A Social-Economic Framework

for Assessing Enduring Value

From Mining for Remote

Communities

Dr Boyd D Blackwell* & Prof. Brian Dollery**

*Post-doctorial Research Fellow, UNE Business School and CRC REP

** UNE Business School and Director, Centre for Local Government

boydb@une.edu.au

Presentation made to the 2012 ANZSEE

Conference, Green growth or de-growth? 12 – 15

November, 2012, Bond University, Gold Coast

Acknowledgements

• Traditional owners

• CRC REP and the Partners in this project

• Views are those of the authors

• Errors or omissions remain with the authors

2

Outline

• Introduction

• Remoteness problems

• Methods for impact assessment

• Evaluation of methods

• Conceptual approach

• Conclusion

3

Introduction

• This project one of six in the

Enduring Community Value

from Mining project

• Objective - to track and map

mining expenditure in and out of

remote communities

• Methodology - input output

analysis

• Two case study locations:

• Yuendumu and Tanami Gold

Mine, NT and

• Jabiru and Ranger Uranium Mine,

NT

Tanami

Newmont

Mine

Yuendumu

Community

Jabiru

Community and

Ranger Mine

Source: Manipulation of NT Government 2012, p. 118

What do we do?

Who are we?

The CRC-REP is a collaborative

research platform that works with

communities, businesses and

people in remote regions of

Australia to systemically

investigate and provide practical

responses to the complex issues

that drive economic participation.

5

6

Systems approach

to achieving

economic

participation

85% of area

BUT 4% of

population (Chaney 2008)

7

Remote Australia

Locations of ATSI communities (DCITA, 2006)

Note

distribution

of ATSI

communities

8

Mineral deposits and operating mines, Australia

9

Mineral deposits and operating mines, Australia

Nth of Tropic of Capricorn 5% of Australian

population produces 50% of nation’s GDP (with

only 12 representatives in Canberra) (Young C

2012, pers. comms, CEO NTCoC, Darwin)

10

Problems associated with remoteness (See Blackwell, Dollery and

Grant (In preparation) for references)

• Factors:

• Institutional

• Environmental or geographical factors:

• Health and wellbeing

• Cultural

• Economic

11

Problems associated with remoteness (See Blackwell, Dollery and

Grant (In preparation) for references)

• Institutional factors:

• No local government representation in unincorporated Australia (see

Blackwell 2012)

• Distant decision making

• Limited management and provision of public services

• Highly complex political economy of governance

• State, non-state, formal and informal authority and governance

• A ‘failed state’ – the hole in Australia’s heartland (Walker, Porter and Marsh

2012, p. 27)

• Environmental or geographical factors:

• Tyranny of distance

• Isolation

• Harsh and extreme environments

• Mostly arid climate

• Limited or dispersed resources (in many cases)

• e.g. food and water

12

Maps of unincorporated or sui generis areas in Australia

Source of Maps: Regional Development Australia 2012

13

Problems associated with remoteness (See Blackwell, Dollery and

Grant (In preparation) for references)

• Health and wellbeing factors:

• High levels of disease and limited access to medical care

• Distance, communication and cultural inappropriateness

• Funding and coordination of health care

• Does not recognize responsible hospitals and primary care sector

• Education, housing and water

• Limited

• High cost

• ATSI participation in workforce and education low

• High proportion of disadvantaged people

• Chronic drug and alcohol abuse, in parts

• Higher rates of arrest and imprisonment, in parts

14

Problems associated with remoteness (See Blackwell, Dollery and

Grant (forthcoming) for references)

• Cultural factors:

• Social variability

• Unpredictability in, lack of control over markets, labour and policy

• Social interaction

• Very restricted or very little access

• Human populations

• Sparse, mobile, patchy

• Research knowledge is limited

• Persistent traditional and local knowledge

• Incongruence of western and traditional laws (more details in Blackwell and

Dollery, 2012a presentation)

• Social dislocation (compounded over generations in a relatively short period of

time)

• Inability to keep young people and resulting boredom for those who remain

15

Market and Cultural Incongruence

Hannah Bell (1998)

Aboriginal culture in NW WA

• Deeply earth connected

• Cultural traditions rhyme & reason

• ‘Pattern thinking’

• Sharing – e.g., Humbug

Western Culture juxtaposed

16

What does this mean for assessing impacts??

Clash of cultures and need for ‘two way thinking’

•Empathy

•Bush University, Caulfield Grammar exchange

• Deeply disconnected

• Distinction of roles blurred

• Extensive freedoms

• ‘Pyramid thinking’

• Market and materialism

Assessment Approaches • Given remote difficulties and hurdles

• How to assess state of play, socially, economically, environmentally?

17

• Criteria for assessment:

• Best purpose

• Holistic

• Systems based

• Understandable

• Ease of practice

• Cost

• Democratic

• Value inclusive

• Measureable

• Politically acceptable

• Data intensive

• Strategic/global

• Range of assessment methods

• Strategic Environmental

Assessment

• Cumulative Impacts Assessment

• Integrated Assessment

• Social, Economic, Environmental

Impact Assessment

• Cost benefit analysis (CBA)

• Cost effectiveness analysis (CEA)

• Multi-Criteria Assessment (MCA)

• Risk Assessment

• Citizen Juries

• Remote sensing and GIS

Evaluation (Blackwell, 2012)

18

Evaluation continued.. (Blackwell, 2012, p. 41)

19

Evaluation continued.. (Blackwell, 2012, p. 42)

20

Assessment Approaches Summary

• Range of assessment methods with pros and cons:

• Strategic Environmental Assessment (early)

• Cumulative Impacts Assessment (synergistic, complex)

• Integrated Assessment (trans-multidisciplinary)

• Social, Economic, Environmental Impact Assessment

(disciplinary)

• Cost benefit analysis (project versus social, $ unit of measure)

• Cost effectiveness analysis (not max net benefits, but easier)

• Multi-Criteria Assessment (depends on criteria and weightings)

• Risk Assessment (institutionally hamstrung)

• Citizen Juries (democratic – expertise?)

• Remote sensing and GIS (can physical layers tell social story?)

21

Conceptual approach to assessment: Systems based

approach incorporating ‘cradle to cradle’ lifecycle

Environment/Ecosystems

Economy Society

Mining Resources

Exploration

Benefits and Costs Benefits & Costs

Benefits and Cost

Export

Mining

Manufacturing

- Disposal, Re-use, Recycling,

Repair

Polity

22

Systems thinking and market and non-market values of

mining

Total Economic Value

Market value

(captured by the market)

Non-market value

(not captured by the market)

Direct use value

Net returns to mining

operations

Expenditure by owners,

workers in economy

Indirect use value

Income flows from original

expenditure through

economy

Increased rents and returns

on housing

Royalties and taxes collected

by governments

Use value Non-use value

Option value

Future ability to use or

conserve resources

Passive use value

Recreational use of

resource including land

and water

Existence value

Value in knowing the

resources exist without

intended use

Bequest value

Providing a healthy and safe

environment for future

generations

Vicarious value

Value of resources

conveyed through history,

culture, art, poetry, other

media

Benefits from development assessed through market valuation

Benefits from conservation assessed through non-market valuation

23 Source: Highly adapted from Turner (1993)

Conclusion

• Impact assessment not simple and needs to account for:

• Informal market economy in community

• Significant ‘leakages’

• Incongruence between aboriginal culture and market based

philosophy

• Sui Generis of remote Australia

• Remote locations (like the NT) are unique culturally, socially,

economically, environmentally, institutionally and politically

• and this needs to be accounted for the approach

24