Biodiversity publications archive

Reimbursing the future: an evaluation of motivational, voluntary, price-based, property-right, and regulatory incentives for the conservation of biodiversity

Biodiversity Series, Paper No. 9
M.D. Young, N. Gunningham, J. Elix, J. Lambert, B. Howard, P. Grabosky and E. McCrone
CSIRO Division of Wildlife and Ecology, the Australian Centre for Environmental Law, and Community Solutions
Biodiversity Unit, Department of the Environment, Sport and Territories, 1996
ISBN 0 642 24429 4

Appendix 2.3: Rangelands case study

Prepared by Tim Clairs and Bruce Howard
CSIRO Division of Wildlife and Ecology, Canberra


Australia's rangelands represent nearly 70 per cent of Australia's land area and cover a variety of bioregions. Recognition of the distinctiveness of these regions implies that each contains a unique suite of biodiversity (Morton and Newsome, 1994). This case study focuses on the Mallee region of NSW and the Mulga Lands of south western Queensland. It also addresses issues involving the management of the Greater Bilby as part of the south western Queensland component.

The aim is to define biodiversity values, determine the processes threatening those values, and recommend instrument mixes to conserve the biodiversity values. This will be achieved by focusing on specific issues that represent 'flagship' opportunities for biodiversity conservation within the chosen bioregions. It is important to note that although a large degree of scientific information is included in this case study, the knowledge that is held by rangeland users (primarily pastoralists) is equally important in developing incentive instruments and mechanisms. A theme of this case study is that efforts to encourage the conservation of biodiversity in the rangelands should recognise the social and economic issues that arise as a result of existing landuse practices, and the capacity of current rangeland users to contribute.

It should be noted that a Draft National Strategy for Rangeland Management has been produced. Components of this strategy address biodiversity conservation issues.

Mallee region of NSW

The Western Division occupies 325,000 km² or about 40 per cent of the land area of NSW (Dickman et al., 1993). The western half of the Division is arid and entirely pastoral, while the eastern half is semi-arid and includes some agriculture whilst remaining predominantly pastoral. The mallee region of NSW covers nine per cent of the Division.

Of particular interest is the Yathong Nature Reserve which is situated near the eastern edge of the semi-arid zone (which is usually taken to be the 375 mm rainfall isohyet), near Mt. Hope. Yathong Nature Reserve is a UNESCO/MAB Biosphere Reserve with the stated aim of conserving biodiversity through the integration of scientific research, conservation management, community participation, and environmental education (Henry Petersen, NSW NPWS, Cobar, pers com.). Biosphere Reserves contain a protected core of undisturbed representative environment and one or more surrounding 'buffer zones' in which experimental work and other human activity can be carried out. The Yathong Nature Reserve, along with the neighbouring Round Hill Nature Reserve, have been linked to recently acquired Nombinnie Reserve to create a contiguous network of reserves covering 250 000 hectares.

Mulga and Mitchell Grass regions of Queensland

The Mulga Lands represent a large part of semi-arid and arid Australia. Mulga (Acacia aneura) communities occur throughout Queensland, NSW, Western Australia and the Northern Territory, representing 150 million hectares or 20 per cent of the continent (Sattler, 1986). In Queensland there are 19.2 million hectares of Mulga Lands (12 per cent of the State) which is dominated by mulga communities, but also includes other flora types such as Poplar Box (Eucalyptus populnea) and grasslands (Thackway and Cresswell, 1994). The soil types that underpin the landscape ecology help define the bioregion. Mulga grows on the light textured, red earths. These soils can be further categorised into sandy red earths (sandy mulga country) and hard red earths (ironwood/mulga country). A lot of sandy mulga country occurs around Charleville, with mulga on harder red earth plains to the west.

North-west of the red earth plains, Mitchell Grass grows on the dark alluvial clay soils, from Longreach north beyond Cloncurry into the Northern Territory. An area of Mitchell Grass Downs extends south of Longreach into the channel country east of Boulia and south of the Tropic of Capricorn, along the Diamantina river. In that region, three properties have been involved in efforts to conserve the Greater Bilby (Macrotis lagotis): Springvale; Diamantina Lakes; and Davenport Downs.

Biodiversity status

Mallee region of NSW

Mallee is derived from an Aboriginal term and is generally used to describe multi-stemmed eucalypt growth forms, whereby the stems arise from a large, underground, woody swelling or lignotuber (Noble and Bradstock, 1989). According to NSW NPWS (1995), the arid and semi-arid areas of the Western Division have 81 per cent of their original vegetation cover remaining, although this figure was calculated some 20 years ago. Current revisions to the calculation indicate further decline in original vegetation cover (G. Roberts and D. Sivertsen, pers com., cited in NSW NPWS, 1995). Furthermore, mallee scrub only covers some 9 per cent of the Western Division (Smith et al., 1994).

Numbers of plant species in the mallee lands are subject to high seasonal variation. One study carried out at sites in the southern mallee area showed that some sites supported as little as 25 per cent of their cumulative richness during some seasons or drought periods (Fox, 1990). The remaining species persist in the soil seed reserve. There is also considerable species turnover between seasons.

Although biodiversity awareness is increasing in the Western Division, there is still a lack of knowledge of the biodiversity existing in most areas (NSW NPWS, 1995). The available information on fauna richness illustrates the changes to the region's fauna (see Table 2.3.8). No information for invertebrates is available.

The species classified as 'under threat' are based on abundance, distribution and survival prognosis (Dickman et al., 1993). These species are of particular conservation concern. Interestingly, 14 of the 60 threatened birds in the Western Division are mallee species and in fact only five mallee birds were not listed as threatened (Smith et al., 1994). Triodia irritans (porcupine grass), a groundcover in mallee lands, is known to be primary habitat for several reptile species. A skink, Ctenotus brachyonyx (considered to be vulnerable nationally), is restricted to such habitat, as are the skinks Tiliqua occipitalis, Morethia obscura, and Cyclodomorphus branchialis melanops (considered endangered or rare in NSW) (Sadlier and Pressey, 1994). Most mammals have wide distributions within the Western Division, although a native mouse, Pseudomys bolami, is restricted to mallee scrubland, and the southern ningaui, Ningaui yvonneae, is generally restricted to mallee woodland.

