Experts undervalue the environment: Henry

PETER MARTIN ECONOMICS CORRESPONDENT

Sydney Morning Herald

March 6, 2010

THE Treasury boss Ken Henry has taken a swipe at the work of his own department and that of others on valuing the environment, saying much of it is flawed and fails to give proper weight to retaining Australia's unique biodiversity

Fresh from producing the as-yet-unreleased Henry Tax Review and amid preparations for this year's budget, Dr Henry told an environment conference in Sydney that the part of his intergenerational report that had received the least attention was the section on environmental sustainability.

But not only did the wellbeing of future generations depend on the resources left to them by this generation, the environment was likely to become more important to them than it was to us.

''It is very likely that improvements in our material wealth and our understanding of the environment will enhance our appreciation and enjoyment of the environment over time,'' he said. ''There seems great scope, for example, for developing new or improved food crops, medicines and industrial products from our biological diversity.''

Market valuations of forests and farmland underplayed their worth because many of their benefits were realised too far in the future to be taken into account in prices. Asking people how much they would be prepared to pay to preserve parts of the environment had resulted in bizarre conclusions, including that preserving blue whales was more important than preserving all whales.

''The idea of blue whales evokes a richer mental image than the idea of whales in general,'' he said.

A practical conservationist, Dr Henry helped draft the Henry Review's tax discussion paper while in central Queensland, caring for northern hairy-nosed wombats. In 2008, in a personal capacity, he is reported to have helped draft a submission opposing plans to cull 500 kangaroos in Canberra.

He said that consulting experts too often gave advice on areas beyond their expertise. In Canberra, grassland ecologists had been asked to ''offer advice on the difficult ethical question of whether it is more humane to kill a kangaroo than it is to relocate it''.