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Interview with an Influencer – Professor David Hill CBE, The Environment Bank Ltd

david hill cbe interview environment bank

As part of Inside Ecology’s ‘Interview with an Influencer’ series, we interview Professor David Hill CBE, Chairman and founding owner of The Environment Bank Ltd. Co-founder and Non-executive Director of The Naturespace Partnership Ltd. Commissioner for the Food, Farming and Countryside Commission, Chair of the Northern Upland Nature Partnership, Chairman of Plantlife and Trustee of the Esmée Fairbairn Foundation. A founding member of Natural England and Deputy Chair (2011 – 2016). Former Board member of the UK Government’s Joint Nature Conservation Committee, and Ecosystem Markets Taskforce. 

How did you get to where you are today?

I was fortunate in being able to study for my doctorate at the Edward Grey Institute of Field Ornithology at the University of Oxford after a first degree in ecology. I subsequently joined the Game Conservancy (as it was then called – now the Game and Wildlife Conservation Trust) as a research biologist studying gamebird ecology. I had a wonderful time with them and after about five years joined the RSPB as Senior Ecologist responsible for the science on all UK reserves. The network from both organisations has stayed with me to this day. I then became Director of Development at the British Trust for Ornithology, with responsibility for moving them from Tring in Hertfordshire to a new home in Thetford, where they are still based. In 1992 I set up one of the first environmental consultancy companies established in Britain – Ecoscope Applied Ecologists. The business grew rapidly, based on a scientific underpinning and a commitment to high quality work that put nature conservation at its heart. I merged the company with the RPS Group plc in 2002 and stayed with them for four years as their Chief Scientific Adviser.

By 2004 I had become disillusioned with the way we treated biodiversity within the planning and development control sector. I asked 400 ecologists at a major conference if they could show me some key examples of where mitigation had been effective (we weren’t even talking about net gains from development in those days!). Not one person raised their hand. I think that biodiversity benefits from development are still woefully lacking or non-existent. We may have created an ecological consultancy industry but I don’t think we are anything close to being effective enough at protecting biodiversity.

So in 2007 I set up The Environment Bank Ltd as a means, initially, of lobbying for a better approach to biodiversity conservation associated with planning and development, based on ‘mitigation banking’. A breakthrough came when the Tories eventually included biodiversity offsetting as a policy opportunity in the 2011 Natural Environment White Paper. However, many of the conservation NGO’s wouldn’t recognise that development was delivering nothing of value to biodiversity conservation and wrongly concluded that offsetting was a ‘licence to trash’. The narrative became polarised and despite endless meetings and discussions at conferences, the conservation sector failed to engage and demand better outcomes from development, believing that developers should retain and enhance biodiversity within the development site. This was unlikely to happen because of viability issues and the fact that protecting and enhancing biodiversity doesn’t sit easily with developers who just want to develop. The consultancy sector perpetuated the perception that it could all be delivered on-site, which was, and still is, a fallacy. We have lost literally billions of pounds that could have been spent on effective large-scale nature conservation as a result.

interview David Hill cbe

Having joined the Board of Natural England in 2006, I had an opportunity to try to change the system for dealing with biodiversity in the planning system. This took a long time and there were many challenges that continued to thwart efforts to get better outcomes from development. The Government established the Ecosystem Markets Taskforce, of which I was a member, and we reported in 2013 with the firm recommendation that biodiversity offsetting should be made mandatory. Unfortunately, this did not find favour with officials at the time. Eventually, however, the narrative changed from ‘offsetting’ to ‘net gain’ which I agree sounds better; the government had set up the Natural Capital Committee, and finally the conservation world saw the benefits that could be delivered if development really was made to pay the true cost of the use of land. These factors coming together, plus continued lobbying by me and others, and a Secretary of State who sees the natural environment as an essential asset that has to be protected and enhanced rather than a barrier and hence burden to ‘growth’, has created a policy landscape for change. None too soon! I continue to advocate, through the Environment Bank, for the effective valuation of biodiversity and my ‘mantra’ is the creation of the ‘restoration economy’ using funds from a) future farm payment contracts for environmental gain, b) biodiversity compensation schemes/net gain from development, and c) net gain funding from corporate natural capital accounting. Such investment would deliver a transformational change in how the countryside looks and substantially increase the amount of biodiversity it can support.

