Position paper and recommendations to the Draft National Biodiversity Offset Policy

The use of biodiversity offsets is controversial, due to the risk of abuse, and the problems of leakage and non-additionality. The approach should therefore be applied with caution if the likelihood of positive biodiversity outcomes is to be maximised.

In April 2017, the Minister of Environmental Affairs, Dr Edna Molewa, published the Draft National Biodiversity Offset Policy in Government Gazette 40733 (Notice No. 276) for public comment. According to the Ministry of Environmental Affiars, the aim of the National Biodiversity Offset Policy is to ensure that significant residual impacts of developments are remedied, as required by the National Environmental Management Act, 1998 (Act No. 107 of 1998), thereby ensuring sustainable development takes place in line with the Constitutional Right to an environment that is not harmful to the health and well-being of all who live in South Africa. The draft policy can be found here.

Wits academics from the GCI, School of Animal, Plant and Environmental Sciences, and the Centre in Water Research and Development wrote a position paper in response to the Draft National National Biodiversity Offset Policy.

Position paper and recommendations to the Draft National Biodiversity Offset Policy

Position Statement of the Authors

There is limited quantitative evidence that biodiversity offsets are effective (Bull et al. 2013; Gardner et al. 2013; Evans et al. 2015; Gordon et al. 2015; Maron et al. 2012; IUCN 2016; Maron et al. 2015; Maron et al. 2016). While gaining traction globally as a conservation policy instrument, there are substantive criticisms levelled at the approach, relating to offset design, accounting, governance, compliance and evaluation (Maron et al. 2012; Maron et al. 2015). In addition, time lags before intervention goals are realised, poor measurability of interventions and uncertainty of the biodiversity outcomes all potentially compromise the effectiveness of biodiversity offsets (Maron et al. 2012). Biodiversity offsets may be misused in a variety of ways: for instance if governments meet existing conservation targets using the compensation that developers pay for damaging biodiversity (Maron et al. 2015; this is a form of ‘non-additionality’); or if the alternate options are not rigorously explored; or if offsets become a cheap and easy default; or if the use of offsets simply displaces the pressure on biodiversity (‘leakage’). Most offset schemes aim to achieve ‘no net loss’ of biodiversity. This may not mean that offsets halt declines in biodiversity, because if the goal of offsets are only to neutralize the loss attributable to a particular development (Maron et al. 2015), they have no impact on overall biodiversity trends.

If properly implemented biodiversity offsets could potentially contribute to positive conservation outcomes (Maron et al. 2015; Maron et al. 2016). In order to ensure this desired outcome, it is critical that the design, implementation and evaluation of biodiversity offset policies be consistently applied across programmes.

However, the current draft policy ignores the possibility that biodiversity offsetting will generate behaviours that increase biodiversity loss via providing perverse incentives, even in well-implemented cases (Gordon et al. 2015). These behaviours include unintended incentives for:

exacerbating baseline biodiversity declines
impeding or altering non-offset conservation actions of government, agencies or the public
promoting false public confidence that the problem of biodiversity loss has been effectively addressed, and
compromising biodiversity outcomes, if offset actions are marketed as environmental gains (Gordon et al. 2015).

We urge that the National Policy on Biodiversity Offsets be better aligned with global best practice on offset policies, as recommended by the IUCN Policy on Biodiversity Offsets (IUCN 2016) and other approaches currently being developed and applied (i.e. Gordon et al. 2015; Maron et al. 2016). In particular, steps must be taken to reduce the risk of perverse incentives, which would have the consequence of exacerbating biodiversity loss, through the mechanism of implementing biodiversity offsets.

As the Draft Policy correctly points out, the use of biodiversity offsets can only be considered an absolute last resort once all other interventions in a mitigation sequence have been exhausted. However, the Draft Policy is not explicit on who makes this decision (other than stating a “biodiversity specialist” and “Competent Environmental Authority”), and what evidence and objective criteria would measure the offsets efficacy. Accurate, transparent and independently verified accounting methods must be developed to assess the costs and benefits associated with all biodiversity offset policies (Gordon et al. 2015; IUCN 2016; Maron et al. 2016).

