Managing for the externalities



Australia's formal environment protection system is broadly charged with the responsibility to deliver protection of the environment while providing for the ongoing development of the wealth and wellbeing of our human communities. This objective means that governments and their environmental protection and management systems need to provide a balanced view of the extent of environmental degradation that can be accepted in achieving acceptable environmental, social and economic outcomes. That is, the environment is protected to the extent that it can be while still providing for advancing economic and social development. This approach can result in, for example, a government authority rejecting an industry proposal on the grounds of unacceptable levels of environment impact, but the government of the day overturning this decision, seeking to provide the balance described above. In this way, setting policy objectives and processes to achieve balance can trade away environmental quality through the tyranny of many small decisions (‘death by a thousand cuts’).

The balance in the Australian environment has become heavily contingent on globalisation of the markets for Australia's raw resources, commodity goods and services. The price that can be achieved for an exportable resource or product governs the extent to which Australia can achieve increased economic and social development. This typically moves the balance and can allow economic drivers from overseas to increase local environmental impacts by greatly increasing the attractiveness and economic feasibility of (for example) an individual resource exploitation project.

‘Creeping degradation’ can be effectively prevented by the establishment of absolute standards for the environment. Important calls have been made for environmental benchmarks to be set for use in environmental accounts,93 but a set of standards based on equivalent metrics is equally important. The lack of a set of standards for the Australian marine environment that are based on measurable and ecologically sound metrics means that acceptability on social and economic grounds can, and often does, result in greater pressures being applied to the Australian environment.

In marine systems, there are very few defendable metrics that can be used within management frameworks for this purpose. Probably the best developed standards are those within the Australian Government's fisheries management systems, although these are primarily directed at production systems, not environmental protection. Not only are there few marine standards, but there are no national monitoring systems that could be used to determine if a relevant standard is being achieved and maintained.

In the absence of a system of national marine standards for ecosystems and biodiversity, or an integrated framework of national marine management that could be used to apply such standards, the marine environment is destined to be continually rebalanced in a downward direction. Although there are many examples of improving local conditions, there are very few examples of improvements in ecosystems at the regional scale. For this report, 13 of the 31 major species or groups assessed (40%) were rated as being in poor or very poor condition, and only four of these were considered to be improving. These four groups were considered to be recovering because of the removal of excessive fishing pressure, reflecting the legacy of overfishing and the improvements in contemporary AFMA fisheries management practices. It is therefore clear that sector-by-sector changes can be (and have been) made to reduce impacts. However, such changes are slow and costly unless an integrated system of management is established that sets targets based on environmental standards.

Ward T (2011). Marine environment: Managing for the externalities. In: Australia state of the environment 2011, Australian Government Department of the Environment and Energy, Canberra,, DOI 10.4226/94/58b657ea7c296