Department for Environment, Food and Rural Affairs              DEF0049

Written evidence submitted by the Department for Environment, Food and Rural Affairs

Section 1: Growing the UK timber industry

Does the UK Government have an adequate understanding of the future demand for timber, including what tree species should be grown?

1. Forestry England, Great Britain's principal organisation for forestry and tree-related research, produce statistics on UK imports, exports and consumption of timber. Their estimates show that the apparent consumption[1] of sawnwood, wood-based panels and wood pellets in the UK have all increased between 2017 and 2021, with the largest increase in wood pellet consumption. The amount of paper consumed has decreased by 1,881 tonnes[2]. 82% of wood consumed is imported and 18% grown domestically[3].
2. 92% of UK timber removals are coniferous timber, with 72% processed for typically construction related applications[4]. The most common coniferous tree species harvested across the UK is spruce at 62% of total timber volume. This is expected to increase to around 71% in the next 25 years[5]. By contrast UK hardwood production is 8% of total UK wood removals with 84% of this volume used for woodfuel[6].
3. Forest Research also produce five-yearly timber availability forecasts. This helps the sector, and organisations responsible for managing the nations’ forests, factor in future domestic timber supply to their planting and harvesting schedules. The aim is to support maintenance of a constant harvesting programme to smooth private and public sector supply that varies with market price.
4. Predicting future timber demand and supply is challenging as it can fluctuate quite considerably in relation to national, regional, and global political and economic circumstances. Recent pest and disease outbreaks in Europe have seen both excessive production of wood for timber and subsequent contraction of long-term availability. Recent events in Ukraine and the impact this has on trade have also shown the highly interlinked nature of timber supply chains.
5. In the England Trees Action plan we have committed to increase public demand for sustainably sourced timber through procurement policies and to identify opportunities to safely increase the use of timber in construction through a cross-sector and cross industry working group. Implementation of these policies, and discussions with the working group, will allow us to further refine assumptions on future demand for timber in England.
6. We expect demand volume of raw wood fibre to increase in the future. It is also likely that the recycling of wood fibre and design of buildings and infrastructure to facilitate greater recovery of recyclable components will be increasingly important.

Does the UK government, working with the devolved administrations, have an effective, joined-up plan with appropriate incentives to increase the production and use of sustainable, domestically grown timber in the UK to reduce its reliance on imports?

7. The Government has committed to bring tree planting rates across the UK up to 30,000 hectares per year by the end of this parliament in May 2024, with further increases needed to follow the pathway to Net Zero[7]. In England we have a target of at least trebling woodland creation over this Parliament to contribute to this. Environmental and Forestry policy are devolved, but we continue to work with the Devolved Administrations to deliver a UK-wide step change in tree planting and establishment, which in turn will increase the production and use of sustainable domestically grown timber.

8. On top of this, the proposed Environment Act statutory target for tree canopy and woodland cover in England is ambitious, increasing England’s woodland cover and tree canopy cover from 14.5% to 17.5% by 2050[8]. This is equivalent to planting 420,000 hectares of woodland while making a net gain in trees outside woodlands, contributing to net zero greenhouse gas emissions whilst delivering for biodiversity and other environmental objectives.
9. The key mechanism to support the production and use of sustainable, domestically grown timber in England is the England Trees Action Plan, published in May 2021 and supported by circa £675m from the Nature for Climate Fund.  The plan sets out commitments to increase domestic tree production, woodland creation and management, and support the forest economy and domestically grown timber.
10. In terms of increasing domestic timber supply, through the Nature for Climate Fund we are investing in sector capacity to support the nursery sector. UK nurseries produce over 100 million trees[9] a year for forestry but to meet our UK tree planting target we will need to plant an extra 30 million tree seedlings a year. We are working with the nursery sector to set up a Nursery Notification Scheme that will help better plan the nature and volume of future supply to meet growing demand as tree planting rates increase and we expect there to be an increase in demand for broadleaf species.
11. Following our England Trees Action Plan commitment to explore new data sharing practices to help better plan for supply and demand in the sector, the Forestry Commission have also recruited a data specialist to facilitate a flow of information on plant supply and demand between Government, the nursery sector, and their customers. Both of these actions will support nurseries and seed suppliers to produce the right stock at the right time and reduce the risk of shortages of trees which in turn will help support an increase in demand for timber in the future.
12. Using Nature for Climate Fund funding we also we have a range of incentives to encourage woodland creation and therefore increase the future potential timber stock. This includes our flagship England Woodland Creation Offer launched last year and the Community Forests Trees for Climate Programme launched in 2020-21. We are currently on our planned trajectory to meet our tree planting commitments, having increased tree planting and woodland creation to c.2,700 ha in England in 2021/22.  We are seeing a strong pipeline of future planting projects but we know that there is more work to do to incentivise and enable planting to accelerate at the scale needed to stay on track.
13. We also need to encourage better woodland management as much potential timber stock is unharvested. We have launched Woodlands into Management Forestry Innovation Funds, including a dedicated Timber in Construction Innovation Fund. We awarded over £600,000 to successful applicants last year through the Woodlands into Management Forestry Innovation Funds.
14. Planting, establishing, and harvesting trees requires skills, technical knowledge, and people to put those into practice. Through the England Trees Action Plan, we will empower charities and businesses to maximise this opportunity for green economic growth by encouraging sector engagement with national education and skills policies and funding, including Kickstart, the Green Recovery Challenge Fund, and the National Skills Fund. We are working with the sector to develop new educational routes and career opportunities in forestry, including through proposals to upskill the domestic workforce, to support the forestry supply chain.

