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A Wonbindi coal mine in Queensland was subject to an infringement notice following the national audit.

One in seven projects using environmental offsets under the Environment Protection and Biodiversity Conservation Act had either clearly or potentially not complied with their approval conditions,the audit found,based on analysis of 222 projects.

A separate phase of the national audit studied another 120 projects and found one in four had potentially failed to secure enough environmental credits to offset the damage they were doing.

The environmental offsets system is a set of rules that allows companies to compensate for damaging the natural environment by paying to protect something of equivalent or greater environmental “value” in a different place. Offsets can be used only if planners decide the damage can’t be avoided in the first place.

Environment Minister Tanya Plibersek said the findings of the audit were “completely unacceptable”.Credit:Alex Ellinghausen

Most of the projects using offsets involve large-scale housing developments,mines,gas fields or road construction.

The audit,commissioned in June last year and set to be distributed to stakeholders on Monday,showed that in many cases,developers had not followed through on their commitments.

“It’s completely unacceptable that around one in seven developments could be in breach of their offset conditions,” Plibersek said.

“When developers agree to offset the environmental impacts of their projects,they are making a legally enforceable commitment to protect nature. If they break that promise,they will face the full force of the law.

“I commissioned this audit after hearing very concerning stories of offsets projects being bulldozed and degradation of habitat that should have been providing homes for threatened species. But now,for the first time,we have the compliance data and we are cracking down.”

Many of the projects identified as potentially breaching the rules are still being investigated and the compliance campaign is ongoing.

So far,six infringement notices and relatively small fines have been issued to five entities,and 13 projects have been subject to a “directed variation”,meaning they must change how they operate to become compliant.

Among those fined are gas exporter Australia Pacific LNG for failing to carry out work managing conservation areas for koala,greater glider and squatter pigeon breeding habitat.

FQM Australia Nickel was fined for failing to implement a plan to protect the heath mouse and the western whipbird and to rehabilitate cleared land,and Queensland’s Wonbindi Coal project was fined in relation to land clearing at Zamia Creek,a wetland area near Mackay.

Corporations were not the only entities caught up in the audit. Gunnedah Council was found to have breached the rules during a flood mitigation project that was required to plant 500 trees for koala habitat.

The offsets system has been operating in its current form since 2012,but this is the first time the government has completed a comprehensive audit of how the system is working.

Plibersek said reforms under way to address the problem included a dedicated audit team within the Department of Climate Change,Energy,Environment and Water.

Under legislation due to come before federal parliament within weeks,the government wants to set upEnvironment Protection Australia,an independent national watchdog agency with the power to issue “stop work” orders on non-compliant projects.

“I’ll issue the EPA with a statement of expectations and ask them to focus on illegal land clearing and offset conditions as a priority,given the findings of the audit,” Plibersek said.

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