According to available information for the Yathong Nature Reserve (Henry Petersen, pers com.), species diversity includes the following, in order of species abundance:

The Yathong area has value as a site for the reintroduction of the malleefowl (Leipoa ocellata). Although the reserves contain mallee communities that are only marginal habitat for malleefowl, the extensive nature of the reserves is said to provide an ideal opportunity to undertake scientific research leading to the implementation of a recovery plan (Henry Petersen, pers com.). The malleefowl was once abundant throughout much of southern and central Australia, but has declined in range and abundance to the point where 'the species is now dwindling towards extinction' (Priddel, 1990a).

The total number of malleefowl in NSW was estimated in 1985 to be around 745 pairs (Priddel and Wheeler, 1994). More recent surveys have noted further decline in numbers. The malleefowl is not only an endangered species, it is an important 'flagship' species. Efforts to conserve the malleefowl also aid recognition of other biodiversity values of the mallee region. Furthermore, action taken to conserve the malleefowl will assist in the maintenance of habitat for other species (Terry Mazzer, pers com.). Indeed, the malleefowl might be a good indicator of general community condition (Cheal, 1989) and could thus be considered a keystone species as well.

Table 2.3.8: Status of fauna in the Western Division of NSW
No. recorded Mammals Birds Reptiles Amphibians
Since 1788 71 324 112 20
Regionally extinct 27 6 0 0
Under threat 28 60 48 8

Note: Same table as Table 4.1

Source: Dickman et al., 1993; Sadlier and Pressey, 1994; Smith, et al., 1994.

Mulga Lands of SW Queensland

There is a lack of detailed knowledge on the level and status of biodiversity in various regions of south west Queensland. A project currently being undertaken aims to determine the spatial variation of biodiversity there (Jill Landsberg, CSIRO Division of Wildlife and Ecology, pers com.). Rare and threatened fauna of the Mulga Lands are listed in Table 2.3.9.

Table 2.3.9: Status of fauna of the Mulga in Queensland
Status Mammals Birds Reptiles
Presumed extinct Western Quoll - -
Endangered Kowari - -
Vulnerable - Plains Wanderer, Yellow Chat, Grey Falcon, Major Mitchell Cockatoo -
Rare - Painted Honeyeater, Redthroat, Freckled Duck, Grebe, Black-chinned Honeyeater Collett's snake, Death Adder

Note: Same as Table 4.2

Source: Bruce Wilson, Department of Environment and Heritage, Toowoomba, pers. com.

The Queensland Department of Environment and Heritage has examined the status of a total of 66 regional ecosystems within the Mulga Lands, defined on the basis of vegetation types (1995). Preliminary results indicate that 5 ecosystems are endangered or vulnerable. Many others have been highly modified. Endangered regional ecosystems include:

Mitchell Grass Downs

Mitchell Grass Downs cover about 6 per cent of Australia, spreading in a curve over 1,500 km across inland Queensland and Northern Territory (Morton and Newsome, 1994). This bioregion remains one of the least surveyed in Australia and thus its distinctiveness is difficult to quantify (Morton and Newsome, 1994). What is known is that the dominant Mitchell grasses (Astrebla spp.) and other associated grasses are the principal habitat for vertebrate animals such as flock bronzewings (Phaps histrionica), Spencer's goanna (Varanus spenceri), and the fierce snake (Oxyuranus microlepidotus) (Morton and Newsome, 1994).

An area of Mitchell Grass Downs is also home to a population of bilbies. The bilby is an endangered species nationally. Once widespread across inland Australia, the bilby is now known from scattered parts of the Tanami Desert in the Northern Territory, Gibson Desert, Great Sandy Desert, the Pilbara and the Kimberley in Western Australia and the isolated population mentioned above in south west Queensland (Southgate, 1994). Populations are still considered to be declining. The south west Queensland population is estimated to be between 600 and 700 animals (Queensland Department of Environment and Heritage, 1995a). The fact that the bilby has survived in this area, one of only two or three similarly sized mammals not to have disappeared from the arid-zone of Australia since European settlement, makes the region highly significant (Morton and Newsome, 1994). Like the malleefowl, the bilby is also highly valued as a 'flagship' species. This has been best illustrated by the drive to have the bilby replace the Easter bunny, in a fable for our times, to increase focus upon campaigns to save the bilby.

Resource use and conservation objectives

Mallee region of NSW

The Western Division of NSW is used predominantly for grazing of sheep and some cattle on the native vegetation of pastoral leases. Pastures constitute 87.6 per cent of the Division's land area, while croplands and other forms of intensive land use occupy only 1.3 per cent of the land area (Smith et al., 1994). The Division has six National Parks and 10 Nature Reserves together comprising 2.6 per cent of the land area of the region (Dickman et al., 1993). There is also one Aboriginal area (11,325 ha) that functions as a reserve for nature conservation. Up to 97.5 per cent of the Division's land area is leased by the Western Lands Commission.

The mallee region is a multi-use resource and as such the conservation objectives for the region should take into account current resource uses as far as possible. The main objective is to conserve endangered species such as the malleefowl by reducing the impact of threatening processes. A good deal of information is available regarding the threats that the malleefowl faces. Many of the threatening processes also apply to the other endangered or vulnerable species in the region. These threatening processes are examined in some detail later. It is also important to conserve areas of representative mallee ecosystems, in order to maintain habitat areas and to ensure the integrity of mallee ecosystems. Little information is presently available on the spatial distribution of significant mallee areas.

South west Queensland

As for the mallee region, the primary land use in south west Queensland is rangeland pastoralism where domestic stock graze native pastures. Although extensive clearing or pasture improvement is not necessarily undertaken, grazing pressure nevertheless affects the condition of the region. In the Mulga Lands the most significant component of land degradation is total herbivore grazing pressure (Sattler, 1994). Grazing pressure results from sheep, cattle, kangaroos and feral goats.

The uncertain economic productivity of the Mulga Lands has been reflected in recent land prices. Land west of Charleville has been passed in at $0.80 per hectare (Sattler, 1994). Average levels of debt in 1993 were $222,000 per pastoral enterprise and an estimated 88 per cent of all properties in the Mulga Lands now have negative cash margins (Sattler, 1994).

