in Australia, Indonesia

“This project has been a total failure,” says Australian Senator Christine Milne about the Kalimantan Forests and Climate Partnership

When it was launched in 2007, Australia’s Kalimantan Forest Carbon Partnership was going to be “practical climate change action that could deliver immediate and tangible benefits”. But five years later, the project has little more to show for the A$30 million spent than 50,000 tree seedlings planted.* That’s 0.05% of the target of 100 million trees.

Not surprisingly, there is an increasing amount of debate in Australia about the project. In March 2012, Erik Olbrei and Stephen Howes, two academics at the Australian National University, put out a discussion paper with three main findings:

  1. KFCP objectives “have been quietly but drastically scaled back”. The area of peat swamp to be re-flooded, for example, is only 10% of the original target. The objectives were scaled back because the original targets were unrealistic and the funding for the project was less than expected.
  2. Progress on the ground has been slow. Blocking of major canals has not yet started, only 50,000 tree seedlings have been planted, work on measuring emissions reductions is incomplete, and baseline emissions have not been defined.
  3. “[D]eforestation and peatland conversion continue at a rapid rate in Indonesia.” Oil palm plantations are spreading, including in the ex-mega rice project. (KFCP is located in a small part of this failed Suharto-era plan to convert one million hectares of peatswamp forest to rice fields.)

(There is a response from Jonathan Pickering, a PhD student at ANU, and a discussion with Olbrei and Howes, here.)

Also in March 2012, AusAID published an Independent Progress Report (IPR) on the Indonesia-Australia Forest Carbon Partnership, of which the KFCP is part. The report concludes that,

KFCP has made some good progress, but it is likely that the KFCP objective of demonstrating effective and equitable approaches to REDD+ will be only partially achieved by mid 2013. Uncertainties remain in relation to the adequate scale of activities to confirm the model and the timeframe required; institutionalising an effective payments mechanism; processes for up-scaling and informing policy development; donor coordination; and building broad based capacity and integration with Central Kalimantan pilot province activities and district work- plans.

The report also states that a second Australian-funded REDD project in Jambi province, Sumatra, “may not be the most effective utilisation of available funding”, and suggests “re-consideration” of the proposed project.

On 21 May 2012, the leader of the Australian Green Party, Senator Christine Milne asked a series of questions at a Senate Committee hearing. Climate Change department secretary Blair Comley explained that one of the problems was that “land tenure issues have been more complex than first thought”.

The discussion is posted below, and the full session is available here (pdf file, 1.2 MB) – the other people answering questions are Robert Owen-Jones, Acting Chief Advisor, International Division, and Shayleen Thompson, First Assistant Secretary, Land Division, both from the Department of Climate Change and Energy Efficiency. Senator Milne also asks about Australia’s REDD project in PNG and about the overall progress of the international REDD negotiations (without receiving any satisfactory answers).

On 31 May 2012, a further series of questions from Senator Lee Rhiannon of the Green Party were answered by Jean-Bernard Carrasco, Assistant Director General, Climate Change and the Environment Branch. The article in the Sydney Morning Herald, that Senator Rhiannon refers to is here. The discussion is posted below, and the full session is available here (pdf file 1.0 MB).



