Independent panel recommends ‘nature positive’ response to significant biodiversity risk in NSW

A statutory independent review of biodiversity laws in NSW has identified the need for more clarity, a proactive approach to address impacts, and a greater focus on impact avoidance and minimisation instead of offsets.  

Snapshot

• An independent review panel (Panel) has found that the Biodiversity Conservation Act 2016 (NSW) (BC Act) is not meeting its primary purpose to maintain a healthy, productive and resilient environment, and is never likely to do so.
• The Panel has made a number of recommendations to the NSW Government, including amending the BC Act to:
  • support nature positive outcomes and identify ‘no-go areas’;
  • require proponents to demonstrate they have taken genuine and demonstrable steps to find like-for-like credits before making payments to the Biodiversity Conservation Fund; and
  • provide a call-in power for the Minister for the Environment for major projects in determining a serious and irreversible impact and a concurrence role in determining if that impact should be approved.
• The Panel has also made some government-specific recommendations, such as requiring proponents of Part 5 activities under the Environmental Planning and Assessment Act 1979 (NSW) (EP&A Act) to apply the Biodiversity Offsets Scheme if the proposed activity has impacts above the area threshold or affects land on the Biodiversity Values Map.
• Implementation of the report recommendations by the Minns Government would have major implications for planning approvals, land clearing, bushfire and marine management, and interactions with the Commonwealth environmental framework. The NSW Government is considering the Panel’s findings in consultation with key stakeholders and developing a whole of government response.

Background

The purpose of the BC Act is to maintain a healthy, productive and resilient environment for the greatest well-being of the community, now and into the future, consistent with the principles of ecologically sustainable development.

Section 14.11 of BC Act requires:

• the Minister for the Environment to review the BC Act as soon as possible after 5 years following operation of the majority of the Act; and
• the review to include public consultation and determine whether the policy objectives of the BC Act remain valid and the terms of the BC Act remain appropriate for securing those objectives.

To support this review, the Minister appointed the Panel who completed an independent review in accordance with its terms of reference, conducted a public consultation process, and produced a report on its findings and recommendations.

The Panel’s final report relating to the review of the BC Act was tabled to NSW Parliament on 24 August 2023.

The key findings of the Panel include that:

• biodiversity in NSW is at risk from a range of environmental disturbances;
• the principal operative provisions of the BC Act, and their delivery, are deficient, no longer fit for purpose and are contributing to the deterioration of the environment. Key reasons for this finding include that:
  • the regulatory provisions of the BC Act are complex and uncertain. For example, environmental considerations, such as opportunities for biodiversity impact avoidance and minimisation, are not considered early enough in the development assessment and approval process;
  • key advisory resources, such as the Biodiversity Conservation Advisory Panel, are underutilised; and
  • stakeholders lack access to transparent data to inform decisions about biodiversity impacts and biodiversity conservation;
• the BC Act needs to move beyond biodiversity ‘conservation’ to ‘nature positive’ framing through new legislative objects to align with global ambitions to put nature on a path to recovery; and
• the BC Act lacks primacy and is undermined by a range of other environmental legislation, such as the EP&A Act.

The BC Act review was carried out in conjunction with an independent review by a separate panel (LLS Panel) into the native vegetation provisions of the Local Land Services Act 2013 (NSW) (LLS Act). The final report relating to the review of the LLS Act was tabled to NSW Parliament on the same day.

Review Panel recommends significant reform

In light of the Review Panel’s findings that the BC Act is failing to achieve its principal purpose, a number of recommendations have been made under the following key pillars:

• a new nature positive architecture for the State, including a nature positive strategy, spatial tools and development;
• species and ecosystem recovery;
• data-informed decision making;
• leveraging private investment; and
• intersections with other legislation.

We explore some of the key recommendations under these pillars below.

A new ‘nature positive’ architecture

The Panel has recommended replacing the current objects of the BC Act with a new overarching object of ‘nature positive’, where biodiversity is protected, restored and improving.

To encompass a new nature positive architecture for the State, the Panel recommends that the overarching object of the BC Act should commit to:

• halting and reversing biodiversity loss and ecosystem collapse;
• restoring threatened species and ecosystems, ensuring the ecological and evolutionary potential of species, and employing a landscape-level focus to building resilience and adaptive capacity, especially with respect to climate change;
• zero human-induced extinctions of known threatened species; and
• a standard of net gain in biodiversity.

In conjunction with this, the Panel has also recommended amending the BC Act to require an independent body to complete regular reviews of the BC Act, assessing progress in achieving nature positive outcomes.

This proactive approach can be contrasted against traditional sustainability approaches, which have generally sought to minimise impacts by slowing or stabilising the rate of biodiversity loss.

Species and ecosystem recovery

The recovery and restoration of species and ecosystems, and achieving zero human-induced extinctions, forms a key part of the proposed nature positive architecture and strategy proposed by the Panel.

Within this framework, the Panel has recommended amending Part 4, Division 6 of the BC Act to ensure the Biodiversity Conservation Program is focused on halting and reversing biodiversity loss and ecosystem collapse, restoring threatened species and ecosystems, and zero human-induced extinctions of known threatened species.

