Sustainable development: Have we got our priorities right?

Peter Clough
JEL codes: 
Working paper 2009/7

Sustainable development remains high on the international agenda, even as policy makers are distracted by the political and fiscal fall-out of the global financial crisis. Its continued prominence is illustrated by various countries use of fiscal stimulus to fast-track the greening of the economy.

For New Zealand, getting its sustainability policy right is important not just because of reputation risks to its trade, but because any regulation should be cost-effective and efficient. This is particularly so in light of New Zealands poor economic growth performance, and the need, now more than ever, to ensure value for money from any government expenditure and to avoid undue impositions on private initiatives.

Given this context, this paper considers New Zealands current sustainable development policy in light of international approaches to sustainability which focus on maintaining stocks of natural, physical, institutional and human capital. It examines environmental priorities against the following criteria: First, scale of the value at risk; second, the immediacy of threat; third, the immediacy of threat; fourth, the coverage of the priorities; fifth, the uniqueness; and last, the controllability of the issue.

We find that New Zealands environmental priorities are not well targeted at sustaining critical stocks or on effects that New Zealand policy can realistically expect to control. Their net benefit to New Zealanders is therefore open to question. This suggests a change in focus could both
improve environmental and economic outcomes for the country at large. Of the current environmental priorities, work on urban air quality and protecting biodiversity and ecosystems would be the highest priority. This is because of the high loss of life quality and premature death from the
former and the high proportion of species at risk that are unique to New Zealand.