Performance and payments in UK agri-environment schemes Factors affecting participation Transaction costs Scheme evaluations and benefit valuation Socio-economic evaluations Environmental monitoring

Factors affecting Participation 1. Economic research Farmer’s decision is based on expected profit/utility 2. Contextual factors Examining a wider set of factors that effect a farmers participation decision 3. Adoption models - Investigating the process of adoption over time

Transaction Costs Both public and private transaction costs should be taken into account Transaction costs of ESA are relatively high compared to most traditional grant aid schemes Public administration costs are an average of 48% of compensation paid Private transaction costs are estimated at 5% of compensation What transaction costs bring in terms of enhancing environmental output is the important issue

Evidence from economic evaluations Both ESA and CSS aim to maintain/increase elements of natural capital stock and public access to this stock Fundamental differences in the way the ESA and CSS schemes have been monitored and evaluated Economic benefit studies – contingent value method

Socio-economic evaluations Ecoscope report – assessments of ESA and CSS ESA – focus of the evaluation was on farmers’ response to the scheme, payment rates and impacts on farm management CSS – should establish performance indicators

Environmental Monitoring Final results from monitoring unavailable On average 38% of performance indicators achieved Landscape and historical features are maintained in nearly all ESAs Limited results for wildlife enhancement As regards wildlife enhancement, ESA appears less successful than CSS Different monitoring systems in place – not feasible to compare