Assessing the Social and Economic Impacts of Coal Mining on Communities in the Bowen Basin: Summary and Recommendations

[Extract] Executive Summary 1.The Centre for Social Science Research at Central Queensland University has conducted a research project funded by the Australian Coal Association Research Program (ACARP) from March 2004 to March 2006. 2. The broad aim of this project was to assist coal mining companies develop effective processes for engaging with their communities and developing impact assessment and planning processes that can be agreed by their stakeholders. The focus of the project has been in three key areas: (a) demonstrating that assessment of social and economic impacts can occur at any stage during the life of mine operations, (b) developing new tools for the assessment of social and economic impacts, and (c) comparing the impacts from mining between mining-focus and rural-focus towns. 3. Social and economic impact assessment is an important component of environmental planning and project approvals processes in Australia. While the EIS process remains important for the assessment of new projects, it does not cover all the economic and social impacts of mining on regional communities. Key deficiencies include the lack of assessment for: (a)Economic and social impacts that occur after the approvals stage, (b)The economic and social impacts of changes in the scale of operations, such as those influenced by commodity cycles, (c)The cumulative impacts of multiple operations on communities, and (d)The impacts of wind-down or closure of mines on communities. 4. Other issues with impact assessment relate to the potential lack of consistency between different studies, and the failure to follow-up and check many of the predictions that are made. 5. The development of sustainability indicators and annual reporting mechanisms that many companies are voluntarily adopting are welcome. However, there are opportunities to better align these with more comprehensive assessments of economic and social impacts, and to use regular social and economic impact assessment procedures as inputs into sustainability reporting. 6. The traditional approaches to social and economic impact assessment are to use stakeholder analysis for the former and economic impact modelling (input output analysis) for the latter. Social impact assessment is enhanced with the involvement of communities in negotiation and decision making stages, but these stages are often not included. In a similar way, economic impact assessment rarely goes beyond a desktop analysis of impacts into a consideration of either net welfare effects or opportunities to increase economic development. The outcomes of most impact assessment exercises are separate assessments of social and economic impacts that are limited and not congruent. 7. Opportunities exist to develop new tools for assessing impacts and gaining involvement with communities. Two key mechanisms that have been identified are choice modelling and experimental workshops. 8. Choice modelling can be applied by giving community members sets of options for different development outcomes or mining impacts on their community, where there are typically some offsetting influences. Analysis of the choices that people make gives insights into both preferences for community development and trade offs between different social and economic impacts from mining. 9. Experimental workshops can be applied with small groups of community people where they might be asked to participate in small 'games' or experiments. These might be focused on different development options for communities or different mixes of social and economic impacts from mining. The analysis of choices that people make provides some indication of both preferences for community development and trade offs between different social and economic impacts from mining. 10.The choice modelling and experimental workshop tools share some elements of social impact assessment in that they involve participation from community members, focus on a number of demographic and social impacts, and provide feedback about participants' preferences. They also share some elements of economic impact assessment in that they give more quantitative feedback about the strength of preferences and often evaluate them in monetary terms. 11. The choice modelling and experimental workshop tools do not replace the traditional impact assessment approaches of structured interviews and economic modelling. Instead, they are better viewed as complements to the existing set of tools. 12. The use of choice modelling has been demonstrated with an analysis of workforce mobility associated with residents of Blackwater. The results identify the contribution of different factors to choices about where people might locate to, and the salary premiums that might be involved in moving them to different locations. 13. The use of four different impact assessment tools has been demonstrated in two case study applications in this project. One case study has focused on assessing the impacts of mining on Blackwater, a predominantly mining service town. The other case study has focused on assessing the impacts of mining on the Bauhinia Shire, a predominantly agricultural shire where mining activities are just starting up. Each case study involved the application of stakeholder analysis, input output modelling, choice modelling and experimental workshop assessment tools. 14. There is a great deal of consistency in the results from the different techniques. For example, the positive impacts of mining on employment and economic growth was consistently identified, as was the importance of health services in future community development. 15. Each of the tested techniques provided different insights into the types of impacts on communities. As expected, stakeholder analysis provided a rich data set about the variety of impacts but little guidance about the priorities or strength of community preferences, while the economic modelling provided some understanding about the changes in economic activity without much understanding of community impacts. 16.There was a tendency with stakeholder analysis for negative impacts to be emphasised, while the economic modelling focused on net positive impacts. In contrast, the alternative assessment provided more guidance about prioritization and how communities viewed trade offs for future development, but without the rich detail of the stakeholder analysis or the predictions of net economic impacts available from economic modelling. 17. The application of the choice modelling technique revealed some particular benefits not available with the other options. The use of a survey allowed data to be collected from large (and random) sample of community members, gaining input from many more people. In many cases, the application of this technique was more inclusive. As well, it was possible in the survey format to collect data on a very wide range of issues in ways that allowed more quantitative analysis. This was particularly the case for the results of the choice modelling analysis, where the priority trade offs for key issues could be expressed in monetary terms. 18. The experimental workshops had particular value in understanding how group feedback might change priority setting, and allowing participants to get feedback about how their preferences or allocations to future community development might contribute to a pool of community preferences. The combination of a group workshop setting with experimental feedback loops made this technique more appropriate to work through potential options for community development and understanding how individual preferences may change with information feedback. 19. The analysis in the two case studies identified some significant differences between the two communities. While mining was generally viewed in positive terms because of the economic and demographic impacts, there were varying levels of concern about different economic and social impacts. The differences between the two communities indicates that dealing with impacts needs to be tailored to specific community characteristics and issues.