to become a default option for developers.

Before the environment bill comes into force, there are also a number of political and legislative hurdles that will need to be cleared. In the event that Brexit never actually comes to pass, EU environment law will still apply and there’s also the potential for the Conservative leadership contest to cause disruption within Parliament. As more changes to the legislation are also likely before it is enacted, it is important for planners and developers to keep up to date with the rules and prepare environmental procedures accordingly.

As environmental pressures increase on all areas of business, more legislation in this area is to be expected. If the UK is to meet its ambitious sustainability targets, it is essential for developers to adopt a thorough approach to assessing environmental impact and considering mitigation strategies.

This will require additional investments from developers, in terms of time and cost, and will likely push up prices for homebuyers. However, when compared with the world’s climate change crisis, this is arguably a small price to pay.

In brief

  • The proposed environment bill sees developers compensating for biodiversity loss caused by development   
  • There is a risk that it will lead to developers simply paying local authorities to deal with environmental harm 
  • This could inadvertently increase biodiversity loss while pushing up house prices 
  • Developers must adopt a responsible approach to mitigation to prevent environmental damage

Paul Wakefield is an associate partner and planning specialist at law firm Shakespeare Martineau

Image credit | Shutterstock


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