42
6
LINKING OUR SOCIETY AND ECONOMY TO THE ENVIRONMENT
42
6
LINKING OUR SOCIETY AND ECONOMY TO THE ENVIRONMENT
43
This section discusses the importance of increasing the community’s understanding of the state of our environment. It also looks at the benefits of accounting for our interactions with the environment, and how local communities can meet and adapt to environmental challenges, including climate change.
RELEVANT GOAL
To encourage more Victorians to value nature. Victoria has a rich base of environmental assets – or natural capital – which, in addition to its intrinsic value, helps to sustain our economic growth, our living standards and the liveability of urban and regional communities. Terms like ‘environmental assets’ recognise the close interdependence that exists between the health of the environment, the economy and society in general. Managing our environmental assets is challenging enough; doing so with due regard to the economic and social needs of the community adds extra dimensions of difficulty to the task. Environmental assets are managed by multiple agencies with different specialised approaches. Sometimes, in their efforts to protect the environment, management agencies do not always account for the social and economic benefits generated by our environmental assets. Nor do these agencies always share a common language or act with full knowledge about the condition of these assets. A key challenge, therefore, is to acquire better, integrated and more consistent information – information about which assets have been depleted or lost, which are declining in condition, and how the health of these assets affects our well-being as a society. Such information will enable government agencies to make more informed and coordinated decisions on how to manage those assets more effectively. It will also strengthen the ability of businesses, local government and community stakeholders to recognise benefits of protecting the environment and to develop more informed plans that capture their interactions with the environment.
6 SEEA: http://unstats.un.org/unsd/envaccounting/seea.asp
The Wentworth Group of Concerned Scientists believes that key transformative, practical, long-term economic and institutional reforms for Australia can lead to a healthy environment with a productive economy. One of these key reforms is to put in place regional scale, national environmental accounts that monitor the condition of our environmental assets, so that people can make better decisions to support a healthy and productive Australia. In 2012, the United Nations launched a new global environmental accounting system as a framework for linking the quantity and quality of environmental assets to socio-economic benefits. The System of Environmental-Economic Accounting (SEEA) is being adopted by DELWP and other lead agencies internationally. It is an internationally accepted standard, with a set of established accounting principles that can help recognise the interdependence of societies, economies and the environment6. It aims, in short, to support governments and environment agencies make more informed, integrated and coherent decisions.
44
ACCOUNTING FOR THE ENVIRONMENT Recognising the benefit our environmental assets contribute to our communities and the economy
Retail
1
Housing
Transport Tourism
Forestry
Biological diversity, freshwater food, enjoyment and tourism, water for consumption and irrigation Climate change mitigation, reduced flood impacts, biological diversity, clean water, reduced pollution Biological diversity, local food products, clean fresh water Reduced impact of storm surges, biological diversity Enjoyment and tourism, biological diversity, fish products, views and relaxation, reduced pollution
Carbon sequestration and storage, flood regulation, habitat for wildlife, water purification, Habitat for wildlife, primary production, water filtration Coastal protection, habitat for wildlife Amenity, habitat for wildlife, primary production, recreation, waste assimilation
South west wetlands
North east catchment
South east coastal dunes
South central marine
Report the market and non-market benefits that people obtain from ecosystem services and support social and economic analysis
Ground water storage
Water supply and filtration
Habitat for wildlife, primary production, recreation, water supply
4
Soil health
Native species habitat
Benefit accounts
Health and wellbeing
Amenity
Eastern waterways
Report on the flow of goods and services that environmental assets provide and assess how changes in asset extent and condition affect these flows
Agriculture
Recreation and tourism
Clean fresh air, climate change mitigation, biological diversity, timber products
3
Pollination
Air filtration Carbon sequestration
Ecosystem service accounts
Health and community services
To account for environmental assets and the benefits they provide, the System of Environmental-Economic Accounting (SEEA) has been developed as an international accounting standard
Environmental-economic accounting
But these measures don’t take into account the state of environmental assets and our reliance upon them
Air filtration, carbon sequestration and storage, habitat for wildlife, primary production
Report on the health of environmental assets and assess how policies, climate and economic activity are impacting on them
Asset condition accounts
Banking
Traditionally, our measures of progress have focused on economic activity (e.g. gross domestic product, labour)
North east forest
2
Construction
Report on the area of environmental assets and assess how they are changing over time
Asset extent accounts
Sequence of accounts
Power generation
Economic accounting
Environmental-economic accounting A framework for decision-making
Recognising the benefit our environmental assets contribute to our communities and the economy
Accounting for the environment
After accounting for the services and benefits our environment provides it’s easy to see why a healthy environment is the foundation of a healthy economy.
