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Enabling the Market: Incentives for Biodiversity in the Rangelands: Report to the Australian Government Department of the Environment and Water Resources by the Desert Knowledge Cooperative Research Centre Anita Smyth Anthea Coggan Famiza Yunus Russell Gorddard Stuart Whitten Jocelyn Davies Nic Gambold Jo Maloney Rodney Edwards Rob Brandle Mike Fleming John Read June 2007 Copyright and Disclaimers © Commonwealth of Australia 2007 Information contained in this publication may be copied or reproduced for study, research, information or educational purposes, subject to inclusion of an acknowledgment of the source. The views and opinions expressed in this publication are those of the authors and do not necessarily reflect those of the Australian Government or the Minister for the Environment and Water Resources. While reasonable efforts have been made to ensure that the contents of this publication are factually correct, the Australian Government does not accept responsibility for the accuracy or completeness of the contents, and shall not be liable for any loss or damage that may be occasioned directly or indirectly through the use of, or reliance on, the contents of this publication. Contributing author information Anita Smyth: CSIRO Sustainable Ecosystems Anthea Coggan: CSIRO Sustainable Ecosystems Famiza Yunus: CSIRO Sustainable Ecosystems Russell Gorddard: CSIRO Sustainable Ecosystems Stuart Whitten: CSIRO Sustainable Ecosystems Jocelyn Davies: CSIRO Sustainable Ecosystems Nic Gambold: Central Land Council Jo Maloney Rodney Edwards: Ngaanyatjarra Council Rob Brandle: South Austalia Department for Environment and Heritage Mike Fleming: South Australia Department of Water, Land and Biodiversity Conservation John Read: BHP Billiton Desert Knowledge CRC Report Number 18 Information contained in this publication may be copied or reproduced for study, research, information or educational purposes, subject to inclusion of an acknowledgement of the source. ISBN: 1 74158 046 3 (Print copy) ISSN: 1832 6684 Citation Smyth A, Coggan A, Yunus F, Gorddard R, Whitten S, Davies J, Gambold N, Maloney J, Edwards R, Brandle R, Fleming J and Read J 2007, Enabling the Market: Incentives for Biodiversity in the Rangelands: Report to the Australian Government Department of the Environment and Water Resources by the Desert Knowledge Cooperative Research Centre, Desert Knowledge Cooperative Research Centre, Alice Springs. The Desert Knowledge Cooperative Research Centre is an unincorporated joint venture with 28 partners whose mission is to develop and disseminate an understanding of sustainable living in remote desert environments, deliver enduring regional economies and livelihoods based on Desert Knowledge, and create the networks to market this knowledge in other desert lands. For additional information please contact Department of the Environment and Water Resources Assistant Director, Biodiversity Trends Section GPO Box 787 CANBERRA ACT 2601 Phone: (02) 02 6274 1111 Copies may be downloaded from <http://www.environment.gov.au/about/publications/index.html> II Desert Knowledge CRC Enabling the Market: Incentives for Biodiversity in the Rangelands Foreword In December 2004, the Desert Knowledge Cooperative Research Centre (DKCRC) funded a scoping study on a potential set of integrated tools for auditing biodiversity, assessing biodiversity condition, and exploring the feasibility of reward or incentive schemes for ecologically sustainable outcomes in the South Australian rangelands (i.e. DKCRC project 1.707 Rewards for biodiversity). The research consortium for this project comprised CSIRO, South Australia’s Department of Water, Land and Biodiversity Conservation (SADWLBC), South Australia’s Department for Environment and Heritage (SADEH), environmental scientists responsible for managing BHP Billiton’s pastoral holdings, and a postgraduate student from The University of Adelaide. The research was based on a case study approach and we used the Stony Plains bioregion as the study area. We performed desktop and participatory studies to report on biodiversity assessment tools for the Stony Plains bioregion. In August 2005, the Australian Government Department of the Environment and Heritage (now Department of the Environment and Water Resources) commissioned the DKCRC to inform department decisions about market-based incentives for achieving biodiversity conservation outcomes in the rangelands. The title of the commission was ‘Enabling the market: incentives for biodiversity in the rangelands’ (DKCRC project 1.806). It had a whole-of-rangeland focus and it specifically targeted information on market-based incentives. The motivation for this study was largely driven by the large body of work on conservation incentive programs for biodiversity