Conservation covenants: securing long-term environmental benefit

Conservation covenants offer a new way of securing long term benefit for the environment. CIWEM Policy Adviser Sarah Anderton outlines the Institution’s take on how they should be introduced.

Conservation efforts can take a long time to come to fruition. We’re talking decades. And a long-term approach needs a long-term mechanism, which is exactly what England has been lacking.

That’s where conservation covenants could come in. Currently we do have the option to use covenants. But only negative covenants (e.g. not to do rather than to do something), for the benefit of neighbouring land. So they’re not really much use, at all, for conservation.

Workarounds have been used in the past but they’re not terribly attractive, with ownership or tax implications that most potential participants want to avoid.

To try to fill this gap in English law, Defra has been consulting on conservation covenants. Asking questions like:

• do you think they should be introduced? (Yes)
• would you make any changes to the Law Commission’s proposals? (yes) and
• should tenants be able to enter into conservation covenants? (yes, but only with agreement from their landlord who must also commit to taking on the remaining agreement after the termination of the tenancy).

Conservation covenants have great potential to be used for delivering biodiversity net gain (which the Chancellor recently announced will be made mandatory for development), facilitating Payments for Ecosystem Service agreements, and facilitating delivery of public goods to meet the 25 Year Environment Plan aims.

To fulfil these potential uses conservation covenants will need to look a little different to those proposed, with the main change being to remove the restriction on who can use them!

The Law Commission proposed that only ‘responsible bodies’ who have been approved by the Secretary of State should be allowed to enter into conservation covenants. Whilst ‘responsible bodies’ should undoubtedly be able to enter into these agreements, it shouldn’t be necessary to restrict use of conservation covenants in this way.

In most other circumstances, willing and able parties can enter into contracts with each other, and this should be the case for conservation covenants too. After all, more agreements means more conservation!

That brings me to our other main point of disagreement. The consultation proposed that conservation covenants should only be used to deliver public goods. Clearly public money should be used to deliver public goods. But why can’t conservation covenants also be used as the mechanism for delivering improvements which mainly benefit private businesses where those agreements are privately funded? There’s even a chance that in doing so, the public will also inadvertently benefit from ecosystem services secured.

For example, improving water quality and flow through a conservation covenant may not only benefit a water company through reduced costs but also the local aquatic environment, contributing to improved biodiversity which is seen as a public ‘good’.

Privately funded conservation covenants should be allowed to be used to provide benefits that mainly serve an individual or company. We know that the Treasury is far from a bottomless pit! So we need to take this opportunity to embrace conservation covenants as a mechanism that can direct private finance towards environmental good.

If you’d like to read more about our views on conservation covenants including minimum length and dispute resolution then have a read of our full response here.

22/03/2019