In the last four years the Queensland government, as part of its initiative to place 4 per cent of the State under National Park estate, has acquired new Mulga Lands. To date, eight National Parks have been acquired, covering 516,950 ha. or 2.59 per cent of the Mulga Lands, at a cost of $10.805 million ($20.90 per ha) (Sattler, 1994).

Throughout the semi-arid woodlands there has been a major shift in the composition of understorey vegetation from dominance by perennial grasses to dominance by native shrubs, particularly species of Eremophila, Cassia and Dodonea (Harrington et al., 1984). Higher shrub densities reduce pastoral production and the associated loss of ground cover contributes to soil erosion. A conservation objective, therefore, should be to integrate efforts to conserve biodiversity into pastoral activity.

Much of the biota across the rangelands move according to seasonal variations, habitat patchiness, climatic change, and a host of other factors, making patterns of local species richness difficult to model. The distribution of flora and fauna across the Mulga Lands is poorly understood in particular, with climatic unpredictability a major factor. Knowledge of the habitat requirements for different species is necessary in order to judge what habitats are critical for the conservation of species and what spatial scales are appropriate. For example, species' distribution may comprise small fragmented sub-populations which fluctuate independently, or, for some species, persistent core populations in particular locations which extend into other habitats during favourable times (James et al., 1995).

Suggestions have been made that although a lot of species are associated with relatively infertile parts of the landscape, small productive pockets also provide critical refuge-habitat for organisms that cannot avoid droughts through behaviour or resistant life stages (James et al,. 1995). However, given that habitat patches change spatially in response to climatic conditions, a static reserve system on its own may not be the most effective method of conserving biodiversity in the region (Jill Landsberg, CSIRO Division of Wildlife and Ecology, pers com.). Efforts to conserve biodiversity should therefore be developed on a regional scale to involve the integration of on and off-reserve management.

Mitchell Grass Downs are used as a valuable pastoral resource because of their resilience to grazing and the ability to recover after drought (Roe and Allen, 1993). However, unpredictable rainfall makes it difficult to determine optimal stocking rates in terms of economic returns and the long-term productivity of the grassland.

Queensland's reserves only contain about 0.8 per cent of the State's Mitchell Grass Downs (Morton and Newsome, 1994). Diamantina Lakes property was purchased by the Queensland government in 1992 for $3.7 million and includes isolated patches of Mitchell Grass. Whether or not bilbies still inhabit Diamantina Lakes National Park has been subject to some conjecture (Morton and Newsome, 1994). In 1994, 475 bilby burrows were viewed on the National Park, but only 2 were actively used by bilbies (Queensland Department of Environment and Heritage, 1995a).

On the other hand there are high densities of active bilby burrows on Davenport Downs. The Queensland Department of Environment and Heritage acquired some important areas of this pastoral property in order to manage the bilby population. An interesting issue arose in this case because the company managing the property contended that it was better placed to manage the bilby. In support of this was the fact that bilbies continued to exist on its property, despite continued grazing. The issue has recently been resolved, and the negotiated solution is a good example of mechanisms available in integrating pastoral requirements with biodiversity conservation.

Pastoralism is still the predominant activity currently undertaken on Australia's rangelands. Consequently the importance of working with rangelands users to promote biodiversity conservation should be emphasised. As the main users of the rangelands, pastoralists are in a strong position to provide informed stewardship of biodiversity values. The difficulties faced by pastoralists in making a living off the rangelands must be addressed if pastoralists are to be in a position to conserve biodiversity and sustainably manage Australia's rangelands. Broadening the economic base of pastoral activities has been suggested and ecotourism represents one opportunity. According to some reports, tourism now ranks substantially higher than pastoralism as an income earner in the rangelands (Stafford Smith, 1994).

Threats to biodiversity values

For the purposes of this report we found it useful to group the threats to biodiversity values into the following classifications:

They were chosen because they are useful indicators of activities which alter ecological processes and which may lead ultimately to an irreversible decline in biodiversity values. They are also useful in that they compare neatly against definitions of biodiversity. It is appropriate to discriminate between the types of threatening processes because this facilitates understanding of the physical processes and the targeting of policies to address them.

Threats to biodiversity are gauged by reduction in distribution and abundance of animal species, and the alterations to plant communities and regional ecosystems leading to diminished biodiversity values. The threats are largely driven by the effects of pastoralism and other human induced changes such as introduced species and altered fire regimes. Land clearance, leading to loss of habitat, has occurred throughout the study regions. Clearing of mallee lands for agriculture is seen as 'the most obvious factor responsible for the demise of the malleefowl' (Priddel, 1990a), however this is primarily a concern in the wheatbelt of central NSW. Although 11 per cent of mallee vegetation in NSW has been cleared since 1960, most of the semi-arid zone remains uncleared (Smith et al., 1994). Around the Yathong region, although agricultural clearing has pushed right up to the western edge of Round Hill National Park, it is largely considered a spent force (Rob Wheeler, pers com.). As a result, processes leading to habitat modification or direct attacks upon species are seen to be the most threatening to biodiversity for the purposes of this case study.

Ecosystem and habitat decline


Rangeland herbivores include introduced stock (cattle and sheep), rabbits, feral goats and kangaroos. Overgrazing may alter the plant composition of regional ecosystems. The effect of this change has been implicated in the decline of animal species.

Increased grazing leads to the removal of long grass, which reduces shelter resources and exposes small marsupials and ground birds to predators. It can also affect the regeneration of tree and shrub seedlings and saplings, which in turn affects food supply, shelter and nesting sites for the areas' birds. Stock, other introduced herbivores, and the increased kangaroo numbers (due to the provision of permanent water and the decrease in dingo numbers) all compete with native herbivores for food, particularly in times of drought. Stock and feral pests with hard hooves can also degrade the exposed topsoil and destroy shallow burrows (Dickman et al., 1993).

