“An economic and environmental wrecking ball” – new figures reveal ripping up of retained EU laws could cost £82bn for the UK

18 January 2023

• Economic analysis shows cost of dropping or weakening EU environmental laws in just 4 sectors could reach £82bn over 30 years [1]
• With over 1,000 environment laws in its scope, the full cost of weakened nature protections from the Retained EU Law (REUL) Bill would likely be far higher
• New report identifies further impacts of REUL Bill including damage to protected sites, the marine environment and the arrival of more invasive species

Figures released today by environmental organisations reveal that the economic costs of removing or weakening laws in just four of the areas covered by the REUL Bill could reach £82.94bn over thirty years.

These high figures come from the damage that could be caused in areas including the health impacts of poorer air and water quality and loss of recycling business opportunities due to weaker chemical regulations.

Analysis for Wildlife and Countryside Link by the Economics for the Environment Consultancy (eftec) investigated the economic implications of weakening environmental laws covering chemical regulation, water pollution, air quality, and habitats. With thousands of other retained EU laws in the REUL Bill’s firing line, the full cost is likely to be far higher.

The REUL Bill is expected to be debated in the House of Commons on 18th January. Campaigners are calling for the Bill to be immediately withdrawn. The charities note that the proposals specifically prohibit new regulations that could impose costs on businesses – even administrative costs. They say this is a deregulatory lock-in clause, which means that the bill cannot strengthen environmental law, but gives Ministers unprecedented freedom to weaken it.

Dr Richard Benwell, CEO of Wildlife and Countryside Link, said: “Prevention of air and water pollution, protection of precious wildlife and habitats, precautions against hazardous chemical use – they are all put at risk by the Retained EU Law Bill. If long-standing protection for nature is removed or weakened, the economic consequences could run into the billions.

“Add to this the costs of years of uncertainty while half the environmental statute book is up in the air and thousands of hours of civil service time spent reviewing laws simply because of where they came from. All together, the costs of this economic and environmental wrecking ball bill could be astronomical at a time when the UK – and our environment – can least afford it.”

Craig Bennett, chief executive of The Wildlife Trusts, said: “Everything about this appalling, anti-democratic and unconstitutional bill is wrong. It is seeking to give ministers the power to remove or amend existing UK legislation on a whim, but this should be the job of Parliament and Parliament alone. As things stand, over 1000 pieces of environmental legislation and regulations will cease to exist at the end of this year, at extraordinary cost to the environment and our economy, and cause untold chaos for business, landowners and farmers in the process.

“This Bill was the brainchild of Jacob Rees-Mogg when he was a Cabinet Minister in the short-lived Government of Liz Truss. By continuing to push it through, Prime Minister Rishi Sunak seems determined to repeat the chaos, confusion and cost associated with the previous administration. He needs to pull it, and think again”.

The RSPB’s director of conservation, Katie-jo Luxton said: “This new economic report shows that the REUL Bill could cost the taxpayer more than £1bn over the next 30 years simply by opening the door to a weakening of current environmental protections. Having just published legally binding targets for nature recovery through its own Environment Act, it is baffling that the UK Government is now seeking to dismantle the legal protections to achieve them.”

Hugh Knowles, co-executive director at Friends of the Earth, said: “Government plans to delete or entirely rewrite thousands of laws that protect people and the environment are a double blow for the communities already hardest hit by the cost of living crisis and existing environmental decline.Many of the same people facing these issues remain at a disproportionate risk of the harmful health impacts associated with breathing in dirty air - and will be for years to come - not to mention the erosion of workers’ rights and consumer safety standards. Instead of needlessly wasting government funding on this bill, which will drain precious time and resources, the government could be investing in the measures that will actually improve people’s lives and support the restoration of our environment.”

Ruth Chambers of the Greener UK coalition said: “This bill is already costing taxpayers millions by draining civil service time, but it’s also likely to have a significant social and environmental cost. Requiring new regulations to be less rigorous than before will lower the level of environmental and consumer protection. Rushing the analysis will lead to dangerous gaps in the law. If the government wants to improve regulations in a sensible and accountable manner, we need an approach that this bill cannot and will not provide.”

Read additional quotes from The Ramblers, Bat Conservation Trust, The Rivers Trust and Institute of Fisheries Management here.