Agencies can identify and better balance tradeoffs when making policy, planning and investment decisions, and can better communicate these decisions to others
Scientists have access to more coherent data over time and provide access to asset condition measures to a broader audience
Communities' decision-making capacity improves with more consistent and coherent information about the environment
Planning agencies, businesses and communities improve their management by using a common organising framework to respond to changes in environmental assets
Investors can compare the outcomes of management actions and develop benchmarks
Parties active in the natural resource management sector share a common language and improve coordination
Victorians appreciate the interdependencies between our wellbeing and the environment
Government and stakeholder decision-making recognises the benefits from protecting and investing in the environment
Advantages of environmentaleconomic accounting
45
46
Leading the way in accounting for our environmental assets The Victorian Government has a primary, overarching role in managing the state’s environmental assets. A key part of this role includes the collection of consistent information about the condition and needs of our environmental assets – and using this to inform decision-making about protecting and investing in those assets. Historically, however, we have not been particularly good at measuring and tracking the health of the natural environment in Victoria. To the extent that we have kept account of our environmental assets and their condition, the efforts have been inconsistent and, in some instances, inadequate. In all likelihood, this has led in some cases to less-than-optimal decision-making due to a lack of basic reliable information. So how can this change? How can the Government and its agencies more fully and reliably account for how our environmental assets are tracking through time? And how can we use this information to improve policy development and decisionmaking, while integrating this process with society’s economic and social needs? A game-changing development is the planned integration of Environmental-Economic Accounting (EAA) into reporting, decision-making and evaluation of social, economic and environmental outcomes and trade-offs. State of the Environment reporting by the Commissioner for Environmental Sustainability will also utilise this framework to inform community, policy and decision-making. This integration of EEA has been set out in a DELWP strategy on valuing and accounting for Victoria’s environment, which is about to be implemented. Through this strategy, the Government will publish a set of environmental accounts for portfolio partners at the state level, such as Catchment Management Authorities, Parks Victoria and Melbourne Water. It will provide us with an internationally recognised framework for assessing our environmental assets, their services and the benefits they provide to society. Establishing common terminology, standardised concepts and consistent measures on environmental assets and their condition is critical to understanding the link between our actions, the health of our environment, and the business case for protecting and investing in the environment.
Work on this initiative has already begun through a recent collaboration between Parks Victoria and DELWP to develop environmental accounting and valuation frameworks to inform park management. As part of this collaboration, the Valuing Victoria’s Parks study assessed a wide range of benefits that parks provide, including tourism expenditure of $1.4 billion per year and supporting 14,000 jobs.
PRIORITY 4 Be the first state in Australia to adopt the UN System of Environmental-Economic Accounts as a way to embed environmental considerations into whole-of-government decision making.
RELEVANT OBJECTIVE Increase the percentage of Victorian organisations reporting and managing their performance against measures that support the natural environment.
47
CASE STUDY
Benefits from nutrient regulation processes in Port Phillip Bay Marine ecosystems provide natural waste assimilation processes that help regulate nutrient loads. For example, a recent study by the University of Melbourne has shown that Port Phillip Bay naturally removes 5,000 tonnes of nitrogen each year. The value of this benefit is estimated at $11 billion per year, which represents the costs that would be incurred to achieve equivalent denitrification through alternative means, considering options such as upgrading the Western Treatment Plant or wetland enhancement works.
If Port Phillip Bay’s nutrient regulation processes are degraded, water bills may increase, as Melbournians would need to pay to maintain the same level of water quality through artificial means. Benefits from natural waste assimilation processes in marine areas enable development of fishing and tourism industries, along with other social and recreational activities, which make Melbourne a great liveable city.
48
Encouraging a new ‘business as usual’ As stated in Chapter 2, several sectors of the Victorian economy are exposed to the risk of our natural capital degrading. One of the impediments to persuading businesses to consider the environmental consequences of their actions is a lack of clear measures and evidence showing the link between natural capital management and a productive economy. It is critical to engage with businesses to support innovation and improve environmental management. The development of corporate tools based on EEA has the potential to help the business community identify synergies between efficient business practices and a healthy and biodiverse environment. The Victorian Government will partner with the broader business community and industry leaders to promote the increased adoption of long-term initiatives that incorporate the impacts on natural capital into business decision-making. Better information could also enable businesses to monitor impacts on natural capital that are relevant to their operations, risk profiles, customer portfolios, supply chains and business opportunities. Leading companies in the financial sector, including National Australia Bank, VicSuper and Bank Australia, are already doing this in collaboration with agribusinesses, creating a market signal for the protection of natural capital. In doing so, these leading businesses are reducing risks in elements of their business portfolios and gaining a competitive edge with an increasingly environmentally-conscious investor base. Rigorous accounting for our natural capital can help inform investors about market risks, particularly in long-term investment options.
