At the request of the Environmental Audit Committee, the National Audit Office has published a Report on the progress Defra and Natural England have made in implementing statutory biodiversity net gain ("BNG") introduced by the Environment Act 2021. 

Notably, the Report confirms that "Defra is relying on a market for biodiversity units emerging, but does not know how rapidly this market can scale up, or whether the market can satisfy demand.” Securing the requisite BNG via off-site units is fundamental in developers being able to meet the new statutory requirements. Where this is not possible, the fall-back is the purchase of statutory credits which have been presented as a last-resort option. The reliance on off-site units as part of the mitigation structure, without proper management or future planning from Defra, may result in delays for developers in satisfying their planning obligations. 

A topic which has been the subject of much discussion is local authority resourcing in order to effectively manage and monitor the new BNG requirements.  The Report notes that “for now, there is doubt about whether local authorities will be able to discharge these duties effectively.” The Report acknowledges that Defra has not allocated local authorities additional funding for monitoring or enforcing on-site gain, despite calculating that local authorities would need additional full-time employees for such purposes. 

It remains to be seen how the conclusions of the Report will be adopted going forward particularly in the context of the upcoming General Election.