15. The England Tree Action Plan also sets out specific proposals to support a thriving forest economy and encourage demand for UK-grown timber. In particular, we see timber in construction as a significant opportunity to increase demand for our home-grown timber. Government have set up a cross-Government and cross-industry working group to develop a roadmap outlining how to safely increase timber in construction in England. The group will also support implementation of other commitments set out in the England Tree Action Plan and Net Zero Strategy which relate to timber supply and demand.
16. Ambitions to increase planting are high across the UK. This is evident in Scotland’s new target to plant 18,000 ha per year by the end of this Parliament; Wales’ ambition to increase to 4,000 ha per year, and; Northern Ireland’s Forests for the Future Programme which aims to plant 9,000 ha over the next ten years.
17. A Forestry Net Zero UK Working Group has been established across the UK administrations to foster collaboration in our efforts to increase tree cover. This group has already identified sapling supply, skills and workforce as areas that will require UK wide collaboration and we are working together on these challenges. The current development of the Timber in Construction Roadmap also shows close working between sectors from across the UK and Government.

Are there sustainable sources of biomass for UK energy generation either from imported or domestically grown wood for pellet or woodchip? And how can future demand be met from sustainable sources?

18. In 2020 the UK used around 4 million tonnes of oil equivalent (mtoe) of woody biomass from domestic sources and around 4.3 mtoe of woody biomass from imports for renewable energy generation[10]. The Government requires that the sourcing and use of biomass comply with strict biomass sustainability criteria under support schemes, such as the Contracts for Difference, the Renewable Obligations, and the Domestic and Non-Domestic Renewable Heat Incentive. To receive financial support generators are required to demonstrate that woody biomass that derives from forests is sourced from areas that follow sustainable forest management practices, including requirements for the maintenance and replanting of the forest, and must demonstrate to the regulator that deforestation is not occurring in the areas the material is sourced from.
19. The management of forests (including for fire and pest management) requires the periodic removal of some trees to ensure the wider forest can be healthy and grow productively. Where forestry residues are used to produce wood pellets, these are branches, limbs or poor-quality trees which are co-products of existing harvesting activities in managed forests driven by timber industry demand and are unsuitable or unmerchantable for the timber industry. Trees would not be left unharvested in the absence of demand for biomass for energy, as usually the market driver is the broader timber demand (e.g. for housing, furniture).
20. In terms of domestically produced biomass, there is a large unmanaged hardwood timber resource that could potentially be sustainably utilised in the short term, as unmanaged woodland is brought into management. In addition to this, the creation of more new woodland under active management will ensure longer term stability of supply. A key logistical challenge remains in sourcing this domestic biomass from many small suppliers. Softwood timber has competing markets, particularly the wood panel industry, and so additional capacity for the biomass sector is limited. Harvesting residues could provide a limited additional resource, but it is important to recognise that harvesting residues and exploitation is also limited by impacts on long term nutrient sustainability of the sites i.e. branches are used to protect the soil in harvesting operations, rather than being utilised for energy generation.
21. The forthcoming Biomass Strategy will examine the amount of sustainable biomass available both from abroad and domestically through an update to the UK and Global Bioenergy Resource model and will consider evidence submitted by stakeholders. The UK is exploring other biomass resources as well, and BEIS recently announced the results of Phase 2 of the Biomass Feedstocks Innovation Programme, which awarded £32 million of funding to UK biomass projects to deliver commercially viable innovations in domestic biomass production.

How well is the UK Government managing its plans for the domestic timber industry in tandem with meeting its woodland creation targets and related climate change, biodiversity and other environmental goals?

