The Scottish Government has recognised the dual crises of climate breakdown and nature loss, and set ambitious targets to become nature-positive by 2030 and net zero by 2045. It has also recognised that scaling up woodland expansion and peatland restoration have a critical role to play in achieving these goals. But despite making commendable commitments, the pace and scale of action remain far too slow. Woodland creation targets have been consistently missed, and peatland restoration efforts are significantly behind schedule. 

If Scotland is to meet its woodland and peatland targets, it is critical that strategies are based on a robust assessment of the true financial barriers to investment, and a rigorous appraisal of the costs, benefits and risks associated with different investment models. To date however, the widespread view that attracting private finance is the only viable means of closing the finance gap has meant that this wider assessment of alternative approaches has often been missing from the debate. This report aims to take a step back and explore the critical questions at the heart of Scotland’s nature challenge: what are the most significant financial and non-financial barriers hindering progress, and what investment models and policy reforms can most effectively mobilise investment in woodland creation and peatland restoration? 

The report argues that if Scotland is to meet its legally binding climate targets, the Scottish Government must adopt a more holistic and coordinated strategy – one that moves beyond market-based approaches and recognises nature as a public good. We set out recommendations for an effective combination of ‘carrots’ and ‘sticks’ to drive land use change towards meeting Scotland’s climate targets.