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Indicators For Sustainable Regional Development

1Ian Ada & 2David Blore,

1Department of Natural Resources and Environment, Seymour, Victoria

2Department of Infrastructure, Benalla, Victoria


This paper reports on a project seeking to identify and use broadly based economic, social and environmental indicators to ensure sustainable regional development is occurring at a regional level. The rationale for having indicators relevant to a wide range of state and local government agencies and regional communities is explained. The recent interest in considering data from indicators in an integrated way is discussed. Questions are posed that provide the challenge on how we can collect and use data from indicators for collaborative decision making by agencies at a regional level.

Outcomes common to most agencies in north east Victoria are identified and draft indicators relevant to them recommended. The tasks set for recently appointed consultants to help address the challenges are identified. The expected range of benefits that will arise from successful implementation of this work are listed, which include a template that other regions can use.


Why have regional sustainability indicators?

Sustainable regional development in a generic sense is about achieving a balance between economic development, stewardship of our natural resources and the social wellbeing of our communities.

The Victorian Government has a whole of government approach to regional development. Consequently a wide range of state and local government agencies have a responsibility to meet economic, social and environmental outcomes.

To date the achievement of environmental, social and, to a lesser extent, economic outcomes, has often been described on a qualitative basis, particularly at a local, regional or catchment level. Currently agencies have relatively few indicators that are being measured to see if performance targets are being reached.

This approach fails to deliver a framework for decision making that clearly balances all outcomes. In short, organisations have limited ways of knowing if either individually or collectively they are achieving sustainable regional development. Because they have responsibility for components of regional development, it is possible for each agency to be reaching its goals, but on a holistic basis a region can be declining in sustainability.

There are other reasons for having sustainability indicators at the catchment or regional level. The Standing Committee on Agriculture and Resource Management (SCARM), 1999 noted that strategies for improved natural resource management at the regional level are most effective when generated by regional communities themselves. They believed that devolution of decision making would enable regional communities to determine the mixture of economic, environmental and social instruments that were most appropriate for encouraging changes in land use and management. However devolving greater authority to regional communities for implementing regional strategies required adequate arrangements for reporting and accounting for outcomes. SCARM therefore recommended that sustainability indicators, useable at the regional scale, should be developed which were capable of monitoring change in the condition of the natural resource base, other environmental values, net economic returns, and social wellbeing.

Looking at indicators in an integrated way

There are many indicators measured at the State and National level; eg. Gross Domestic Product (GDP), Quality of Life Indices (eg. Headey, Eckersley), State of Environment reports (State of Environment Report Advisory Council, 1996). Environmental indicators are now being identified for use at the regional, catchment or community levels, (DNRE, Alexandra et al). There is also increasing demand for economic and social indicators, but few relevant to regional program providers have yet been developed.

However until recently there has been little discussion on what might be an appropriate balance between social, economic and environment outcomes. Discussions on data from indicators have all been considered as independent issues. Eckersley (1999) identified the need for a changed approach when reporting on research measuring whether the quality of life in Australia was improving. His paper distinguished between the quality of life and standard of living and argued that policy makers gave too much emphasis to economic growth at the expense of other aspects of economic and social life. The report found that Australians were looking for a different national and social vision. “Instead of one narrowly focussed on material progress, they want a coherent story that better reflects human needs and expresses a better balance between economic welfare, social equity and environmental sustainability”.

There have been some attempts to put social, economic and environmental monitoring into a single index, such as Genuine Progress Indicators (GPI), (eg. Hamilton, Cobb et al). In general the GPI takes from the GDP the financial transactions that are relevant to wellbeing. It adjusts them for aspects of the economy the GDP ignores. In their GPI, Cobb et al add on non-monetary benefits such as the value of time spent on household work, parenting and volunteer work. They subtract expenditure needed to defend quality of life such as burglar proofing homes, social costs such as divorce, and the depreciation of environmental assets and natural resources.

However much of the data included in these indicators is only available at the national or state level, and the final index and its components are best used for policy development and debate at these levels.

What issues need to be considered?

This increasingly identified need for regionally based indicators raises a number of questions.