The affect of grazing on malleefowl is significant. Where sheep graze uncleared mallee, densities of malleefowl have declined substantially (Priddel, 1990a). Malleefowl feed on the same shrubs and herbs that stock browse and thus suffer a reduction in food supply. This can be critical to the survival of malleefowl chicks, who can not only starve to death, but must spend more time exposed and susceptible to predation (Priddel, 1990a).

The relationship between bilbies and cattle grazing is less clear. The Queensland Department of Environment and Heritage has suggested that higher cattle densities correlate with a greater loss of active bilby burrows. However, an assessment of the relationship by Morton and Newsome concluded that 'it remains an open question as to whether cattle grazing has acted as an agent of decline for bilbies in south-western Queensland' (1994:18).

Grazing may involve a shift in the local abundance of flora. Patches of critical habitat that usually sustain native herbivores during drought, or provide stable core populations of flora, are susceptible to browsing by feral goats. Such areas are also used sometimes as protection against drought for stock, emphasising the impact of overgrazing. This practice of using remnant vegetation as a hedge against production risk is particularly threatening to biodiversity values as it places the pastoralist's desire to set aside areas of native vegetation at odds with desired biodiversity conservation outcomes. Control of this threat, therefore, depends upon altering pastoralists' requirements for using such areas as drought reserve by providing an alternative hedge against production risk.

Fire regimes

Historically, Australia's rangelands have been subject to frequent burning by Aboriginals. This produced a mosaic of different aged patches of vegetation and also affected the evolution of many rangeland ecosystems. European pastoralists reduced the use of fire as a management tool. The effect that this change in fire regimes has had on biodiversity values in the rangelands is not well understood (National Farmers' Federation, 1994).

Altered fire regimes in the mallee, which is highly flammable, are known to have had a severe impact on populations of malleefowl (Benshemesh, 1990). Fire suppression has lead to the build up of fuel and resultant major widespread wildfire throughout the mallee. In NSW major fires occurred in 1917, 1957, 1969, 1974 and 1984 (Noble and Vines, 1993). Malleefowl populations are more dense in areas that have not been burnt for up to 50 or 60 years (Rob Wheeler, pers com.). Benshemesh hypothesises that this may be due to the greater cover from predators that old mallee affords (1990).

Virtually nothing is known of the effects of fire on bilby habitat, nor of any interactions between fire, predators, competitors and removal of stock (Queensland Department of Environment and Heritage, 1995a).

Direct species loss


Introduced predators have been assumed to be a major cause of decline in mammalian species across the rangelands. The extinction of many 'critical weight range' (CWR) marsupials and rodents (35-5500g) since European settlement seems to support this, as CWR species are particularly prone to predation by introduced predators. Foxes (Vulpes vulpes) and feral cats (Felis catus) remain abundant and it is clear that foxes, at least, play a major role in the extinction of both remnant and re-introduced populations (James et al., 1995).

The fox has been shown to be the most significant threat to the survival of the mallefowl in NSW (Priddel, 1990a). Foxes dig up and eat malleefowl eggs and prey heavily on the chicks. A study of the survival of captive-reared malleefowl carried out in 1990 at Yathong Nature Reserve found that, as a result of predation, up to 96 per cent of chicks released were dead within 36 days (Priddel and Wheeler, 1995). Perhaps as many as 92 per cent of chicks were killed by foxes. Juvenile malleefowl released (14-28 months of age) fared slightly better with 3 out of the 12 juveniles released surviving longer than 428 days. Again, predation by foxes was the chief cause of mortality (Priddel and Wheeler, 1995). Foxes also prey on adult malleefowl. Reduced vegetation cover as a result of heavy grazing in these areas may have exacerbated the impact of raptor predation (Priddel and Wheeler, 1995).

According to Morton and Newsome (1994), no foxes are reported on Davenport Downs Station. This may be one reason why the population of bilbies remains, but the exact effect of foxes on bilbies is not clear. Despite the lack of information, fox predation is inferred to be a threat to bilby populations (Southgate, 1994; Queensland Department of Environment and Heritage, 1995a). Dingoes are abundant throughout the region where bilbies survive and although no information is available on dingo predation of bilbies, it does not appear to be a major influence (Morton and Newsome, 1994).

Multiple threats

We have described the major threats separately; however many of the threats interact and it is difficult to determine cause and effect. This means that some threats need to be treated as multiple threats if they are to be successfully controlled. The relationship between rabbits and foxes, as threats to the survival of the malleefowl, is a good example. Newsome (1989) tested the relationship in a study at the Yathong Nature Reserve at a time when rabbit numbers have effectively 'crashed' after a drought. At sites where foxes and feral cats were persistently shot, rabbit numbers increased ninefold in the first year, while at sites where foxes and feral cats were not removed, numbers only increased 1.3 times. The implication of the study is that pest control measures must recognise the inter-relationship between foxes and feral cats and rabbits, and the implications of this for native species.

Woody weeds

Although not a multiple threat itself, the build up of so called 'woody weeds' highlights the relationship between grazing and altered fire regimes, as well as illustrating the need for various control measures, including fire itself. The process is particularly interesting because of the potential requirement for clearing as a control measure. The understorey of perennial grasses in the Mulga Lands is grazed, leaving the less palatable woody weeds with less competition and also less grass recruitment, resulting in a threat to the natural state of native grasses. As a result, there is less fuel to maintain fires and a modification of surface soils as the unprotected topsoil is eroded (Jim Noble, CSIRO Division of Wildlife and Ecology, pers com.).

The suppression of natural fire regimes is thought to contribute to the woody weed problem. As such, controlled use of fire can be an effective tool for managing woody weeds (Hodkinson and Harrington, 1985). Once woody weeds are established, however, the canopy can be too thin to sustain a fire and little fuel is available in the depleted understorey. Furthermore, not all species of woody weeds are sensitive to fire once mature (Hodgkinson and Griffin, 1982). The difficulty in controlling woody weeds heightens the threat that they pose to biodiversity values.

