The UK government has announced a significant increase in funding for environmentally friendly farming, setting a target of up to £2 billion annually for England’s Environmental Land Management (ELM) scheme by 2028. This initiative aims to support farmers in restoring hedgerows, soils, and wetlands, contributing to carbon absorption, pollinator support, and water purification. However, despite this increase, budget cuts elsewhere complicate the overall recovery for environmental efforts.
Funding Challenges Amid Expanding Goals
While the ELM scheme promises a substantial boost, the Department for Environment, Food and Rural Affairs (Defra) is facing a real-term budget cut. This reduction places the department in a challenging position, requiring them to manage thousands of new ELM agreements with fewer resources. The ability to monitor environmental progress, such as increases in skylark populations or improved water clarity, could be significantly hampered.
Independent analysis from 2024 suggests that £6 billion annually is necessary to align UK agriculture with the Environment Act’s targets for habitat restoration and net-zero commitments. The proposed £2 billion for England only covers half of this requirement. Additionally, the planned £400 million for trees and peatlands is not new funding but rather a continuation of previously promised allocations.
Tech Investments Overshadow Environmental Needs
In contrast, the Department for Energy Security and Net Zero has been allocated roughly £30 billion for nuclear fission, fusion research, and carbon-capture hubs. These projects, while crucial for low-carbon technology development, lack immediate ecological benefits. The focus on technological infrastructure underscores the challenge of balancing ecological restoration with technological advancement.
The UK Office for National Statistics estimates the replacement cost for the benefits provided by natural resources like forests and rivers at about £1.8 trillion. This figure highlights the immense value of these ecosystems, which is not fully accounted for in current financial planning. The spending review does not address the integration of these natural benefits into economic assessments or stress testing by financial institutions.
There is a critical need for policies that embed nature-based solutions in national planning. For example, the chancellor’s £39 billion allocation for social and affordable housing over the next decade could lead to significant ecological benefits if developments achieve at least a 10% net biodiversity gain. This approach could transform the UK’s housing program into a global leader in nature-positive, net-zero development.
However, the ongoing planning and infrastructure bill presents risks, as it may allow developers to bypass habitat protection by paying a levy instead. Economists and ecologists have expressed concerns, describing it as a potential “license to kill nature.”
As the UK prepares for the Cop30 summit in Brazil in November 2025, there is pressure to align domestic spending with international commitments. Over 150 UK researchers have urged the Prime Minister to prioritize nature in the UK’s Cop30 agenda. Delivering on this requires converting budgetary commitments into tangible habitat gains and embedding robust rules into planning and housing reforms.
While the spending review marks progress for nature-positive agriculture, the dominance of technological investments over environmental funding remains a significant hurdle. Ensuring Defra has the capacity to implement its objectives, publishing a clear timetable for tree and peat funding, and reserving part of the flood budget for community-led solutions are crucial steps. These measures could transform headline promises into meaningful projects that enhance daily life and steward public resources effectively.