22. Our ambition, as set out in the England Trees Action Plan, is the creation of more truly multi-functional forests, creating a diverse treescape which delivers timber alongside a wealth of other environmental and social benefits. A growing timber industry is part of that vision[11]. The Nature for Climate Tree Programme supports a wide range of woodland types and establishment methods, including mixed woodlands that serve a variety of environmental, productive and amenity purposes; it is important to balance the needs of nature recovery, achieving net zero and putting in place a sustainable timber resource.
23. The softwood availability forecast, recently published by Forest Research[12], sets out future availability and will help inform future incentives for woodland creation. The issue is regularly discussed in various fora, including the Expert Group on Timber and Trade Statistics and the Forestry Commission’s Applicants Focus Group. These and other discussions aim to ensure domestic timber objectives are achieved alongside woodland creation targets and other environmental objectives.
24. Woodland management is also key to deliver a multifunctional and productive woodland. Presently around 42%[13] of our woodlands are not actively managed and this can have a negative impact on the resilience and the biodiversity they contain, as well as the productiveness of those woodlands. We are helping more owners manage more woodlands by providing Countryside Stewardship woodland management planning grants, infrastructure grants and woodland improvement grants. We have also launched the Woodlands into Management Forestry Innovation Funds aimed at increasing management through regional funding and that also supports conservation to restore ash woodlands and enables better access to woodlands. This will help restore vulnerable woodland habitats and help woodlands adapt to a changing climate and recover from the impacts of pests and diseases. We awarded over £600,000 to successful applicants last year through the Woodlands into Management Forestry Innovation Funds.
25. We know there are challenges in achieving this multifunctional vision and we are working through these as we implement the England Trees Action Plan, including  measures to increase the number of skilled silviculturists and other foresters, able to plan and implement sustainable forest management regimes; improving management of grey squirrel and deer to minimise the damage they can cause, which hinders forestry productivity; and increasing demand for home-grown timber through the development of the Timber in Construction Roadmap mentioned above. We continue to explore opportunities to more greatly integrate environmental and commercial objectives to ensure greater benefits in all woodland creation and tree planting projects and their future management.

How effectively is the UK strengthening the resilience of its tree stock to ensure it is resilient to the future impacts of climate change, as well as to pests and diseases?

26. We recognise that climate change, pests, diseases, deer, and squirrels are amongst the biggest challenges our woodlands face. Trees can only help mitigate the impact of a changing climate if they are resilient to those challenges themselves. In recent years managers of trees, woodlands and forests have needed to adapt to growing uncertainties related to climate change, pests, and diseases, as well as other threats.
27. We are working across Defra and the Forestry Commission, as well as engaging stakeholders, to develop the Woodland Resilience Implementation Plan. This Plan will help improve the ecological condition of our woodlands and increase their resilience to climate change, pests, and diseases. As part of this Defra, alongside Forestry Commission and Forest Research, are working together to develop an approach for forestry grants and regulations that supports species diversification and climate adaptation using lesser used or novel species while minimising the risk of non-native species becoming invasive or introducing new pests and diseases.
28. When planting woodland, it is important to consider the current and future climates and it is a requirement of UK Forestry Standard (UKFS) and our grant schemes, such as England Woodland Creation Offer, that landowners take this into account. Forest Research has published Ecological Site Classification spatial decision support tools for tree species suitability which includes climate change projections to enable landowners to do this. The ‘Climate Matching tool’ helps woodland owners and managers visualise the climate of the future, by identifying locations across the UK and Europe that currently have the climate that a planting site will experience in the future. Spatial data is also available on species mixtures (Forest Development Types) that are likely to be suitable under current and future climatic conditions.
29. Further detail on measures to address the climate risks to forestry will be set out next year in the National Adaptation Programme. 
30. On pest resilience, we also recognise the impact the rising deer population and grey squirrel populations are having on our woodlands. In the England Trees Action Plan, we committed to publish a national deer management strategy, which is out for consultation, and update the Grey Squirrel Action Plan. We continue to support the UK Squirrel Accord and their research into immunocontraception for grey squirrels and the UK Squirrel Accord are simultaneously developing a Red Squirrel Action Plan. A consultation seeking views on key proposals for the deer management strategy recently closed.
31. On disease resilience, reducing risks to tree health and strengthening biosecurity is a key priority for government. We will continue to invest in evidence, including launching the Centre for Forest Protection which will enhance the protection and resilience of our trees, woodlands, and forests to the threats from pests and pathogens through the provision of evidence. This is in addition to our already existing Tree Health Resilience Strategy.
32. Considerable progress has been made to deliver against the Tree Health Resilience Strategy objectives, including:  

