Value of Australia’s biosecurity system

Project ID: 170713
Project Name: Value of Australia’s biosecurity system (extension of project 1607A)
CEBRA Project Leader: Prof Tom Kompas
DAWR Sponsor: Matthew Koval, First Assistant Secretary, Biosecurity Policy and Implementation Division
DAWR Division: Biosecurity Policy and Implementation Division
DAWR Project Leader: Paul Pheloung, Director, Research and Intelligence, Biosecurity Implementation Branch, Biosecurity Policy and Implementation Division

  • Alistair Davidson, A/g Assistant Secretary, Strategic Policy and Biosecurity, Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES)
  • Jay Gomboso, Director, Biosecurity Economics, ABARES
  • Ahmed Hafi, Senior Economist, Biosecurity Economics, ABARES
  • Tony Arthur, Senior Quantitative Scientist, Fisheries, Forestry & Quantitative Sciences, ABARES
  • Thomas Krijnen, Director, Biosecurity Strategy and System Reform, Biosecurity Policy and Implementation.
  • Christine Reed, Manager, Biosecurity Science and Risk Assessment, New Zealand Ministery for Primary Industries

This project is an extension of project 1607A: Value of Australia’s biosecurity system, for a second year to 30 June 2018.

Australia’s biosecurity system provides a substantial benefit to the Australian community by managing the risks of pests and diseases entering, establishing and spreading, causing harm to human, animal and plant health, the environment and the economy. Australia also benefits from an effective biosecurity system by being better positioned to export high quality agricultural produce into premium international markets.

We know the system is inherently valuable but its value is difficult to quantify. This is because the system has a complex interplay of parts across supply chains, geographies, jurisdictions and stakeholders. Past attempts to value the biosecurity system have been based on ad hoc and qualitative statements of overall benefits or limited to specific cases, such as an estimate of the cost to Australia of an incursion of foot and mouth disease and other major invasive pests and diseases.

The current review of the Intergovernmental Agreement on Biosecurity (IGAB), additional biosecurity related investments arising from the Australian government White Papers on Agricultural Competitiveness and Developing Northern Australia, and the regulatory reform agenda would all benefit from an improved ability to describe the value of the biosecurity system.

The research will serve multiple purposes for the department such as: contributing to an assessment of the health of the biosecurity system through annual reporting requirements; providing evidence and context in conversations with governments from all jurisdictions, industry and the community; and informing and contributing to a national biosecurity strategy, IGAB and the National Environmental Biosecurity Response Agreement (NEBRA) reviews.

The overall objective of the multi-year project is to:

1. set out and design the methods that are needed to measure the value of the biosecurity system as a whole, and its various components;

2. to further develop and adapt the preferred approach for valuation and the aggregation of values specific to the Australian context;

3. map value measures with risk-return trade-offs, especially for cases where resources are being directed to generate highest returns;

4. work towards providing component measures and an aggregate value measure of the biosecurity system across different biosecurity measures and threats, taking into account different desired outcomes.

The outcomes sought from this project are to:

1. Estimate a defensible value of the biosecurity system and indicate best ways to maximise rates of return with value-added measures for biosecurity.

2. Understand where the components that make up that value are generated across the biosecurity system, and where net returns may be highest.

3. Create a benchmark value for comparison with future value estimates.

Phase one of the project (2016 – 2017) delivered a comprehensive review of the biosecurity economics literature, and identified suitable methods, measures and indicators of the types of value generated by biosecurity interventions. Phase one concluded with the delivery of a report that outlined a framework for estimating the value of Australia’s biosecurity system through a multi-year project.

Phase two of the (2017 – 2018) reviewed and standardised existing estimates of value, and included any new measures of market values provided by the work of ABARES; extended these estimates to include non-market values, using ‘benefit transfer’ measures, and the best procedure for undertaking non-market valuation generally; and updated/refined methods to properly aggregate measures of value up to the system scale.

Phase three of this project (2018 – 2019) will continue to augment the existing market and non-market value estimates, where required; aggregate these values, where appropriate; and, moreover, develop a global framework for capturing the measure of value for the system as a whole, in a fully integrated setting. The proposal is to develop a Markov/SAA approach that simulates the arrival and potential spread of pests throughout Australia and thus to measure values with no biosecurity system in place (the counterfactual) and with biosecurity measures (border and post-border) operating.

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