Master Thesis: Critical review of assumptions of gains in biodiversity under Victorian offsetting policy

Global biodiversity is declining faster than at any time in human history. This loss is largely attributed to human activities, in particular urban, industrial and agricultural development. Biodiversity offsetting seeks to balance the environmental impacts from development through the generation of measurable gains in biodiversity that compensate for loss. To achieve No Net Loss or a Net Gain in biodiversity, the biodiversity gains from offsetting must be at least equivalent or greater to the biodiversity losses from development. But while losses from development are typically immediate, gains from offsetting are generated over longer timeframes, often after the impact has occurred. Determining equivalence between an impact and an offset thereby requires projecting the gains that will be generated over an offset management period. As biodiversity is in decline, gains may be generated from averting further loss in biodiversity, as well as from improving the biodiversity at an offset site. To determine the gains attributable to an offset, assumptions must be made about changes in biodiversity with and without the offset. These assumptions have serious implications on achieving a No Net Loss outcome from offsetting, however they may not always be drawn from empirical data. In this thesis, I review the assumptions used to calculate gains from offsets in two loss-gain exchange case studies under Victorian offsetting policy. These gains were used to offset losses in native vegetation from permitted development impacts, and reflect the gains from projected averted loss and improvement in native vegetation over the 10-year offset management periods. The assumptions of gain vary between the case studies according to the native vegetation condition, foregone land use entitlements and proposed management activities, but the assumptions are not entirely explicit nor supported by empirical data. When compared to available data on native vegetation change without an offset, I reveal that the assumptions of gain from averted loss are significantly over-estimated. Over-estimating gains from offsetting is problematic, as it allows a larger development impact for the same offset, resulting in a net loss of native vegetation and exacerbating biodiversity decline. I conclude that a No Net Loss outcome was unlikely to have been achieved in either case study presented in this thesis, and that it is questionable whether No Net Loss is possible under the current policy framework in Victoria. Based on my analysis of the two case studies, I make eight recommendations to improve the plausibility and transparency of the assumptions of gains under Victorian offsetting policy, and to ensure that the policy is more likely to achieve its No Net Loss objective.