PRIORITY 5 Develop Environmental-Economic Accounting tools that help Victorian industries move towards environmentally pro-active business opportunities and manage risks associated with the loss of natural capital.
RELEVANT OBJECTIVE Increase the percentage of Victorian organisations reporting and managing their performance against measures that support the natural environment.
CONSULTATION QUESTIONS 12, 13 & 14 What are you currently doing – personally and professionally – to support and create a healthy and biodiverse natural environment? What else do you think you could do to support and create a healthy and biodiverse natural environment? What might help you to do this? What currently hinders you from doing this? What could businesses do to improve their environmental performance in relation to biodiversity? What might empower them to do this? What currently hinders them from doing this?
49
CASE STUDY
CASE STUDY
Puma’s environmental accounts
Bank Australia Conservation Landbank
In 2011, the multinational sportswear company Puma developed and implemented an Environmental Profit & Loss account for its business and estimated a financial value on its use of natural capital of around €145 million (USD 190 million), which included impacts like water use, greenhouse gas emissions, land use conversion, air pollution and waste. An independent expert panel judged the methodology as a valuable asset for strategic decision making, as well as for analysis of potential business risks linked to the use of natural capital. In Puma’s case, it has enabled the company to evaluate the water intensity of its raw materials and map these against regions where availability of water is an issue or where it could be in the future.
Bank Australia is demonstrating environmentally responsible business practices by driving biodiversity conservation in Western Victoria’s Wimmera. The bank is in a partnership with Trust for Nature in Bank Australia Conservation Landbank, a scheme that involves purchasing land for conservation and funding community groups such as Landcare to deliver on-ground action, which provides incentives to develop land for conservation rather than other purposes. For Bank Australia, the scheme helps to offset the loss of biodiversity resulting from its financing of new homes and vehicles, as well as emissions from running the bank. The Conservation Landbank mitigates biodiversity loss by, for example, setting aside the same amount of land that is lost through a new home construction to be protected or re-vegetated. New home owners with a loan from Bank Australia can access this financial service through Bank Australia Conservation Landbank.
50
CASE STUDY
VicSuper and Kilter Rural Future Farming Landscapes project Since 2007, VicSuper has invested in the Future Farming Landscapes project. The project is based in the southern part of the Murray Darling Basin in northern Victoria, one of Australia’s major regions of agricultural output.
Kilter Rural manages VicSuper’s investments in the region, which aim for sustainable management of agribusinesses while maintaining commercial returns. Activities are diversified to balance precision-irrigated agriculture and the protection of key ecological areas, which service the site and generate additional returns through vegetation offsets, carbon sequestration, salt credit trading, and flood mitigation services.
51
Creating more liveable and climateadapted local communities Victoria’s environmental assets will play a pivotal role in helping communities to become more liveable and resilient, particularly in the face of challenges such as climate change and population growth. Environmental assets in the natural environment help to sustain, protect and enhance our communities and their built infrastructure, while also making them more liveable. For example, coastal mangroves not only support high levels of biodiversity, they also sequester carbon and help mitigate the effects of storm surges and sea level rise. Some environmental assets are purpose-built – as engineering solutions to improve the liveability of our communities – and save significant costs that would be incurred by providing such benefits through different means. One example of such green infrastructure is the use of constructed wetlands; these are increasingly being designed in an ecologically functional and biodiverse manner to improve water quality, mitigate floods and support native species.
There are other examples of green infrastructure with multiple benefits. Urban forests boost amenity and enjoyment for people, remove harmful air pollutants, filter water and help reduce the urban heat island effect – a phenomenon that is estimated to result in annual health costs within the City of Melbourne area alone in the order of $283 million. Green roofs are another example of how to improve the local environment by reducing energy usage and stormwater runoff. While green infrastructure in the urban context may often have limited biodiversity value per se, it can still be a useful way to connect people to nature. Environmental-Economic Accounting tools can be used to help government and communities understand these wide-ranging benefits, and also the vulnerabilities of environmental assets in the built and natural environment – particularly in the context of a changing climate. These tools can also help local communities plan for the future, maintain their environmental asset base and make their built environment more liveable. The development of guidelines or standards for green infrastructure, will give government, industry and communities a stronger ability to realise these benefits more readily, including delivery of services at lower cost and/or with additional benefits.
