The really big and tough issue is the environment says Ken Henry

In last weekend’s Sydney Morning Herald, Jessica Irvine quizzed Ken Henry on his preferences for tax reform. Ken emphasised the critical importance of a clear, settled allocation of roles between the Commonwealth and the States.

“The big one, the really tough one, is environment. There I can see the sense in leaving it to the states. But their record has been so bad, I would not. It’s just terrible. And I think there has to be a national discipline when it comes to environmental matters. And I’m not just talking about climate change – obvious climate change – but the preservation of the continent has to be thought of in those terms: it has to be thought of as the continent of Australia. And that should be a national responsibility. Bizarrely, under the constitution, the Commonwealth doesn’t actually have power, except in unusual circumstances.”

So, would Henry strip state governments of the ability to approve mining projects?

“Yep.”

Bombs away!

A timely intervention, given the cognitive dissonance on the environment flowing from leaders, political and corporate, for years now, which is coming to a head as we tentatively emerge from the pandemic lockdown.

Pre-pandemic, in the euphoria following the Morrison government’s unexpected election win, the heat was on to “free up” the economic system, streamlining project approvals and letting the juices of unconstrained markets flow, to deliver recovery to an ailing economy.  Politicians, conservative media and industry bodies have long railed against “lawfare”- “activists seeking to subvert our legal system for political ends”, notably in supposedly slowing up environmental approvals for projects like the Adani Carmichael coal mine.

The Independent Review of the Environment Protection and Biodiversity Conservation (EPBC) Act, initiated in October 2019 and currently being carried out by Graeme Samuel, was apparently seen in some quarters as a means of achieving such streamlining, inter alia “removing green-tape

Then, in quick succession on top of the extended drought, Australia was hit by another three warnings that our society and economy are systemically unsustainable – unprecedented bushfires, floods and now the pandemic.  They all relate directly or indirectly to human-induced climate change, which stems from our use of fossil fuels, agriculture and land-clearing.

This should have given leaders food for thought about the environment; in addition to our execrable climate and energy policies, key Australian indicators are all heading in the wrong direction, whether it be biodiversity loss, coral reef damage, unauthorised land-clearing, and much more.

But no. After a brief dalliance with ideological freedom and Keynesian stimulus measures, it became clear that little had been learnt. Recovery was to be a continuation of free-market growth at all costs, in which environmental concerns don’t much feature.  Projects are apparently to be fast-tracked, fossil fuel development accelerated irrespective of Australia’s emission reduction obligations, clean energy funds diverted to extend fossil fuel use with technologies such as carbon capture and storage (CCS) which, despite wasting millions of taxpayer dollars, has demonstrably failed anywhere other than in depleted oil and gas reservoirs.

A gas-led recovery is trumpeted, despite the fact that no credible transition plan for Australia has been proposed which actually includes any substantial role for gas. The mantra of gas as a transition fuel to a low-carbon world is totally at odds with the accelerating impact of climate change – and unjustified given that low carbon alternatives and energy efficiencies are available and economically more attractive.  And then there is coal which, hiding under cover of the gas-led recovery, has just seen an unprecedented number of recent development approvals in NSW and Queensland.

Herman Daly’s reminder that: “the economy is a wholly-owned subsidiary of the environment, not the reverse” obviously has yet to penetrate the latest incarnation of the  Canberra bubble.

Ken Henry’s logic that the Commonwealth should take primary responsibility for the environment, in the interests of preserving the continent, makes eminent good sense, but is not helped by the recent scathing report by the Australian National Audit Office on the failings of the Federal Department of Agriculture, Water and Environment in administering the EPDC Act.  At one level, a depressing litany of incompetence and mismanagement which goes some way to explaining Australia’s appalling environmental record. At another, it is understandable, given the politicisation and emasculation of the public service over recent years. With continual political pressure to accelerate development, in the current climate, there is not great mileage for any public servant to take a stand on the environment.

Clearly there is justification for streamlining Australian environmental legislation to expedite justifiable development, but not because of supposed “lawfare” delays reiterated by development-at-all-costs politicians.  There are far more fundamental problems which the legislation should, but does not, address. The reason activists often have to resort to legal contortions to prevent disastrous environmental outcomes is largely due to these failings.

