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Abstract
The widespread clearance of native vegetation has been identified as one of the major
environmental issues facing Australia. Impacts of clearing include dryland salinity,
weed invasion, soil erosion, soil structural decline and the loss of species.
Development of effective polices to deal with remnant native vegetation (RNV) decline
has been hampered by lack of detailed data on the economic benefits and costs of RNV
conservation. This study measured the on-farm benefits and costs associated with
RNV in the two study areas, the northeast Victorian catchment and the Murray
catchment of NSW. Data were collected using landholder surveys. The most
important economic benefits from RNV under current management regimes in the
Victorian study area were productivity effects associated with prevention of land
degradation, firewood production, and for the NSW study area, stock and crop shelter.
The most significant cost in both study areas was weed management.
A proposed conservation management scenario that included fencing of the RNV, and
limitations on grazing and firewood and post removal would negatively effect most of
the survey participants. The differences between the net present value (NPV) of the
current management regime maintained over a 40 year period, and the NPV of the
proposed scenario were large and negative. For Victorian participants, the marginal
effect of the conservation proposal was - $2 million, and for NSW participants -$15
million. In both study areas, the incremental economic costs of the scenario
outweighed the incremental economic benefits for at least 89% of participants. This
study confirmed that one of the major barriers to protecting RNV is the economic costs
associated with conservation management. A large proportion of participants cannot
expect a positive return from investing in RNV conservation. Any policy approach to
achieve conservation objectives for RNV requires significant financial incentives for
landholders to undertake conservation activities.