Recommendations

Comprehensive guidelines and more robust decision criteria are required in the policy, as to when to apply biodiversity offsets, and how to design, implement and evaluate offset programmess, using best practice approaches (IUCN 2016; Maron et al. 2016).
The draft policy must recognise the limitations, costs and risks of biodiversity offsets as a strategy to mitigate the residual effects of development (Maron et al. 2016).
To reduce the risk of perverse incentives, four actions are required that need to be incorporated into the policy framework (after Gordon et al. 2015):

(i) Transparent baselines that are periodically updated

The reasoning, assumptions and evidence underlying the baseline estimations must be provided when establishing offsets, and regular reviews must re-assess their relevancy. This implies proponents would be required to offset not only the impact for which they are responsible, but also a component of ‘background’ decline, and set offset ratios (as mentioned in draft). The latter is designed to accommodate both the uncertainty in estimation (see below) but also to act as a disincentive for selecting offsets as a cheap and easy option, and should be reviewed periodically by the relevant authority.

(ii) Linking baselines to biodiversity trajectories

Offset schemes must be considered in the context of other biodiversity-impacting activities occurring in the landscape. This is critical, if catastrophic biodiversity loss through the cumulative effect of individually minor impacts is to be avoided. Biodiversity maintenance exhibits threshold effects related to habitat connectivity, home ranges and minimum viable population sizes. The landscape trajectory of biodiversity change beyond the specific offset cases under consideration determines the crediting baseline to be used in that offset.

(iii) Transparent accounting

Clear and open-access accounting and legal agreements, must be applied to record environmental losses (development impacts) and potentially and enforce associated gains (biodiversity offsets).

(iv) Public education about offsets

A balanced view of biodiversity offsetting, as well as its limitations, will help explain its utility as a policy instrument to the public, who are generally poorly informed on the matter. As such, public outreach and communication about the benefits, use and potential misuse of biodiversity offsets should form a cornerstone of the policy.

4. The use of biodiversity offsets must not compromise or replace national conservation targets, as stipulated by South Africa’s commitments to the Convention on Biodiversity (Maron et al. 2015). They must be additional to these targets, and not be based on cherry-picking opportunities or creating a protected area estate which is suboptimal or where the responsibility for its maintenance falls on the public purse.

5. Biodiversity offsets should only be considered and used:

(i) when all other interventions in a mitigation sequence have been exhausted, as agreed by an independent evaluation and decision process and against a priori defined criteria, ideally by an accredited independent practitioner/consultant,

(ii) when the impacted biodiversity and ecosystem values can be explicitly defined and measured, both for the impacted area and for its offset,

(iii) when biodiversity benefits are additional to a baseline scenario (what would have happened without the offset), plus an agreed multiplier to act as a disincentive to adopting offsets as an easy and cheap option,

(iv) there is sound evidence that the biodiversity offset in question will enhance the values of that biodiversity,

(v) any uncertainties involved are explicitly accounted for in a loss–gain calculation (in other words, the upper uncertainty limit is applied to the biodiversity loss estimate of the impacted area, and the lower uncertainty limit to the biodiversity gain estimate for the offset area),

(vi) when comprehensive post implementation monitoring and evaluation plans are in place following best practice approaches (IUCN 2016; Maron et al. 2015; Maron et al. 2016).

Authors

Dr. Bernard W.T. Coetzee: Global Change Institute, University of the Witwatersrand

Prof. Frances D. Duncan: School of Animal, Plant and Environmental Sciences, University of the Witwatersrand

Prof. Barend F.N. Erasmus: Global Change Institute, University of the Witwatersrand

Prof. Robert J. Scholes: Global Change Institute, University of the Witwatersrand

Assoc. Prof. Craig Sheridan: Centre in Water Research and Development, University of the Witwatersrand

Prof. Ed T.F. Witkowski: School of Animal, Plant and Environmental Sciences, University of the Witwatersrand

References

Bull J.W. et al. 2013. Oryx, 47, 369–380.

Evans D.M. et al. 2015. Animal Conservation, 18, 1–3.

Gardner T.A. et al. 2013. Conservation Biology, 27, 1254–1264.

Gordan A. et al. 2015. Journal of Applied Ecology, 52, 532–537.

Maron M. et al. 2012. Biological Conservation, 155, 141–148.

Maron M. et al. 2015. Nature, 523, 401–403.

Maron M. et al. 2016. BioScience, 66, 489–498.

IUCN 2016. IUCN Draft Policy on Biodiversity Offsets. Available at: http://cmsdata.iucn.org/downloads/iucn_biodiversity_offsets_policy_jan_29_2016.pdf

Position paper and recommendations to the Draft National Biodiversity Offset Policy

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