LEGARDA FILES BILL INSTITUTIONALIZING AN ECOSYSTEM AND NATURAL CAPITAL ACCOUNTING SYSTEM IN A BID TO PROTECT NATURAL RESOURCES AS THE COUNTRY RECOVERS FROM HEALTH AND CLIMATE CRISES

Four-term Senator Loren Legarda filed a bill seeking to develop and implement an ecosystem and natural capital accounting system that applies to the Philippine environment, giving importance to the role, value, and impact of our natural resources on the economy.

“For decades, the debate has been whether to choose economy over conservation of natural resources. This is a false dichotomy. The economy and all of society are fully and entirely dependent on natural resources—our natural capital that includes our forests, wetlands, and other ecosystems,” Legarda said.

Indicators and standards generated by the national income accounting system are considered vital information for economic management and policymaking. They serve as the basis for socio-economic planning, formulation of development programs, and policy analysis to aid legislation. However, conventional national income accounting systems measure economic performance by determining the value of goods and services produced in a country and aggregating them to develop economic development indicators, such as the Gross National Product (GNP) and Gross Domestic Product (GDP).

Senate Bill 9, otherwise known as the Philippine Ecosystem and Natural Capital Accounting System (PENCAS) Law of 2022, will include what was formerly considered “externalities,” not valued as capital, in the national income accounts.

Legarda pronounced, “I consider it important that the national income accounts reflect a more accurate state of development and economic performance of the country and should incorporate both environmental and non-environmental inputs and outputs. This will allow policymakers to make responsive, relevant, and effective laws, plans, and programs necessary for national development. The climate crisis and biodiversity losses that could potentially lead to the next pandemic highlight the urgency of having this bill approved and implemented.”

“Good housekeeping requires that you work on what you have and not live beyond your means. It is the same for national patrimony. Not taking into account how much we have and how to allocate it drives our ecosystems to ruin,” Legarda added.

When passed into law, the bill will allow government planners to fully understand the natural capital available and expendable in pursuing national goals. Legarda highlighted what natural capital investments can contribute to the society and economy. She underscored the importance of fully tapping into the benefits of natural capital by developing a governance framework that promotes nature-based solutions while reducing harmful practices.

Legarda stressed, “We should recognize the immense potential of using ecosystems, such as forests, mangroves, and urban green spaces, for climate change adaptation and mitigation, especially as we rebuild and recover from the pandemic.”

The proposed measure adheres to the United Nations System of Environmental-Economic Accounting (SEEA), which the UN introduced in 2006 and has been continuously advancing further with the adoption of the SEEA Ecosystem Accounting in March 2001 and the UN collaborative project with other organizations on Natural Capital Accounting and Ecosystem Valuation that will end in 2021.

The PENCAS bill recognizes the critical role of natural capital in our country’s sustainable development. It also identifies the roles of various government agencies in natural capital accounting, especially that of the Philippine Statistics Authority (PSA) and provides funding to support the implementation of the PENCAS. [END]