The Australia Institute has made a submission to the House of Representatives Standing Committee on the Environment inquiry, Streamlining environmental regulation, ‘green tape’, and one stop shops. Our submission draws on earlier TAI research conducted jointly with the Minerals Council of Australia, which found that there is considerable room for improvement in environmental regulation.
A consistent problem in application of environmental regulation has been the inadequate attention paid to economics, particularly in relation to major projects. The standard of economics in project assessment is low and departments lack the capacity to review economic assessments.
The need for specialist expertise in project assessment, not just in economics but across many fields, means a “one stop shop” approach is unlikely to produce good regulatory outcomes. This view is shared by the Productivity Commission in their recent review of Major Project Development Application Processes.
Another issue raised is that further devolvement of planning powers to state governments creates a clear conflict of interest. State governments enjoy most benefits of major projects through revenues, however it is local government and communities that bear many external costs.
The costs that environmental regulation impose on developers can be significant for proponents, but represent a tiny fraction of overall investment. While improvements can be made, this is not an issue of major economic significance in Australia.