Much-needed flexibility is in view 4 min read
The Queensland Government is reviewing its environmental offsets framework, and consultation is now open on A fresh start for Queensland’s Environmental Offsets Framework (the Discussion Paper).
In this Insight, we explain the proposed reforms, which seek to reduce regulatory complexity, modernise the calculation of offsets and unlock the Offsets Account.
Key takeaways
- A refresh of the environmental offsets framework is long overdue.
- Learnings from the past ten years and a more flexible approach to the framework will result in better on-the-ground outcomes, a more strategic approach to offset delivery, and better alignment between federal and state requirements.
- An unavoidable outcome will be an increase in the cost of financial settlement offsets.
- The consultation period for the Discussion Paper will close on 29 June 2026.
Queensland's existing framework
The environmental offsets framework was established over a decade ago, and comprises the Environmental Offsets Act 2014 (Qld) (the Offsets Act), the Environmental Offsets Regulation 2014 (Qld) (the Offsets Regulation) and the Queensland Environmental Offsets Policy.
Under the current framework, a decision maker may impose an offset condition to counterbalance a significant residual impact of an activity on an environmental matter that remains following the implementation of all reasonable on-site mitigation measures. An offset may be delivered as a financial settlement offset, a proponent-driven offset or a combination of these mechanisms. The potential for duplication of offsets is addressed and there are a variety of legal mechanisms to secure an offset.
Over the years, cracks have emerged in the current framework, including the offsets calculator no longer being fit for purpose; the state amassing a large, unallocated sum of money in the Offsets Account; a failure to properly utilise advanced offsets; a lack of flexibility and increased complexity creeping into the regulation of offsets; and a growing disconnect between federal and state offset requirements.
The Discussion Paper recognises the current framework's shortcomings and proposes solutions. Its release is timely, given the environmental reforms at the federal level and the recent consultation on the National Environmental Standard for Environmental Offsets.
Proposed reforms
Regulatory reforms
The Discussion Paper proposes changes to the Offsets Act, the Offsets Regulation and the Offsets Policy to clarify, streamline and simplify the Queensland offsets framework. The changes to the framework include administrative, substantive and policy changes.
Some of the more important changes for proponents and landowners are in relation to the Offsets Act and Offsets Regulation. In particular, it is proposed that:
- the mitigation hierarchy (which involves avoiding, minimising, mitigating and offsetting impacts) be clearly defined;
- the process for entering into an agreed delivery arrangement for an offset and registering advanced offsets be updated and modernised;
- when amending an existing authority, the significant residual impacts include cumulative impacts;
- the need to lodge a notice of election or enter into an agreed delivery arrangement be removed where a financial settlement offset condition has been imposed at the proponent's request;
- an offset may be approved during or after commencement of significant impact works when the actual impact is known;
- the need for the consent of the landowner and persons with an interest in the land be rationalised, so that such consent is only required once;
- a voluntary environmental agreement under the State Development and Public Works Organisation Act 1971 (Qld) be recognised as a legally secured offset mechanism;
- an environmental offset protection area be able to be used to secure a federal offset;
- landowners be permitted to establish an advanced offset for both federal and state matters; and
- private protected areas under the Nature Conservation Act 1992 (Qld) be able to be used as advanced offsets.
The proposed changes to the Offsets Policy include:
- greater clarity around the location of offsets;
- expanding the scope of indirect offsets beyond research and education, to include activities such as threat mitigation; and
- enabling high-value regrowth or remnant areas to be improved as part of a connectivity area offset.
Collectively, these changes will have the effect of introducing much-needed flexibility, increasing the use of advanced offsets and creating procedural efficiencies.
Calculation of financial settlement offsets
The Discussion Paper identifies issues with the financial settlement offset calculator, including a 2014 cost base and inadequate multipliers, sliding scale discounts for large offset areas resulting in reduced funding, the bundling of offsets leading to delivery difficulties, and a lack of contingency planning to account for circumstances such as natural disasters.
The inevitable result of addressing these matters will be an increase in the cost of providing financial settlement offsets.
The revision of the financial settlement offset calculator will be the subject of a separate Consultation Impact Analysis Statement during this year. The Discussion Paper recognises the need for alignment with the Federal Government to facilitate its accreditation of the Queensland offsets framework.
Unlocking the Offsets Account
The growth in the Offsets Account is linked to a high proportion of offset conditions being fulfilled through financial settlement offsets, the scarcity of suitable land and a lack of landowners willing to participate.
The Discussion Paper identifies a number of solutions, including:
- improved landowner engagement;
- encouraging delivery partnerships between landowners and natural resource management groups;
- more flexibility in delivering offsets by eg departing from the like-for-like offset requirements in appropriate cases; and
- taking a more strategic approach, by supporting advanced offsets and expanding the protected area estate.
Next steps
The consultation period for the Discussion Paper will close on 29 June 2026. We can work with proponents and landowners to understand its implications and, if necessary, assist in preparing a submission.