Offset policies don’t work

So maybe we should be weighing up the alternatives

A new age of offsets policy does not seem to be stopping land clearing. Should we be looking to other alternatives?

A new age of offsets policy does not seem to be stopping land clearing. Should we be looking to other alternatives?

Biodiversity offsetting policies are in place across Australia, administered by both state and federal authorities, to ensure that there are no net losses of native vegetation. Readers might be alarmed then to learn that in 2014, almost 300,000 hectares of native vegetation was cleared in Queensland. That’s an area bigger than the Australian Capital Territory, and more than 3.5 times as much as was cleared in 2010.

What’s going on? Why is the rate of native vegetation clearing increasing when we have policies designed to stop it? And, given the history of extensive land clearing in Australia, are offsetting policies the best option, or should we be considering alternatives?

They don’t stop vegetation loss

An increasing body of evidence suggests that biodiversity offset policies will struggle to achieve goals of no net loss, let alone net gain. In fact, biodiversity offset policies may result in a number of perverse incentives that lock in biodiversity loss (consider the story on perverse incentives).

Changes in land tenure or protection of existing assets (such as unprotected remnant vegetation) are the most common forms of offsets. By definition, these result in net loss or depletion of biodiversity (Bekessy et al, 2010). Any lag that occurs between habitat loss and the establishment of new habitat or recovery means a net loss is guaranteed in the medium term.

Indeed, there are very few conditions under which offsets policies can deliver no net loss (Gibbons & Lindenmayer, 2007; Maron et al, 2012). Restoration of currently degraded sites is the only way to achieve true net gain, but there are pitifully few examples of where this has actually occurred, and many scientists are extremely sceptical about the potential for restoration to generate legitimate offsets.

Evaluation of the effectiveness of offset policy is rare; however, in the cases where accounting has been done, the evidence suggests that a net loss is occurring. For example, Victoria’s Native Vegetation Net gain accounting first approximation report found a net loss of more than 4,000 habitat hectares per year. This result was six years after offset provisions were introduced into vegetation clearing regulations.

They are difficult to implement and poorly monitored

When designing and implementing an offsets policy, regulators must determine how to measure biodiversity, what baseline should be used to assess losses and gains, and what constitutes an offset. Uncertainty is present in each of these steps – whether it is associated with variation or error in environmental measurements or multiple ways of assessing them – and different approaches will result in very different outcomes.

Why is the rate of native vegetation clearing increasing when we have policies designed to stop it? And, given the history of extensive land clearing in Australia, are offsetting policies the best option?

 Assessing equivalence

Every policy requires some method for measuring environmental equivalence of losses and offsets. Metrics employed for this purpose – such as Habitat Hectares and BioMetric – are subject to a range of uncertainties, including variation in measurement of environmental attributes and inconsistencies in the way individual attributes are combined to produce an overall score. Observer variation in attribute measurement can lead to vastly different habitat scores for the same site.

Baselines & counterfactuals

The success of offset policies in arresting vegetation loss will vary depending on which baseline – or counterfactual – is used (Bull et al, 2015). Assuming that everything is at risk of being cleared in the absence of offsetting policies is one approach, but is likely to overestimate the ‘net gain’ achieved. Further, selecting a baseline that assumes high rates of losses from biodiversity decline creates a perverse outcome in which those losses are ‘locked in’ by the policy (see page 6).

Mitigation hierarchy

In their original conception, offsets were supposed to be considered in the context of the mitigation hierarchy, whereby offsets were used as the last resort when all options to avoid and mitigate the impacts were exhausted. However, there is little science to support policy and standards to demonstrate that adequate attention has been paid to avoidance and mitigation before offsets can be pursued. There is a significant research opportunity in developing and testing standards for application of the mitigation hierarchy.

Monitoring offsets

Assessing success or otherwise of offset policies is not difficult in theory; it is limited only by a lack of resources dedicated to offset evaluation and monitoring. In some instances, individual losses and gains have been monitored by local land managers but these data are usually inadequate for program evaluation without augmentation with other data on the outcomes of offsetting. The move towards strategic offsets means that offset gains can no longer be linked directly to a loss, making it impossible to measure whether the loss has been successfully offset. Though there remains the opportunity to assess how well the program is going overall, this costs money to do properly.

