3.2.1 Net public and private benefit
Pannell( 2008) presented some rules that could be applied by decision makers to guide the selection of incentives. This is often referred to as the Public Private Benefit Framework( PPBF). In this framework, policy mechanisms are organised into five categories.
Pannell’ s( 2008) Public Private Benefit Framework( PPBF) incentive categories
� Positive incentives – financial or regulatory instruments to encourage change( financial payments, required standards or codes of conduct);
� Negative incentives – financial or regulatory instruments to inhibit change( taxes, fines, required standards or codes of conduct);
� Extension – technology transfer, education, communication, demonstrations, support for community networks;
� Technology change – development of improved land management options such as strategic research and development( R & D), participatory R & D with landholders, provision of infrastructure to support a new management action; and
� Informed no action.
The choice between the mechanisms depends on the level of private and public net benefits from the proposed land use change. 8 Private net benefit refers to the benefits minus the costs accruing to the private landholder as a result of making the land management change. Public net benefits refer to the benefits minus the costs accruing to everyone other than the land manager as a result of the land management change. Applying the PPBF( Pannell, 2008) present 10 rules for incentive selection:
Applying the PPBF to incentive selection
� Do not use positive incentives for land use change unless public net benefits of change are positive;
� Do not use positive incentives if landholders would adopt land use changes without those incentives; � Do not use positive incentives if private net costs outweigh public net benefits; � Do not use extension as the main tool 9 unless the change being advocated would generate enough positive net private benefits such that it is sufficiently attractive to landholders for them to change. That is, the practice is sufficiently adoptable for the adoption to continue if the extension ceases;
� Do not use extension as the main tool where a change would generate negative net public benefits;
8
It is important to understand that these principles should not be used to rigidly but be used as a guide only and that risk, uncertainty and temporal aspects of practice change need to be considered as well.
9
It is likely that extension is used as a supporting tool for most other form of incentives. Rules 4 and 5 refer to extension as the main tool.
26 | Landholders driving change: Exploring new incentives