Scotland's Natural Capital Asset Index - 2023 (data to 2021) - Update Summary
Headline result and key messages
Nature’s ability to provide services plateaus
- For 2021, natural capital is classed as being ‘maintained’ with results showing a mixture of improvement and decline amongst the habitats and ecosystem service categories.
- For 2021, the ability of coastal, mires, bogs and fens, woodlands, and agriculture and cultivated habitats to contribute to well-being have all slightly improved.
- The Natural Capital Asset Index is an anthropocentric look at how well nature is able to contribute to people’s wellbeing through a range of ecosystem services and ecosystem characteristics. The Natural Capital Asset Index is designed to complement tools that measure the state of biodiversity, including reporting on species, habitats and genetic diversity within wild species.
Natural capital and a capitals approach
Natural capital are the environmental resources (e.g. plants, animals, air, water, soils) that combine to yield a flow of benefits to people. The range of benefits people can derive from natural capital can be understood as ecosystem services and are often grouped into three distinct categories:
- provisioning services refer to material outputs we receive from nature, such as food or water for drinking;
- regulating services are ecological processes such as climate regulation or air pollution removal; and
- Cultural services include non-tangible contributions from nature such as aesthetics and recreation.
Natural capital has historically been eroded by human activity, partly because it has not been properly valued when compared with other types of capital. Natural capital is one of four types of capital: social, human, financial, and natural. A capitals approach integrates these pieces that shape society together for a more equitable and holistic understanding of the drivers and impacts our choices, laying the groundwork for a wellbeing economy.
Natural capital is a way to represent and make sure nature is included in decision making and makes the invisible benefits and value of nature visible. The Natural Capital Asset Index is one tool to include nature in policy decisions where it historically has been overlooked, undervalued and unaccounted for.
What is the Natural Capital Asset Index?
The Natural Capital Asset Index (NCAI or the Index) helps us assess Scotland’s prosperity: it tracks the capacity of Scotland’s terrestrial ecosystems to provide the benefits that underpin our quality of life and that of future generations.
The NCAI is a composite index made of a range of datasets looking at the amount and characteristics of different Scottish habitats. It is not a monetary value but is composed in a way which reflects the relative contribution of habitats to the wellbeing, or quality of life, of those who live in Scotland. The capacity of ecosystems to provide benefits fluctuates over time due to changes in habitat quantity and quality.
Gaps will forever remain in our understanding of the complexity of nature. While the NCAI is an indicator of terrestrial habitats’ contribution to wellbeing, it does not account for Scotland’s considerable marine habitats. A feasibility study for a marine version of the Index was conducted in 2019. The NCAI also does not demonstrate changes in biodiversity nor a habitat’s resilience to outside pressures. However, it does account for and acknowledge the importance of biodiversity for healthy and resilient ecosystems and the future delivery of benefits through a selection of bird and butterfly indicators.
The Index is a desk-based natural capital assessment at a national scale. It’s an anthropocentric understanding of nature; valuing the services nature provides as it relates to humans. As with any natural capital assessment, its best used in tandem with and to complement other indicators to fully understand the state of natural capital in Scotland. Many other pieces of work, such as the ecosystem health indicators can help round out our understanding.
Natural capital and biodiversity
Biodiversity is the bedrock of nature and Scotland’s natural capital. The function, resilience and ability of nature to provide benefits now and into the future are fundamentally reliant on the diversity of life – genes, species and ecosystems. The Scottish Biodiversity Strategy (SBS) envisions fully restored and regenerated biodiversity across Scotland by 2045, ensuring the flow of ecosystem services that our economy depends now and in the future. Delivering this vision means embedding biodiversity and natural capital into policymaking. The NCAI is an instrument for policy delivery as an indicator for a thriving sustainable economy that conserves and grows its natural assets in the Environment Strategy’s Monitoring Framework as well as an economic indicator for sustainable development in the National Performance Framework.
In 2021 the UK’s HM Treasury released The Economics of Biodiversity: The Dasgupta Review, highlighting the importance of biodiversity for life and wellbeing on the planet and the need for change in the economic system to protect nature. The Review advocates for a natural capital approach, the same approach the NCAI takes, as a change indicator for overall stocks of natural capital and as a national wealth indicator demonstrating the contribution of nature to Scotland’s wellbeing. Natural capital approaches help guide the investment that is essential to achieve the SBS’s priority actions for 2030 and increase biodiversity and ecosystem service delivery.
The NCAI uses ecosystem services to assess how nature contributes to the wellbeing of Scottish citizens. Four types of data inputs are used, including habitat extent, ecosystem service potential, Scotland’s demand for different ecosystem services and measurements of habitat quality, along with three types of weighting processes. More detail can be found in the Ecological Indicators journal article "Scotland’s natural capital asset index: Tracking nature’s contribution to national wellbeing.”