52
CASE STUDY
The utilisation of native plants in green infrastructure projects will become increasingly important, as native plants are adapted to the Australian climate and therefore may be more likely to withstand the impacts of climate change. The greater use of native plants will also create more opportunities for Victorians to reconnect with our rich botanic natural heritage. The Victorian Government recognises the unique roles that local governments and communities play in tackling climate change, and the important work that is already enhancing Victoria’s sustainability at the local level. Recent examples have included the planting of native vegetation, the establishment of community gardens, local sustainable food networks, green roofs and open spaces. Often these projects involve the conversion of derelict sites into inspirational public spaces, which has the additional benefit of lowering the incidence of illegal waste dumping and vandalism. These activities help communities connect with nature, stay healthy, attract visitors, maintain social support networks and become more climate adapted. The Victorian Government will support this tremendous momentum already underway in local governments and communities with initiatives such as the Victorian Climate Change Grants 2015 and the Local Government Climate Adaptation mentors.
Climate Change Adaptation Plans for Victoria’s catchments The Goulburn-Broken CMA’s 2015 draft plan takes a social-ecological systems approach to identify: • Priority landscapes for climate change adaptation and mitigation in the context of improving the resilience of natural resources; • Options for climate change adaptation and mitigation, including carbon sequestration, within focus areas and priority landscapes; and • Risks to catchment processes from carbon sequestration activities and mitigation actions.
53
PRIORITY 6 & 7 Support communities to plan for future climate change scenarios that impact our natural assets. Drive the expansion of green infrastructure and the use of native species, to help create liveable and climate-adapted communities that include opportunities to connect with nature.
RELEVANT OBJECTIVES Improve ecological regimes to best support biodiversity in a changing environment. Increase the number of Victorians acting to protect nature (e.g. volunteering, making everyday choices).
CONSULTATION QUESTION 15 In addition to existing government, private and volunteer programs, are there any other ways to help Victorian communities and local government agencies promote and create a healthy and biodiverse natural environment at local and regional levels?
54
Increasing nature-based tourism Victorian environmental assets attract millions of local, domestic and international visitors every year. Increasingly, a focus on personal, environmental and community wellbeing has helped drive growth in the demand for nature-based experiences. Victoria’s nature based tourism is built on the quality of our state and national parks and marine protected areas, along with our great natural icons, wildlife attractions and our vast array of landscapes, from our beaches to our mountains, rivers and lakes. To enhance and leverage existing nature-based experiences, Tourism Victoria has identified priority areas, including development of environmentally-sensitive tourism infrastructure in specific regions – such as the Phillip Island Nature Parks, Great Ocean Road, Gippsland, the Grampians and Victoria’s High Country. It is also focusing on targeted investments in our national attractions, such as the Grampians Peak Trail, Phillip Island Nature Parks, and the Shipwreck Coast. Other priority areas include Daylesford, the Macedon Ranges, the Yarra Valley and the Dandenong Ranges. More than 1.4 million international nature-based tourism visitors travelled to Victoria in the year ending June 2014, accounting for 35.8 million overnight stays. Nature-based tourism visitors represent 70 per cent of all international overnight visitors to Victoria. In addition, about 4.3 million day trips were undertaken to and within Victoria by domestic nature-based tourists in the year ending June 2014. According to the Valuing Victoria’s Parks study, $1.4 billion per year in spending is generated by tourist visits to Victoria’s parks. This generates $1 billion gross value added and supports 14,000 jobs. Regional economies that benefit most from park-based tourism include the Grampians, the Great Ocean Road, Phillip Island, the Yarra Valley, the Dandenong Ranges and Gippsland. In and around Melbourne, we also have a wealth of nature-based tourism, including our world-class zoos, aquarium and botanic gardens, as well as hundreds of kilometres of splendid coastline.
