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Joint Media Release
Minister for the Environment and Heritage
The Hon. Dr David Kemp
Federal Minister for Agriculture, Fisheries and Forestry
Warren Truss

13 June 2003

$360,000 for Market-based Projects Tackling Dryland Salinity

Landholders and rural communities are encouraged to apply for a share of $360,000 in federal funding to carry out pilot projects targeting dryland salinity, using trade or offset mechanisms.

The $360,000 - announced today by Federal Ministers for the Environment and Heritage, Dr David Kemp, and Agriculture, Fisheries and Forestry, Mr Warren Truss - comes under the first round of the $5 million national Market Based Instruments (MBI) Pilots Program.

The MBI program is a partnership between the Commonwealth, the States and Territories, and the private sector and is funded under the $1.4 billion National Action Plan for Salinity and Water Quality program.

Dr Kemp said MBIs make use of market signals rather than regulation or legislation to tackle environmental challenges in a much more cost-effective way and help change land use behaviour.

"More traditional MBIs include taxes and subsidies while more innovative MBIs include trading mechanisms, "green offsets" and auctions to allocate grants," Dr Kemp said.

"For example, trade mechanisms can be used to limit the total salt load generated by a particular land activity or industry. This can be done by trading with specified credits or rights to encourage cost-effective ways of slowing the spread of salinity.

"Offsets, on the other hand, are mechanisms where negative activities such as clearing native vegetation can be offset by other, more positive actions such as replanting vegetation elsewhere in the local area."

Mr Truss said dryland salinity is a serious and growing problem in Australia.

"Dryland salinity can be caused by removing deep-rooted vegetation and replacing it with shallow-rooted crops and pastures that use less water. As a result, groundwater tables can rise, bringing dissolved salts present to the surface," he said.

"Dryland salinity is distinct from other types such as irrigation salinity and naturally occurring dry saline lands, and its diffuse nature often makes it hard to identify the source of the problem.

"In fact, the causes and effects of dryland salinity can be widely separated - both physically within the landscape and over time. Among other things, this means using trade and offset mechanisms to tackle dryland salinity poses some challenges.

"We are therefore keen to see a good mix of innovative and creative project ideas."

Dr Kemp stressed dryland salinity is a problem affecting many parts of Australia.

"One of the key criteria for a pilot project to secure funding is that the knowledge and understanding gained will be applicable and beneficial to all States and Territories," he said.

"In Australia, we are still at an early stage in developing and using MBIs but expect the program to deliver real on-ground results in improving natural resource management.

"There is already significant and growing interest in Australia, and around the world for that matter, in developing practical, workable and successful MBIs. They are seen as an increasingly effective way of, among other things, of conserving biodiversity, reducing salinity and managing water allocation within environmental limits."

Ten pilot MBI projects - addressing other natural resource issues including water quality and biodiversity - have already been announced under the first round of funding and are now underway.

One pilot project involves a scheme where irrigators can choose the most cost effective way to manage salinity levels in a river catchment. To prevent salinity levels from increasing, a cap or target is set for the whole irrigation area. The cap or target can be achieved through activities that reduce salinity levels or by purchasing credits from other landholders who can achieve the same results more cheaply.

The closing date for dryland salinity MBI pilot proposals is 23 July 2003.

For more information, visit or
contact Genevieve Kelly on (02) 9228 6254 or, or
Bryony Mika on (02) 9228 6334 or

Commonwealth of Australia