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«The Economic and Social Aspects of Biodiversity Benefits and Costs of Biodiversity in Ireland REPORT PREPARED BY: CRAIG BULLOCK, OPTIMIZE CONSULTANTS ...»

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The second NDP, for the period 2007 to 2013, was launched in January 2007.This plan outlines a programme for the investment of 184 billion to support environmentally sustainable economic and social growth over the next seven years, including an allocation of 25 billion in “programmes that will directly and positively impact on environmental sustainability”. The NDP recognises that “Ireland’s biodiversity, which includes our ecosystems, provides environmental services vital to human welfare.These environmental services include the provision of food, fresh water, clean air and nutrient recycling, all of which are essential to human life. Furthermore, our natural environment is valuable and worthy of protection in its own right.” Table 2.2 below highlights some of the principle themes of the NDP 2007 - 2013 for which biodiversity provides important services.

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The National Spatial Strategy for the period 2002 – 2020 is designed as a framework to assist Ireland to achieve “a better balance of social, economic, physical development and population growth between the regions”.The NSS contains a large focus on the need for sustainable development, and, importantly, recognises that sustainable development is more than just an environmental concept. In addressing the spatial and regional issues for its implementation, the NSS recognises the fundamental importance of Ireland’s natural resource base to the economy and to future national development. Furthermore, it explicitly recognises that biodiversity has intrinsic economic and social value, whether through its importance for recreation or tourism, or its relevance to agriculture, forestry, fisheries and other indigenous industries.

Under both the NDP and the NSS, ensuring that continued national economic and social development (in the short, medium and long term) is not jeopardised by negative impacts on Ireland’s biodiversity, requires a high level of cross-sectoral understanding and partnership.The Strategic Environmental Assessment process under EU and Irish legislation represents a useful instrument in this regard, although a strong framework for identifying, monitoring and targeting the critical ecosystem services which support development within each sector is still required.The ecosystem approach, when applied to economic and social considerations, can help to set out the basis of this framework. Although the second NDP has not been subjected to a Strategic Environmental Assessment, many of the programmes and policies that follow from it will be subject to the SEA process under EU and Irish law.This is of particular relevance to Development Plans and Settlement Strategies at the local, county and regional level. In line with the EU Sustainable Development Strategy, the Lisbon Agenda and the EU Biodiversity Action Plan, the conservation of biodiversity must be given high priority as an integral aspect of the successful planning and implementation of the Plan.


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The report of the first I n t e r n a t i o n a l C o n f e re n c e o n H e a l t h an d B i o d i ve rs i t y (CO H A B 2 0 0 5 ) is published by the CBD Secretariat on their website at:

https://www.cbd.int/doc/programmes/areas/agro/agro-cohab-rpt-smry-en.doc M i l l e n n i u m E c o s y s t e m A s s e s s m e n t – the background and reports of the Millennium Ecosystem Assessment can be found at www.maweb.org T h e U. N. M i l l e n n i u m D e c l ara t i o n is available at http://www.un.org/millennium/declaration/ares552e.htm, and information on the Millennium Development Goals can be found at http://www.un.org/millenniumgoals/ and at http://www.undp.org/mdg/ E u ro p e an Po l i c y an d L e g i s l a t i o n o n B i o d i ve rs i t y an d N a t u re C o n s e r v a t i o n – the EUROPA website of the European Union provides a portal for information on all aspects of EU biodiversity policy and legislation, including full text downloads of EU and European Commission

decisions and directives, convention texts etc. Go to:

http://ec.europa.eu/environment/nature/home.htm or ec.europa.eu/environment/index_en.htm Information on I ri s h L e g i s l a t i o n o n t h e E n v i ro n m e n t an d N a t u re C o n s e r v a t i o n can be found on the website of the Department of the Environment, Heritage and Local Government at http://www.environ.ie/, and on the website of Ireland’s National Parks and Wildlife Service at http://www.npws.ie/WildlifePlanningtheLaw/.

T h e N a t i o n a l B i o d i ve rs i t y P l an is available at http://www.npws.ie/Biodiversity/Ireland/ I re l an d’s N a t i o n a l D e ve lo p m e n t P l an – details of the NDP, including the text of the NDP for 2007 to 2013 and a review of the previous NDP (2000 – 2006) can be found at www.ndp.ie I re l an d’s N a t i o n a l S p a t i a l S t ra t e gy – the text of the NSS can be found at www.irishspatialstrategy.ie.

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Through agriculture we have learnt to harness ecosystem services to our own interests by increasing the level and reliability of the production of food crops necessary to our survival. As technology has progressed, we have also achieved a degree of independence from natural systems such that high levels of biodiversity are not required for high levels of production. We can selectively encourage those plant or animal species that are of value to us. We can also substitute for the ecosystem services of others through the application of inorganic fertilizers or the use of pesticides. Indeed, it could be argued that it is largely because our agricultural systems are artificial that we need artificial inputs. For instance, agriculture monocultures (single product) supply pest species with a single food crop, providing the opportunity for potential population explosions of pests in the absence of pesticides. By comparison, a natural system has a diversity of habitats and species that ensures that these same pests are regulated within natural norms and balances.

If there were no natural systems of any kind it would nevertheless be impossible to produce food.

In principle, therefore, the value of biodiversity could be represented as the total value of all food production. However, it is easier to understand the marginal value of biodiversity in the sense of the contribution of various ecosystem services to additional agricultural output.

Technology has permitted big advances in agricultural productivity, but it has its limitations.

Technology has diminishing returns and there are limits to our capacity to select and substitute. We cannot, for example, supply all the nutrient demands of crops through fertilizers alone. Neither can we hope to control all potential agricultural pests. Applying more and more inputs undermines future sustainability and leads to external costs for others.

