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Aspects of Land Spring / Summer 2019
will impact all land, in particular land that
is currently thought of as marginal.
Natural capital opens up new earning
opportunities for land holdings that
may mitigate the loss of payments as
a result of leaving the EU Common
Agricultural Policy.
Michael Gove’s Agriculture Bill has
seven clear target areas, all focused
on enhancing natural capital, but the
Scottish Government has yet to give
the same clarity. However, the Scottish
Environment Protection Agency (Sepa)
is leading a £1 billion challenge to attract
private, public and non-profit sectors to
develop funding models for large-scale
nature conservation activities.
There are uncertainties over the size
of the future budget streams from Defra,
Sepa and others, but it can be inferred
that farms and
landscapes that
are naturally richer
in environmental
resources are
more likely to
be recipients of
public investment
under future
agri-environment
policy. This will open up a new and
profitable income stream for farms
in areas of natural constraint, as their
earning capacity is increased by managing
these resources compared to returns
from agriculture alone. At current land
values, marginal land could then present
an attractive investment proposition,
even if earnings from marginal livestock
enterprises fall.
As the controllers of natural capital
assets, landowners are uniquely placed
to benefit from payments for ecosystem
services. It’s my belief that this will have a
positive impact on land values in areas of
high ecosystem service value and a neutral
impact elsewhere.
n To discuss natural capital opportunities,
speak to Hugo Struthers, Perth, 01738 477 501,
N atural capital might be the
phrase of the moment,
but is it in fact no more
than the well-established
principle that landowners
and farmers have long taken into
consideration in their decision-making
processes? Either way, the concept has
gained tremendous momentum and is
likely to influence how we invest
in and manage land in the future.
Natural capital is the stocks
of natural assets that include
geology, soil, air, water and all
living things. It is from these
assets that we derive what have
been coined ecosystem services
such as carbon sequestration,
water purification and soil
fertility. From these in turn we derive
societal benefits such as food, energy,
clean water and air, wildlife conservation,
recreation and tourism. However, what is
unclear is how we calculate the monetary
value we place on these natural assets.
In Scotland, our country pursuits
and scenery continue to be a draw to
investors, but more recently a new
breed of buyers has surfaced. Anders and
Anne Holch Povlsen, are now some of
the largest owners of land in the UK,
having acquired 221,000 acres of the
Highlands since 2006. Their aim is to leave
a negative carbon legacy by restoring and
protecting the natural capital of
their estate.
These philosophies, while in many cases
being led by wealthy philanthropists and
conservationists, are not restricted to that
group. In the future, natural capital value
ON THE COUNCIL
Clive Beer, of Savills Professional Services,
has been elected to the council of the
Agricultural Law Association (ALA), which
provides a forum for professionals to support
each other in their work. Membership of
the ALA is open to all those involved in
rural advisory professions such as lawyers,
surveyors, accountants, bankers and farm
consultants. Clive is the only non-lawyer to
have been elected to the council in 2019.
6
NATURAL CAPITAL
IS GOOD NEWS FOR
MARGINAL LAND
#PROTECT YOUR FUTURE
The National Federation of Young Farmers’
Clubs has launched a tree-planting campaign.
In partnership with the Woodland Trust, it
has set a goal for all Young Farmers’ Clubs
(YFCs) to plant a tree per member. “This year
is all about YFCs putting their green feet
first and supporting the environment and our
local rural communities. I am excited to be
spearheading this campaign and ensuring the
next generation are making sustainability a
priority,” says Katie Hall, the federation’s chair.
“Natural capital
value will impact all
land, in particular
land that is thought
of as marginal”
HUGO STRUTHERS
HEAD OF SAVILLS RURAL, SCOTLAND
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