The Wellbeing Budget

New Zealand's wellbeing

Natural capital: Our environment

Natural capital covers all aspects of the natural environment that support life and human activity, like land, soil, water, plants and animals, minerals and energy resources.8

A strong and sustainable environment contributes to wellbeing. The relationship we have with the environment goes beyond the goods and services we derive from it. The quality, quantity and sustainability of our environment not only directly impacts material aspects of wellbeing but also our cultural identity, subjective wellbeing and health.

The environment is our turangawaewae – the place where we live, learn, socialise, work and earn a living

Our land, sea and biodiversity are unique and special, having evolved so distinctly and separately from the rest of the world. There are areas of our natural environment that are looking positive. For example, the quality of our air is good in most places and at most times of the year, particularly in comparison to OECD countries.

However, New Zealand has one of the highest rates of greenhouse gas (GHG) emissions per person internationally (Figure 11). Globally, these emissions are causing significant changes to the Earth's oceans, atmosphere and climate, which are expected to be long lasting and some irreversible.

Figure 11 – Net greenhouse gas emissions, by source

Chart showing net greenhouse gas emissions by source.

Source: Ministry for the Environment

Note: 'Other' includes emissions from waste, industrial processes and product use (IPPU) and Tokelau gross emissions

The quality of our waterways is also an issue. The 2019 Environment Aotearoa report finds that waterways in farming areas have markedly higher pollution levels than waterways in catchments dominated by native vegetation. Pollution can easily spread through catchments, threatening our freshwater ecosystems and cultural values and making water unsafe for drinking and recreation.

Almost 4,000 of our native species are currently threatened with, or at risk of, extinction

The decline in our biodiversity also needs attention (Figure 12). A recently released international scientific report and the 2019 Environment Aotearoa report illustrate just how bad the situation has become both in New Zealand and globally. Almost 4,000 of our native species are currently threatened with, or at risk of, extinction. Globally, the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services report suggests that one million animals and plant species are now threatened with extinction. Biodiversity is a key health indicator for ecosystems. Ecosystems provide many benefits integral to our wellbeing, including food, recreation, pollination and erosion control.

Figure 12 – Conservation status of native species

Multi-bar graph showing onservation status of various native species.

Source: Stats NZ

Soil erosion is a significant issue, with the rate of loss at 720 tonnes per square kilometre per year. Along with landslides, this is estimated to be costing the economy at least $250-300 million a year.9 Cultivation, grazing and logging often degrade soils through erosion, affecting our waterways and causing the loss of nutrients and organic matter. This reduces the productivity of the land, harms aquatic ecosystems and affects flood control, water filtering and soil retention.

This Government is starting to help transition our economy to a clean, green carbon neutral New Zealand with a sustainable future

This environmental evidence has strongly influenced the Budget 2019 priority, Transforming the economy. We are starting to transition our economy to a clean, green, carbon-neutral New Zealand with a sustainable future. We are also looking at ways to more sustainably manage the extraction of our natural resources and support our people, places and businesses to transition to a low-emissions economy.

Transitioning to a low-emissions economy will benefit many areas of our environment and our overall wellbeing. There is increasing evidence that low-carbon, climate-resilient growth can be progressed alongside other socio-cultural, environmental and economic goals. However, it will take time. Technology and science will play an essential role in supporting this transition.


8. Additional sources used in this subsection: Environment Aotearoa 2019 report and the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services report 2019.

9. Environment Aotearoa 2019 report. Note: 2012 is the latest year when this data was collected. It is unlikely that erosion rates have reduced significantly since then. For soil erosion, and many other natural capital indicators, annual data is not always available.

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