1. INFFER (Investment Framework For Environmental Resources)
Background and Overview

2. Context Budgets small compared to the problems
Environmental protection more expensive than we’ve often allowed for
Spatial heterogeneity
Prioritisation is essential but difficult

3. Institutional context
Concerns about outcomes from regional investment
Treasury, Australian National Audit Office concerns about value for public money from NRM investment
Greater focus on outcomes in Caring for our Country and by some state governments

4. What does INFFER help with?
How to get value for money from NRM budget?
What is realistic/feasible?
Appropriate delivery mechanisms?
Project design
Give confidence to funders

5. General emphases Natural assets Outcomes Value for money
Multiple threats
Multiple asset types
Technical & socio-economic (equal emphasis)
Policy tools/delivery mechanisms
Transparency

6. Regional testing and use
South West (WA)
Avon (WA)
South Coast (WA)
Northern Agric (WA)
Rangelands (WA)
Perth (WA)
Lachlan (NSW)
Central West (NSW)
Border Rivers/Gwydir (NSW)
Northern Rivers (NSW)
Namoi (NSW)
North East (Vic)
North Central (Vic)
Corangamite (Vic)
West Gippsland (Vic)
East Gippsland (Vic)
Goulburn Broken (Vic)
Port Phillip & Westernport (Vic)

7. Based on experience
Builds on lessons from previous frameworks and from use by 15 regions
As simple as possible, but comprehensive
Highly structured and guided process
Template
Actively supported
Help desk
Workshops
Regular phone-hookup meetings
Fully documented
All documents freely available at

8. Asset types River reach Intact native veg Cultural heritage
Woodland birds
Asset types
Wetland
Listed on register
Last of its type
Threatened species
Flagship
Critically endangered
Native vegetation
Concentration of threatened species
Near pristine condition
Important location

9. What is the output? An assessment for each asset
Background information about the asset
A specific, measurable, time-bound goal
On-ground works that will achieve that goal
Delivery actions that will result in those works
Information about asset value, threats/damage, technical feasibility, socio-economic feasibility, urgency, cost, risks
Benefit:Cost Index (comparable across projects)

10. What sorts of projects?
Ones that will deliver NRM outcomes for identifiable natural assets, which can be
large or small
degraded or pristine
localised or dispersed
any sort of natural asset
Not
Untargeted capacity building
M&E not linked to a specific project
R&D not linked to a specific asset

11. INFFER Pre-Assessment Checklist
Asset focus
1. Can you clearly identify the environmental or natural resource asset?
2. Will it be possible to define a goal for the asset that is “SMART”?
Cost-effectiveness
3. Is there evidence to indicate that management actions can make a real difference?
4. If the desired management actions are mainly on private land, is it likely that those actions would be reasonably attractive to fully informed land managers when adopted over the required scale?
5. If the project requires change by other institutions is there a good chance that this will occur?

12. North Central CMA

13. The INFFER Process

14. INFFER process Can be applied to individual assets
Run small number of cherry-picked assets through the process
Helps with project development
Helps assess whether it is worth pursuing the project
Better to be a comprehensive process
Community consultation + other info sources
A more comprehensive look at the project options

15. Comprehensive process
1. Develop a list of significant natural assets in the relevant region(s)
2. Apply an initial filter to the asset list, using a simplified set of criteria
3. Define projects and conduct detailed assessments of them
4. Select priority projects
5. Develop investment plans or funding proposals
6. Implement funded projects
7. Monitor, evaluate and adaptively manage projects

16. Rationale for the process
Starts broad, with far too many assets
Reduce list somewhat with simplified criteria
No point in great sophistication at this stage
Few enough make it through to make a good assessment practical

17. How long does it take?
New user: around 5 person-days per asset to complete Project Assessment Form
Experienced user: 1-2 days per asset, if information and experts accessible
Could be extended to encompass detailed modelling if desired

18. What skills needed? Ideally, good knowledge of asset(s)
Able to engage with experts
Understand NRM projects – some experience in implementation
Capture and interpret technical and socio-economic information
Make judgements based on partial information

19. INFFER and knowledge gaps
Makes the best of the available info
Captures key knowledge gaps
Ratings for quality of information
Possible outcomes
Project to fill knowledge gaps
Data collection/investigation within the project
Feasibility assessment as phase 1 of project
Captures risks of project failure

20. Project Assessment Form

21. Project Assessment Form
Completed for every project
Could be more than one alternative project for the same asset
Guided process to collect the required information
Detailed instruction manual

22. Project Assessment Form
Web-based
Instructions hidden until needed
Automate calculations
Easy navigation
FAQs
Example responses

23. 1. The asset Spatial definition of the asset
Significance/importance of the asset
Key threats
Existing projects

24. 2. Goal, works Setting a specific, measurable, time-bound goal
On-ground actions to achieve goal
Actions by other organisations
Time lags until benefits
Effectiveness of works
Risk of technical failure
Spin-offs (positive and negative)

25. 3. Socio-economics
Anticipated adoption of works by private land/water managers
Encompasses community capacity and knowledge
Risk of practice changes for the worse
Approvals
Socio-economic risks

26. 4. Budget Delivery mechanisms Costs Private citizens
Other organisations
Works, investigation and management
Costs
Up front (3-5 years)
Long-term maintenance costs

27. 5. Project info Project title Project summary
Funder’s targets and outcomes
Outputs and intermediate outcomes

28. Public and private benefits and choice of NRM policy instruments

29. Public: private benefits framework
Selects the most appropriate policy tool for a given circumstance
Relevant to change on private land

30. Public and private benefits
“Private benefits” relate to the landholder making the decisions
“Public benefits” relate to all others
neighbours, downstream water users, city dwellers interested in biodiversity

31. Possible projects
Each dot is a set of land-use changes on specific pieces of land = a project.
Lucerne
Farm B
Lucerne
Farm A
Current
practice
Which tool?
Incentives
Extension
Regulation
New technology
No action
Forestry in
water
catchment

32. Alternative policy mechanisms for seeking changes on private lands
Category
Specific policy mechanisms included
Positive incentives
Financial or regulatory instrumentsA to encourage change
Negative incentives
Financial or regulatory instrumentsA to inhibit change
Extension
Technology transfer, education, communication, demonstrations, support for community network
Technology change
Development of improved land management options, e.g. through strategic R&D
No action
Informed inaction
AIncludes polluter-pays mechanisms (command and control, pollution tax, tradable permits, offsets) and beneficiary-pays mechanisms (subsidies, conservation auctions and tenders).

