The New South Wales parliament has passed the “biggest reforms to the biodiversity offsets scheme since its inception” after inquiries triggered by a 2021 Guardian Australia investigation.
The legislation, promised by the Minns government before the 2023 election, introduces changes aimed at reversing the decline of the state’s biodiversity and improving the integrity of the offsets scheme.
“The goal of the Minns Labor government is to leave nature better off than we found it. We owe this to the next generation,” the environment minister, Penny Sharpe, said.
Sharpe said governments “cannot simply be the manager of environmental decline” and the legislation was the first tranche of reforms to address a biodiversity crisis that threatens beloved species such as the koala with extinction.
The state’s upper house passed the bill with some environmental improvements by crossbench MPs on Thursday night.
Introducing the legislation to the lower house for a final vote on Friday, the Blue Mountains MP, Trish Doyle, said: “This bill represents the biggest reform to the biodiversity offset scheme since its inception.”
“It is a significant first step in implementing our commitments to fix the biodiversity offset scheme and set nature in NSW on a path to recovery.”
The Nature Conservation Council of NSW welcomed the legislation as a first step in reforming the state’s nature laws after a review by former federal treasury secretary Ken Henry found substantial changes were needed with half of the species under threat in NSW on course to become extinct within the next 100 years.
“We have been calling for reform of the broken scheme for many years, and today we finally have an important first step to deliver better protections for nature,” said the NCC’s policy and advocacy director, Dr Brad Smith.
Biodiversity offsets are used by developers to compensate for clearing of endangered habitat by protecting and restoring equivalent ecosystems elsewhere. A series of reports by Guardian Australia in 2021 revealed major problems with the NSW scheme, triggering numerous inquiries.
The government legislation introduces several new requirements, including that the scheme transition to one that delivers a net positive for nature after those inquiries found it had been facilitating loss. Developers will now have to demonstrate how they have first avoided damage to endangered ecosystems and species. New public registers will track how developers meet their environmental commitments.
The reforms reduce the circumstances in which developers can pay into a fund managed by the state’s Biodiversity Conservation Trust after a parliamentary inquiry found that money paid into the fund was outstripping the availability and delivery of necessary offsets. And a controversial policy that allowed mining companies to claim future rehabilitation of mine sites towards their offset requirements will be ended.
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The changes will also exempt a small number of low-risk local developments from the requirement to deliver offsets.
The bill passed on Friday with support from the Coalition but was opposed by the Greens, who said it would not be sufficient to change the “business as usual” scenario of offsets facilitating further environmental decline.
The independent MP Greg Piper spoke strongly in favour of the bill but said it was not the end of the reform task that was necessary for nature and that he would welcome government consideration of the introduction of so-called no-go zones for areas of high biodiversity value.
Although voting in favour of the bill, the Nationals expressed some concerns about the costs of the scheme for developers in regional areas.
The opposition’s environment spokesperson, James Griffin, said a “functioning biodiversity offset scheme is more than a policy tool”.
“There’s an opportunity to restore ecosystems and create thriving, resilient economies for a sustainable future,” he said.
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