Ecoedge-INFFER Paper SER Conference, Avignon 2010


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The paper is based on the presentation given by Melanie Strang (Director of Ecoedge Environmental Pty Ltd) at The Society for Ecological Restoration Conference, Avignon 2010.

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Ecoedge-INFFER Paper SER Conference, Avignon 2010

  1. 1. Proceedings 7th European Conference on Ecological Restoration Avignon, France, 23-27/08/2010 DETERMINING ENVIRONMENTAL INVESTMENT PRIORITIES – A NEW FRAMEWORK MELANIE STRANGA, DAVID J. PANNELLB,D, ANNA M. ROBERTSC,D,E, GEOFF PARKD,F, JENNIFER ALEXANDERC A Ecoedge Environmental Pty Ltd, PO Box 1180 Bunbury, Western Australia, Australia 6231 B School of Agricultural and Resource Economics, University of Western Australia C Department of Primary Industries, Victoria, Australia D Future Farm Industries Cooperative Research Centre, Western Australia E Formerly known as Anna M. Ridley F North Central Catchment Management Authority, Victoria, Australia Abstract: Environmental problems are often much larger than the budgets allocated for addressing them, and many public programs fail to achieve outcomes cost-effectively. A new tool that enables transparent, effective and informed decision making regarding investment in environmental projects has been developed and is now used extensively in Australia. Called INFFER (Investment Framework for Environmental Resources), this tool is a seven-step process that assists users to identify the most valued environmental assets (for example rivers, wetlands, endangered species, highly valued agricultural land) in their regions, and determine which ones are the most cost-effective to protect. INFFER uses available science and gives priority to highly valued natural assets that are highly threatened or degraded, with high technical feasibility of avoiding or repairing that damage, and high likelihood of adoption of the required works by relevant land managers. INFFER has been used in nineteen of the fifty six natural resource management regions throughout Australia and in several state government agencies. The first northern hemisphere trial is currently being undertaken with the University of Florence and there is strong interest in North America. Other partnership opportunities are being investigated in Europe. Keywords: invasive species, disturbance by fire, biodiversity policy, water policy, environmental policy, socio-economics of nature restoration, decision support Introduction Funds for the conservation, repair and maintenance of the natural environment are often substantially less than what is realistically required. In Australia, as in other countries, costs associated with these activities are often under-estimated, leading to many programs not achieving stated goals and to environmental assets remaining at risk. The Australian National Audit Office has expressed concern regarding the effectiveness of current environmental investment programs (Auditor General, 2008). Substantial increases in funding available to environmental managers appear unlikely for the foreseeable future. It is therefore important that the available funds are used effectively, and that those making decisions regarding funding allocation have confidence in comprehensiveness and transparency of the project proposals put before them. Fifty-six community-based regional groups in Australia are responsible for planning and delivering publicly funded environmental projects, funded by programs such as Caring for Our Country. In order to secure funding, these groups must develop high-quality project proposals that are aligned with the federal government’s stated investment priorities. They must also indicate a high likelihood of achieving stated outcomes. To facilitate the development of well- considered projects and enhance the assessment of those projects, a new framework, the Investment Framework for Environmental Resources (INFFER), was developed and is now extensively used. Simultaneously considering biophysical, social, technical and economic parameters, as well as providing an indication of cost-effectiveness and guidance on appropriate policy mechanisms, the new framework facilitates the development of robust, self-substantiating project proposals and subsequently enables confidence in investment decision making. This paper will provide an overview of the INFFER framework and present a case study application from the north of the state of Western Australia. 1
  2. 2. Ecological Restoration and Sustainable Development - Establishing Links Across Frontiers Methods: Description of the framework INFFER was specifically designed to be asset-based, meaning that it focuses on areas of greatest environmental significance in a region or area. ‘Assets’ can be lakes or wetlands, rivers, nature reserves, plants, land, marine areas or other natural things; the only qualifying factor is that they must physically exist and be spatially explicit. The seven-step process begins with guiding users through the initial asset identification and screening process, which usually involves consideration of existing scientific knowledge as well as community and stakeholder consultation. Once assets have been identified and screened to identify preliminary priorities, projects to address threats to these assets are developed by way of the Project Assessment Form (PAF). This step involves rigorous consideration of all aspects of the project and is generally undertaken using input from local experts, technical advisors, local socio-political (community) experts and others. In this step, goals are set and actions required to achieve them are determined; here also impacts such as community support or opposition and effects of actions (or lack of action) by other organisations on the achievement of the goals are considered. The most appropriate and relevant policy mechanism to secure engagement in the project is determined through use of the ‘Public-Private Benefits Framework’ (Pannell, 2008), and then, based on this and the recommended actions, the proposed budget is developed. Values, risk parameters, feasibility parameters and the short and long-term costs of the project (which have been captured throughout the PAF process) are applied to a formula which calculates a Benefit- Cost Index, which indicates the project’s cost effectiveness or value for money. Step four involves the assessment of completed PAFs and culminates in an Investment Plan in Step five. Project implementation and monitoring, evaluation and adaptive management complete the process as Steps six and seven respectively. Benefit-Cost Index One of the primary objectives of the framework is to embed economic thinking into the analysis and decision processes of environmental managers. The Benefit-Cost Index (BCI) generated through the process is one of the key outputs of INFFER. The BCI creates the opportunity to compare projects of different types, scales and durations with one another based on their relative cost-effectiveness or value for money. It facilitates this because it expresses benefits in a common unit of measure (a score standardised against an asset of high national significance), divides benefits by costs to allow comparison of relative cost-effectiveness, and discounts future benefits and costs to calculate their present values (Pannell, 2010). Higher priority projects are those with higher index values. INFFER is a strongly supported, with training and technical assistance available. All documentation including completed examples, FAQs and templates are available online free of charge at Methods: Case study – Fire Sensitive Vegetation Communities of Hamersley Ranges As part of the development of their regional planning strategy, Rangelands Natural Resource Management Region, a regional land management council in the northwest of Western Australia, trialled the use of INFFER to develop and prioritise projects that would protect important assets of the region. An asset prioritisation process was undertaken prior to the INFFER trial, with assets essentially ranked based on results of a threat-value matrix assessment. One of the exceptional assets, located approximately 1040 km north-northeast of Perth, was the Hamersley Ranges; a national biodiversity hotspot containing the Karijini National Park. The vegetation communities of the ranges resulted in the asset being scored as of ‘exceptional’ value. Land within the ranges is owned and/or managed by various organisations including mining companies, pastoralists, the state conservation agency and local government. To further define the asset, discussions were held regarding the relative degree and urgency of threats to the vegetation communities present and the range of natural values provided by them 2
  3. 3. Proceedings 7th European Conference on Ecological Restoration Avignon, France, 23-27/08/2010 (such as habitat values or relictual characteristics) with technical advisors from state agencies and universities as well as local regional staff. This resulted in three vegetation communities, all vastly different in characteristic and location, being selected as the asset. They are those located in topographically protected areas such as gorges, wetlands and hilltops; Mulga vegetation communities on low slopes; and the long-unburnt fire sensitive Spinifex vegetation communities. As the three communities shared the common threat of being susceptible to inappropriate fire regimes, they were considered under the one analysis. An experienced INFFER officer travelled to the region to guide and assist with the process of project assessment. For this particular asset, there were two key technical experts of which one, a state environment agency employee with more than twenty year’s local experience, was the primary expert. Additional advice was sourced where required and where possible from literature, university, regional staff and other agency staff. The PAF was completed over 5 days, with two days of intensive discussion held with the technical advisor(s) and others. Projected onto a screen for ease of collaboration, the PAF was ‘live’ during these discussions, with all agreed comments and conclusions captured. The INFFER officer processed the information collected, creating drafts that were then reviewed and approved by the contributors. In-depth discussions were held around: achieving agreement on the three key threats; determining the current extent of and recommended actions to control specific weed species; determining the most appropriate control methods for feral grazing animals; the best ways to achieve effective combinations of a) summer burning which was used by pastoralists but not undertaken on lands managed by the state agency and b) the use of strategic buffers which are used by state agencies but not by pastoralists. The latter was the most important discussion in the process as it revolves around a highly political topic, and one that if resolved, has the potential to significantly reduce the threat of wildfire. Results The completed PAF clearly illustrated the value of the vegetation communities in