Urban sprawl chipping away at native vegetation on the Swan Coastal Plain, WA. (Image Google Earth)

Urban sprawl chipping away at native vegetation on the Swan Coastal Plain, WA. (Image Google Earth)

They are susceptible to policy creep

Policy creep is the gradual process by which policies change over time, often with undesirable consequences. As noted by Megan Evans in her Editorial (see page 4), some updates and changes have resulted in improvements in the rigour of offsets policies. However, on the whole, incremental changes have led to a general weakening of the capacity for offset policies to reverse or halt native vegetation loss.

The 2012 overhaul of Victoria’s native vegetation clearing rules – the first in over a decade – provides an example of this. The most significant was the change to the stated goal of the policy. When it was introduced in 2002, the objective of Victoria’s native vegetation clearing regulations (of which the offsets policy was a part) was to achieve “a reversal, across the entire landscape, of the long-term decline in the extent and quality of native vegetation, leading to a net gain”. Following the overhaul, the goal was for “no net loss in the contribution made by native vegetation to Victoria’s biodiversity”.

Another significant change was the relaxing of the offsets hierarchy, which dictates that offsetting should only occur when it is not possible to avoid or mitigate onsite losses. As part of Victoria’s streamlining of native vegetation policies, landholders are now permitted to clear and offset vegetation without conducting a site assessment or demonstrating an attempt to avoid or mitigate onsite vegetation loss across vast areas of the state. The requirement for like-for-like trading was also substantially diluted.

But there are alternatives

Alternatives to biodiversity offsetting exist. One obvious, but rarely mentioned, option is to simply prohibit the clearance of native vegetation. This must be managed well in order to avoid the types of pre-emptive clearing noted prior to previous changes to native vegetation protection policy.

Prohibiting native vegetation clearance has a number of advantages:

  1. Provides certainty: It would provide – once and for all – certainty for landholders and industry about what is and isn’t permitted.
  2. Promotes innovation: By emphasising the value of remnant native vegetation as something that cannot be simply recreated somewhere else, it would encourage innovative approaches to development.
  3. Serves the majority: The majority of Australians benefit from vegetated landscapes. Apart from aesthetic and cultural benefits, vegetation provides numerous and substantial services, such as salinity and erosion control and carbon sequestration. In cities the services are equally compelling; temperature reduction, air quality improvement, and numerous benefits to health and well-being.
  4. Protects threatened species: It would reduce the number one threat to Australia’s endangered species and communities. Vegetation clearing is noted as an ongoing threat to 26 of Australia’s 29 nationally-listed Critically Endangered ecological communities, and the majority of listed flora and fauna species. In response to the listing of vegetation clearance as a threatening process under the EPBC Act, the Threatened Species Scientific Committee was “strongly of the view that land clearance has been the most significant threatening process in Australia since European settlement”.
  5. Provides clarity: It’s simple and logical and restores an important ethical roadblock to the removal of vegetation that offsetting negates.

So let’s put it to the test

In the spirit of evidence-based policy development, an important first step is to measure and evaluate the outcomes of 15 years of offset policies around Australia and internationally. Ideally this evaluation would allow comparison of offsetting with other policy and regulatory instruments such as prohibiting land-clearing in terms of how well they achieve environmental, social and economic outcomes. Program evaluation is a major challenge to researchers and policy makers alike; a challenge well suited to EDG researchers and policy partners.

More info: Georgia Garrard


For details on all four references below, read more here…

Bekessy SA, BA Wintle, DB Lindenmayer, MA McCarthy, M Colyvan, MA Burgman & HP Possingham (2010). The biodiversity bank cannot be a lending bank. Conservation Letters 3: 151-158. And see Decision Point #41 (p10-12)

Bull JW, A Gordon, EA Law, KB Suttle & EJ Milner‐Gulland (2014). Importance of baseline specification in evaluating conservation interventions and achieving no net loss of biodiversity. Conservation biology 28: 799-809. And see Decision Point #85

Gibbons P & DB Lindenmayer (2007). Offsets for land clearing: No net loss or the tail wagging the dog? Ecological Management & Restoration 8: 26-31. And see Decision Point #39 (p2,3)

Maron M, RJ Hobbs, A Moilanen, JW Matthews, K Christie, TA Gardner, DA Keith, DB Lindenmayer & CA McAlpine (2012). Faustian bargains? Restoration realities in the context of biodiversity offset policies. Biological Conservation 155: 141- 148. And see Decision Point #63

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