Habitat quantity is tracked using what we know about land cover change in Scotland. The following Scottish habitats are included in the NCAI:
- Inland surface waters
- Mires, fens and bogs
- Agriculture and cultivated
Habitat quality is tracked using 38 separate indicators on ecosystem characteristics and condition which rely on datasets gathered by a range of public organisations and citizen science schemes. These datasets are listed at the end of the Results section. Each habitat delivers a unique and varied blend of benefits, as demonstrated below. The Index is set against a baseline year 2000 which is given the value 100. For the 2021 update, the COVID-19 pandemic impacted the ability to conduct fieldwork for some of the quality indicators.
The Index is a work in progress and efforts will continue to refine its methodology and data. In 2014 James Hutton Institute conducted a review of the NCAI methodology and its suite of habitat quality indicators. Outcomes from this review included transitioning the habitat extent classification from Broad Habitats to the European Nature Information System (EUNIS) land cover classification, and a refinement of the over 100 quality indicators to the current 38.
As a note, result comparisons for the NCAI are discussed as percentage points.
The potential of Scotland’s habitats to deliver ecosystem services has improved over the past 20 years and has now plateaued around its peak in 2017, as seen in Figure 1. Despite consistent modest improvements, the NCAI is officially classed as ‘maintaining’ by the National Performance Framework where it is an economic indicator of sustainable development. This follows a deterioration in Scotland’s natural capital between the 1950s and 1990s, discussed more following the Results section.
- The Index remains stable (+0.05 percentage points from 2018). Because of natural and statistical variability in the underlying data and assumptions, these are marginal changes and are not considered likely to reflect significant trends.
- The NCAI status in the National Performance Framework remains in a ‘maintaining’ state. An increase of 2 percentage points over 3 years is required for an ‘improving’ state.
Results by type of ecosystem service
Regulating and maintaining and cultural ecosystem services reflect the trend of the overall NCAI with provisioning ecosystem services seeing a continuous gradual increasing trend.
Provisioning ecosystem services
- In 2021, provisioning ecosystem services remain stable (+1 percentage point from 2018) but has increased 3.9 percentage points since 2000.
- Since 2000, provisioning services have fluctuated but seen a steadily increasing trend.
- The main habitats that drive provisioning ecosystem services are inland surface waters and agricultural land, with characteristics such as cereal yield and the number of livestock, as well as the quality of water.
Regulating and maintaining ecosystem services
- Regulating and maintaining ecosystem services are stable (-0.1 percentage points from 2018) but have increased by 2.3 percentage points since 2000.
- Regulating and maintaining ecosystem services are the services that most drive the NCAI through the high demand and the full range of habitats performing these services.
- A concentration of indicators in grasslands and woodlands is likely to be driving the improvement in regulating and maintaining ecosystem services, as both these ecosystems have been increasing in ecosystem extent and are heavily represented with quality indicators for this service.
Cultural ecosystem services
- Cultural ecosystem services are stable (-0.7 percentage points from 2018) with an overall increase of 2.3 percentage points since 2000.
- Cultural ecosystem services have the most even distribution of habitats and quality indicators. However, grasslands and woodlands habitats have the most influence with expanding ecosystem extent and highest number of quality indicators. Coastal habitats also contribute significantly to this category of ecosystem services.
Results by individual habitats
Habitats including coastal, inland surface waters, heathland, and mire, bogs and fens, are mirroring the recent plateau of the overall NCAI trend. Meanwhile agricultural and woodland habitats have increased with grasslands decreasing. These habitat trends are seen in Figure 3.
- Woodlands are continuing their improvement since 2011 (+1.6 percentage points from 2018).
- Woodlands are exceptionally important for providing regulating and maintaining ecosystem services including climate regulation and air pollution—services with a high demand from society in Scotland and a key driver in the NCAI.
- Although woodland natural capital values are increasing, overall woodland condition is poor.
- More than half the amount of protected woodland in Scotland is in unfavourable condition at 51% (245 of 487 sites measured), a trend that has existed for the duration of the NCAI, while only 35% (170 of 487 sites measured) of woodland on protected areas can be considered to be in favourable condition and 14% (70 of 487 sites measured) are recovering; two sites were not assessed (NatureScot).
- 60% of woodland in Scotland is certified forest. This means more than half of woodland are under sustainable forest management (Forest Research), a trend that has been consistently increasing since the NCAI was first calculated.
- The net annual change in carbon in woodlands was 7.4 million tonnes of CO2 in 2021 (Forest Research).