1. How do statewide Government or agency targets, such as NRE’s aim for $12billion in agricultural exports by 2010, translate to a target within diversified economic output at a regional level?

2. Can we identify key indicators1, that measure the broad outcomes sought by the various state and local agencies?

Can agreed benchmarks2 be set for each of these indicators that meet the various agencies outcomes and targets?

Do benchmarks need to be modified to allow for the tensions that exist in achieving multiple outcomes?

How do we introduce the use of indicator data into the cycle of policy development – project prioritisation and selection – funding – outcomes review – policy modification?

Can agencies act, both individually and collaboratively, on the data provided by the indicators to make planning decisions within their portfolios to better meet their goals, particularly if the benchmarks are not being met?

How do we address the implications of any overlapping policy and program impacts of agencies and interpret trend data from indicators to ensure responsibility for corrective action is assigned appropriately?

Pilot Project

State and local government agencies in the dryland section of north east Victoria are attempting to determine whether a group of social, environmental and economic indicators can be chosen, so that data from them can be used, both individually and collaboratively, for decision making to improve sustainable regional development.

Outcomes and indicators for north east Victoria

A working party of representatives of eight agencies were appointed last year to recommend indicators and processes for the above to be achieved. Firstly they identified the economic, social and environmental outcomes that were common to the majority of agencies that had responsibilities in a particular area. These were:

  • Economic: Increased economic growth/prosperity.
  • Environmental: Sustainable use of the region’s land and water resources, including protecting and enhancing biodiversity. Land use matched with land capability.
  • Social: Improved quality of life or social wellbeing

The number of indicators that can be measured for collaborative use will, by necessity, be limited because:

  • most are costly to measure
  • the amount of information generated, collated and distributed needs to be manageable.
  • the data must be useful to all or most agencies who influence environmental, economic and social outcomes.
  • the data must be useful for multiple purposes, such as policy development, strategic planning and prioritising of resources, and reporting on achievements.
  • each must pass the test of being reliable, consistent, tailored to objectives, have the ability to detect trends, be scientifically credible, meaningful and understandable to the average person, cost effective and committed to, (Forbes, pers.comm.).

The draft indicators recommended are:


Land Use and Management Compared Spatially with Land Capability
Area affected by Priority Pest Plants
Index of Stream Condition
Water Quality
Soil Condition
Remnant Vegetation
Ground Water Condition
Water Use


Gross Regional Product
Population Change
Property Values
Number of Building/Planning Permits


Quality of Life
Age Profile

The environmental indicators have been chosen from amongst those being developed for use in measuring catchment condition and evaluating environmental programs in Victoria (DNRE, 1998). Methodology for measuring the key economic indicator, Gross Regional Product, has been developed by Pinge (1999). The methodology for measuring the key social indicator, Quality of Life, has been modified from other work by Ada (2000)

Answering the challenges we posed

A consultancy has recently been commissioned by the working party to validate the selection of indicators, recommend how data from indicators should be collected and distributed, what benchmarks should be assigned to each indicator, and how stakeholders can best make use of the data.

The consultants appointed are Jason Alexandra and Associates, in conjunction with Prof. Snow Barlow, Melbourne University, Francis Grey, Economist @ Large and Terry White and Associates.

The brief for the consultants is to:

1. Review how stakeholders currently use information to make planning and policy decisions and report on achievement of their social, economic and environmental outcomes.

2. Survey how individual stakeholders could use the data available from the recommended indicators for the above purposes.

3. For each draft indicator, recommend the agency to be responsible for, and describe, the collection, collation and distribution of the data, including an estimate of the cost.

4. List recommended benchmarks for each indicator, or a range of benchmarks based on location (eg the benchmark for the water quality indicator may vary at different locations along the Goulburn River).

5. Identify if and where there is significant divergence between stakeholders on the appropriate benchmarks.

6. Identify whether any expert advice suggests there will be conflict in achieving benchmarks for various indicators.

7. In light of the review and survey above, recommend strategies and specific actions that will help:

  • individual stakeholders add value to their business practices by using data from the indicators to report on achievements, develop policy and plan strategically.
  • all the stakeholders review their programs and share decisions on the actions they should take to ensure sustainable regional development is achieved for the region.

