The Commonwealth's proposed "Nature Repair Market" is bad policy. Headline policy failures include: high transaction costs; the lack of validated methodologies for the assessment and measurement of biodiversity; and neglect of the scope for strategic action on biodiversity loss (including effective regulation and targeted subsidy programs).

This initiative, under Labor's Tanya Plibersek, has been transferred directly from the Morrison Government (under Sussan Ley), expanded from a focus on farms to biodiversity generally plus a name change. 

The policy process was launched in 2020 when the Environment Department under Sussan Ley, commissioned Frontier Economics to complete a scoping study on the potential for a national biodiversity trading platform. The study reported that:

There is no standard definition of biodiversity services or single fungible unit of biodiversity. This is partly because biodiversity is heterogeneous, embodied in many different types of plants, animals and ecosystems. There are many processes for defining, monitoring, reporting, verifying Frontier Economics Biodiversity services platform scoping study FINA8L and trading biodiversity across different government programs and different buyers. The demand for biodiversity, from governments and private purchasers, is uncertain and hard to predict. The fragmented and complex market arrangements mean high search and transaction costs, which can deter both buyers and sellers of biodiversity. Farmers face further financial, social and cultural barriers to participation.

The study identified three options, an information portal, a spatial information portal, and an exchange platform. It recommended proceeding through these options, in the above order. 

However, the Coalition went straight to the third option and established the National Stewardship Trading Platform, with the goal of:

reducing "the barriers to farmer participation in environmental markets, initially by: providing farmers with access to tools to plan projects; providing farmers with easy-to-use application portals for Australian Government environmental markets; [and] connecting buyers and sellers of environmental services" (the marketplace).

The National Farmers Federation, in association with a number of consulting firms, has been lobbying for a national biodiversity market for some years. See:

• "A Return on Nature" by KPMG and National Farmers Federation (2019).  
• "Recognising on-farm biodiversity management", prepared for the NFF by the Australian Farm Institute (2020)
• "Farming for the Future: Improving Natural Capital", by PWC, Macdoch Foundation, National Farmers Federation and Farming for the Future (2021).

Particularly relevant to the present Nature Repair Market proposal is the Phase 1 report of the Natural Capital Investment Initiative by Climate Works Australia and the National Australia Bank (2021).  The Stage 1 report includes a table (page 16) with a long list of potential indicators with great scope for double counting, significant omissions and unbalanced assessments. (See Legge (2022) for further background on natural capital accounting.)

The Labor Government took the baton seamlessly and in August 2022 set up a two week consultation (based on a three page 'fact sheet' and a highly targeted consultation strategy) on what was then called a "national biodiversity market". Despite the restricted timelines  there were over 200 submissions received, including 45 from people who requested anonymity and 58 which were confidential (presumably from various consultants and banks).  (See below for further comment on the submissions to this consultation.)

Three months later in December 2022 the Department launched a further consultation on the draft legislation proposed to create what was now described as a "nature repair market".  The draft bill is 240 pages long and clearly had been under development for longer than three months (in fact it follows the broad structure of the Coalition's Agriculture Biodiversity Stewardship Market Bill 2022). It is this draft legislation which was the focus of the current consultation and the current RFPG submission.  

Further reading

Feik, N 2023, 'The great stock ’n’ coal swindle', The Monthly (focused on the carbon offsets scam but very relevant to the natural capital market scam) 

Bob Brown Foundation 2023, Nature Repair Market an extreme expression of failed neoliberal economics (BBF submission to Nature Repair Consultation; link will be inserted shortly). 

Reflections on submissions to National Biodiversity Market consultation

Most of the responses to the consultation supported the proposed market although in many cases such support was sceptical and /or conditional on addressing particular risks. Most submissions mentioned the option of using the purchase of biodiversity certificates to offset continuing environmental degradation, virtually all of whom were opposed to this use.  

Many of the supporters of the proposed market would stand to benefit in various ways from its introduction. These include farming organisations, environmental consultants, natural resource managers, and conservation organisations operating area-based conservancy.  

Among the submissions opposing the proposed market, several stand out. These include The Australia Institute, the Centre for Resources, Energy and Environmental Law and Melbourne Climate Futures at the University of Melbourne, the Wilderness Society, the Ecological Society of Australia, the Mulgoa Valley Landcare Group, Environmental Justice Australia, Dr Manu Saunders of the University of New England, and Dr Yung En Chee of the University of Melbourne (see also Dr Chee's peice in the Conversation on the Nature Repair Market).