( 1 ) S u s t ai n ab i l i t y It is beginning to be appreciated that intensive agriculture cannot be sustained in the long-run without consideration being given to the need to ensure the continuance of ecosystem services.

For example, while pesticide formulations have, indeed, improved over the years to better target pest species, they are unlikely to ever achieve 100% success. Even if they do, they are likely to be depriving other beneficial species of a food source or some other productive interaction. They can also leave behind residues that interfere with the functions of yet other species, many of which are likely to be beneficial to agriculture and often in ways that are, as yet, little understood. As an example, monoculture crop systems reduce the variety of food sources for bees, while pesticides do an equivalent amount of damage to bee populations, as do herbicides by reducing other out-ofseason food sources. Yet bees are important to the pollination of some crops grown under monoculture systems such as oilseed rape.

By diminishing biodiversity, intensive agriculture is removing the foundations on which it depends and is placing itself at risk of future catastrophe. The rather biblical scenario is one where the population of a pest species gets out of control due to the reduction in the population of its natural enemies. Equally, the same would be true of less visible pathogens, some of which could threaten the future of domesticated animals or particular crops that have been selectively bred for high productivity and which have often lost much of their natural disease resistance.

Particular uncertainty relates to exogenous factors, the most pressing of which is climate change and the fear that a diminished biodiversity will fail to respond quickly enough with the result that some ecosystem services could be undermined. Crops could be deprived of essential ecosystem services even where the crops themselves have been selected for a modified climate. The risk may be small, but the implications are unknown, though potentially huge. We may not be able to quantify the insurance value of having a high level of biodiversity (Costanza et al. 2000), but a cautious approach represented by the “precautionary principle” would suggest that we ignore biodiversity at our peril.

(2) External costs Secondly, loss of biodiversity due to agriculture leads to externalities, or external costs, for others.

Application of fertilizers or pesticides is inevitably imprecise and certain amounts will always find their way into surface or ground water. Pesticides pose a particular threat to human health as their very toxicity can lead to problems such as increased rates of birth defects, infant mortality, cancers or other diseases. Fertilizers lead to the eutrophication of water bodies by providing nutrients to algae which then reduce oxygen levels to the point where rivers and lakes become unsightly or devoid of aquatic life. The chapters on Water and Human Welfare, discuss the value of healthy river/lake systems to society for the purposes of drinking water and recreation or the indirect value represented by people’s appreciation of the wildlife wetlands support. Consequently, there are very real and significant economic and social benefits associated with the avoidance of human health problems, recreation and tourism.

In principle, these external costs could be internalised by ensuring that farmers are charged or fined for pollution. However, diffuse pollution is difficult to identify and difficult to control. Government has therefore opted for the alternative of providing incentives to farmers to reduce pollution.

Within the Common Agricultural Policy (CAP) these incentives have been provided in the form of agri-environmental policies, represented in Ireland by the Rural Environmental Protection Scheme.

REPS was originally designed to reduce the negative externalities of agriculture, but the scheme has evolved over time to recognize the value of biodiversity within farming and of the need to adapt existing measures to protect biodiversity. These benefits are being realised through lower intensity farming or farming in which semi-natural systems are preserved. Such systems can often provide for higher levels of biodiversity than purely wild systems.

It would be a fallacy to presume that REPS does not have a useful income transfer function as well as an environmental function. Neither is the scheme entirely directed at protecting biodiversity.

However, to an extent, the amount spent on REPS, at upwards of 280 million per year, does provide an indication of the minimum value that society places on both good environmental management and biodiversity.

3.1.1 V a l u i n g B i o d i ve rs i t y w i t h i n A gri c u l t u re The value of biodiversity is at a maximum where an agricultural system is designed to be sustainable. Where the system is more intensive, this value may appear to be less, but future output will depend on some restoration of biodiversity. A closed-system organic farm in which no inputs are imported would represent the ultimate example of a sustainable system. The problem is that output is lower on organic farms and the price premia of organic produce does not generally compensate for lower yields in terms of higher revenue. Relative produce prices are still determined by supply and demand of all food products as much as by production costs.

Intensive agriculture is capable of producing a higher output. Although ecosystem services have distinct value, it is worth remembering that high intensity systems with low biodiversity dependence are commonly being selected by farmers the world over. Many farmers have clearly decided that the opportunity cost of protecting biodiversity, for example by setting aside areas of natural vegetation, is less than the economic benefits of a more intensive system (Ghazoul, 2007). Aside from some fundamental processes, the associated value of biodiversity therefore appears to be low.

This situation may arise because of a lack of awareness of the benefits of ecosystem services. It can also arise because biodiversity is a public good that often requires protection at community level, whereas agricultural output is a private benefit. Scientific opinion is that intensive agriculture is not sustainable in the long-term (Ryan, 1999), but farmers are not always in the position of being able to consider the environmental damage or the costs to future generations.

As an alternative, a broadly sustainable, but non-organic system would have a stronger relationship with biodiversity. A two-tier intensive/extensive agricultural sector is now the rural development prospect for Ireland and much of the EU (Binfield et al, Agri-Vision 2015). The extensive scenario has employment and social benefits and is likely to be represented mainly by smaller farms that are partly dependent on rural development payments. These payments reflect policy support for a scenario that favours farming systems which benefit the environment, rather than a system that ensures that high-output farming systems conform to environmental criteria. The former farms will not be able to match the high yields of the more intensive sector, although they are often capable of producing higher quality food. Before taking into account the social costs and benefits, ecosystem services may appear to be more valuable on these extensive farms than they would be for those with a greater dependence on artificial inputs.

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