question, and provided substantial information regarding actions that needed to be implemented to protect them from the identified threats. Three SMART (Specific, Measureable, Achievable, Relevant, Time-bound) goals were set for the project, based around maintenance or improvement of asset condition rather than based on actions. The level of threat to the asset was estimated to be 76- 100% loss of asset value in the absence of the proposed 5-year project, or 26-50% with the project in place. The analysis provided a clear case for investment. The cost of the project was substantial at AU$4 million; however, the Benefit-Cost Index was very high at 24.22, indicating that the project is likely to provide excellent value for money. The in-depth consideration of the social and political aspects of the project also brought to light the fact that much more emphasis needed to be placed on communication between the state conservation agency and pastoralists regarding the reasoning behind their different management regimes, and to foster a mutually supportive relationship that would result in a cooperative future approach. Discussion Based on the information contained within the PAF, Rangelands Natural Resource Management (NRM) consider this project to be a high priority for investment. In the 18 months since the INFFER trial was completed, both Rangelands NRM and the state conservation agency have made substantial investments towards stated project goals and have used the PAF to guide project development and prioritise actions. The project is not aligned with current Federal Government investment priorities and so has been unable to attract funding from that source but it remains a priority for Rangelands NRM. 3
  4. 4. Ecological Restoration and Sustainable Development - Establishing Links Across Frontiers One of the most positive results of this INFFER process has been the establishment of open and willing communication between stakeholders, particularly the state agency and pastoralists. Prior to this project, these land managers approached fire risk reduction in completely different ways, both of which had merits. Through the INFFER process, it became clear that both groups needed to adopt aspects of the management styles of the other, so that both were implementing a more comprehensive and complementary regime. The recent regional investment, which delivered meetings, workshops and the establishment of a representative working group, has resulted in the formation of an effective working relationship between these key stakeholder groups. For the state agency, which has a legislative responsibility to manage fire risk, to have the local landholders cooperating is a significant achievement, and one which makes implementation, review and ongoing adaption of their fire management plan a much easier task. The state agency has also committed to implementing their fire management regime within the framework of the collaborative approach, giving confidence to pastoralists into the future. Conclusion Early in the process it became apparent that funds required to implement a fully comprehensive project were unlikely to be obtained. The PAF process resulted in a smaller, more targeted project that was developed in a concise and transparent proposal. The INFFER assessment provided a clear, justifiable reason for bridging a social and political gap that had existed for many years; by addressing the social and political risks identified in the PAF, a new environment of cooperation and support between key stakeholders has been created that will result in improved outcomes for the asset in question, even in the absence of full funding. Since this initial trial, Rangelands NRM have undertaken numerous INFFER assessments, with at least four more ‘exceptional’ or ‘very high’ ranked assets being assessed. This proactive preparation of fully developed project proposals puts them in a strong position when new funding opportunities emerge. Whilst INFFER was developed and is most widely used in Australia, principles of the framework are applicable internationally. In addition to the primary deliverables of the process, other non-project-related outcomes of INFFER, such as those detailed above, have been noted by users across Australia. It is likely that similar benefits would also result from international applications. INFFER will continue to be trialled, piloted and or applied throughout natural resource management regions and government agencies in Australia. The first international application, currently being undertaken by the University of Florence with the Siena Province, will be completed in late 2010. There is strong interest for trial applications in Canada and interest from the US, Ireland, England and the Netherlands. References Australian National Audit Office (2008) Audit Report No.21 2007–08. Performance Audit: Regional Delivery Model for the Natural Heritage Trust and the National Action Plan for Salinity and Water Quality Pannell, D.J. (2008). Public benefits, private benefits, and policy intervention for land-use change for environmental benefits, Land Economics 84(2): 225-240. Pannell, D.J., Roberts, A.M., Park, G., Curatolo, A. and Marsh, S. (2010). INFFER (Investment Framework For Environmental Resources): Practical and Theoretical Underpinnings, INFFER Working Paper 1001, University of Western Australia. Pannell, D.J., Roberts, A.M., Park, G., Curatolo, A., Marsh, S. and Alexander, J., (2009). INFFER (Investment Framework For Environmental Resources), INFFER Working Paper 0901, University of Western Australia, Perth. 4