The Terms of Reference for the EPBC Review state that: “The Australian Government is committed to delivering improved national environmental laws to ensure a healthy environment and a strong economy.”

The threshold issue, fundamental to the review of the EPBC, is that, in a free market economy as conceived by recent governments of both persuasions, along with most political and corporate leaders, ensuring a “healthy environment” has become incompatible with maintaining a “strong economy”.  In particular, whilst it may be possible to “promote ecologically sustainable development (ESD) through the conservation and ecologically sustainable use of natural resources, and to promote the conservation of biodiversity”, two of the primary objectives of the EPBC Act, it is not possible to actually achieve these objectives given current national and State policies.  Consequently, the EPBC, and much State environmental legislation, is no longer fit-for-purpose, assuming these objectives hold.

This was less so when the precursors to the EPBC were conceived in the early 1990s.  Environmental and conservation pressures in those days were far less acute than today, given lower population pressure and resource consumption.  Hence environmental legislation developed primarily around national and state considerations.  The global context was less relevant, although even then it should have featured more prominently.

Today, with continued exponential growth in both population and consumption, in Australia and globally, the most critical environmental and conservation issues are global.  These arise from a range of potentially catastrophic, even existential, threats which now confront humanity.  Particularly the inter-related issues of anthropogenic climate change, water, food and resource scarcities more broadly, the collapse of ecosystems, loss of biodiversity, and pandemics.

For the last three decades, Australian leaders, political and corporate, have refused to accept, and act upon, expert advice on these major risks, from climate change in particular.  The resulting damage is now obvious, most recently the 2019/20 bushfire season, but this is only the beginning, as climate change, along with these critical, inter-related risks, will probably manifest themselves henceforth as escalating compound events, as we already see with the pandemic.

Obviously Australian leaders cannot be blamed exclusively for the impacts of climate change, or the pandemic, but Australia’s intransigence and failure to even acknowledge these risks historically, in preference to maintaining its high carbon economy and international fossil fuel trade, has been a major contributor to the disasters now unfolding globally and locally.

In recent years, the assumption that has come to dominate Australia’s development, along with other Western democracies, is that the free-market economy is all-important, with environmental and social considerations very much secondary.  That thinking has led to the current global emergencies around the pandemic and climate change, which are directly related.  Of the two, climate change is the far greater, potentially existential, risk to humanity, and to the environment.  However, the pandemic serves as a wake-up call that the free-market economy is incapable of handling the contradictions it has created.  That is particularly true of environmental and biodiversity damage.

The first duty of any government is the security of the people. That duty historically has been interpreted in narrow, militaristic, national security terms, whereas the real priority should be human security.  If the Australian community, and their governments, want that security, it must be accepted as Herman Daly asserted, that society and the economy are wholly dependent upon the healthy environment aspired to in the EPBC Act.  This will require the Act to be strengthened, the starting point being an acceptance of the real risks we now face, locally and globally, based upon the best science and evidence, with policy and legislation developed accordingly.

To be fit for the future, the EPBC Act must require objective science and evidence-based assessments of the really critical risks affecting the Australian environment, and proposed developments.  Given the global nature of these risks, particularly climate change, global perspectives must be considered, not just the parochial national economic view which has dominated decision-making historically.  The existing Act has been interpreted largely as not requiring such global considerations, although this has started to change with some recent legal decisions, such as rejection of the Rocky Hill and Bylong coal mines.

In his 2006 book: “The Upside of Down: Catastrophe, Creativity and the Renewal of Civilisation”, Thomas Homer-Dixon concluded that:

The 21st Century will be the Age of Nature. We’ll learn, probably the hard way, that nature matters: we’re not separate from it, we’re dependent on it, and when there’s trouble in nature, there’s trouble in society”.

We are learning the hard way.  The EPDC Review is the opportunity to reset the dial and position the environment with the pre-eminence it requires. Don’t waste it.

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Ian Dunlop was formerly an international oil, gas and coal industry executive, chair of the Australian Coal Association and CEO of the Australian Institute of Company Directors. He is co-author of “What Lies Beneath: the understatement of existential climate risk”, and of the Club of Rome’s “Climate Emergency Plan”. He was a co-convenor of the first Australian National Climate Emergency Summit recently held in Melbourne.

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