- The woodland birds indicator has improved 19% since 2000 but have seen a decline of 4% since peaking in 2016; chiffchaff, great spotted woodpecker, and blackcap have seen the largest increases (NatureScot).
- Woodland extent in Scotland has increased 46% for broadleaved deciduous woodland since 2000 and increased 4% for coniferous woodland since 2000 (Forest Research).
- Habitat extent, woodland birds, and certified woodland are driving the increase in woodland natural capital values, overshadowing the overall poor site condition of Scottish woodlands.
- Additional factors in this habitat are outdoor visits per week, butterflies, visual influence of built development (inverse), total number of different bird species counted, and agri-environment area.
Inland surface waters
- The Index has been decreasing since 2017 with the value for the habitat remaining 8.4 percentage points above the 2000 baseline.
- No change in site condition from 2020 with 193 of 278 sites in favourable condition (NatureScot).
- Wild salmon and grilse rod and line catches from recreational angling in rivers have continued to decrease (catches are -24.8% since 2019). The Salmon Fishery Statistics 2021 from Marine Scotland attribute this to lingering COVID-19 restrictions early in the 2021 season as well as the summer’s poor fishing conditions. Catch and release is included in the catch statistics meaning the same fish could be caught twice.
- Raw water abstraction has had a decreasing trend since 2003, indicating less water is being abstracted and a positive NCAI trend for freshwater habitats (Scottish Water).
- Additional datasets include Water Framework Directive (good or better ecological status), outdoor visits per week, total number of different bird species counted, river water quality (% of unpolluted sites), raw water quality (nitrates in rivers), pollution (orthophosphates).
- Absence of data held by SEPA has meant that these values are less accurate than usual.
- Coastal habitats remain stable (-0.9 percentage points from 2018) with an overall increasing trend.
- Coastal site condition has decreased 0.8% from 2020 with 248 of 334 sites in favourable condition, a trend that started in 2017 (NatureScot).
- Coastal habitats captured in the NCAI, by EUNIS category, are coastal dunes and sandy shores (B1), coastal shingle (B2), and rock cliffs, ledges and shores (B3).
- Wintering waterbirds have seen a decline since 2017 (down 7% in 2020 from 2017) (NatureScot).
- Coastal bathing water quality is a heavily weighted indicator for coastal habitats but has not been updated since 2014 due to the change in scale of how bathing water quality is measured.
- Additional factors in this habitat are visual influence of built development (inverse), outdoor visits per week, total number of different bird species counted, butterflies, upland birds, use of marked coastal paths.
- Grasslands decreased 2 percentage points from 2018, likely due to a decrease in site condition with only 39% of grasslands in protected areas in favourable condition for 2021 (NatureScot).
- However, the number of cattle and sheep reared on grasslands has increased 1% from 2020. Cattle numbers saw a slight increase after a 60-year low in 2020, largely attributed to the long term downward trend in the profitability of cattle (Scottish Agricultural Census June 2021). Sheep numbers also slightly increased from 2020 due to the good lambing season in 2021 (Scottish Agricultural Census June 2021).
- Areas with agri-environment scheme has had an increasing trend since 2016 reaching a peak in 2020; this indicator was not updated for 2021 (JNCC). Agri-environment areas mean the environmental management strives to conserve wildlife, enhance the landscape, protect the natural and historic environmental resources and promote public access.
- Farmland birds are an indicator for grassland regulating and maintaining and cultural ecosystem services. They have been above their year 2000 baseline level but declining since a peak in 2008 (NatureScot).
- Additional factors in this habitat are visual influence of built development (inverse), outdoor visits per week, total number of different bird species counted, area of grass cut for hay, butterflies, and upland birds.
- Heathlands are stable (-0.8 percentage points from 2018) after a low in 2011 and steadily trending back to, but are still below, year 2000 levels
- Site condition of heathlands has remained stable since 2017 with 39 of 114 sites (34%) in favourable condition and 19 of 114 sites (16%) in recovering condition (NatureScot).
- The upland birds indicator continues its downward trend declining 21% since 2000 and down 1.7% from 2020 (NatureScot); upland birds are important for regulating and maintaining and cultural ecosystem services for heathland.
- Adult red grouse density was 59 birds per hectare in 2021, an 18% increase from 2020 but a 30% decrease from its peak of 84 birds per hectare in 2015. Densities are lower in Scotland than in northern England with less pronounced post-breeding densities (Game and Wildlife Conservation Trust Review of 2021).
- Additional factors in this habitat are visual influence of built development (inverse), outdoor visits per week, total number of different bird species counted, and butterflies.