         Establishment of the UK Plant Biosecurity Alliance;

         Launch of the ‘Plant Healthy’ management standard and self-assessment tool and launch of new biosecure procurement requirement pilot for government grants;

         Recruitment of over 200 new border inspectors;

         Publication of updated Generic Plant Health Contingency Plan, and 35 pest specific plans including Xylella fastidiosa and emerald ash borer;

         Implementation of a new UK Plant Health Outbreak Readiness Board, which reviews levels of preparedness for priority pests;

         Expansion of the Observatree citizen science network to over 200 trained volunteers across GB;

         Launch of Action Oak, a pioneering initiative to protect our native oak;

         Publication of our ash research strategy and the planting of 3000 tolerant trees of 1000 distinct genotypes in the UK’s first tolerant ash archive;

         A recently concluded consultation seeking views on additional biosecurity measures for high-risk trees. The consultation was part of the consultation on a refreshed GB Plant Biosecurity Strategy which will be published later this year.

33. On top of this, the UK Plant Health Risk Group works with partners around the world and uses a scientific, risk-based approach to understand global plant health threats and carry out horizon scanning for new and emerging risks to the UK. The group continuously identifies actions needed to mitigate the most significant risks, including updates to the regulatory regime, enhanced surveillance and inspections, contingency planning, research, and awareness raising. There are over 1200 threats on the UK Plant Health Risk register[14], one third of which can impact trees, and prioritisation in this way helps to ensure that government and the industry are focusing resources and efforts effectively.
34. We have also set up a Sector Capacity Project to support nurseries and seed suppliers in meeting the anticipated increase in demand and enhancing the quantity, quality, diversity, and biosecurity of domestic tree production. Through this Project, Government is investing over £10m in public and private sector tree nurseries to increase the quantity, quality and diversity of our domestic seed and sapling supply.  This includes the new Tree Production Innovation Fund and the new Tree Production capital grants which are designed to help the sector overcome barriers to forest nursery production by for example, increase germination and establishment rates, automate labour-intensive process and enhancing biosecurity.
35. Government have also launched a biosecure procurement pilot, based on the Plant Health Management Standard, which applies to suppliers of trees to the England Woodland Creation Offer grants and Tree Health Restocking Pilot grants, and covers both domestic and imported planting stock.  A commitment to introducing this biosecurity standard to relevant government grants and contracts was published in the England Trees Action Plan.
36. We are building capability and resilience by investing in science and skills for the future. Since 2014, government has invested around £70m into research that has directly informed plant health policies, and this includes the management of priority pests which affect our timber industry such as ash dieback and Phytophthora ramorum. We are developing a comprehensive research programme to support the delivery of the England Trees Action Plan and support the development of policies beyond 2025. This will include research into climate adaptation, the benefits we gain from trees and woodlands and into supporting home grown timber. Our research will collaborate with industry and academic partners to deliver cutting edge advice.
37. We have recently invested £5.8 million to build a new world-leading quarantine laboratory at Forest Research’s Alice Holt site in Hampshire. The new facility will conduct world-leading research into the growing threats posed by tree pests and diseases. Its work will inform UK-wide efforts to combat ongoing disease outbreaks, and emerging potential threats from abroad as a result of our warming climate. The facility is important for the whole UK forestry sector and research will help tackle the threat of diseases which could be detrimental to our forests and international trade.
38. Defra, Forestry Commission, and Scottish and Welsh Governments have recently concluded a consultation seeking views on a refreshed GB Plant Biosecurity Strategy. We will publish a new GB Plant Biosecurity Strategy later in 2022. The revised strategy will set a biosecurity vision for the next 5 years, building upon work achieved under the existing strategy published in 2014. It aims to deliver a step change in our plant health protections, actions, and behaviours.

Section 2: The effectiveness of UK efforts to reduce global deforestation

In what ways and to what extent are UK value chains (in the form of public procurement, goods, services, or the private sector) contributing to global deforestation?

1. Around 90% of global deforestation is driven by agriculture[15], much of it to produce the commodities we use on a regular basis, such as palm oil and cocoa. In recent years growing demand for forest and agricultural commodities has led to an increase in the UK’s overseas environmental impact.[16] Evidence commissioned by Defra shows that just seven commodities (cattle, cocoa, coffee, maize, palm oil, rubber and soy) are responsible for almost two-thirds of tropical deforestation risk associated with UK supply chains.[17]
2. In 2018, we asked an independent taskforce – the Global Resource Initiative (GRI) – to provide us with advice on how we could strengthen our efforts to reduce our overseas deforestation footprint. The GRI recommended 14 actions to which the government response was published in March 2020. These recommendations included, for example, the introduction of a due diligence obligation and heightened global leadership through forums such as the G7 Summit. A further report which complements the original recommendations and considers the role of the financial sector in reducing global deforestation was also published in May 2022. We are in the process of reflecting on the GRI’s finance report alongside responses to the Call for Evidence on updating the Green Finance Strategy which closed in June 2022 and included questions regarding deforestation.

