The Agenda Was Adopted

Marine Strategy Framework Directive Common Implementation Strategy Working Group on Economic and Social Assessment

Summary of decisions made

The agenda was adopted.

The notes of the previous meeting 30 Oct 2009 were adopted.

The following was agreed upon regarding the mandate:

-The formal name of the document will be Terms of Reference, not mandate.

-All comments and additions from Marine Directors will be left as it is.

-Working group will be functioning until end of 2012, involving an evaluation workshop during autumn 2012.

-The Working group will have no more than four meetings per year.

On the question if the Total Economic Value framework should be used by Member states the group decided that it should not be compulsory.

On the question if a distinction between the economic and social aspects of the initial assessments should be made the group decided that we should not separate these but rather use the term socio-economic, which includes impacts on labour, distributional effects etc.

Division of work to the next meeting was decided:

1. Core content and core assumptions (It was agreed upon that hard product 1 and 2 should merge into one document.) A common understanding of art 8.1.c and the minimum requirements of this. Kirsty Inglis and Henrik Scharin will be lead authors. Rob van de Veeren will participate. Anita Payne volunteered to participate as reviewer.The Lead authors shall start on a table of content and purpose and circulate to participants.
2. Business as Usual Scenarios. Lead authors will be Kevin Brady United Kingdom andTorben Wallach,Denmark. Lead authors shall start on a table of content and purpose of each hard product and circulate to participants. Anita Payne and Sif Johansson volunteered to participate as reviewers. Further volunteers would be very welcome.
3. Cost and Benefits of measures and data needs.Maria Dalla Costa Italy volunteered to be a reviewer, if volunteers were identified for a document on the topic or for relevant sections in the documents envisaged. She will investigate the interest of other Italian colleagues to look at what has been done in this area.Further volunteers would be very welcome.
4. Identify methodologies and their pros and cons. It was agreed upon that this workstream would progress at a slower pace than the work on core content/assumption and BAU.It was further decided upon that all countries should share experiences and send information to Circa. [NB The “Turner report” produced for OSPAR on socio-economic assessment is now available through Circa]
5. Lessons learnt from WFD:Anita Paynevolunteered to compile a short paper based on the relevant lessons learned from WFD economics for MSFD. This would be done on the basis of an email request to members of WG ESA to provide inputs to the paper. All member states shall send experiences on lessons learnt from WFD that are relevant to MSFD to Anita Payne.

Comments on the discussion papers and these minutes to be sent to Katrin Zimmer before the 12th of April.

Next meeting in Sweden, Stockholm 5-6 July 2010.

Detailed notes from meeting

Day 1, 8th of March

Philip Stamp from Department for Environment, Food and Rural Affairs (DEFRA) opened the second meeting of the Working Group on Economic and Social Assessment (WG ESA) and wished all participants welcome.

Agenda Item 1:Welcome and introduction

Katrin Zimmerfrom the Swedish Environmental Protection Agencypresented the agenda and the objectives of the meeting:

- Adopt draft mandate.

- Comment and discuss work programme.

- Comment and discuss papers sent out before the meeting.

There was a round of presentation of all participants. The agenda was adopted and the meeting notes of the previous meeting 30 Oct 2009 were adopted.

Agenda Item 2: Commission update

Sif Johansson from the European Commission explained there are three active working groups within the Marine Strategy Framework Directive (MSFD). These are:

-WG ESA

-WG GES, Good Environmental Status. This is the most active group which are working on the 11 descriptors which classify Good Environmental Status.

-WG DIKE Data information change.

Anita Payne from the European Commission summarized what is going on in the Water Framework Directive Common Implementation Strategy (WFD CIS) in relation to economics. The 2010-2012 CIS work programme agreed by Water Directors in Nov 2009 provides for a workshop to be held on economics issues relating to the WFD. The workshop will be organised by a core group of CIS participants ie Commission, MS and stakeholders. Water Directors requested that the this work should make the relevant links with MSFD economics work. Anyone interested in discussing the WFD economics workshop was invited to contact Anita Payne.

Philip Stamp summarized ongoing work in OSPARs Working Group on Environmental Impacts of Human Activities (EIHA). A feasibility study which will clarify how OSPAR can work with the MSFD and what can be done is planned to be done in time for the next EIHA meeting (November). The study will also make an analysis of measures at the OSPAR scale. A tender for this study has recently been published.

