The design of the Sustainable Farming Scheme (SFS) in Wales needs to use the best available information. This information can be complex to organise, and needs to be joined-up to connect the science on how farm management will affect the environment, with economic evidence on what benefits society will get as a result.
ERAMMP is exploring the use of a ‘logic-chain’ approach that shows how land management actions (under the proposed SFS) will affect the resilience of ecosystems and the benefits that ecosystem goods and services provide to people. The approach will inform the identification of the public goods that the proposed SFS payments aim to secure, and the estimated economic value of those benefits.
Public goods (such as some categories of ecosystem goods and services) are outcomes that have value to wider society but in some cases are not traded in markets. As public goods are not traded in markets they do not have market prices, however there are approaches that can be used to value some public goods. For others, the evidence base is less reliable. This initial report explores the evidence base underpinning the logic chains for each of the environmental outcomes generated by the proposed SFS.
The economic values identified are NOT recommended payment rates. They are one input into payment design. Other factors relating to the overall scheme design, farm businesses (e.g. levels of risk, incentives) and value for money, must also be considered.
Logic chains do not replace the need for detailed and accurate scientific evidence such as that provided in the ERAMMP Evidence Packs for the SFS, the National Forest and other policy initiatives. They summarise information to help communicate policy options.
This report presents an initial exploration of the logic chains approach for the SFS for key outcomes the SFS will aim to achieve: Improving air and water quality; Reducing greenhouse gas emissions; Reducing flood risk; Healthier ecosystems with more wildlife; Livestock health & well-being; and Healthy soils.
This work is ongoing and a further, more detailed, analysis is planned for release at a later date. This follow-on work will draw on the detailed scientific information gathered in the ERAMMP evidence packs on the SFS and National Forest for Wales, including the synergies and co-benefits - as well as some trade-offs - between management measures and their outcomes.
How to cite this report:
Dickie, I. & Neupauer, S. (2021). Environment and Rural Affairs Monitoring & Modelling Programme (ERAMMP). ERAMMP Report-40: SFS Economic Valuation: Logic Chains. Report to Welsh Government (Contract C210/2016/2017)(UK Centre for Ecology & Hydrology Projects 06297 & 06810)