There have been some great successes in the use of market-based instrument (MBIs) to address natural resource management (NRM) and environmental problems across Australia. These approaches have further developed and provided examples of practical application of MBIs.
For example, BushTender was designed by the Victorian Department of Natural Resources and Environment (NRE) in 2001 to efficiently allocate public funds to biodiversity management contracts. It has significantly improved the efficiency of investment in native vegetation. The first BushTender auction was up to seven times more cost effective than a traditional grants-based scheme.
There have also been a number of great MBI projects as part of the two rounds of the National MBI Pilot Program under the National Action Plan for Salinity and Water Quality (NAPSWQ).
For example an offsets project to manage salt loads to stressed rivers in the Murray-Darling Basin provided practical testing of offsets as a way of complementing traditional regulatory approaches. It also helped in the development of an institutional framework to integrate offsets within the existing planning, regulatory and policy framework.
An increased understanding and confidence about MBIs is developing through trials, NAPSWQ pilots and wider implementation of incentive programs, which include MBIs. This is especially evident in regions that have implemented auctions and competitive tenders for the delivery of NRM funds.
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