Whose Land is it anyway? The importance of property rights and the market to the delivery of ecosystem services. Michael Winter Natural Capital Initiative Valuing our Life Support Systems Savoy Place, London 30 April 2009

This paper will: Consider the evidence on four out of five key ‘social’ determinants of land use. Question whether the choices made by land occupiers and consumers are likely to be conducive to balancing our options in an optimal way. Raise questions and (hopefully) stimulate discussion about how ‘market failures’ might be addressed.

Some Key Social Determinants of Land Use 1.Land occupancy arrangements (ownership and tenure and associated motivations) 2.Land occupiers’ perceptions and assessment of market and policy possibilities 3.Land occupiers’ knowledge, technical ability and personal aspirations 4.Consumer demand for land-based products 5.The ‘public interest’ as represented through public policies and stakeholder rights

Land Occupancy 2007 England & Wales Postal Survey covering 0.49% of the total holdings, consisting of 186,024 hectares, some 1.72% of the total agricultural area. Key finding is the importance of unconventional occupancy. Some examples: Contract Farming: 19.5% of land area in East Anglia and 10.4% in South East but no other English region with more than 5%. Farm Business Tenancies: range from 4.7% in Yorkshire & Humberside to 13.7% in East Midlands. Informal/Unconventional: range from 3.3% in East Anglia to 11.5% in North West.

Two other occupancy issues: The new owners. Evidence over a long period of an increasing proportion of land purchased by non-farmers: residential purchasers. Occupancy units stubbornly refuse to align with natural units.

Why is this important? More complex array of actors. The determinants of land management and the objectives of those engaged in different aspects of land management no longer reside only with landlord and tenant or sole occupier. More frequent occupancy change. We know from previous research that occupancy change is often a trigger for management change. Danger of environmental asset stripping. Multiple Short term arrangements, whether formal or informal, are not necessarily the best suited to long term stewardship.

Long term management may be compromised. We know that short-term arrangements may mitigate against long term ‘crops’ such as woodland. Or, in case of new owners, land may be neglected or mis-managed. Becomes a ‘positional good’ rather than a productive resource.

We certainly do not know what the optimal occupancy arrangements might be for optimising/balancing ecosystem service delivery. Alongside the urgent need for hard science on ecosystem services is a need for more social science work on occupancy.

2. Market & policy orientation Orientations will vary but despite what I have just said re changing trends in occupancy, do not under-estimate the continuity of farmers and two particular characteristics: Their deep awareness of the complex mix of market and policy signals. Their underlying ethic of productivism and a belief that the day for food is returning.

Knowledge, technical ability, aspirations Farmers are people! They vary – they know different things and have different desires. They have a knowledge base that is hugely important in terms of their own land. They are likely to know more about some ecosystem services than about others.

Consumer demand Continued big demand for the big commodities purchased through the big retail outlets. But alternative food supply chains are growing and becoming more sophisticated (local, healthy, organic, etc) – recession may cause blips but overall trend is steady. But underlying issue of what we eat is not changing hugely – meat, dairy, cereals, vegetables.

Market failures In this context MF exist if what land occupiers do to satisfy their own objectives and market/consumer demand does not lead to optimal patterns of land use terms of ecosystem service delivery. The old issue of public goods and +ve or –ve externalities. What balance of regulation and incentives is needed?

And this question has to be considered in the context of deep-rooted societal value value attached to private property rights and to consumer sovereignty.