Realisation That Biodiversity Net Gain Is Hindering SME Development
Since Biodiversity Net Gain (BNG) became mandatory in 2024, it's become clear that the policy—while well-intentioned—is having unintended consequences on the viability of Small and Medium-sized Enterprises (SMEs) in the development sector.
The Government has now acknowledged this issue. On 28 May 2025, DEFRA launched a consultation (running until 24 July 2025) specifically focusing on the impact of BNG on SMEs and minor development.
Key proposals under consultation include:
Exemptions for minor development (fewer than 10 homes/up to 0.5 hectares), such as:
- Replacing the self-build exemption with one for a single dwelling on small sites
- Raising the de minimis threshold (currently 25m²) up to 250m²
- Full exemption for all minor development
- New exemptions for developments with biodiversity or conservation aims, temporary permissions, or minimal land use change.
Changes to off-site BNG rules to reduce cost and complexity:
- Relaxing the biodiversity gain site hierarchy
- Reviewing the Spatial Risk Multiplier to make unit sourcing cheaper
Reforms to the Small Sites Metric (SSM), including:
- Rebranding to “low impact metric”
- Simplified habitat classifications and trading rules
- Online platform development for ease of use
- Garden biodiversity features potentially counting toward the 10% gain.
These steps aim to streamline BNG delivery, reduce disproportionate costs, and remove barriers that are blocking much-needed housing delivery—particularly from smaller developers.
Recommend Action: Evans Jones welcomes the proposed changes. It is however essential that the development industry as a whole is vocal about its support for the proposed changes (or suggest alterative solutions). It is all very well bemoaning the imposition of requirements which hinder development, but unless as an industry we fully engage with consultation then ultimately, we get the legislation we deserve.
Get in touch with the planning team at Evans Jones if you wish to explore development opportunities and./or discuss how you can engage with the consultation exercise.