Following the Libs ‘Net Zero’ battle, ‘Net Gain’ will be the focus this week as Murray Watt struggles to get changes to environmental laws passed. Rex Patrick reports.
One of the changes in Minister Watt’s Environmental Protection and Biodiversity Conservation reform is the introduction of a requirement for a proposed project to pass a ‘net gain’ test.
What does ‘net gain’ mean?
‘Net gain’ means simply that a proposed project, overall, must have a positive effect on the environment. If a development is going to have a negative impact on a ‘matter of national environmental significance’ (such as a world or national heritage site, a Ramsar wetland, a threatened species, a listed migratory species, a protected marine area, etc), then there will need to be complementary and compensatory activities – offsets – that exceed the anticipated negative impact.
Platypuses and Possums
But how does it all work? That’s yet to be defined. But there are already big concerns.
Richard Denniss, CEO of the Australia Institute, testified at the last Senate hearing into the Bill, pointing out that ‘net gain’ allows/requires the use of offsets that are not like-for-like:
“I can destroy some platypus habitat if someone else protects some possum habitat. And a bureaucrat is literally going to have to develop the platypus-to-possum exchange rate. I am not kidding; a bureaucrat is going to have to
develop exchange rates for different forms of environmental destruction.
He went on to describe how the Government will be able to take payments from developers, a cash payment to destroy a particular piece of natural heritage, and government officials will then have to go off to try to buy some other piece of land to offset the destruction.
“… if there’s no possum land on the market, well, maybe we’ll have to go with some swift parrot. And if there’s no platypus land on the market, we’ll have to go with something else.”
Denniss went on to point out to the Senate that there is “Clear evidence from NSW where this is a tried and true failure. The NSW Parliament has this scheme in operation now. The Ken Henry Review said it was failing. The NSW Auditor-General said it was failing. It has failed at a state level, yet it is the foundation of the offset provisions in this [Bill].”
Others were a bit more optimistic in their presentations to the Senate inquiry, but agreed the devil would be in the details. That very necessary detail just isn’t there at the moment.
History of environmental protection legislation
Environmental protection has developed slowly over more than a century. As far back as 1866, Jenolan Caves was made a protected reserve. Sydney’s Royal National Park was established in 1879 (although it only got its ‘Royal’ title in 1955).
States were predominately responsible for environmental protection up until the 1970s. It was the Coalition Government of Prime Minister Billy McMahon that first established a Federal Environment Department in 1971. The Labor Government of Gough Whitlam further expanded the Federal Government’s role with the passage through the Parliament of the first national environmental impact assessment laws (Environmental Protection (Impact of Proposals) Act 1974.
Further Federal Acts were to come, including The National Parks and Wildlife Conservation Act of 1975 (now repealed) and the World Heritage Properties Conservation Act of 1983 (also repealed) – both of which featured in the 1983 High Court Case of Commonwealth v Tasmania where the High Court held that carrying out work for the construction of a Gordon below Franklin Dam was unlawful without the written consent of a federal minister.
The current Environment Protection and Biodiversity Conservation (EPBC) Act 1999 came into force in 2000.
All of these Acts of Parliament, in various ways, aimed to protect the natural environment and to prevent the implementation of proposals that would harm the environment. The laws themselves have prevented projects from being approved and have allowed the courts to intervene where the laws have been breached or misapplied.
But, in a turning of the tables, we now see approvals for projects that are designed to respond to climate change being slowed down and knocked back. If climate change is to be addressed, something has to change and
‘net gain’ seems to be, at least on paper, a pragmatic approach
– not a new field for environmental and development lawfare. Everyone agrees, something has to change.
Rushing it through
It’s complicated. And so, rightly, when the Senate was asked to consider the legislation, it resisted Government calls for a quick inquiry and set a reporting date of 24 March 2026.
The Senate Standing Orders prevent the Bill being further debated until after the inquiry reports in March. Of course, that date can be overridden by a further vote of the Senate. And that’s one of the things Watt will insist either the Coalition or the Greens will support should a deal on the Bill be done.
Watt wants this Bill passed this week. He’s signalling publicly that he’ll either do a deal with the Opposition pr Greens to make that happen.
That’s ‘huff and puff’ to pressure the Coalition and the Greens.
MWM has already reported on this ‘huff and puff’ as we predicted, rightly, that Watt would not be able to get the Bill approved in the previous sitting week.
Watt happens. A Labor deal with Coalition or Greens on environment?
The Coalition will struggle to get party room approval (for anything, it seems) this week, and the fact is, the Greens will betray their supporters if they allow the Bill to be rushed.
There are many things that need to be sorted out with the reform Bills. National Environmental Standards have not been finalised, policy has not been properly developed, and regulations simply don’t exist.
The Government has, in fact, presented only part of a reform package, and said in regard to the rest, “just trust us”.
The Greens could drive a hard bargain only to find that they get duped when weak National Environmental Standards are declared by Watt at a later date. Sure, if those standards are too weak or problematic, they could be disallowed by the Senate, but the Greens and Cross-Bench won’t have the numbers to do that if the Labor joins forces in the Chamber with the Coalition. I can just see the smile on Watt’s face as a Greens’ disallowance fails.
Net gain for naught
Maybe the ‘net gain’ debate will all be for naught, though.
Watt can do all the dealing he likes on that, because the Bill also has a “national interest” provision whereby the Minister, on his or her own initiative or the project proponent’s application, that will enable the Minister to approve an action even if it had unacceptable impacts, was not consistent with national environmental standards, and did not meet the net gain test.
It would come back to “trust me” in relation to the approval of coal and gas projects. And trust is something we know we can’t do with the Albanese Government.
Environment minister Murray Watt approves 4.3 billion tonnes of carbon emissions
Rex Patrick is a former Senator for South Australia and, earlier, a submariner in the armed forces. Best known as an anti-corruption and transparency crusader, Rex is also known as the "Transparency Warrior."