Sif Johansson summarized the latest HELCOM activities. Work is ongoing on the status of the environment and the HOLAS study which will give a more holistic view, putting together assessments made in different areas and filling gaps by making new assessments. There is also a chapter on economics in the study.

Siv Ericsdotter from the Baltic Stern secretariat summarized ongoing work in the research project Baltic Stern in which all countries bordering the Baltic Sea is included. Large parts of the project is performed in Finland and in Sweden. In Swedenthey are for example working with a Baltic Survey which explores how people identify what is valuable in the Marine environment.

Didier Sauzade, representing UNEP / MAP informed the meeting that in MAP, Mediterranean Action Plan some domestic studies on fishery and transport are being done. The studies have an ecosystem approach to all marine activities, but not much focus on economics. Some more info on UNEP/MAP can be found on circa.

Agenda Item 3:Revised Mandate and proposed working programme

Katrin Zimmer explained that since the last meeting all comments from MS and Marine Directors have been considered and inserted into the mandate. Marine Directors adopted the mandate but made some changes and additions in the text. Some of these additions included detailed comments under deliverables and the question was raisedhow to consider this. Further there were still issues to be clarified concerning length of the working group’s mandate and how many meetings the WG ESA would have per year.

A discussion was held concerning the name of the mandate. In notes from Marine Directors it is called Terms of Reference.

The following was agreed upon:

-The formal name of the document will be Terms of Reference, not mandate.

-All comments and additions from Marine Directors will be left as they are.

-Working group will be functioning until end of 2012, involving an evaluation workshop during autumn 2012.

-The Working group will have no more than four meetings per year.

Katrin Zimmer explained what had been done with the work programme, WP, since the last meeting. The former list of issues has been inserted into the work programme. The WP is now structured into four work packages and deliverables in four hard products, products to be agreed by the group and some soft products, other strands of workby the group.

Groups' general comments on the work programme:

-There are many overlaps in the hard products. It was considered better to work in one document at least from the start in order to avoid double work.

-Focus should be on developing a common understanding of the requirements and the analysis that needs to be done. A proposal was therefore to divide the work programme into: 1) social and economic analysis; 2) cost of degradation; 3) preparation of CBA and 4) data needs. Methodologies should be included in each of these work packages.

-Discussion on assumptions and reference year - these discussions should be held in each region, should not be decided in this group.

-Another proposal was to include products 1 and 2 in one document as these are relatively similar. The paper on BAU could be a separate document.

-Products could be divided according to the Terms of Reference:

1,2: Hard products

3-5: Soft products

No agreement could be reached on the division of work packages in the work programme. As this is closely related to the discussion papers, a decision was made to go back to the discussion on the work programme after having had the presentations of the discussion papers.

The Marine Directors expressed in the Terms of Reference that we should agree on minimum requirements. This was however considered to be too time consuming to be discussed at this meeting without a proper proposal from the drafting group.

Agenda Item 4. Core content of economic and social assessment

Kirsty Inglis presented the discussion paper for Hard Product 1: “Core content of economic and social assessment”. (All presentations will be available at CIRCA).

Question 1: Is the Total Economic Value (TEV) framework a useful approach for MS to consider in undertaking their initial assessment?

Groups comments;

Focus should be more on DPSIR (Drivers, Pressures, State, Impact, Response). We should answer the question why we are doing the analysis. The initial assessment is to prepare for the programme of measures.DPSIR describes the policy process that we are doing the analysis for. The level of ambition is to try to understand the situation and present to policy makers. We should be realistic - what does the MSFD ask for and what economic data exists.

The Total Economic Value framework and DPSIR are not conflicting methods, theycomplement each other. DPSIR also look at impacts and non-use values.

Both methods are good but there are difficulties with data. The use value and actual planned use is mostly what is available.

It is possible toget the total valueof the use value, but for non-use value it is only possible to get the value of change.

The MSFD says we should make an analysis of the use of our seas. TEV may be too ambitious. TEV can take years to do for just a small region, there is neither time nor data.

No agreement could be reached. It was proposed that lead authors should receive comments and guidance from other MS and there should be agreement on minimum requirement and then proposal on how to go further.

Question 2: Should a distinction be made between the economic and social aspects of the initial assessments.

An agreement was made that we should not separate these but rather use the term socio-economic, which includes impacts on labour, distributional effects etc.

Agenda Item 5: Links between article 8(1)c and other requirements of the directive

Presentation by COWI Christina van Bruegel, Denmark.