To maximise accountability and track the measurement of progress, the Panel has recommended providing the NSW Department of Planning and Environment (DPE) with a more active role in the recovery and restoration of species and ecosystems in NSW, such as by requiring it to publicly report on the status and trajectory of each species and ecological community every 5 years.

Data-informed decision making

Currently, stakeholders lack access to transparent data to inform decisions about biodiversity impacts and biodiversity conservation. As a result, there are opportunities to better capture and utilise biodiversity data to inform decision-making.

The Panel has, amongst other things, recommended that the NSW Government invest in contemporary, reliable and decision-ready information systems that enable the capture, storage, management, interrogation and translation of data to inform reporting on biodiversity at landscape scale in real time.

We consider that increased investment into reliable and credible biodiversity data will benefit proponents, allowing measurable baselines to be created against which progress can be accurately measured and reported on. This will lead to better informed decision-making, and in turn, improved biodiversity outcomes.

Leveraging private investment

It is widely acknowledged that substantial private investment is needed to deliver nature positive outcomes. To support this, biodiversity markets will need to have integrity and be founded on robust data, metrics and reporting systems.

The Panel has recognised that collaboration, partnership and investment between the government and private sector stakeholders will be essential to achieve nature positive outcomes.

Accordingly, the Panel has recommended that the NSW Government:

• continue exploring the role that government might play in driving the development of natural capital markets;
• facilitate the investigation and development of instruments and methods that overcome barriers to participating in emerging nature markets and valuing and investment in natural capital;
• consider opportunities for, and resolve obstacles to, landholders establishing multiple credit types on a parcel of land; and
• review incentives for private sector investment and other mechanisms to support private and public land restoration and conservation investment and outcomes.

These recommendations, if implemented, are intended to support an increased supply of biodiversity credits capable of meeting demand, enabling private-sector proponents to invest in liquid and legitimate natural capital markets.

Intersections with other legislation

The Panel considered that intersections between Commonwealth and State legislation do not accord primacy to environmental considerations, and result in outcomes that are not consistent with, and do not support, nature positive outcomes.

For example, the Panel found that:

• some legacy development consents under the EP&A Act were granted before the BC Act commenced, and can therefore proceed with no biodiversity assessment or offsetting if the proponent commenced work within five years of approval being granted. While the Panel did not make a formal recommendation on this point, it suggested that the government could consider whether a periodic refresh of approvals or expiry of new development applications should be required to allow re-assessment of older projects; and
• there are competing priorities between the BC Act and the Aboriginal Land Rights Act 1983 (NSW), noting that the land claims process does not consider potential biodiversity constraints of claimable land.

The Panel considered that legislative reforms and corresponding changes to administrative arrangements may be required to align relevant Acts with the recommended nature positive approach.

While the Panel held that a review of the BC Act cannot await the outcome of the review process for the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act), the Panel found that reforms to the BC Act should consider the Commonwealth’s reforms and deliver alignment and streamlining where this does not detract from NSW achieving its biodiversity objectives.

Native vegetation risk also requires better management

The objects of Part 5A of the LLS Act are to “ensure the proper management of natural resources in the social, economic and environmental interests of the State, consistently with the principles of ecologically sustainable development”.

The native vegetation provisions (Part 5A and Schedules 5A and 5B) of the LLS Act are commonly described as the ‘Land Management Framework’ (Framework), which seek to ensure a balanced approach to land management and biodiversity conservation in NSW.

The key finding from the LLS Panel’s review of the Framework was that the policy objectives of the LLS Act remain valid, and the provisions of the Framework are appropriate for achieving these objectives. However, the LLS Panel has made the following recommendations to ensure the objectives continue to be achieved and further improve the outcomes of the native vegetation provisions:

• improve management of identified environmental risks by, amongst other things, strengthening protections for critically endangered ecological communities and developing a risk-based framework to respond to major climatic events;
• reduce unallocated clearing through better identification of native grasslands / non-woody vegetation by staging the release of the draft Native Vegetation Regulatory Map to help landholders understand the categories of land on their properties, and by better monitoring and reporting of ‘Allowable Activities’ under the LLS Act through satellite imagery;
• expand and support incentives for landholders to retain and enhance native vegetation through a nature positive approach, such as through increased access to natural capital markets; and
• enhance transparency and awareness of the Framework by increasing public transparency and reporting, and establishing monitoring and an annual reporting process for woody vegetation loss and regrowth/revegetation on rural regulated land with oversight by an independent body or expert panel, in consultation with Local Land Services and DPE.

Next steps

This provides a clear platform for the Minns Government to improve biodiversity, introduce changes to the offset market, and align the BC Act with the expected reforms to the Commonwealth environmental framework.

The NSW Government has confirmed that a whole of government response will be developed to the findings of the BC Act and LLS Act reviews.

By Peter Briggs, Partner, Tom Dougherty, Senior Associate, and James Donaldson, Solicitor.