Delivering on the promise of stewardship: Issues in realising the full potential of Environmental Stewardship Payments for landholders and the land

4 Dec 2008

Over seventy per cent of the Australian continent is managed by farmers, graziers, Indigenous communities, and other private land managers. Recent years have seen a growing interest in the potential to use stewardship payments to encourage conservation activities on private land. Australian governments have supported a variety of pilot programs and studies, including through the joint Market Based Instrument pilots. In May 2007 the previous federal government announced a new Environmental Stewardship Program. The current government has built on this foundation through the Caring for our Country initiative, which brings together the Environmental Stewardship Program, the National Heritage Trust, the National Action Plan for Salinity and Water Quality and a number of other programs.

The Australian Conservation Foundation commissioned this discussion paper to identify the role and potential contribution of stewardship payments in promoting biodiversity conservation and sustainable natural resource management; to outline key design principles and implementation issues; and to explore possible tensions and synergies with other policy areas – particularly interactions with future policies addressing climate variability and drought, and the introduction of emissions trading.

The key findings of this research include:
(A) Stewardship payments represent an important addition to the Australian sustainability policy toolkit, and can play an essential and distinctive role in promoting environmental conservation and sustainable resource use.

(B) There is scope for a significant increase in the size of the stewardship program over time. This would provide economies of scale and scope, increasing the outcomes achieved and the environmental returns per dollar.

(C) Payments are best delivered through flexible outcomes-based mechanisms. We consider devolved arrangements and trust funds are likely to perform better over time than programs managed directly by government.

(D) As implementation matures, increased priority should be given to: supporting innovative approaches to delivering environmental outcomes; exploring farm-level and regional approaches for enhancing conservation outcomes and improving management of climate risks and variability; and engaging with land managers and investors who are willing to establish new enterprises to deliver environmental benefits that are difficult to achieve through changes within existing businesses.

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