I was also interested in trying to make a contribution to nature conservation within the third sector and was fortunate to join the Board of Trustees of the Esmee Fairbairn Foundation, which gives substantial sums of money to a range of sectors including the environment, to become the chairman of Plantlife, and chair of the Northern Uplands Nature Partnership focussing conservation delivery in the massive protected landscapes of the North Pennines AONB, Northumberland National Park, Yorkshire Dales National Park, Nidderdale AONB and Forest of Bowland AONB. I also sit on the Board of the Food, Farming and Countryside Commission, funded by Esmee. Through all of these positions I have met some amazing people.

interview David Hill cbe

Natural England was established in 2006 by the NERC act – as one of the founding members, Deputy Chair and Board Member for ten years, what were the main challenges in that role and what significant changes did you observe during that period?

The obvious, first, challenge came in 2010 following the financial crash and the austerity measures that were put in place. Having had a few years where we felt we could do so much, it was a shock to have to manage a reducing budget just at a time when everyone was in agreement that the natural environment was critical to all of our lives. Nonetheless, we were not alone and the job of a non-executive Board is to be able to manage an organisation during both good and bad times. On balance, I would say we did a good job but we should not underestimate the pain that everyone – Board, staff and stakeholders alike, went through during that time. Other challenges were that we needed to devise a new business model and so we established a Developer Industry Group and a Board Innovation Group, both of which I was asked to chair, in order to develop new and novel ideas for financing the natural environment. This led to the progression of the net gain initiative and District Licencing for European protected species, amongst others. One of the most significant changes was the realisation that Natural England could no longer do everything; working in partnership was to become essential. But with that change came with much criticism from stakeholders, purely because we inevitably lost visibility. Under a new landscape of hope for the natural environment, it would be good to see greater resources going back into supporting its critical role in all of our lives.

What are your thoughts on the question posed by the recent House of Lords Select Committee’s report i.e. Is the NERC Act 2006 still fit for purpose?

I welcome the report because on the whole, the recommendations are sound and would lead, in particular, to a reversal of biodiversity loss. I am especially in favour of a new environmental watchdog to hold Government to account, and Natural England should be given much greater powers to ensure delivery of biodiversity conservation across the wider countryside, and not just focus on protected species, habitats and landscapes. Amending the NERC Act in order to add a reporting requirement to the biodiversity duty with the Government strengthening the wording of the duty, is critical. Planning authorities, for example, must be required to ensure delivery of net gain from all development – for too long they have abrogated responsibility for biodiversity. Biodiversity must be a material consideration in planning at least equal in weight to other planning matters. I would certainly, therefore, advocate that the Government should publish, and promote effectively, new guidance on implementation of the biodiversity duty and hold public bodies to account. The new environmental watchdog could randomly assess a planning authorities schedule of biodiversity requirements (e.g. as identified in Section 106’s) for all developments and put authorities into ‘special measures’ if they have failed to enforce requirements and deliver net gain from development. Biodiversity compensation/offsetting would play a key role, using the biodiversity impact accounting metric of Defra to determine the quantum of net gain, delivered for example, via habitat banks.

What changes would you like to see / opportunities taken in relation to biodiversity and nature conservation as a result of Brexit?

I personally believe there are likely to be few benefits emanating from Brexit but clearly a major one will be the removal of the Common Agricultural Policy (CAP). We should design a ‘payments by results’ model in which land managers are paid for delivering outcomes enshrined in environmental land management contracts, funded by Pillar 1 money. We should convert the narrative of subsidy, support and agreement, into contractual language where the land manager is paid public money to deliver public goods. This is embedded into the 25 year Environment Plan and I have every confidence that we can deliver something special, at scale, across the countryside – stitching back the fabric that the CAP destroyed. The prize is huge but the consequences of failure for the likes of Defra will be significant indeed. We must ensure that farming properly accounts for all of its externality costs such as health impacts from pesticides, nutrient enrichment, emissions of greenhouse gases, damage to roads, flooding, damage to wader populations as a result of silage making, and the culture of plastic accumulation in the countryside. New technologies must be embraced to refine input use and improve yields whilst sparing land for biodiversity conservation. And finally, I want to see all of the EU legislation for nature conservation imported directly into UK law, together with a watchdog (as mentioned above) that has teeth and can hold the Government to account in the same way as the infraction system does now.

