[ASC-media] Media release: bidding for a greener rural Australia

JCA Media jca.media at starclass.com.au
Sun Aug 13 12:44:57 CEST 2006

International Association of Agricultural Economists 26th Conference
Gold Coast Convention Centre, Qld, Australia
August 12-18, 2006	   ph 07 5504 4057


August 14, 2006


An Australian world-first system in which farmers bid for funds to improve the environment will be in the spotlight at an international food conference today.

The EcoTender technology, in which farmers make sealed bids to carry out work that will achieve multiple environmental outcomes is attracting worldwide attention, says Mark Eigenraam of the Department of Primary Industries, Victoria.

It is one of the new market-based instruments being used to improve the management of land, water and natural landscapes which are being discussed at a major session at the International Association of Agricultural Economists conference at the Gold Coast.

Under EcoTender, the Government announces that funds are available to pay for improving environmental outcomes like native biodiversity, water quality and saline land mitigation.  Farmers bid to carry out work and the Government selects the best value for money bids ?those that will provide the best outcomes at lowest cost.  

Farmers compete with one another to grow crops or livestock.  The EcoTender approach offers farmers the chance to compete with one another to provide ecological goods and services (eco-system services). 

"It ensures farmers are fairly compensated for the environmental services they provide to the wider community."

"Also, it ensures the taxpayer gets the most competitive price for having the environment improved," Mr Eigenraam explains.

The EcoTender project team has made significant inroads in the development of contracts, auction design and scoring landholders for environmental outcomes.

The EcoTender model, like its predecessor BushTender, allows farmers to choose a set of activities and the price they wish to charge for undertaking them 

"We don't mind how the farmer does it, so long as the outcome is what we're after," Mr Eigenraam explains. "We recognize farmers are innovative and know how best to provide goods and services from their land and water resources. To ensure this the team uses a state-of-the-art scientific model of the landscape which can predict likely changes and improvements resulting from actions taken by private landholders."

"There's a lot of interest in what Australia is doing with market-based instruments coming from the United States, Europe and elsewhere," Mr Eigenraam says.

Other market-based instruments to be discussed at the conference include 'cap and trade', where a limit is set for a certain quantity of (say) pollution and enterprises can then trade pollution permits, and 'offsets', in which an enterprise whose development plan has an adverse environmental impact must ensure that it sources an offsetting gain somewhere else that has at least equivalent value.

Australia has been at the forefront of developing market-based instruments to help enterprises play their part in caring for the environment and Mr Eigenraam predicts that providing environmental services to the wider community may in time become a significant source of income for many farmers.  

The conference session on market-based instruments is on Monday, August 14
at 1-2.45pm.

The International Association of Agricultural Economists (IAAE) 26th Annual Conference on "The Contribution of Agricultural Economics to Critical Policy Issues" is at the Gold Coast Convention Centre, Qld, from August 12-18, 2006.

More information:
IAAE media centre, Gold Coast Convention Centre, +61 (0)7 5504 4057
Mark Eigenraam, VDPI, ph 0412 239 492
Media contact: Prof. Julian Cribb, 0418 639245

Conference program & details:

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