conservation on private lands in the intensive land use zone of coastal Australia. The extensively managed rangelands which cover some 80% of the continent have received little investment largely because the landscapes are perceived to be relatively intact. However, recent State of the Environment reports suggest that rangeland ecosystems are in slow decline and extremely vulnerable to inappropriate land uses, fire management practices and invasive weed species. Biodiversity conservation options in the rangelands are likely to be highly cost-effective and could alleviate the need for large remedial investments in the future. Because their has been less exposure for market-based delivery of conservation outcomes in the rangelands than in the intensive land use zone, it is unknown how transferable they are; this must be understood before embarking on any new investments. The expected outcomes of this study were: • The scientific basis necessary to support the development of a market-based approach to biodiversity conservation in the rangelands • A better understanding for investors of the depth of any potential incentives markets • Improved regional and organisational ability to plan for and implement incentives programs to protect biodiversity. Research outputs were: 1. a field-tested condition/intervention metric for rangeland Australia, where the metric is applied in incentive policies to summarise future management outcomes for biodiversity conservation 2. a review of existing market-based conservation opportunities in the rangelands, which included comparing the design requirements, and investigating the economic feasibility of new conservation incentives Enabling the Market: Incentives for Biodiversity in the Rangelands Desert Knowledge CRC III 3. recommendations on what is needed to create a more open marketplace for biodiversity incentives in rangeland Australia, if required following this review 4. based on a pre-test using focus groups across 4–5 regions, the degree of likely uptake of an incentive program and the degree of change (management and/or areal extent) likely to be offered in the marketplace. The commission gave the 2004 study a national context by reviewing the incentive opportunities available to Aboriginal people in the spinifex deserts, and including two extra pre-test case studies in New South Wales and Queensland. The research consortium for the commission included the collaborators mentioned above, as well as the Queensland Murray-Darling Committee Inc., South West NRM Ltd (Queensland), the New South Wales Department of Environment and Climate Change (formerly Department of Natural Resources), the Central Land Council (Northern Territory) and the Ngaanyatjarra Council (eastern Western Australia). Dr Anita Smyth of the Rangelands and Savannas Program, Sustainable Ecosystems at CSIRO in Alice Springs led the project team. The work was divided into four research components, and is documented in four parts of this report. The four parts in the series Enabling the market: incentives for biodiversity in the rangelands are: 1. Issues and opportunities for using market-based instruments for biodiversity conservation, with the Stony Plains bioregion as a case study (Gorddard, Whitten, Coggan, Yunus) 2. Incentive opportunities for Aboriginal lands of the spinifex deserts (Davies, Maloney, Gambold, Edwards) 3. Scoping a biodiversity metric for conservation incentives, using the Stony Plains bioregion as a case study (Smyth, Brandle, Fleming, Goddard, Read, Whitten) 4. Policy options for providing conservation incentives in Australian rangelands (Goddard, Whitten, Smyth) Key recommendations Biodiversity tender design recommendations • Ensure acceptable participation rates via communication and regional trials. • Base schemes regionally to develop appropriate tender mechanism and process. • Start small to manage risk and allow time for tenders to be tailored to regions. • Significant funding to ensure the benefits outweigh the start-up costs and the risks of diminishing intrinsically motivated biodiversity management. • Provide medium-term funding: Medium-term contacts (5–10 year) to ensure effective management changes in a variable environment. • Have flexible specifications which allow for innovation and encourage tailoring to local needs. • Consider whole of lease contracts to control for intensification and adverse effects on biodiversity on other parts of the property. • Minimise transaction and monitoring costs for all parties as managers’ time can be a limiting factor in engagement in a tender process. IV Desert Knowledge CRC Enabling the Market: Incentives for Biodiversity in the Rangelands Incentive opportunities in the Aboriginal lands of the spinifex desert Recommendations for creating
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