1. List strategies how the working party can convince stakeholders of the benefits of the above, so that they are willing to provide financial support where appropriate and share decision-making. This is to include demonstration of a case study as mentioned above.

2. On the basis of discussion with stakeholders, recommend a final list of indicators to be used based on agreed cost effectiveness and value for contributing to decision making.

The consultancy will be completed in mid September.

Expected Benefits Of The Project

One of the challenges for this project is for the processes recommended to gain the support of stakeholders, and be practical and cost effective to implement.

If this occurs it can provide a template for the systems needed to identify, generate, report on, interpret and act on data from robust indicators of environmental, economic and social processes and performance, which can then be used in other regions.

There will be significant benefits to individual stakeholders. Most at present are, at best using “surrogate” indicators that tend to measure outputs, rather than outcomes. Use of the indicators finally chosen, where relevant to a stakeholder, will provide better information for strategic planning, prioritising of projects, and statutory, or accountability, reporting. This will lead to more efficient use of both financial and human resources, as well as improving transparency of performance to customers and/or clients.

Using the information from all the indicators in an integrated way provides the best opportunity to achieve holistic sustainability in a region. No stakeholder acting alone is powerful enough to obtain the correct balance between economic development, maintenance of environmental values and social wellbeing. There will be a better return of investment in resources if stakeholders with similar programs agree that program priorities lie in agreed areas. Mechanisms that encourage collaboration and cooperation will be identified.

Continually monitoring the same indicators will progressively provide trend information at a regional level for the first time, which will provide stakeholders with the objective data needed to be more persuasive in development and debating of policy at the State and National levels. This will also allow the whole community to be more informed about their own environment and contribute more effectively to these debates.

Communication Of The Results

A seminar will be conducted for stakeholders by the consultants after their final report is approved by the working party. Any agreements on collaborative action, which arise from this seminar, will be widely communicated within the North East regional community.

A paper outlining the outcomes of this project will be prepared for an appropriate conference in the future.


Ada I, (2000) “Recommended Method for Developing a Quality of Life Index” Unpublished paper, Department of Natural Resources and Environment, Seymour

Alexandra J, Higgins J, and White T (1998) “Environmental Indicators for National State of the Environment Reporting – local and community uses”. Environment Australia, Canberra

Cobb C, Goodman, G S, Wackernagel M (1999) “Why bigger isn’t better: The Genuine Progress Indicator – 1999 Update” Redefining Progress

Department of Natural Resources and Environment (1998) “Proposed Catchment Indicators for Victoria”, December 1998, Catchment and Water Division, DNRE

Eckersley R (1999) “Quality of Life in Australia – An analysis of Public Perceptions” The National Centre for Epidemiology and Population Health, Australian National University. Discussion Paper No. 23, September 1999. The Australia Institute Ltd., Canberra

Forbes P (Personal Communication) Team Leader, Catchment Information and Evaluation, Catchment and Water Division, Department of Natural Resources and Environment, Epsom

Hamilton C (1997) “The Genuine Progress Indicator - A New Index of Changes in Wellbeing in Australia”. Discussion Paper No.14, October 1997. The Australia Institute Ltd., Canberra.

Headey B (1981) “The Quality of Life in Australia” Social Indicators Research 9 pp 155 – 181

Pinge I (1999) “Regional Economic Modelling, Gross Regional Product and Impact Analysis” August 1999. Unpublished paper, Centre for Sustainable Regional Communities, Latrobe University, Bendigo

Standing Committee on Agriculture and Resource Management (1999) “Managing Natural Resources in Rural Australia for a Sustainable Future – A discussion paper for developing a national policy”. National Natural Resource Management Task Force, Natural Resource Management Policy Division, Agriculture, Fisheries and Forestry – Australia

State of the Environment Advisory Council (1996) “Australia: State of the Environment 1996”. CSIRO Publishing, Melbourne

1 An indicator is a significant physical, chemical, biological, social or economic variable that can be measured in a defined way for management purposes (eg percentage of landholders participating in Landcare groups).

2 A benchmark is the level set for a particular indicator, against which performance is measured (eg 80% for the above indicator)

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