. 2014. Improving the link between payments and the provision of ecosystem services in agri-environment schemes.Contact CEH NORA team at noraceh@ceh.ac.ukThe NERC and CEH trademarks and logos ('the Trademarks') are registered trademarks of NERC in the UK and other countries, and may not be used without the prior written consent of the Trademark owner.Improving the link between payments and the provision of ecosystem services in agri-environment schemes in UK peatlands
AbstractThis paper considers how agri-environment schemes under the Common Agricultural Policy could be adapted to derive a higher return of ecosystem services from agricultural land, through deliberation with members of the public, land owners, managers and other stakeholders: i) paying for the ecosystem services that are valued most by society; ii) spatially targeting payments to locations where ecosystem services can most efficiently be provided; and iii) providing incentives for cross-boundary collaboration over the provision of ecosystem services that need to be managed at catchment or wider spatial scales. Using UK upland peatlands as a case study, and drawing on experience tackling these issues in the new Glastir agri-environment scheme in Wales, the paper attempts to find a balance between current input-based schemes that pay for land management activities on the basis of income foregone and output-based schemes that pay by results. The paper reviews evidence that spatially targeted, output-based payments may be more economically efficient than current approaches, but identifies a number of challenges, including: scientific uncertainty; pricing of ecosystem services; timing of payments; increased risk to land managers; compliance with World Trade Organisation regulations; and barriers to cross-boundary collaboration in the management of ecosystem services at habitat, catchment or landscape scales. A number of options are reviewed to overcome these challenges, including: the use of process-based models, pressureresponse functions and expert knowledge to establish causal links between management and ecosystem service delivery and reduce the costs of monitoring; the use of competitive bidding or non-market valuation techniques to set prices for ecosystem service delivery; insurance schemes; combining agri-environment schemes with funding from private Payment for Ecosystem Service schemes; and independent facilitation of groups of potential applicants across property boundaries in scheme options that are co-designed with the land management community. Drawing on examples from UK peatlands and experience designing the Glastir scheme, the paper 2 proposes a number of ways in which agri-environment schemes around the world that make payments on the basis of management inputs can better link payments to the provision of ecosystem services.