Natural capital


Natural capital a concept whose time has come


With growing recognition of the economic benefits of protecting nature, Professor Dieter Helm takes a look at how making the financial case could help halt nature’s destruction.


N


atural capital is an incredibly rich endowment. Nowhere is this more obvious than in Scotland. Scotland has a cornucopia of renewable natural capital – its mountains, lochs, and islands teem with wildlife, and the result is a natural capital-based economy. Fishing, tourism, timber, hunting and agriculture are utterly dependent on this fabulous endowment. On top of this, Scotland’s non-renewables – North Sea oil and gas – have underpinned the country’s economy for decades. However, the strain is now showing. The twentieth century was built on the non-renewable natural capital – stuff we can only use once, like oil, coal, gas and minerals. We have used so much already that we have started to change the climate. In this century, at current economic growth rates, global consumption will be 16 times bigger by 2100, and perhaps half of all species will have been rendered extinct.


Nobody can seriously maintain that we can go on like this.


30 SCOTTISH WILDLIFE NOVEMBER 2015


The total of natural capital can no longer be allowed to deteriorate. To do this the right approach is economic – to place natural capital at the heart of the economy, to provide a proper natural capital balance sheet and to make sure that the maintenance of natural capital is a core budgetary requirement – for government and companies. We should be looking to establish a natural capital fund to finance restoration, into which the surpluses from non-renewable oil, gas and other minerals should be funnelled, along with revenues from the pollution charges associated with carbon, other air pollutants, pesticides, herbicides and other water pollutants. Protecting


natural capital is


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