A “nature repair market” proposed by Labor will not succeed unless backed by substantial initial public funding and a ban on environmental offsets in the scheme, government scientific advisers have warned.
The Senate environment legislation committee heard a range of critical evidence about the bill on Friday, prompting the government to concede it will indefinitely postpone its passage in parliament.
The bill creates a market that encourages private spending on projects that protect and restore biodiversity. Businesses would receive tradeable certificates in return for their investment. Critics have argued there is not enough private sector demand for the scheme to work, and that allowing the certificates to be used to offset habitat destruction in other places would just add to environmental decline.
Scientists from the government’s threatened species scientific committee told a committee hearing on Friday allowing certificates to be used to offset other environmental damage would undermine the scheme.
Prof Helene Marsh, the committee’s chair, said the plan had the potential to increase investment in nature if it was improved, including by explicitly excluding offsets.
Marsh said the bill also should be changed to recognise the market needed to be backed by expert scientific advice to deliver what had been promised.
Prof Kingsley Dixon, a committee member, said the scheme would need an initial funding injection – which he described as “ignition funding” – if it was to build momentum.
The ACT government backed the push to exclude offsets.
Its environment minister, Rebecca Vassarotti, pointed to a scathing audit of the New South Wales offsets scheme that found the scheme had failed to protect the the environment as promised and was not transparent enough. That audit was brought forward after Guardian Australia uncovered serious problems with biodiversity offsets for major projects in NSW.
The inquiry heard that as a result of the critical evidence the government had agreed to delay both the committee’s report into the legislation, which was scheduled for 1 August, and further parliamentary debate on the bill until later in the year.
Since the Coalition withdrew support for the bill earlier in June, the government has conceded it will need to progress it alongside or after Environment Protection and Biodiversity Conservation Act reforms later in the year.
But the Greens and Coalition were quick to claim victory, with the Greens senator Sarah Hanson-Young declaring that “Green Wall Street just crashed”. “The minister’s environment scheme is in tatters. It has no friends, no integrity, and should be shelved for good.”
The shadow environment minister, Jonno Duniam, said the bill had “collapsed” due to lack of consultation.
Concern about the use of environmental offsets prompted the federal environment minister, Tanya Plibersek, to this week announce an audit of 1,000 sites where they are used to investigate whether developers are meeting requirements.
On Friday, Plibersek said the primary purpose of the nature repair market was to make it easier to invest in nature, and promised upcoming changes to national conservation laws “to deliver the strongest protections for our environment in Australian history”. The changes are expected later this year or next year.
Plibersek said a new standard against which offsets would be assessed was being developed with environment groups and business. “Offsets will only be used as a last resort, and will have to more than compensate for impacts that cannot be avoided or mitigated,” she said. “The standard will make sure that where offsets are required they deliver genuine, lasting and additional benefits for the environment.”
The nature repair market is opposed by the Coalition and Greens. On Friday, the Greens said it should be “binned” and the government should focus on strengthening environmental laws.
Hanson-Young said evidence from a range of experts and state and territory officials had shown the nature offset market was “undercooked and as it stands would be worse than nothing”. She said rather than stop logging or pollution, the legislation before parliament would “greenwash their expansion”.
The environment group WWF-Australia said it supported the legislation to establish a market because there was “substantial need” for private investment in nature. But it said offsets should be excluded until a national standard was developed.
Other conservation groups, including the Wilderness Society and the Environmental Defenders Office, repeated concerns the scheme could contribute to further environmental decline.
“We hope this sort of trade-off bill is the last of its kind,” the Wilderness Society’s Tim Beshara said.
Beshara said the government should be directly funding conservation work. “We are in a biodiversity crisis, the rate of decline is horrendous,” he said. “But what we do know is when we have conservation measures that are properly funded the outcomes are positive.”