The report, The economic costs of the Retained EU Law Bill, found that the UK would face the following economic costs from environmental decline as a result of the Retained EU Law Bill:

• £20.6bn over 30 years from damage to rivers, lakes and coastal waters as a result of losing Water Framework Directive standards. Without this standard, increased levels of agricultural pollutants could flow into our rivers, along with insufficiently treated wastewater spreading across the water network. This will lead to deterioration in our already struggling waters and would cause harm to threatened wildlife like salmon, kingfishers and otters. [2]
• Less air quality improvement could cost £10.4bn over the next five years, rising to £44.9bn over 30 years. Long term progress on air quality is at risk due to the weakening of the National Emission Ceilings Regulations through the Retained EU Law Bill. By slowing progress on cleaning up our air we will see more workdays lost to sickness and increased burdens on the NHS due to conditions including Asthma.
• £1bn could be lost due to weaker protections for key nature sites. The weakening of Habitat Regulations would leave such sites at risk of degradation or destruction. Ecosystem services provided by nature sites like ancient woodlands and coastal marshes include lowered flood risk and increased health and wellbeing. [3]
• £12.8bn – lost market opportunities from weakened chemical regulation over 30 years. The UK has a huge business opportunity in recycled packaging, if progress towards further clean waste streams is maintained. Plastic packaging is just one of many waste streams where reduced use of hazardous chemicals through strong regulation may increase further opportunities for recycling. The weakening of chemicals regulations means the narrowing of these business opportunities. [4]
• £3.6bn – health costs from weakened chemical regulation over 30 years. Adverse health impacts such as infertility and cancer could cost the UK billions through increased worker absences and addtional demands on the NHS, as people would be more likely to be exposed to hazardous chemicals currently covered by European REACH regulations. [5]
  
  

Wildlife and Countryside Link also investigated the environmental and social impacts of regulations affected by the REUL Bill:

• Weakening of Habitats and Species Regulations could open up important nature sites, including Ashdown Forest and Dogger Bank, to unsustainable development projects – putting species including bats, otters and puffins at risk.
• Less healthy seas as a result of weakening Marine Strategy Regulations, which could lead to a decline in habitats including seagrass meadows and saltmarshes (vital carbon stores for reaching net-zero) and impact the recovery of species including puffins.
• Weakening the Plant Protection Products Regulations would lead to less stringent tests for pesticides before they are authorised for use in the UK, opening the door to more dangerous products in our fields, and ultimately our food and bringing back chemicals that have already been banned. Pesticide pollution can be devastating for habitats like chalk streams, along with soil health and pollinator populations.
• Invasive species such as Japanese Knotweed and Quagga Mussels already cost the UK economy £1.7bn a year. Weakening current regulations on invasive species could cost a further £1bn just from the impacts of pests and diseases threatening UK trees, with millions of trees being lost. Other UK species particularly vulnerable to invasives include water voles and common earthworms. [6]
  
  

This report only covers the economic costs associated with environmental regulations in the Bill’s firing line. Regulations protecting consumer and workers’ rights are also affected by the legislation – the cumulative impacts of such widespread regulatory change will be enormous.

Notes:

1. Analysis of economic costs associated with water, air, chemical and habitat regulations in the remit of the Retained EU Law Bill undertaken by eftec on behalf of Wildlife and Countryside Link during November and December 2022
2. In 2018, only 2% of waterbodies had high status, but 79% had moderate or good status. The impact of their deterioration to poor is valued at £2.8bn per year, giving an estimated value of damage to rivers, lakes and coastal waters of £13bn over the next 5 years as a result of losing Water Framework Directive standards. These impacts could persist, giving damage costs of £28.3bn over 30 years.
   1. Additional loss of tourism and recreation revenue as a result of water pollution and failing bathing water directive standards could mean the economic cost of weakened water protections is significantly higher than this figure.
   2. The significant economic contribution of sustainable freshwater and sea angling would also be impacted.
3. Many sites covered by these regulations (Special Areas of Conservation and Special Protected Areas) are also protected as Sites of Special Scientific Interest, but this offers a lower standard of protection. The Habitats Regulations ensures these sites are protected from significant harm except in cases of overriding public interest, and only then if proper compensation is in place. By contrast, SSSIs are afforded legal protection through the Wildlife and Countryside Act 1981, which does not clearly cover offsite or cumulative impacts and which still allows development which is likely to have an adverse effect on an SSSI to proceed if the development’s benefits are considered to outweigh the adverse effects on the SSSI.
4. This figure accounts for the reduced compliance cost that would come for businesses from deregulation, but is likely to underestimate the economic impact of ill health from chemical exposure due to the difficulty in fully quantifying the health impacts of chemicals.
5. Weakening of chemical regulations also risks the concentration of harmful substances higher up in the food chain, with marine mammals such as killer whales and dolphins at particularly high risk of impacts including sterility and suppressed immune systems.
6. The Invasive Alien Species (Enforcement and Permitting) Order is the only the piece of current legislation that works to prevent the introduction of invasive species. Other pieces of legislation regarding invasive species work only to prevent their spread, and do not contain powers to stop the introduction of them in the first place.