The exorbitant cost of ecological offsets is strangling community development in regional and rural communities, argues Narromine Shire Mayor and chair of the Alliance of Western Councils, Craig Davies.
Subscribe now for unlimited access to all our agricultural news
across the nation
or signup to continue reading
The Biodiversity Offsets Scheme applies to all developments in the state that meet thresholds for "significant impact". Councillor Davies doesn't argue the reason why, only the inflated price of credits in relation to real market value of western land.
Concerns have already been delivered to the Independent Biodiversity Offset Scheme Review Team, chaired by Ken Henry through the NSW Independent Pricing and Regulatory Tribunal, which is currently monitoring the Biodiversity credits market. The review team is now calling for public submissions.
Cr Davies argues that current market demand, and therefore value, was inflated by the presence of two big players, namely Inland Rail and Transgrid. When the big projects are finished the price could be very different. But that may be a further eight years away.
Meanwhile, projects that would have helped communities have been abandoned by developers refusing to buy into projects requiring biodiversity offsets.
As chair of the Alliance, which covers councils from Mudgee to the central Darling, Cr Davies has a grip on the reality of an area covering 32pc of the state.
At Gilgandra, a $4 million commercial subdivision on a 20 hectare block of previously farmed country on the outskirts of town required $1.4m in offsets to account for trees in the migratory path of an Asian eagle.
Ecologists used audio equipment to identify the bird, said Cr Davies, with the end result being that the project became unprofitable for the developer and was significantly downscaled.
At Bourke a development of six to 12 hectare allotments, which promised employment in a jobless community, came unstuck when land that would have sold for $48,000 blew out to unrealistic values when it was discovered each block would require 10 times that price in offsets.
"The project was scrubbed," he said. "Bourke council area covers 43,000 square kilometres of bush and they are worried about something measuring 600m by 1000m? That is on a miniature scale; hardly a measure. As a result there's no investment, no jobs and everyone's a loser."
Other examples at Moree and Coleambally had shown the exorbitant cost of biodiversity offsets had cruelled expansion of housing in those centres, too.
"We are proposing a flat fee based on the value of undeveloped land," he said. "This way it would capture a value that reflects the value of the land in situ."
Cr Davies said blame lay with bureaucrats and politicians; the Liberals who introduced the concept and the Nationals staying quiet.
A spokesperson from NSW Department of Planning and Environment recommended developers "explore early in the planning phase options to avoid and minimise impacts to biodiversity to reduce offset costs".
"While IPART reviews the scheme, the department is working with councils, developers and landholders to balance demand with supply and help them navigate the scheme," the spokesperson said.
The department has created a Credits Supply Taskforce to help developers find competitively priced credits sourced from the market.
It also works with landholders to create biodiversity credits and ensure there are sufficient credits available for use as offsets.
