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Damning Auditor-General’s report finds Coalition’s biodiversity conservation architecture is a house of cards

The NSW Government must bite the bullet, end the developer free-for all and strictly limit the use of biodiversity offset as a last resort only for critical public infrastructure. 

“It is hard to imagine a more damning assessment of such an important scheme than the Auditor General has given the NSW Government’s Biodiversity Offsets Scheme today,” Nature Conservation Council CEO Jacqui Mumford said. 

“It is failure by almost every measure. Essentially, the government’s biodiversity offsets scheme treats nature like a Magic Pudding that developers can keep eating forever if they throw some cash into the government’s tin. 

“It reduces nature to a bunch of financial formulas that can never capture the true value of our unique and rapidly disappearing wildlife and bushland. 

“After this report, offsets must be only used as an absolute last resort. Currently, they are handed out like lollies.” 

The conservation movement from the very start opposed the offsets scheme, which part of a package weakened nature laws government introduced in 2017. 

“Biodiversity offsets underpin the whole system of new nature laws the Coalition introduced in 2017,” Ms Mumford said. 

“The Coalition claimed those new laws would hit the sweet spot — protecting wildlife while allowing development. The truth is, nature has gone backwards since the scheme began.

“The most recent NSW State of the Environment Report found more than 1,020 plants and animals are now threatened with extinction, about 20 more than when the scheme began. 

“Offsetting must be used as a last resort and only when it adheres to best-practice principles.”  

Best practice principles include: 

  1. Adhering to the avoid, minimise, offset hierarchy.   
  2. Requiring no net loss, and preferably a net gain, in biodiversity. 
  3. Ruling out destruction of high-conversation value habitats.   
  4. Requiring strict like-for-like offsetting, with no variation rules.   
  5. Excluding supplementary measures, mine rehabilitation and payments in lieu of offsets.   
  6. Ensuring all offset actions are additional to what is already required by law.  


  • Core elements of the scheme are “not effectively designed”. (p2) 
  • There is no clear strategy for assessing whether the scheme is achieving its intention (p2) to maintain a healthy, productive and resilient environment, so we may never know the full extent of the damage it has allowed. 
  • The market-based approach is not working. There are not enough biodiversity 'credits' to meet the demands of development, even as credit demand is projected to grow with the NSW Government's infrastructure plans. 
  • The practice of developers paying into the Biodiversity Conservation Fund without proper information about whether sufficient credits for their project exist is enabling damaging projects to progress while nature loses out. 
  • The scheme is plagued with problems of integrity, transparency and conflict of interest (p2). The Biodiversity Conservation Trust is the scheme’s supplier, market intermediary and market participant. 
  • There is no plan for long-term funding for the care of Biodiversity Stewardship sites, and with no monitoring in place, we can't know if land management actions are actually achieving the necessary gains to compensate for biodiversity loss (p8). 


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