33. Simple rules for allocating mechanisms to projects
1. No positive incentives for land-use change unless public net benefits of change are positive.
2. No positive incentives if landholders would adopt land-use changes without those incentives.
3. No positive incentives if overall costs outweigh benefits.

34. Simple public-private framework

35. How applied Project Assessment Form collects info Public net benefits
Asset significance
Threats, Effectiveness of works
Time lags, Risks
Private net benefits
Adoption of the required works
Does not dictate mechanisms: you choose

36. Benefit: Cost Index

37. The BCI An index of benefits from the project
Total costs (project and ongoing)

38. A  B A: adoption B: compliance
V  W V: asset value
W: effectiveness of works
A  B A: adoption B: compliance
F  P  G F: feasibility P: socio-political
G: long-term funding
1/(1 + r)L
L: time lag to benefits
r: discount rate
Potential project benefits
E(prop’n of required adoption)
Discount factor for time lags
Risk of failure 
 (1  ) 
BCI = ──────────────────────────────────────────────────
Project cost
C + PV(M) C: project cost
M: annual maintenance cost
PV: summed present value over 20 years

39. Flexible Can compare large and small projects
Can compare short and long projects
Allows comparison of projects for different types of assets
Waterways
Wetlands
Vegetation
Threatened species
Agricultural land

40. Example BCI ranking If budget = $17m, preferred projects are 4, 2 & 5
Benefit: Cost Index
Budget 4
10.0
$3m 2
8.1
$13m 5
7.2
$1m 1
4.0
$0.5 6
1.1 3
0.8
$9m
If budget = $17m, preferred projects are 4, 2 & 5

41. Advantages of the BCI
Avoids common problems in metrics used for ranking environmental projects
Add when they should multiply variables
Fail to divide by project costs (e.g. subtract costs, or just leave it out!)
Omit key variables (common to ignore adoption and technical feasibility)
All three
Cost of poor metrics is huge
Benefits of investment roughly halved
BCI can easily double environmental benefits

42. Interpretation and use of results

43. Project assessment report
Title, summary, etc.
Benefit: Cost Index
Time lag until benefits delivered
Risks of project failure
Spin-offs
Quality of information
Key knowledge gaps

44. Principles The info is an input to decision making
BCI is not to be used mechanistically
All-things-considered judgement
Other things may matter
Need a process of QA to give the decision makers confidence

45. Challenges

46. Challenges
For many environmental managers it’s a very different way to do business
Having to provide comprehensive info
Particular concepts new to people
Ideally, need an asset expert with comprehensive knowledge

47. Typical problems for new people
Difficulties with “asset” and goal
Poor link between threat and works/actions
Required land-use changes not quantified
Tend to stick with comfort zones
Unrealistic expectations of adoption
Not adequately costed
Insufficient detail to judge the project

48. Requirements to get through
Training
One-to-one support
INFFER team offers training and one-to-one support
Getting to resource limits
Vic govt planning to provide a training/support
Clear signals from government that there will be benefits to those managers who do it well

49. Project Examples

50. Example Upper Lachlan River

51. Upper Lachlan River
Goal – improve condition and connectivity, protect fish
Threats – loss of habitat (riparian and in stream), sediments –nutrients, sand slugs
Management – fencing, grazing exclusion, habitat restoration, sediment slug control, gully control, groundcover
Moderate impact on threats

52. Upper Lachlan River (cont’d)
Adoption
Little/none without incentives
Standard CMA cost sharing ~50% adoption
Achievable for some elements, unlikely for larger management changes (gully, groundcover)
Overall cost around $3 million
BCI 3.6 (pretty good)

53. Lachlan Ranges

54. Lachlan Ranges High value, but not a ‘jewel’?
Goal – high conservation vegetation
Maintain extent and condition
Threats – weeds, invasive native species, ag impacts
Reduce threat from high to medium
Management – grazing management, direct weed/pest control, reveg

55. Lachlan Ranges (cont) Adoption Little/none without incentives
Standard CMA cost sharing anticipates >50% adoption
Analysis recommended stewardship payments
7 landholders
Overall cost $1.81 million
BCI 4.65

56. Patho Plains

57. Patho Plains Very high value Goal – high conservation vegetation
Small remnants dispersed over large area
Goal – high conservation vegetation
Maintain extent and condition
Threats – weeds, over grazing, cultivation
Reduce threat from high to medium
Management – grazing management, direct weed control

58. Patho Plains (cont) Adoption Little/none without incentives
Current MBI payments  25-50% adoption
100+ landholders
Overall cost $5 million
BCI 1.75

59. Acknowledgements Affiliations of the INFFER team Other key funders
University of Western Australia
Department of Primary Industries, Victoria
North Central Catchment Management Authority
Future Farm Industries CRC
Other key funders
Australian Research Council (Federation Fellow Program)
Department of the Environment, Water, Heritage and the Arts (CERF Program)
Department of Sustainability and Environment , Victoria