How effectively is the Government monitoring the UK’s contribution to global deforestation and its progress in tackling the issue? And what progress has been made by Government to develop an indicator on overseas environmental impacts of UK consumption of key commodities?

3. The UK Government’s 25 Year Environment Plan notes the need for an indicator to measure the “overseas environmental impacts of UK consumption of key commodities”. Defra has supported the development of a new experimental statistic, launched in October 2021 that tracks the global environmental impacts of UK consumption of agricultural crop commodities. It provides estimates of the hectares of deforestation, biodiversity loss and the scarcity weighted water use associated with UK consumption, alongside a range of other impact types.
4. This experimental indicator is included in the Outcome Indicator Framework of the 25 Year Environment Plan, and progress against this indicator will be assessed and published annually. The most recently available assessment of the overseas environmental impacts of UK consumption of key commodities was published in 2022.
5. The data is currently published as experimental statistics, in order to gather feedback and facilitate user involvement future development of the indicator. The latest data is from 2017. This represents the most recently available assessment of the overseas environmental impacts of UK consumption of key commodities and establishes a baseline from which future progress can be measured.

How effective are the measures to improve due diligence and ban imported products of illegal deforestation in the Environment Act 2021? Do these measures target the right sectors? Given that they do not extend to all products of deforestation, are they adequate?

6. The Agriculture, Forest and Other Land Use (AFOLU) sector (including deforestation) accounts for 23% of global emissions.[18] Nearly 70% of tropical deforestation is linked to commercial agriculture, mostly due to the production of ‘forest risk’ commodities that can cause wide-scale deforestation: palm oil, soy, cattle products (beef and leather), and timber products (including paper).[19] 
7. We have introduced world-leading due diligence legislation through the Environment Act to help tackle illegal deforestation in UK supply chains. This legislation will help us to achieve the commitment enshrined in the COP26 Glasgow Leaders’ Declaration to work collectively to halt and reverse forest loss and land degradation by 2030 while delivering sustainable development and promoting an inclusive rural transformation.
8. We ran a consultation from 3 December 2021 to 11 March 2022 to seek views on the details of regulations that will implement the Environment Act provisions, to ensure that these are designed effectively. The Government published a summary of responses to this consultation on 1 June 2022 and is committed to implementing due diligence provisions at the earliest opportunity through secondary legislation.
9. The consultation sought views on how to determine which and how many forest risk commodities should be regulated through the first round of secondary legislation. Scientific evidence highlights the role that a wide number of commodities have played and continue to play in driving deforestation and habitat conversion. A review of key sources identified widespread consensus on seven agricultural commodities responsible between them for driving the majority of recent and ongoing global deforestation. Those commodities are cattle (beef and leather), cocoa, coffee, maize, palm oil, rubber, and soy. Given the evidence that these seven commodities are also responsible for an estimated 65% of the annual tropical deforestation risk associated with UK supply chains, we proposed that they be considered for initial inclusion under the due diligence regulations. We will take into account responses received through consultation to inform the design of secondary legislation and keep under review any new evidence. 
10. Our law will make it illegal for larger businesses operating in the UK to use key forest risk commodities produced on land illegally occupied or used. A significant proportion of deforestation is illegal, and this is closer to 90% in some key forests. Businesses in scope will be required to undertake a due diligence exercise on their supply chains, and to report on this exercise annually. To ensure transparency, information about businesses' due diligence exercises will be published. Businesses in scope that do not comply with these requirements may be subject to fines and other civil sanctions.  
11. The Government is committed to ensuring this policy is effective in addressing illegal deforestation. Schedule 17 of the Environment Act contains a provision that will require the Secretary of State to conduct a review of the law’s effectiveness every two years once it comes into force, and set out any steps they intend to take as a result.
12. It is important to note that Deforestation is a global issue that requires global collaboration and close working between producer and consumer countries. this new law is one part of a wider package of measures to improve the sustainability of our supply chains and will contribute to global efforts to protect forests and other ecosystems.

To what extent have the Global Resource Initiative (GRI) Taskforce’s recommendations on deforestation and land conversion been met by the Government?