Anita Payne introduced the scoping study that is being undertaken by COWI for DG ENV and explained the nature of the study is a scoping exercise. The main objectives of the study have been to:

Identify the economic requirements in MSFD and identify different interpretation options.

Identify possible analytical and methodological approaches and give an overview of the advantages and disadvantages of each approach

Identify potential of synergies and inspiration for related policy areas, literatureand research.

Christina also touched upon the work inDenmark regarding their initial assessment. Denmark has initiated their work on the initial assessment and the cost of degradation. To calculate the cost of degradation, Denmark started from the list of descriptors and focused on those where problems could be identified. Then possible measures were identified. The cost of degradation was then equalled to the cost of the different measures. Examples: Off shore: to avoid contamination the costs of investments were used. Fishing: the cost to change to alternative fishing tools were used. Comments from participants in the meeting were made that the cost of degradation could not be the same as the cost of different measures.

Day 2; 9th of March

Philip Stamp wished all participants welcome back to the second day and presented the agenda of the day.

Agenda Item 6: Core Assumptions

Henrik Scharin from the Baltic Stern Secretariat in Sweden presented the discussion paper for Hard Product 2 “Core assumptions”.

Group's general comments on presentation and discussion paper:

There was confusion about the terms cost of action and cost of inaction and whether these were equal and how these terms relate to the cost of degradation. It was expressed that the term cost of inaction can not be the same as cost of degradation as degradation can occur regardless of inaction.

Common discount rates: As each country have their own policies on discount rates it would be difficult to determine a different discount rate for the directive's work. A solution would be to use different discount rates in the sensitivity analyses.

The calculations should be living documents in which it should be easy to change the discount rates. It should be up to the member states to decide on discount rates. It is not possible to compare results unless all parameters are equal. Common definitions and methodology are more important in terms of producing comparable impacts than using the same discount rate.

The most important task for the scenarios is to see if measures have to be taken.

It is difficult to understand the ecosystem services. Models of ecosystems will give information but not the necessary answers. We are one step further in that we know we don’t know. National measures that have to be taken will not target a special ecosystem, it will look more macro.

An important limitation for the economic analysis is that we need the data from natural sciences and it's difficult to relate to economics.

Core contents and assumptions must be easy to follow and understand. Then also non-member states will be able to follow. This is specially important for Mediterranean countries.

It was agreed upon that hard product 1 and 2 should merge into one document.

Agenda Item 7: Methodologies and approaches for initial assessment (Soft product ii)

Stephen Hull from UK Marine presented a project on attempts to valuing UK seas. The project is about identifying options for valuing UK seas and follows an ecosystem approach, using the TEV framework.

A discussion came up on which value to use - is it the landing value or the value involved with processing goods from the sea. And what value are we talking about - we should also include the value of using a depletable resource if we talk about for example sand extraction. There is a risk of overestimating direct values. It is difficult to value for example leaks from ships.

Rob van der Veeren from the Netherlands presented the NAMWA tool (National Accounting Matrix including Water Accounts) used by the Netherlands for the water framework directive and other lessons from the work on WFD.

The main conclusions from his presentation was to start on time and to keep it simple. Use existing data, for example from National statistics as much as possible. If the approach to the economic analysis of water uses in WFD was good enough it should be OK also for the MSFD. It is also important not to delay the role that the CBA will play in the MSFD.

Group's comments and questions on presentation

In the tool NAMWAused it is focus on social and economic analysis - what about cost of degradation, how do you integrate that?Netherlands is still not clear on how to deal with the cost of degradation.

How do we look at land based sources, how should this be separated from the work in the WFD?

Didier Sauzadefrom MAP presented the current work on valuation in the Mediterranean Action Plan, MAP.

General comments from group:

The benefits presented in the project - to whom are these benefits. We have to be clear to whom we present values and benefits.

The study gives an idea of the complexity we have ahead of us.

Kirsty Inglis presented the discussion paper on Business as Usual Scenarios, hard product 3. Most points had already been covered in previous discussions.

Anita Payne gave a short presentation on reflections from the two days meeting.

The starting point for the WG ESA work is the Terms of Reference. The first objective of the ToR; “to facilitate a common understanding of article 8.1.c and provide recommendation concerning the level of detail required” should have a "policy" thinking. Put focus on the objectives of the ToR and how the WG ESA shall fulfil these.