The Environment Bank was founded in 2007 – could you explain a little more about the idea behind the organisation and how it works?

Having been disillusioned by the lack of account taken of biodiversity in development applications (or lip service paid to it) I decided a better model was needed where biodiversity could be created, enhanced or habitats restored off-site using significant funding from development, along the lines of ‘mitigation banking’ that has been operating in the United States for decades. I established the Environment Bank firstly to lobby Government on the idea and secondly to operate as a broker between land managers who would be paid to create and manage offset sites, and developers whose schemes have an impact on biodiversity. Though ‘biodiversity offsetting’ was included in the 2011 Natural Environment White Paper, it has taken a rename to ‘net gain’ for it to be seen as acceptable. Net gain is now a key principle within the revised National Planning Policy Framework (NPPF) and the 25 year Environment Plan. It is hoped that the principle of net gain will soon be made mandatory – all planning authorities being required, via local plans and supplementary planning documents, to use it to deliver their biodiversity duties. It will then be no longer acceptable for planning authorities to fail to take account of biodiversity in the planning system. Rightly, it will escalate the importance and standing of biodiversity (and planning authority ecologists) in the planning system and will no longer be treated as a poor relation to planning, traffic, design, job creation and other matters.

The Environment Bank as a business works as follows : Planning authorities must require all developments to deliver net gain in biodiversity. Environment Bank measures the impacts of the development and calculates the compensation requirement using the agreed biodiversity impact accounting metric (Defra/Natural England). Environment Bank establishes strategically located Habitat Banks in the countryside working with landowners, farmers, the planning authority and conservation bodies. Habitat Banks yield ‘conservation credits’ that we sell to developers in relation to their need to compensate for their residual impacts and provide further value beyond those impacts, ie net gain. We pay the land manager to create, enhance and manage their land for long-term biodiversity benefits, secured through a Biodiversity Management Plan. We undertake monitoring and feedback to the planning authority which ensures they are compliant with delivering their biodiversity duties under the NPPF.

interview David Hill cbe

There has been criticism that species and their relationship to habitat are not considered as part of the metric calculation process, nor is the value of a habitat considered within a wider landscape context – is no-net-loss / net-gain really achievable with the omission of these factors?

The material consideration of protected and notable species within planning and development has not changed due to the introduction of biodiversity accounting and offsetting and in general terms, better compensation for broad habitats and biodiversity impacts will benefit a range of wildlife. More specifically, a metric designed to address all protected species would both take a significant time to develop and be unwieldy to use. However, in bespoke assessments, certain species groups can be taken into account within the Defra metric by giving a higher distinctiveness score. Regarding landscape value, currently the metric can apply a value to the location of a compensation site and a development in a location causing a significant fragmentation issue is also a planning consideration. We are currently working with Natural England on exploring options to improving how landscape value can be incorporated into the metric.

Critically, however, we need to be mindful that no net loss/net gain is certainly not being delivered through development at present, so any improvement on the status quo has to be advantageous for biodiversity. I would not wish effective roll-out of the initiative to be stalled just because the metric may need some tweaks – these will happen over time. We need to get on with the whole process and secure the proper accounting, mitigation and compensation for biodiversity impacts from development.

What surety is there that new habitats created as a result of a biodiversity compensation scheme are developed as planned and managed for the long term?