13. The Global Resource Initiative (GRI) recommended a package of high-ambition policy interventions and priorities to support the UK to reduce our overseas footprint related to deforestation. These recommendations supported the introduction of a comprehensive set of landmark policies and actions. These include the Forest, Agriculture, and Commodity Trade (FACT) Dialogue, Due Diligence legislation, changes to the government procurement standards and the Mobilising Finance for Forest programme.
14. Whilst we have achieved a lot in relation to these recommendations, we recognise that there is more to do. As such, we have and will continue to work across departments, sectors and internationally to deliver a strategic and coordinated response to the GRI’s package of mutually reinforcing recommendations.

What role can sustainable certification and Government Buying Standards (GBS), have in tackling deforestation? How can the UK Government support the private sector to reduce its contribution to furthering deforestation?

15. Sustainable certifications, such as those developed through the Roundtable on Sustainable Palm Oil (RSPO) and Round Table on Responsible Soy (RTRS), help to embed best practice in the agricultural production industry. This includes environmental practices. The UK government supports numerous programmes and partnerships such as Partnerships for Forests (P4F), Forest Governance Markets and Climate (FGMC) and the Tropical Rainforest Alliance (TFA), to improve and promote these standards and ensure they help to deliver on private sector deforestation commitments.
16. In turn, certification schemes and standards can be used, domestically and internationally, to promote the decoupling of agricultural production from deforestation, and help to reduce the UK’s deforestation footprint.
17. For example, domestically, promoting certified sustainable products through public procurement policies can send market signals and encourage more sustainable domestic consumption. As such, fostering sustainability is at the forefront of the government’s approach to updating the Government Buying Standards for Food and Catering Services (GBSF). To underpin this approach, we launched a consultation on public sector food and catering policy which closed on 4 September. This consultation included proposals for the sourcing of products such as palm oil, soy and cocoa to be demonstrably sustainable - reaffirming the government’s commitment to tackle key drivers of deforestation.
18. Internationally, through the Forest, Agriculture and Commodity Trade (FACT) Dialogue the UK and Indonesia as co-chairs are promoting international discussion about the importance of sustainable production and better alignment between importer and exporter countries to ensure there is a coherent market signal for farmers.
19. Beyond this, the UK is playing an active role in convening industry leaders to reduce deforestation in global supply chains. We are supporting UK companies to be at the forefront of global efforts to reduce the impact of commodity supply chains on forests and other critically important ecosystems. UK companies have chaired the global sustainability committee of the Consumer Goods Forum alongside using the UK Roundtables on Sustainable Palm Oil and Soya to tackle the problem of deforestation. In collaboration with the US, the UK has convened 13 CEOs of major international agricultural commodity traders and processors representing almost 500 billion USD and a major global market share in key commodities such as soy, palm oil, and cattle. These companies are developing a roadmap for increased supply chain action in line with a 1.5 degree pathway that will be published at COP27 at the World Leaders Summit. The Roadmap will focus on action areas for increased collaboration and implementation on accelerating supply chain action, raising climate ambition, and supporting forest positive sector transformation. This roadmap will build on the FACT Roadmap and Consumer Good Forum Forest Positive Coalition of Action last year at Cop26 to show major ambition by key actors in agri-commodity supply chains. By working closer with agricultural traders, the UK private sector will be able to realise their commitments more easily in tackling deforestation.

Additional information:

20. Finance is also critical. Public investment is not sufficient, and we need large volumes of private finance to flow into activities which promote sustainable land use and combat deforestation. The UK is a global centre for the finance sector and the government has been working with sector leaders to both move away from deforestation-risk investments, and to increase positive investment in sustainable land use. As COP26 President, the UK government brought private sector leaders together alongside governments to shift financial flows towards forest protection and, more broadly, towards a nature-positive economy.

21. We are developing tools to drive transparency in the financial sector. We are introducing requirements for UK financial institutions to have a robust transition plan setting out how they will decarbonise as the UK meets its ambitious and legally binding net zero targets. We are working to ensure these, and other regulatory measures, deliver for nature as well as climate, by supporting tools like the Taskforce on Nature Related Financial Disclosures (TNFD). This support includes £2.8m of funding for the development of a framework for corporate and financial institutions to assess, manage and report on their dependencies and impacts on nature. In addition, we are also in the process of updating the Green Finance Strategy, due to be published later in 2022, which will take stock of progress and set out how the UK can better ensure the financial services industry is supporting the UK’s energy security, climate and environmental objectives (domestically and internationally). Finally, through its UK aid programmes such as Partnership for Forests and Mobilising Finance for Forests, the UK is directly mobilising private sector investments in forest-positive business models in tropical forest countries.

