Executive summary

The need for more widespread and ambitious policy instruments for biodiversity conservation and sustainable use, including the reform of incentives that are harmful to biodiversity, is widely acknowledged. Progress, however, has not been as rapid and effective as needed. Global biodiversity trends continue to decline and the OECD Environmental Outlook to 2050 projects this to continue under a business-as-usual scenario (OECD, 2012). Loss of biodiversity and associated ecosystems in turn, results in adverse and costly impacts on human health, well-being and economic growth.

As countries strive to implement more ambitious and cost-effective policies to enhance biodiversity conservation and sustainable use, a key question is why some policy reforms relating to biodiversity have been successful, while others have not. Though there is a growing body of literature on the political economy of environmental policy reform, much less attention has been devoted to biodiversity, or biodiversity relevant, policy reform. Taking a political economy perspective on biodiversity related policy reform i.e. the political constraints that condition the timing, speed and sequencing of reform, can shed light on this, and consequently, help to provide insight on how barriers to reform can be addressed.

This report aims to contribute in this regard. It summarises the salient political economy issues that arise in environmental policy reform more broadly, and highlights cases where these have arisen in the context of biodiversity relevant policy reform. Four new case studies follow, highlighting insights and lessons that emerge from each experience. The case studies are: the French tax on pesticides; agricultural subsidy reform in Switzerland; European Union (EU) payments to Mauritania and Guinea-Bissau to finance marine protected areas management via conservation trust funds as part of Fisheries Partnership Agreements; and individually transferable quotas (ITQs) for fisheries in Iceland. Each of these case studies focusses on the policy context in which the reform was undertaken; the drivers of reform and the types of obstacles that have been encountered; key features of the policy reform and the impacts on various sectors; and the lessons learned from the reform experiences, including insights on how obstacles were addressed.

Drawing on the literature and the experiences from the case studies examined here, the insights and lessons learned on overcoming obstacles to more effective biodiversity policy reform are summarised below.

• Salient issues that arise in the political economy of environmental policy are competitiveness concerns, impacts on income distribution, vested interests, and the political acceptability of reform. These issues also resonate strongly in the biodiversity related policy reforms examined in this report.

• Potential adverse impacts on competitiveness can act both as a driver and as a barrier to reform. In the case of Iceland, the looming threat of an economic crisis due to the impending fisheries collapse led to a rapid and sweeping reform of domestic fisheries policy. Barring an economic crisis however, stakeholders have most often used potentially adverse impacts on competitiveness as an argument for slower and more piecemeal policy reform. This is illustrated in the case of France. Revenue-recycling of the tax on pesticides was one approach that helped to mitigate these concerns.

• Concerns regarding the impacts of policy reform on income distribution have also been important in the case studies on France, Switzerland, and Iceland. In Iceland, discontent with the way the initial free allocation of fisheries quotas had led to a distinct set of “winners” was an important driver of more recent policy reforms, which introduced a resource rent tax on fishery quotas to more broadly share the benefits from a common property resource. In Switzerland, transition payments were used to minimise negative impacts on farmers who would no longer receive payments per head of cattle.

• Developing a robust evidence base can help to build support for policy reform. Such an evidence base has helped French authorities resist pressure from vested interests. The identification of costs and benefits of reform amongst various stakeholders and over time can help to identify possible allies in the case for reform, as well as how to better target compensational and transitional measures as illustrated in the Swiss case. Moreover, communicating evidence to the general public can enhance the political acceptability of the reform.

• In addition to finding ways to design policies and build support for reform so as to reduce the (real or perceived) obstacles, the case studies presented here also point to the need to be ready to act quickly to take advantage of windows of opportunity that are often outside the influence of domestic policy-makers. This can include forming coalitions, either explicitly or behind-the-scenes, with other interest groups who may share the same desired outcomes, though their own motivations may not be driven by concerns for biodiversity or the environment more broadly. This is shown in the case of Switzerland, where economic and environmental interests aligned to support reform.

• It is also important to ensure that reforms are sustained over time. Vested interests, for example, do not simply disintegrate once a policy reform has been enacted – political priorities can shift and governments can change. Similarly, when there is high turn-over of leadership or staff in key institutions, a void may be created when champions or experts move on, resulting in existing policies becoming vulnerable to back-tracking. These challenges have arisen in the case studies on the conservation trust funds in Mauritania and Guinea-Bissau and in the agricultural policy reform in Switzerland. Continuous training, awareness raising, and provision of evidence-based results can help to maintain successful reforms over time.

• Finally, and similar to findings on environmental and fishery policy reform more broadly, this report re-iterates that there is no “one size fits all” approach to biodiversity relevant policy reform. Strategies to overcome barriers to biodiversity related reforms need to be tailored to the specific context, institutional and political setting of a given country. For example, while broad stakeholder engagement was an important factor in driving incremental policy reform in the French and Swiss case, the lack of broad stakeholder engagement is credited with facilitating the speed with which fisheries reforms in Iceland was undertaken, after which a series of piecemeal reforms were required to address persistent stakeholder concerns.