Mires, bogs, fens
- Mires, bogs, fens remain stable (-0.14 percentage points from 2018) but remain below year 2000 levels (-3.62 percentage points).
- Site condition has remained steady from 2019 with 53% of sites in favourable condition (NatureScot).
- The upland birds indicator continues its downward trend declining 21% since 2000 and down 1.7% from 2020 (NatureScot); upland birds are important for regulating and maintaining and cultural ecosystem services for mire, bogs, and fens.
- Additional factors in this habitat are visual influence of built development (inverse), outdoor visits per week, and total number of different bird species counted.
Agriculture and cultivated
- Agriculture and cultivated habitats increased 3.5 percentage points from 2018.
- Over the longer term, however, agriculture and cultivated habitats have shown a decreasing trend largely due to a reduction in ecosystem extent and this has consistently been the habitat group with the smallest potential for ecosystem services, staying below its 2000 baseline since 2002.
- Cereal yield has decreased 8% from 2020, dropping from 7.3 tonnes per hectare to 6.7 tonnes per hectare, primarily attributed to wet conditions for winter crops (Cereal and Oilseed Rape Harvest 2021).
- Weight of fertiliser use increased 5.5% from 2020 (British survey of fertiliser practice 2021), which decreases the natural capital of arable land and lowers the habitat score. Note, this indicator does not account for the amount of an active ingredient.
- Pesticide use (inverse) has an increasing trend and so this factor has remained below its year 2000 NCAI baseline. Active substance area of all pesticides for total arable crops includes cereals, oilseed rape, potatoes, and legumes (Arable crops and Potato stores 2020).
- Additional factors in this habitat are visual influence of built development (inverse), outdoor visits per week, total number of different bird species counted, butterflies, agri-environment area, farmland birds, and bare fallow/set-aside area.
Notes on data
- Some of the data for this update were impacted by limitations to field work due to the COVID-19 pandemic.
- Cyber-attacks of SEPA’s systems means that SEPA were unable to provide some underlying statistics for this update.
Historic trends of the Natural Capital Asset Index
A backcasting exercise was attempted to backdate the Index to 1950 to understand the longer term trends of natural capital in Scotland. Unfortunately, this exercise wasn’t able to use the same detail of habitat quality data that has been available since around the year 2000. However, using more coarse datasets we were able to demonstrate the longer term trends of natural capital in Scotland.
The trend suggests that natural capital has been in decline since 1950 and efforts to recover natural capital in Scotland still have some way to go to return to historic levels.
A refresh of the Natural Capital Asset Index
NatureScot conducted the first of a two-part refresh of the NCAI in autumn 2022. Outcomes from this refresh included an updated backcasted NCAI graph (Figure 3), a consultation with Space Intelligence on the suitability of the SLAM map as a data input for habitat extent in the Index, and a rerun of the original public survey conducted for the demand of ecosystem services data input of the NCAI. The focus of the first half of this refresh was on improving the transparency and communication of the Index. The second half of this refresh of the Index will take place in autumn 2023, focusing on gaps in the suite of quality indicators for habitat characteristics.
The 2024 publication of the Index will incorporate outcomes from both the first and second refresh and include any updates to its data inputs.
Scotland’s National Natural Capital Accounts
The Scottish Natural Capital Accounts (the Accounts) are experimental statistics produced in partnership with the UK Office for National Statistics and the Rural & Environmental Science and Analytical Services team in Scottish Government. The Accounts look at what the natural capital assets in Scotland are, the physical and monetary flows of these assets and the values of the ecosystem services they provide.
The 2023 release of the Scottish Natural Capital Accounts found Scotland’s natural asset value to be £230 billion in 2019. The total value of annual flows from Scottish natural capital assets in 2019 was £15 billion. A summary of the report can be found here.
The Accounts are not a price tag for nature in Scotland but a tool to help understand nature’s impact on people and to help incorporate nature into policymaking decisions. The asset values are not an absolute "value" of the price we would accept to sell the entire natural world. The natural world supports all life on earth, and its collapse would precipitate our own, implying infinite value.
The Accounts differ from the NCAI in many ways but are complementary models to understand natural capital in Scotland. More detail and a joint publication on the NCAI and the Accounts can be found on our NCAI and NCA Comparison webpage.
Final notes and contact details
Visit our NCAI StoryMap for a visual experience of Scotland’s natural capital.
Further technical information on the NCAI and how it was formed can be found in the journal 'Ecological Indicators' (McKenna et al, 2019).
Links to the NCAI 2021 data can be found separately in the NCAI detailed model spreadsheet.
Please get in touch if you would like further information by emailing Hanna Espie, [email protected]