Woody weed build up reduces the grazing capacity of the land and the efficiency of wool production (Hodgkinson, 1993). Pastoral income losses as a result have been estimated at $50-100 million annually across Australia's rangelands (Noble, 1995). Subsequently, controlling woody weeds should be beneficial to pastoralists as well as for conserving biodiversity values. Yet despite this, managing woody weeds remains problematic. Mulga as a woody weed is often used to provide the nutrient requirements of livestock during drought and is thus seen as a valuable top fodder species through cutting and chaining. In the absence of technical advice most pastoralists prefer to avoid the risks perceived to be associated with prescribed burning. These include the risk of starting a wildfire that extends to neighbouring properties, and the risk of burning off fuel that could be used as drought reserve (Hodgkinson, 1993). Pastoralists are reluctant to invest in the management because of the uncertainty as to when the economic benefits will be realised (ie. pasture response) and if in fact the areas cleared of woody weeds can be used for productive grazing. These constraints must be overcome if woody weeds are to be controlled effectively.

Gene loss

In Queensland, kangaroo harvesting is estimated to be worth $12.58 million. There is also a significant legal non-commercial kill by pastoralists who can obtain permits to cull kangaroos on their properties. The main issue in terms of threats to biodiversity seems to be the sex bias in the harvest with selective shooting that targets large males.

Commercial apiculture in mallee reserves (and possibly mulga reserves), or adjacent to mallee reserves, may have adverse effects on native flower-visiting fauna because introduced honeybees take up to 90 per cent of available nectar (Paton, 1990). Similarly, commercial harvesting of broombush (Melaleuca uncinata) in remnant mallee areas is perceived to reduce mature habitat refuge for several vertebrate species (Woinarski, 1989). Other uses of rangeland resources such as eucalypt oil and firewood do not seem to pose any threats to biodiversity values at this stage.

Existing incentive instruments and mechanisms

In NSW, a State-wide conservation strategy has been prepared for the management of the Malleefowl (Priddel, 1990b). The strategy includes the creation of a 'Malleefowl Conservation Zone' within the northern mallee block on Yathong Nature Reserve. Efforts to conserve malleefowl within this zone include: prevention of fire; goat, fox, rabbit control; captive breeding program; and monitoring and assessment.

The Yathong Malleefowl Recovery Program operates as part of the strategy (Priddel, 1990a). An interesting aspect of the program is the Fox Control Program. This is a cooperative program with local landholders participating, extending more than 70 km from the reserve (Henry Petersen, pers com.). Neighbouring landholders are provided with fox baits by NSW NPWS and liaise closely with extension officers from the Cobar regional office. In a sense this represents a direct payment to landholders by way of a grant in-kind, as baits are provided free of charge. The aim is to create a buffer zone of low fox density surrounding the core conservation area. All reports suggest neighbours are happy to participate in the program as they are benefiting by way of increased lambing rates and one neighbour is running free-range chickens for the first time in many years (Rob Wheeler, pers com.). As the NSW conservation strategy states: 'landholders surrounding Yathong might at last view the Reserve as having some purpose other than a breeding ground for vermin' (Priddel, 1990b:10).

A draft national recovery plan exists for the bilby (Southgate, 1994), however, a more recent rescue plan has been drafted for the bilby in Queensland (Queensland Department of Environment and Heritage, 1995a). Much of both plans is concerned with filling the information gaps that exist in relation to the bilby, its habitat, and its threats. Two approaches to conserving bilbies are advocated in the Queensland rescue plan: the acquisition of land to be designated as National Park; and the management of populations through conservation agreements with landholders, including the introduction of Nature Refuges (conservation easements). Although not fully spelt out in the plan, it implies that populations to be included in the management regime would be specifically targeted and an agreement would then be negotiated with the relevant landholders. This is in line with the approach suggested for applying conservation easements or covenants for the protection of endangered species. Although a Nature Refuge did not eventuate in the case of the bilby population on Davenport Downs, the targeting approach was the method used by the Queensland Department of Environment and Heritage.

An agreement between the Stanbroke Pastoral Company and QDEH was negotiated to assist the conservation of the bilby. This example illustrates the use of a mix of incentives and the role of land swaps in conserving biodiversity. Research by the Queensland Department of Environment and Heritage indicated that the bilby population was so vital that the paddocks should be resumed as a National Park. This proposal was supported by an assertion that the area is important biogeographically, as a remnant of Mitchell Grass Downs. Stanbroke was unwilling to give up the paddocks and argued that it would be safer to continue managing the land for multi-use, as this was the management method that had maintained the bilby population. The issue was finally resolved by a land swap in April 1995. Stanbroke gave the State government the Store Paddock in return for an area of neighbouring Springvale, equivalent in terms of carrying capacity. Stanbroke then purchased the rest of Springvale for $1m. Stanbroke will also contribute $500,000 over the next 5 years for bilby research and assistance in formulating a regional bilby strategy.

Potential incentive instruments and mechanisms

Ecosystem and habitat decline

The nature of biota in both study areas is particularly variable. Biologically productive areas provide critical refuge-habitat for native herbivores and other fauna, especially during drought. Alternatively, areas of critical habitat provide core populations of flora. Such areas of biodiversity value also have pastoral production values. Even if production values are low, the areas are often used by pastoralists as 'drought reserves' for domestic stock. The need for ongoing management of areas with high biodiversity value must also be considered. Flexible biodiversity measures are required to target these areas, deal with them as discrete land systems, and provide incentives to reduce grazing pressure. Several opportunities exist.

Policy opportunity 1

Pastoralists may aim to maintain areas with the intention to protect the biodiversity values, but often they are likely to lack information on: the existence of biodiversity values; the effects of grazing on these values; and how best to protect them. Provision of information is a prerequisite step in facilitating some change of management and in itself could act as an incentive for biodiversity conservation.

Making reference material available will help land managers identify flora and fauna. Information emphasising how to best manage areas of biodiversity value and the benefits to land managers, such as preventing land degradation, may also be of use. Similarly, land managers are not always aware of how to obtain information regarding the management of risks and benefits involved with fire regimes.

It is important to collect information concerning matters such as habitat requirements or vegetation cover. Pastoralists can help provide this information. Training of land managers to undertake rapid assessments and biodiversity surveys could increase awareness on-property and, moreover, represents a cost-effective method of collecting information.