While Victoria’s nature-based tourism industry is thriving, it is also highly vulnerable to the future impacts of environmental degradation and climate change. Parks and tourism must be managed to ensure that environmentally-sensitive visitation rates are maintained so that parks aren’t receiving too many visitors in sensitive areas. The use of Environmental-Economic Accounting can help businesses to better understand the benefits they derive from natural assets, and to plan for potential threats to these benefits. Tourism Victoria and public land managers such as DELWP, Parks Victoria and local councils will work in collaboration with the community to ensure that our iconic natural and built assets keep offering opportunities to connect with nature. Recent projects like the Grampians Peaks Trail, the Harcourt Mountain Bike Trail and the Shipwreck Coast Master Plan represent a concerted effort to strategically look at opportunities to maximise access to nature.
PRIORITY 8 Showcase Victoria’s environmental assets as world-class nature-based and cultural tourism attractions.
RELEVANT OBJECTIVE Increase the number of Victorians spending time enjoying nature.
55
CASE STUDY
The Grampians long-term fire, climate and fauna research program – a collaborative approach The Grampians National Park is one of Victoria’s recreational and biodiversity hotspots, and as such is a perfect location to conduct long-term fire, climate and fauna research programs aimed at ensuring future generations can learn about our natural history and understand the ecological dynamics of the areas that they are enjoying. A research project launched in the Grampians in 2008 is investigating how species respond to major climatic changes and fires through time, and how this knowledge can be utilised to manage our ecological assets. Parks Victoria and Deakin University researchers established 36 long-term small mammal monitoring sites across the Grampians landscape. After several years of bushfires and significant flooding in 2011, this monitoring has become critical in establishing the roles that climate and fire play in driving faunal communities. The sites have been monitored annually since 2008 by Deakin University students, assisted by Parks Victoria staff.
With 65,502 trap nights of survey effort and captures of 5457 small mammals, the research has yielded significant information on how systems recover from fire under differing climatic conditions. Species monitored include the Agile Antechinus (Antechinus agilis), Common Dunnart (Sminthopsis murina), Heath Mouse (Pseudomys shortridgei) and the introduced House Mouse (Mus musculus). Outcomes of the Grampians research program are highly relevant to park management. The project has led to significant practical outcomes that support better decision making across the Grampians landscape. These include: • The development of a landscape-scale predictive model identifying ‘small mammal climatic refuges’, utilising longterm satellite imagery; • Species specific fire and climate response models to enable fire and predator management programs to be responsive to underlying climatic conditions; and • The ability to continuously adapt fox baiting for the ‘Grampians Ark’ project to ensure greater predator control effort is applied at locations where populations of significant mammals (e.g. Southern Brown Bandicoot) have been detected.
56
CASE STUDY
1980s
Phillip Island Nature Parks In 1985 the Hon. Joan Kirner, who at the time was Victoria’s Conservation Minister, addressed the Victorian Parliament with a vision to embark on a ground-breaking project to protect the Little Penguin colony at the Summerland Peninsula of Phillip Island. Primarily due to a housing estate occupying their habitat, scientists predicted the colony was at risk of extinction, with only 12,000 breeding birds left. In a bold move, the entire housing estate was purchased by the State Government and Phillip Island Nature Parks was formed to manage more than 1805 hectares of Crown Land. Since its formation, the Nature Parks has achieved significant gains for the ecology and economy of Phillip Island. Of the annual surplus generated from its eco-tourism attractions, $3.5million is spent annually on research and environmental management programs. As a result, Phillip Island Nature Parks has become a world class destination that enables the local community and international and domestic tourists to connect with Victorian wildlife. In 2014-15, Nature Parks welcomed a total of 1,261,882 visitors (58 per cent international) with an annual economic contribution to the Victorian economy of $402.5 million, and underpinning 1753 full-time jobs.
2015 And importantly the number of penguins has grown – more than 30,000 breeding penguins now utilise the reclaimed peninsula as their home. This success has been driven by a broad range of conservation initiatives by the Nature Parks including strengthening the protection and interpretation of significant Indigenous and cultural assets, major revegetation and habitat restoration, ongoing penguin burrow re-instatement programs and the multi-award-winning fox eradication program run in partnership with local farmers. In 2012, the Nature Parks completed a 20 year Vision and Master Plan for the Summerland Peninsula that further details the ongoing transformation of the Peninsula from the former housing estate to become a demonstration of world-class conservation, recreation and eco-tourism.
57
In 2014-15, the average daily number of penguins crossing the beach at the Penguin Parade (969) was higher than the long term average of 850 for the fifth year in a row.
Figure 6: Average number of penguins crossing the Penguin Parade beach each night, July 1977 – June 2015
1,000 long term average 800
600
2014
2010
2005
2000
1995
1990
1985
200
1980
400
1977
Average number of penguins
1,200