Meeting the policy challenges of rural and peri-urban land use in Australia: Government, governance and public policy
3. Land use policy objectives and values
To be effective and efficient, public policy and supporting governance should be directed at achieving a clear objective. This objective can be enhanced social, environmental or economic outcomes – either separately or in concert – from the use of land resources. These outcomes reflect the different values that society places on land use. The approach taken in defining land use planning objectives in Victoria has been to explicitly capture these different values in the objectives. This approach can face difficulties in capturing the wide range of values that society has and that these values change over time. To avoid such difficulties, a key land use policy objective could be to allocate land between competing uses in a way that maximises the total value created for the community.
3.1 Land use objectives
The objectives of land use planning for Victoria are set out in the Planning and Environment Act 1987 and summarised by the Victorian Auditor General (2008)16 as:
- providing for the fair, orderly, economic and sustainable use and development of land
- protecting natural resources and maintaining the ecological processes and genetic diversity
- securing safe and liveable urban and rural environments
- conserving and enhancing culturally or socially significant buildings or areas
- protecting and enabling the provision of public utilities
- facilitating development
- balancing the present and future interests of all Victorians.
These objectives explicitly recognise particular land use values and that these may, in some cases, conflict. A proposed land use such as residential development, for example, may simultaneously contribute to a ‘facilitate development’ objective and conflict with a ‘protect natural resources’ objective. Society faces difficult choices about allowing uses for land that generate financial gain or conserving habitat that protects biodiversity (or some mix) — both biodiversity and material wellbeing are important goals for the community. The challenge for land use policy is to establish a framework for making these tradeoffs by planning the use, development and protection of land in Victoria in the present and long term interests of all Victorians.
In some cases governments have articulated objectives for land use which focus on social or equity goals including 17:
- protecting or preserving land for particular uses, for example for the benefit of a particular industry such as agriculture
- limiting or constraining particular land uses, for example stopping urban sprawl
- assisting groups within the community, for example allocating land to residential development for ‘affordable housing’
- minimising conflict between competing claims on land
- preserving administrative discretion for government.
16The Act is currently subject to review by the Victorian Government to enhance the operation of Victoria’s planning system.
17Other examples include ‘fiscal zoning’ to generate high property tax payments and low levels of local government expenditure (Evans 2004).
3.2. Land use values
Some values generated by land use can be easily observed. The value of food and fibre, for example, can be seen in market transactions. Other values, such as the amenity value of biodiversity habitat, and philosophical and spiritual values, may be less visible. These values can also change over time. A century ago in Australia food and fibre were scarce relative to habitat. Today the opposite could be argued (Stoneham et al. 2003).
Value is commonly understood in a financial sense – how much income agricultural land uses generate or how much a family is willing to pay for a hobby farm, for example. Economic value is broader than this and includes a range of use values and non-use values. Examples of these values are presented in Table 1 and discussed below.
| Use values | Non-use values | |||
|---|---|---|---|---|
| Direct | Indirect | Option | Existence | Bequest |
|
Outputs directly consumable |
Functional benefits |
Future direct and indirect values |
Value from knowledge of continued existence |
Value for environmental and cultural legacy |
|
Examples of use and non- values |
||||
|
Food, biomass, recreation, health, cultural, scientific and educational |
Ecosystem services such as flood control, catchment protection, nutrient cycles |
Biodiversity, conserved habitat |
Habitats, species, genetics, ecosystem, places of spiritual and cultural significance |
Habitats, prevention of irreversible change, places of spiritual and cultural significance |
Table 1: Categories of economic values for environmental assets - Source: Pearce and Moran (1995), Wallace (2006)
Use values
Use values are those that arise from the actual utilisation of a given resource (Pearce and Moran 1995). They can be broken down further into direct, indirect and option values.
Direct use values are those derived from consumption or production of a resource. They are revealed in markets where participants reveal their willingness to pay for the resources or willingness to accept compensation to give them up. An agricultural landholder, for example, will allocate land to various farming activities such as crops or livestock, or buy and sell land, based on expectations about returns. These returns will be drawn from estimated revenues for outputs, and costs for inputs, at market prices.
Indirect use values are derived from the benefits of amenity and ecosystem services which may not have a market price. Where markets for these indirect use values are missing or incomplete, landholders and communities can use market substitutes to inform decisions on whether to maintain or develop ecosystem services relative to other land uses. A mechanical water filtration system, for example, can be a substitute for a protected catchment for removing impurities from water or a person may pay more for a property in a picturesque setting.
Option values reflect the value of delaying use of or conserving a resource for either direct or indirect use for the future. Option values may be present when there is uncertainty about the resilience of an ecosystem or where decisions now may cause damage that is difficult or costly to reverse. If remnant vegetation is cleared for agricultural use, for example, the yet-to-be discovered beneficial uses of the remnant vegetation may be lost. If these future uses are likely to be of high value, then there may be value in delaying the decision to convert the land to agricultural use. Individuals or communities may be willing to forgo benefits from a development until there is more certainty about future benefits or the resilience of the particular ecosystem involved.
Non-use values
Non-use values include existence and bequest values. Existence values are derived from the knowledge that an environmental asset exists. Many people value the existence of national parks and reserves and the associated environmental goods they produce even though they may not visit (use) them. In addition people gain bequest value from knowing that these parks and reserves will be available for future generations to enjoy.
Existence values can be broadly interpreted to also cover intrinsic values associated with philosophical and spiritual values tied to land (Wallace 2006). An example includes the spiritual connection between indigenous Australians and the land as a significant part of their culture. Places of Aboriginal cultural and heritage significance, for example, may be protected by being placed on national or state registers under which legislative protection is provided (Department of Sustainability and Environment 2005c).