Information can be provided through the distribution of field notes such as Greening Australia's 'Birds on Farms', so that landholders can undertake inventories of wildlife on their land, complete rapid assessments and collect information about habitat requirements. Access to information could be made available through:

National Parks also have a role to play in involving neighbours in biodiversity conservation projects and showing them the benefits of management practices. The malleefowl conservation project at Yathong Nature Reserve, with its opportunities for neighbouring land managers to participate and gain economic returns through the goat control program, is a good example of the role NPWS can play in disseminating information.

The National Landcare Program has a role to play in encouraging biodiversity conservation; however this would require explicit 'biodiversity' terms of reference in the Landcare structure. Funding mechanisms already exist within the program for the conservation of areas with high biodiversity values. Existing Landcare groups are in a position to collect and distribute information regarding biodiversity conservation and the effectiveness of different policy opportunities. For example, land mangers are more likely to enter into property management plans when the benefits of doing so have been outlined by their peers.

Policy opportunity 2
Management Agreements

Management Agreements for critical land systems or remnant vegetation provide an opportunity to set out husbandry restrictions (such as low stocking rates or areas protected from stock) and ongoing conservation work. Positive management requirements include the control of feral animals and invasive exotic plants and fire management, and could be extended to the training of land managers to undertake rapid assessments and biodiversity surveys. In return, land managers will require some degree of assistance. Management Agreements require land managers to enter into an arrangement with a contractual agency which may be a local authority, State government department, or a non-government conservation organisation.

If stocking rate reductions on critical areas result in reduced production income, it is reasonable for pastoralists to be compensated for the non-recoverable incremental cost they incur in providing a benefit to the community (ie. the conservation of biodiversity). Other restrictions, such as fencing, can sometimes be seen as merely measures to prevent land degradation for which the land manager obtains a private benefit. In theory it makes sense to only compensate for incremental costs. However, in practice, efforts to separate private and community benefits can be time consuming, costly and inaccurate. A pragmatic approach is to provide assistance to land managers even if there is an element of private benefit in the work undertaken. Landcare funding is sometimes provided in such circumstances. The positive feedback effects in creating Landcare groups (exchange of information, reinforcement of attitudes, encouragement, pooling and efficient use of limited resources, teamwork, and overcoming a sense of isolation) mean that paying compensation for work that partly provides a production gain is worthwhile anyway.

The practice of destocking during drought followed by restocking can reduce land degradation and thus result in a production benefit. Although successful examples of this practice exist, not all pastoralists are convinced it represents an affordable alternative, as profitability varies with other factors, like the debt status of individuals (Bruce Wilson, QDEH, pers com.). Once again the dissemination of information is important as the benefits of lower stocking rates are not necessarily evident to neighbouring pastoralists. Providing financial assistance to encourage lower stocking rates may therefore be worthwhile despite the private benefits that occur.

Making payments on a case-by-case basis can lead to high administrative costs. Standard payments can overcome these costs by setting flat-rate payment levels on a per hectare or per unit of work done basis for all land managers who accept the standard contract. Standard contracts would lead to more rapid processing of claims, a factor that is likely to make a scheme attractive to land managers (Briggs, 1994). In this way standard payments per hectare could be pitched significantly below levels otherwise required to gain land manager support. Where the opportunity cost for a land manager, of undertaking positive management action, is higher than average, standard payments are unlikely to be a sufficient inducement to enter a Management Agreement. Standard payments will therefore achieve the highest levels of uptake where opportunity costs are homogenous (Colman et al., 1992). This is likely to be the case within land or vegetation types and on properties of similar size within a district. As such, standard contracts would be most effectively administered through regional strategies or by local government, in terms of linking biodiversity outcomes to land manager acceptability.

Policy opportunity 3
Management plans

Property management plans are increasingly used as a gateway for financial assistance. For example, a 20 per cent rebate under the Income Tax Assessment Act 1936 for expenditure on prevention of land degradation is limited to that identified in an approved management plan. Management plans are used as a condition for assistance under the Rural Adjustment Scheme. As well as being necessary as a condition of financial assistance, the process of undertaking a property management plan is proving useful in increasing biodiversity awareness and providing information and thus ties in with Policy Opportunity 1.

An opportunity exists to use property management plans in conjunction with the management of areas critical for biodiversity. Biodiversity conservation undertakings could be added as a condition of future management plans under existing schemes. Their use could be linked to preferential lease or licence renewal, or the use of a drought preparedness investment allowance, in order to encourage acceptance. Connecting property management plans to drought preparedness would create greater consistency in the provision of drought assistance. Presently, the determination of exceptional drought circumstances under the National Drought Policy 1992, takes into consideration factors such as stock conditions and farm income levels. Therefore it is possible for two neighbouring properties, under the influence of the same meteorological conditions, to be treated differently for drought assistance. With management plans in place, drought assistance could be tied to the plan and based on rainfall, rather than land condition.

Policy opportunity 4
Conservation easements and covenants

Conservation easements and covenants provide a flexible means of controlling land use to gain on-going stewardship from land managers. Programs exist in both NSW and Queensland. Easements, called Conservation Agreements, are available in NSW under the National Parks and Wildlife Act 1972 and similar easements called Nature Refuges are available in Queensland under the Nature Conservation Act 1992.

Two options to applying conservation easements or covenants exist. An analysis of the region can be undertaken to establish areas of significance for biodiversity and relevant owners can be targeted. The method of targeting landholders varies. If the property is freehold, an offer could be made for the entire property, or the property could be earmarked for future purchase. If the property is leasehold, conditions could be applied to the lease renewal, clearing applications or rural assistance schemes. Alternatively, once significant areas are established the placement of easements can rely on land managers with targeted land types approaching the relevant government agency to put land under an easement or covenant voluntarily.

The second approach is to establish general criteria for desired land types, vegetation cover, or habitat qualities, determine the total area to be put under easement or covenant in the region and then open the process to tender. The tender option is in line with the general principle that where information is uncertain and/or diffuse, bottom-up administrative processes are likely to be more effective than top-down processes. For many land managers, this simplifies the process too. Once they know what government agencies are looking for they are more likely to come forward voluntarily, or will at least be aware of any such areas on their property.