22. The UK is also supporting the global frameworks for high integrity carbon markets. We are supporting the work of the Voluntary Carbon Markets Integrity Initiative (VCMI), which aims to help unlock global markets whilst ensuring credibility of carbon offset claims. We are also working to help build capability of all countries to access carbon market finance to help in their decarbonisation efforts, and in this regard, welcome the private sector led Integrity Council on Voluntary Carbon Markets (IC-VCM) to set and implement a global threshold standard for voluntary carbon credits. 

23. Through the UK’s International Climate Finance, BEIS are providing over £400m to support REDD+, the UNFCCC’s framework for sustainable forest management, and the development and uptake of carbon pricing instruments, to strengthen the international carbon market, and to trial new and innovative approaches that reduce emissions and leverage investment in land use and non-land use sectors.

24. The growth of voluntary carbon markets can also deliver much-needed finance and help increase global climate ambition, providing they operate with high-integrity across demand and supply sides. For example, the UK is supporting the Lowering Emissions by Accelerating Forest Finance (LEAF) Coalition – a high integrity initiative mobilising public and private finance ats scale for the protection of forests through carbon markets. Having mobilised more than USD $1 billion, LEAF demonstrates that the demand and supply of forest carbon credits can follow a high integrity path, in line with the goals of the Paris Agreement. Private sector buyers purchase in addition to, and not a substitute for, deep cuts in global carbon emissions. Additionally, forest country participants follow a rigorous, high-integrity approach that guarantees robust results in terms of carbon - where payments come only upon verified results - and in terms of social and environmental safeguards.   

Section 3: Working with international partners to tackle deforestation

How effectively is the UK engaging with international partners to tackle deforestation?

1.      COP26 presented a game changing moment for forests. As COP26 President, the UK bought together the nature and climate change agendas for the first time. The World Leaders' Summit on Forests and Land Use convened leaders from governments standing alongside corporate and indigenous leaders to announce action towards ending deforestation. This convening built on decades of work, but provided a real highlight on forests at a leader level for the first time. The World Leaders Summit saw 145 governments endorse the Glasgow Leaders’ Declaration (GLD) to halt and reverse forest loss by 2030.

2.      As part of this package, the UK has worked with those governments and non-state actors to announce a raft of policies including pledging over $19 billion to meeting deforestation targets up until 2025 and commitments from financial institutions (worth up to $8 trillion in assets under management) to eliminate investments in activities linked to agricultural commodity deforestation.  These pledges include $12 billion of public funds, including $1.7 billion for Indigenous Peoples and Local Communities (IPLCs), and $1.5 billion for the Congo Basin which has traditionally received small proportions of forest climate finance.

3.      The UK, on its own has committed £11.6 billion of climate finance, of which £3 billion has been specifically allocated to support action on nature, over the next 5 years. Of this, £1.5 billion is specifically for action on protecting standing forests and reducing forest loss, including £200 million for the Congo Basin, and £300 million for the Amazon Basin.

4.      In collaboration with the US, the UK has convened 13 CEO’s of major international agricultural commodity traders and processors of representing almost 500 billion USD and a major global share in key commodities such as soy, palm oil, and cattle.

5.      These companies are developing a roadmap for increased supply chain action in line with a 1.5 degree pathway that will be published at COP27 at the World Leaders Summit; this roadmap will focus on action areas for increased collaboration and implementation on accelerating supply chain action, raising climate ambition, and supporting forest positive sector transformation.

6.      This roadmap will build on the FACT Roadmap and Consumer Good Forum Forest Positive Coalition of Action last year at Cop26 to show major ambition by key actors in agri-commodity supply chains. By working closer with agricultural traders, the UK private sector will be able to realise their commitments more easily in tackling deforestation

7.      In addition, the UK’s programmes and policy, as noted by Independent Commission for Aid Impact (ACAI) review on forests and biodiversity[20], have supported the establishment of global frameworks, country partnerships, and private sector action. Together they have demonstrated what is possible and laid the basis for further action, pushing forests up the political agenda.

8.      ICAI scored the overall effectiveness of HMG’s efforts to tackle deforestation as green-amber, which included an assessment of international cooperation and engagement. The review recognises that the UK has been an active participant in a substantial number of international initiatives and agreements with a spectrum of partners to tackle deforestation and biodiversity loss, including but not limited to:

• The New York Declaration on Forests, which called for a halt to global deforestation by 2030.
• The Amsterdam Declarations on eliminating deforestation from European agricultural imports.
• The Bonn Challenge, which aimed to restore 350 million hectares of degraded land by 2030.

