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Legislative Assembly for the ACT: 1997 Week 10 Hansard (23 September) . . Page.. 3134 ..

MRS CARNELL (continuing):

financial format. Hence we envisage that, eventually, budgets and annual reports will contain information on environmental assets and liabilities and how they are being managed. Budgets in the future will also contain a set of environmental indicators which demonstrate the environmental performance of the Government.

As with any form of accounting, environmental accounting is essentially about the generation, analysis and presentation of useful information. Such useful information is not limited to monetary expressions but also incorporates physical and qualitative measures. Hence it would include reports on soil and water quality, air purity, health of the population and so on. However, environmental accounting is not an end in itself but is a means to an end. The end, or the purpose of the Government, is the enhanced wellbeing of the community, supported by quality environmental outcomes. In other words, environmental accounting is worth while only if it makes us all better off in the long haul. That is why the information must have a practical use.

A significant problem with the existing once-off methods of project assessments, including environmental impact statements, is that they do not have the benefits of a comprehensive and consistent reporting system. As a result, the information presented is frequently unreliable. Similarly, it is unfortunately the case that at present some of the environmental concepts being taken for granted, such as "sustainability" and the "precautionary principle", are neither consistently defined nor scientifically based. These concepts would be more valid if, for example, useful information about them could be developed which took into account the impact of changing technologies on the availability of and demand for resources. It is of little use to be advised that a particular rate of resource use is "unsustainable" under assumptions of fixed demand and fixed technology, when we all know how quickly demand and technology can change, especially in response to significant movements in prices.

Essentially, I hope that the project on environmental accounting will bring much more scientific and intellectual rigour than we have seen up till now in understanding the relationship between the environment and people's living standards. Provided that environmental accounting is based on consistent, testable scientific principles, and not merely assertions, it will improve community awareness of the state of the environment, help to improve both environmental and financial performance and help to inform decision-makers on policies to improve community wellbeing on an enduring basis.

This status paper is a beginning. It explores the meaning and the state of environmental accounting and canvasses the questions which need to be resolved. Its purpose is to be a basis for consultation with all stakeholders in public sector decision-making. I hope that all members will study it carefully and come back to the Government with comments and suggestions which can be incorporated early in the present conceptual stage of the environmental accounting project.

The next stage of the project is the development of an options paper, which will take into account the comments received and propose some possible environmental accounting models for the ACT. The options paper will form the basis of much wider community consultation. There will, of course, be no instant answers. However, this paper represents a very important step towards better stewardship of our resources.

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