Application of conservation easements or covenants represents a fundamental shift in bargaining power. When the aim of applying conservation easements or covenants is to gain a representation of different land types or remnant vegetation under restricted land use, then the requirement to pursue specific areas is not critical. This is particularly the case given the spatial variability of areas of biodiversity value across the rangelands. Therefore opening the process to tender is likely to be the most effective method. When the aim is to protect remaining habitats of endangered species, then the requirement to target specific areas is greater. Interestingly, the application of a conservation easement or covenant was not considered to be sufficient protection in the case of the population of Bilbies on Davenport Downs, despite being recommended by Morton and Newsome (1994).

Policy opportunity 5
Easements over water use

Where reducing grazing impact is the desired outcome, easements or covenants could be placed over the use of stock watering points rather than imposing stock limits or placing land areas under restricted use and having to fence the areas off. Such an easement would in effect be buying the watering rights over the land.

Policy opportunity 6
Debt-for-nature swaps

The high debt-carrying position of many pastoralists makes the possibility of acquiring properties with critical habitat or remnant vegetation feasible. The debt streams could be purchased from the financial institutions by the government or conservation organisations. Alternatively, part payment of debt could be directly negotiated with pastoralists in exchange for conservation easement or covenant over desired areas.

Policy opportunity 7
Enhancement of the Income Equalisation Deposit Scheme

The Income Equalisation Deposit Scheme (IED) and the Farm Management Bonds (FMBs) within the scheme, provide tax efficient mechanisms for hedging against income variability by facilitating the accumulation of cash reserves. Funds invested are deductible from taxable primary production income, but are included in taxable income when they are withdrawn. The IED scheme and FMBs have not been widely utilised due to their perceived complexity and withdrawal limitations, and the full deductibility of other risk management options such as conserved fodder (Goucher, 1994).

These measures could be used for biodiversity conservation by including the sustainable management of biodiversity in the withdrawal criteria. Use could also be increased by including a 100 per cent investment component for biodiversity conservation, or the application of tax deductions on income withdrawn for biodiversity conservation expenditure. A suggestion has been made that 'a taxpayer can elect to have an IED treated as a FMB specifically for Landcare purposes. The deposit or part thereof will be available for withdrawal after three months if it is used for Landcare purposes and a request for a withdrawal must be supported by details of proposed expenditure on Landcare measures approved by a registered or gazetted Landcare group or the Department of Agriculture' (Esperance Land Conservation District Committee, pers com.).

Policy opportunity 8
Enhancement of Rural Adjustment Scheme

The Rural Adjustment Scheme (RAS) provides support to farmers to improve farm productivity, profitability and sustainability. It offers interest rate subsidies for property build up and grants for property development. There has recently been a move from assistance packages towards a regional program which encourages property adjustment and resource management. Although one of the objectives of the Rural Adjustment Act 1992 is sustainability, the Commonwealth Minister for Primary Industries and Energy said in 1992 that agricultural production systems need to 'take account of Australia's eco-systems, ensure sustainable development and long term profitability' (Hansard, House of Representatives, 3 November, cited in Farrier, 1993).

A policy opportunity exists in supporting more activities related to sustainable development. More specifically, the RAS criteria could be expanded to include assistance for improved biodiversity management of remnant vegetation or critical land types. Financial assistance could be provided for the incremental costs and also for positive management requirements. In this way, the RAS has the potential to be the vehicle for funding the management agreements and this could be linked to other policy opportunities. For instance, the provision of interest subsidies for property build up could trigger the implementation of conservation easements and covenants. In this case, a condition of the subsidy could be that a conservation easement or covenant must be placed over any areas on the property to be purchased which fit general target criteria.

Policy opportunity 9
Goat control programs

Some goat control programs operate on reserves, employing local contractors to muster and remove goats. These programs create a double incentive in that the neighbours benefit from less grazing competition for livestock on their land and also receive a steady source of income to help offset the normal variability in farm income. Control programs encourage the acceptance of the role of conservation and allow land managers to participate in the process, seeing the benefits for themselves. This helps lay the groundwork for promoting the entry into voluntary management agreements or easements if so desired.

Nevertheless, contractors operate under market conditions which will not always correspond to the impact feral goats are having on biodiversity values. One solution is to pay local contractors a set bounty for goat mustering. The creation of secured prices however, does provide incentives to maintain feral goat herds or even increase herd sizes. The commercialisation of feral goats therefore needs to be seen as a transition market only, set-up for the short-term. This could be achieved by entering into short term contracts with contractors. When a contract is complete, it may be prudent to move into eradication techniques, rather than allow continual farming of feral goats. Eradication techniques include subsidised trapping and shooting, or financial assistance for organised community musters. Expenditure for such programs could be partially offset by the sale of captured goats or the sale of goat meat.

Policy opportunity 10
Kangaroo industry

The provision of water for stock has resulted in increased populations of certain macropods, such as the Eastern Grey Kangaroo, Red Kangaroo and Common Wallaroo (Queensland Department of Lands, 1993). Sustainable harvesting of kangaroos may provide an opportunity for land managers to diversify their economic base and to reduce the grazing impact of kangaroos. This may provide a market incentive to reduce domestic stock levels while at the same time achieving an appropriate use of critical areas that cannot tolerate high domestic grazing pressure.

Encouragement of a level of substitution for sheep with income derived from kangaroos is thought to require significant value adding to kangaroo products (Sattler, 1994). Sattler suggests that a return to landholders of $10 per kangaroo would be required for harvesting to be economically feasible (1994). To encourage the perception of kangaroos as a resource, payments per kangaroo may need to be subsidised initially in order to achieve the returns required to achieve significant substitution of sheep numbers. To ensure that grazing pressure was reduced on critical areas, zonal management could be introduced. In this way the increase in kangaroo harvesting could be directed into the Mulga Lands. To create an equitable distribution of revenues from harvest zones to other land managers, a system of tradeable rights could be introduced.

Policy opportunity 11
Clearing controls

Clearing licences apply for leasehold land in both NSW and Queensland. In the Western Division of NSW a formal application is made to the Department of Conservation and Land Management. The Environmental Planning and Assessment Act 1979 and the Endangered Fauna (Interim Protection) Act 1991 require that the effects of clearing on biodiversity are taken into account when applications are assessed. However, a limited knowledge of the status of biodiversity in the Western Division means that decisions are made using limited information about the effect on biodiversity values (Terry Mazzer, pers com.).

