ICLEI proposes the introduction of the ‘beneficiary pays’ principle

In its Contribution to the Zero Draft of the Rio+20 outcome document, ICLEI - Local Governments for Sustainability (an association of over 1220 local government Members who are committed to sustainable development with members from 70 different countries and representing more than 569,885,000 people) calls for a UN Decade of Sustainable Urbanization to raise awareness, create synergies and to share solutions and good practices.

In ICLEI’s view, the world does not need another declaration. If Rio+20 is to be a worthwhile multilateral conference justifying the enormous financial and human resources invested in it, Heads of States and Governments have to be personally involved in jointly deciding upon and presenting concrete actions.

ICLEI therefore sees greening the “urban” economies as an essential part of the global transition to a green economy. Local Government Organisations (LGOs) such as ICLEI can draw upon the vast implementation capacity of cities around the world, thus tapping into a large potential for green economy transitions. A green urban economy realizes opportunities to enhance human well-being and local natural resources, while reducing future costs, ecological scarcities and environmental risks.

According to ICLEI, the common conceptualization of sustainable development as having three pillars – social, economic and environmental – is misleading. While there is an interconnection between the three spheres, ICLEI doubts that they can be seen as equal and the concept of “harmony” between them is solid. Why should humans and their societies, and why should the environment be brought in harmony with the
economy?

ICLEI sees the economy as a servicing system, not as an end in itself. The economy is dependent upon productive and functioning natural resources and ecosystem services, which it processes into products and services for people. It is thus the mechanism between nature and humans. It must ideally use as little natural resources as possible to enable as many people as possible to live well. With an increasing global population and finite natural resources, this is essential in order to secure decent livelihoods for all human beings now and in future. The way the economy works – whether wasteful or efficient, whether polluting or clean, whether exploitative or just – determines the extent of sustainability of our civilization.

The need for Sustainable Development Goals

ICLEI supports that one central outcome of Rio+20 should be Sustainable Development Goals (SDGs), the framework and goal set for action until 2050:

- SDGs must ensure that in 2050 all 9 billion people will be able to live within the planetary boundaries with decent living conditions. Continuing with a business-as-usual approach will lead to a dearth of natural resources and the possibility of conflict over scarce remaining natural resources. This threat must be addressed decisively and immediately.

- SDGs should be based on scientific evidence and expertise, particularly regarding current assessments and projections for 2050 under business-as-usual and other models, as well as analyzing which actions now would lead to which revision of trends.

- SDGs should be quantifiable, measurable, reportable and verifiable.

- SDGs must address urbanization and its impacts on sustainable development of all societies on this planet. Urbanization trends are interlinked with most of current key challenges such as poverty and resource scarcity exacerbated by climate change, biodiversity loss and globalization.

- SDGs must include clear targets for global sustainable development standards to be met jointly by all actors. It should also set up a centralized registry of commitments that keeps track of which country or institution has agreed to do what, and the extent to which that commitment has been fulfilled.

- Local Governments and Local Government Organizations (LGOs) such as ICLEI will be crucial for successful implementation of SDGs and should be included in relevant global decisions on the definition of SDGs. Discussions on SDGs and governance should be interlinked, since good sustainable development governance at global, national and local level will be crucial for the successful implementation of the SDGs.

- SDGs should be clearly linked to and seen in conjunction with the Millennium Development Goals (MDGs).

Towards a green and sustainable economy: beyond GDP

When considering the green economy in the context of sustainable development and poverty eradication, it is not a question of environmental protection or economic growth, but rather a structurally and qualitatively different type of economic growth which values the finite natural resources the economy relies upon. This is the idea behind green economy in the context of sustainable development and poverty eradication. After the financial and economic crises the world has undergone in the past years, we must once more realize that the current global economic model is unsustainable.

Gross Domestic Product (GDP) is the most widely used metric of the economic performance of a country. However, it is now widely recognized that GDP is an inadequate measure of social progress: measuring efforts and not results, focusing only on quantity of expenditure and not quality, masking inequalities, and disregarding the value of natural capital.

Developing a more comprehensive indicator would allow for more nuanced performance measurement. The Human Development Index (HDI) and other alternatives have existed for a long time. More recently Bhutan’s Gross National Happiness Index and the OECD’s Better Life Index among others have also gained some recognition. ICLEI welcomes and supports the recent efforts made to seek more nuanced measurement of performance and considers it possible to move to a better indicator of national well-being than GDP.

ICLEI expects the Rio+20 Conference to take a decision to generally introduce a new performance measurement framework for countries and their economies.

ICLEI demands that such improved indicator(s) should allow for being translated into locally used indicators as part of a coherent global monitoring and evaluation framework for globally and nationally agreed targets.

As part of the transition to a green economy, ICLEI requests that existing ideas such as the internalization of costs and the ‘polluter pays’ principle must finally be fully implemented. In addition, ICLEI proposes the introduction of a new principle, the ‘beneficiary pays’ principle, for the sake of inter-generational justice: those actors of the current generation who use and benefit from the use of resources or natural capital have to bear the full costs. In the energy sector, for example, energy prices from diverse sources would be extremely different under the ‘beneficiary pays’ principle. Since the current use of fossil fuel both depletes finite resources and pollutes the planet for future generations, a fairer price for the long-term effects of that which benefits us today should be levied.

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