UK – Extreme Weather Events Could Cost Economy Tens of Billions, Warns WWF Report

Extreme weather and other possible scenarios that lead to environmental decline could have a significant impact on UK jobs and the economy if left unchecked, and must be factored into governmental and business decisions, according to a new WWF report that uses new risk mapping techniques to look at the cost of inaction by 2050

The new report, ‘Developing and piloting a UK Natural Capital Stress Test’, shows the potential impact on the UK economy in the year 2050, if actions are not undertaken to curb or adapt to environmental changes, and water supplies are not managed sustainably.

The report looks at issues surrounding increased extreme weather events such as floods, heatwaves, droughts and wildfires.

Regarding potential future flood events, it warns that if the UK followed a business-as-usual scenario – paying little or no heed to population growth, climate change and continued housing development on flood plains – a repeat of the 2012/13 winter floods in 2050 would affect many more properties.

  • 2.5m homes – more than double (+129%) the number affected in 2012/13;
  • 770,000 non-residential properties (mostly businesses) – 45% more than in 2012/13;
  • 783 care homes – 78% more than in 2012/13; and
  • 1,652 schools – 48% more than in 2012/13

This could lead to a 70% increase in damages to £2.2 billion – up from an estimated £1.3 billion cost of the 2013/14 flood.

The report shows the economic impact of environmental decline by assessing the costs of events that impact on land, rivers and nature. The economic estimates were based on an adverse but plausible scenario of environmental decline that assumes an international failure to reduce greenhouse gas emissions sufficiently, keeping temperatures on course for 4°C of global warming. The scenario also assumes a reduction in public subsidies for UK agriculture, growth in demand for water and a significant increase in the frequency and severity of pest and disease outbreaks in the UK.

The overall aim of the study was to develop and pilot an approach that would allow the UK Government and business to identify the potential impacts of environmental changes on the economy in order to help prioritise and inform efforts to mitigate the most significant risks. At the moment, far too little is being done to prepare for these risks, despite warnings from WWF and others.

Karen Ellis, Chief Advisor on economics and development at WWF said:

“We have some major environmental challenges coming our way, and our economy needs to be future-proofed. From increased risks of flooding to soil erosion, drought and air pollution, our environment is changing quicker than people think. This is bad for business, bad for our national economy, and bad for jobs. But businesses and governments across the UK are giving it too little consideration when making decisions.

“A stress testing approach, and a long-term plan for managing our natural capital, would enable the UK Government to better understand and manage these risks. Environmental damage is already imposing significant costs on the UK economy and businesses. The UK Government must start addressing these issues properly or it is going to cost us all money and some of us might even lose our jobs.”

The report also found that increased extreme weather events such as floods, wildfires, poor weather and heatwaves and disease could have a major impact on food production, resulting in potential costs of over £33 billion (a 0.9% reduction in GDP) and affect 347,000 jobs.

Source: WWF