Draft Tree-Clearing Guidelines for leasehold and other Crown land in Queensland were announced in March 1995 (QDEH, 1995c). The draft guidelines have led to some panic clearing as land managers attempt to clear as much land as possible before the guidelines are formalised. The introduction of the state-wide guidelines over the top of a community consultative process to introduce regional controls has also upset many land managers. The use of clearing controls without any recompense is unlikely to instil a strong biodiversity management ethic in land managers. Incentive instruments that compliment clearing controls are therefore worth considering. Compensation for lost property rights associated with land use restrictions should be applied to achieve an equitable outcome.

Policy opportunity 12
Tradeable clearing rights

The nature of control mechanisms for woody weeds makes the use of tradeable permits a possibility. As it is not critical which areas of woody weeds are cleared, it is feasible to provide clearing rights across a land type or regional ecosystem. Pastoralists who find it economical to clear can buy further rights from others who do not wish to clear. The administrative costs involved with setting up tradeable markets can be high relative to the value of the rights; however, most costs relate to enforcement costs. In this case however, (non-tradeable) clearing rights currently operate, therefore the additional enforcement costs of creating tradeable clearing rights will be limited. In determining how the market conditions are to be formulated, greater effectiveness will be achieved if the market participants (ie. pastoralists) have an input into the process. Issues such as market zones may need to be set by government agencies. Clearing rights should be kept as simple as possible if they are to be effective and efficient and given the nature of the market's underlying product (woody weeds), there is no need for sophisticated equity mechanisms, such as claw-backs and zero-revenue auctions.

Policy opportunity 13
Tax incentives

The allowance of income tax deductions for expenditure incurred in conserving biodiversity (ie. capping of bores, fencing of critical areas in line with land types, or fencing of watering holes) encourages land manager participation. It has been suggested that a tax deduction be allowed for Landcare for an amount of up to 150 per cent of qualifying expenditure in the year it is incurred (Esperance Land Conservation District Committee, pers com.).

Although tax deductions are an 'off-budget' mechanism for distributing compensation, they are not always considered an appropriate method of providing assistance, given the low taxable incomes of many pastoralists (National Farmers' Federation, 1994). Tax rebates can be a more effective way of compensating pastoralists.

Policy opportunity 14
Lease requirements

Conditions have been attached to leases to maintain their management as a pastoral property. The potential exists to remove some perverse 'rules' of operation, as well as to attach conditions relating to the maintenance of biodiversity values. Leases could be provided for purposes other than pastoral, and should not necessarily require the maintenance of infrastructure for pastoral production. Restrictions on pastoral production could be introduced with financial incentives unless the required action applies across the industry.

Lease incentives could include rebates on the cost of the lease or favourable renewable agreements. Lease rent reductions or waivers for areas set-aside are a good method of encouraging reduced stocking rates. To ensure that reduced stocking rates are adhered to, the rent reductions could be deferred so that if stocking rates increase, the previous saving must be repaid plus interest (Crompton, 1990). Another alternative is to only provide the rent reduction if a management agreement or conservation easement or covenant is entered into.

Direct species loss

The policy options available for the control of habitat modifying threats are also relevant for the control of direct threats to species. This is especially the case where efforts are made to protect species through habitat conservation. Perhaps the only difference that should be noted is that the method of applying easements or covenants might be different when protecting endangered species. Some further specific opportunities are given here.

Policy opportunity 15
Corporate funding

Limited funding opportunities exist outside the State and Commonwealth governments. It is acknowledged that corporate opportunities are likely to be greatest in relation to endangered species. Possibilities for corporate sponsorship include animal sponsorship schemes and naming rights. The NSW NPWS Western Region Conservation Project ($1m committed over 3 years) includes a Draft Community Relations and Media Strategy (NSW NPWS, 1995), which includes, as a source of resources, commercial sponsorship.

Policy opportunity 16
Role of non-government organisations (NGOs)

Non-government conservation organisations can play a strong role in focussing attention on endangered species and raising resources for their protection. This role can be linked to the implementation of instruments, such as the role of the Victorian Conservation Trust in negotiating conservation easements or covenants to protect critical habitat in Victoria.

Mechanisms that could be employed by NGOs include one successfully implemented by Landcare. Programs aimed at the children of pastoralists are said to be a powerful form of social learning (Campbell, 1994) and are particularly relevant for endangered species. Programs could include school projects to raise awareness of what species are found on each family's property, and the promotion of information such as the 'kids page' included in WWF for Nature Australia's 'Wildlife News' magazine. The establishment of 'Friends of ... ' groups by the National Threatened Species Network is also important in bringing scientists, landholders and members of the community together.

Paying landholders for endangered species that breed on their property is seen to be a particularly effective incentive that can be operated by NGOs. In the USA, Defenders of Wildlife pay $5,000 to private landholders if wild wolves successfully raise a litter of pups on their land (Clark and Downes, 1994). Financial incentives of this kind could operate for malleefowl or bilbies.


Ecotourism may provide an opportunity for some pastoral businesses to diversify their income base or enable a different landuse for specific areas of high biodiversity interest or scenic beauty. In the rangelands where distance between services is a factor, farmstays can play an important role in providing accommodation adjacent to conservation reserves and other natural attractions where other forms of service are unavailable or inappropriate to local development guidelines.

In NSW and Queensland an important issue for tourism on leasehold properties is the right of tourists to gain access to sites on pastoral leases. Pastoralists in these states hold the right to exclude access to their leases in much the same manner as does a private landholder. This enables them to gain value from allowing right of access to tour operators and private tourists. In other states pastoralists do not hold such rights, this may provide an obstacle to them in deriving revenue from management of biodiversity values.

Preferred mix of incentive instruments and mechanisms

The preferred mix of incentives and mechanisms is targeted to involve and utilise the expertise, goodwill and resources of existing users of the rangelands as far as possible. To encourage resource users of rangelands to protect biodiversity values the following mix is suggested:


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