9.      These fora bring together different coalitions of relevant partners from other donor countries, consumer countries, forest and producer countries, as well as important Non-Governmental/Civil Society Organisations. Our engagement contributes to a strong overall ‘UK offer’ on forests, including:

• Leadership from UK companies: Unilever, M&S and Tesco have been first movers to catalyse zero deforestation commitments from industry;
• Civil society engagement: UK Non-Governmental Organisations have been at the forefront of advocacy, analysis, and evidence to inform solutions;
• Bilateral partnerships with key forest countries: examples include UK-Indonesia multistakeholder forest partnership and UK-Colombia Partnership for Sustainable Growth; and
• Influencing and convening others: for example our role in establishing the Germany-Norway-UK (“GNU”) strategic partnership on forests (the leading influential donor group on forests and land use) and as a founding members of the Amsterdam Declaration Partnership (ADP).

Is the Glasgow Leaders Declaration on Forests and Land Use an effective mechanism for halting and reversing forest loss?

10.  As COP26 President, the UK elevated forests to world leader level for the first time at a climate COP through several policies and ambitious pledges, including the Glasgow Leaders Declaration (GLD). We now need to hold partners to account for their actions and increase ambition. The UK is working with other ambitious governments to create a solutions-focussed political forum. This will help to maintain a spotlight on forests and the implementation of collective commitments while progressing shared strategic challenges and supporting collaboration. This forum is intended to play a major role in driving progress in the sector up until 2030 as it drives national action and international collaboration. 

How can the UK ensure its £1.5bn commitment to the Global Forest Finance Pledge is used to best effect?

11.  The International Forests Unit (IFU), which brings together the forest teams in BEIS and FCDO, will develop and coordinate the strategic approach and long-term direction on international forest programming and engagement to support the delivery of £1.5bn UK International Climate Finance (ICF) commitment. 

12.  Delivery of the £1.5bn will take on board ICAI recommendations and lessons learned from previous phases of ICF forests programmes. There is no single bullet to tackling deforestation and reversing forest loss and programmes will therefore utilise a variety of channels and mechanisms, including bilateral and centrally managed support, alongside continued investment through multilateral channels. We will continue to operate in areas of UK expertise and competence, including forest governance, supply chains and leveraging private finance including through carbon markets. We will continue to learn from the latest evidence and analysis and to work closely with other key donor governments, particularly Germany and Norway, to ensure our combined efforts are complementary.

What impact will the UK’s measures to tackle deforestation have on producer countries, indigenous peoples and local communities?

Working with producer countries

13.  The UK prides itself on taking a partnership approach with producer countries on protecting forests and reversing forest losses. For example, as COP26 Presidents, the UK launched the Forest, Agriculture and Commodity Trade (FACT) Dialogue, alongside Indonesia as co-chair, in May 2021. Collaboration is at the heart of the FACT Dialogue, bringing together 28 producer and consumer countries committed to addressing the interrelated issues around sustainable commodity production and global trade. Countries have been working together to develop a joint vision and roadmap of actions which they are currently working to deliver.

14.  We also work bilaterally with individual producer countries across the Amazon, Congo and Indonesia. For example, through the UK-Colombia Partnership on Sustainable Growth we take a context-specific approach to supporting Colombia’s efforts to tackle deforestation, in conflict-affected areas.

Working with Indigenous Peoples and Local Communities (IPLCs)

15.  The UK recognises the critical guardianship provided by Indigenous Peoples and Local Communities (IPLCs) in protecting tropical forests, preserving vital ecosystem services, and the global contribution they make to climate change mitigation, biodiversity preservation, and inclusive and sustainable development.

16.  With our International Climate Finance (ICF), we support IPLCs through programmes that clarify and strengthen rights – for example supporting communities to secure their access to forest resources and land – to generate sustainable livelihood benefits, and to benefit from forest and land use investments in timber, agriculture, and carbon. Through our Investments in Forests and Sustainable Land Use (ISFLU) and Forests, Governance Markets & Climate (FGMC) programmes, we are supporting government reforms that help strengthen rights and mobilising support to create impact for people and communities on the ground.

17.  At COP26 the UK played a leading role to influence others to do more to support IPLCs, convening the COP26 IPLC Forest Tenure Pledge. The Pledge saw $1.7 billion committed to advance IPLC tenure rights and their guardianship of tropical forests; the UK is committed to promoting activities that a) secure, strengthen and protect Indigenous Peoples’ and local communities’ land and resource rights, and b) support national land and forest tenure reform processes and their implementation.  The UK, along with other GLD endorsers, would like to see the GLD follow-up process maintain the focus on IPLCs and the actions needed to increase funding available and push for positive policy outcomes. We will use the remainder of our COP presidency to influence others to ensure this pledge becomes reality.

September 2022