Environment Bank holds a delivery contract with the land manager where the net gain/offset site is located. The land manager is paid in accordance with meeting the objectives and outcomes of the Biodiversity Management Plan. The full creation, enhancement and long-term (25 – 99 years) costs are calculated by our costings calculator and the sum commuted to a capitalised value that is paid (as a one-off payment) by the developer for a certain number of conservation credits according to the impacts calculated by the Defra metric. The liabilities for mitigation/compensation are taken away from the developer and placed with someone who is paid under a formal contract to deliver a scheme. At present we have a good number of net gain sites coming through the pipeline and have had no push back from developers since it removes their long-term liabilities, can improve net developable area (which has direct financial benefit) and gives certainty and clarity to the planning system. There is simply no comparison between the benefits of our system and the failures of the ‘current’ system whereby developers fail to deliver biodiversity conservation at scale because of the conflicts between biodiversity and built development, and lack of any enforcement. It’s fine to argue that green walls and roofs, a few ponds within a housing scheme, or a bund planted with wild flowers, supports biodiversity in the built environment, but what really interests me is the wilder side of biodiversity, created, enhanced and managed at scale, where species and habitat conservation is meaningful and can be secured for the long-term.

Natural England is looking to update the Defra Biodiversity Metric in 2018 – are there any changes that you would like to see implemented?

We are working closely with Natural England and their team during this process. Some of the changes we are most looking forward to are the fine-tuning of habitat terminology and condition assessments to facilitate ease of use and their accuracy, and an improvement in how hedgerows and other linear features are assessed.

interview David Hill cbe

How is NatureSpace Partnership assisting with the delivery of schemes in relation to the new District Level Licensing for great crested newts?

We founded The NatureSpace Partnership Ltd to concentrate on rolling out District Licence delivery of new habitat for great crested newts (which will also benefit a range of other species of conservation interest). We have secured the first District Licence from Natural England for the region of Oxfordshire, Buckinghamshire, Bedfordshire and Milton Keynes, with all local authorities on board. We have undertaken all the strategic surveys and population modelling so that we know where to create new habitat to maintain/enhance favourable conservation status for the species. Each development that wishes to join our scheme is assessed to determine the potential impacts on newts and differential charges are applied, which are used to fund habitat creation. We have established a Community Interest Society run by the Amphibian and Reptile Conservation Trust and Freshwater Habitats Trust who deliver the new habitat and its management. It is early days (the scheme was launched in March 2018) but we have generated considerable developer interest and have already created new habitat. We intend to roll the model out to other regions over the next two years.

What project or accomplishment do you consider to be the most significant in your career to date?

I think my main accomplishment has been to found the Environment Bank and thereby to lobby for, and eventually realise, changes in the planning system to better account for biodiversity impacts from development through biodiversity offsetting/net gain. Having gone from bringing an idea to Government, through to seeing net gain embedded in Government policy, has been really satisfying. Though it has not been without frustration – it can take so very long to effect change. I guess I’m a person who likes to find a way of doing something rather than finding ten reasons why not to do something! A number of other people have also been key in driving the net gain agenda. Making nature economically visible as well as intrinsically visible has been the driver for me. Only then will biodiversity be attributed the value it deserves. But the job is not yet done and there are many other players besides me who need to work together to ensure scale-up, not least within planning authorities. I want to see net gain from development delivering substantial revenue into habitat creation and management schemes, at large spatial scales, across the country, in association with land manager payments from corporate natural capital accounting and payments to improve the environmental performance of farming. I am aggregating these into the concept of a ‘Restoration Economy’ as mentioned above, that will bring much needed finance to biodiversity conservation, creating jobs and skills in rural communities, transforming the way the countryside looks and functions to the benefit of future generations of wildlife and people.

Further Information: Prof. David Hill CBE is Chairman and owner/founder of The Environment Bank Ltd (EBL), a Board Trustee of the Esmee Fairbairn Foundation, Chairman of the conservation charity Plantlife International and Chairman of the Northern Upland Chain Local Nature Partnership covering the vast upland areas of the Yorkshire Dales and Northumberland National Parks and Nidderdale and North Pennines Areas of Outstanding Natural Beauty. He is currently a Commissioner on the RSA’s Food Farming and Countryside Commission. He was previously Deputy Chair of Natural England, the governments statutory advisers on the natural heritage, and previously a member of the Board of the UK government’s Joint Nature Conservation Committee and the government’s Ecosystem Markets Taskforce. David has a doctorate in ecology from the University of Oxford and worked for a number of NGO’s before establishing one of the first environmental consultancies in the UK, which he merged with a plc in 2002.

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