Monday, 21 May 2012
Senator MILNE: I will switch to another question in relation to the international climate work. I go to the Kalimantan Forests and Climate Partnership. I asked a series of questions on notice about that at the last estimates. The answers show that about one-third of the $100 million has been spent and only 1,000 hectares has been replanted. I come to the Kalimantan project. It really is quite a serious issue here because this project has been a total failure compared with what was claimed for it and what has actually happened. The facts sheet said that the initial work was to avoid deforestation of 50,000 hectares and rehabilitate an additional 50,000 hectares of degraded peatland. As I said, the answer you gave me showed you spent about one-third of the $100 million and replanted just under 1,000 hectares. So it is a total failure, in other words. Can you explain to me what went wrong, why, when it started to go wrong and what this means realistically for REDD in Indonesia?
Mr Comley: I think Mr Owen-Jones is looking for some material. In broad terms, I think the issue that has been found in Kalimantan has essentially revolved around the fact that land tenure issues have been more complex than first thought and resolving the land tenure issues has taken longer than first thought. We have been working very closely both with the Indonesian government and the indigenous people of the area to try to resolve these land tenure issues. What does it mean for REDD? I think it means that until such time as further work on those land tenure issues is resolved, REDD will take longer than first thought. That is the principal reason. It is not dissimilar, in a sense, to when we have been working on the Carbon Farming Initiative here. Here we have clear land tenure. As you know, there are obligations that will be attached to the titles of properties as a way of ensuring permanence and durability. But the clarity of the land tenure situation in Indonesia has proved more problematic than first thought.
Senator MILNE: So that is where I wanted to go next. Basically, under the UN Declaration on the Rights of Indigenous Peoples, to which we are a signatory, it is very clear that the rights of indigenous people have to be guaranteed. To date, that has not happened and nor is there any clarity about Indonesia’s preparedness to recognise indigenous rights in this regard. So can I assume from that that REDD programs are not going to proceed in the short term until these matters are sorted? What is your time frame on it? What are you thinking?
Mr Comley: Mr Owen-Jones will comment and I will come back to it. Clearly, a whole range of issues need to be addressed, but I will ask Mr Owen-Jones to comment and then I will come back to it.
Mr Owen-Jones: There are two things. Firstly, this is a program that is specified administered by AusAID, so they will be able to respond to some of your questions in detail. Secondly, it is a demonstration activity. It has not been as vast as originally expected. AusAID still expects it to come to completion. One of the reasons why it has been slower than originally expected has been the interaction with the local communities.
Senator MILNE: Well, that is one way of dressing up a failure, I suppose. Can you tell me why the Australian REDD scheme in PNG was cancelled? Was that for the same reasons? Can you explain why there was no formal announcement when we pulled out of that? If the indigenous land tenure issues were not the main reason, what was? When did we pull out of the PNG project?
Mr Comley: I will have to take that on notice. I do not know off the top of my head.
Senator MILNE: Maybe I will go to Ms Thompson on this issue of REDD and progress on REDD in the international negotiations. Could you just summarise briefly where you think it is up to, because every year there is hope that REDD will be sorted and every year people come home disappointed. What is your take on where REDD is up to?
Ms Thompson: Senator, I would have been very happy to answer your question, but in fact it is Mr Robert Owen-Jones that has responsibility for that issue.
Senator MILNE: I will redirect it, then.
Mr Owen-Jones: As you know, Senator, REDD is an area of very active discussion in the negotiations. It is one of the areas that has tremendous support across all parties. It is also, as you know, an extremely complex area. So it continues to be taken forward. Australia has been very active in that negotiation and we also support the general approach towards REDD through things like the REDD+ Partnership, which we are co-chairing with the Democratic Republic of the Congo at the moment. So it continues. It is an active part of the negotiation.
Senator MILNE: So give me a time frame. Tell me where we are up to. What can we expect in Qatar?
Mr Owen-Jones: REDD, Senator, is part of the overall negotiations. That has a four-year time frame that will come to its eventual conclusion in four years. What milestones and progress can be made up until that point depends on the general dynamic in the negotiation. But the end point is in four years.
Senator MILNE: I know that. What are the barriers that people are working on at the moment? What are the active areas of dispute in these international discussions on REDD? What are the obvious ones, or the most problematic ones?
Mr Owen-Jones: I am quite happy to come back with a more comprehensive answer to that, Senator.




Thursday, 31 May 2012
Senator RHIANNON: Thank you. This month, the Sydney Morning Herald ran a report that there was a review of the Australian-Indonesian carbon programs. Was this review commissioned by AusAID?
Mr Carrasco: Yes. AusAID, as part of its normal business, does reviews of a range of programs. We had a mid-term review of the Indonesia-Australia Forest Carbon Partnership.
Senator RHIANNON: Why did it take over a year for AusAID to release the report?
Mr Carrasco: The report was released as part of AusAID’s current focus on transparency, at the same time as a whole raft of other products from the Indonesia program were also released.
Senator RHIANNON: But it was a long period of time. I understand that it had been ready earlier. Why was there a delay?
Mr Carrasco: It was not a delay. It was released at the same time as the other products for the Indonesia program were released.
Senator RHIANNON: I understand that the review calls for the Sumatra pilot to be reconsidered in light of the challenge and delays in the Kalimantan project. What is AusAID’s response to that, please?
Mr Carrasco: The government intends to work with the Jambi province, Sumatra, on climate change, but the scope of work is currently under review as a result of a number of changes, including the independent review that you have alluded to. The scope of that work is currently under consideration by the governments of both Australia and Indonesia.
Senator RHIANNON: What impact has the $1 billion investment from Norway had on all these developments?
Mr Carrasco: The $1 billion investment from Norway—and I use that term loosely, because it is based upon Indonesia’s performance—has had a significant impact in terms of supporting Indonesia’s efforts to reduce its emissions. As you know, Australia has been working with Indonesia on forest carbon for quite a while and we are constantly working in partnership with the Indonesian government to refine our work and to change it with changing circumstances. As a result of that investment we are also working closely with Norway to ensure that our work and their work matches up. For example, under the $1 billion investment they chose Central Kalimantan as the pilot province where they would be doing their work and, as this committee is aware and as you are aware, Senator, that is also where we are doing some work under the Kalimantan forest carbon partnership. So we are certainly ensuring that our work is consistent and supports Indonesia’s efforts.
Senator RHIANNON: But hasn’t the Kalimantan project that was launched five years ago been scaled back and isn’t it suffering delays?
Mr Carrasco: The area of land rehabilitated by the Kalimantan project, yes, is expected to be less than was originally announced. This has occurred for a number of reasons. Firstly, it was decided at an early stage, during the design stage, that this would be a demonstration activity and that we would not focus on the total area covered but on demonstrating the viability of various approaches which could, if successful, be scaled up. Secondly, the initial targets were based on a much larger total funding envelope of $100 million, on the assumption of additional funding from external partners, and this funding has not eventuated. So the revision of those goals and targets is not unusual for a complex aid program such as this, which needs to be flexible and responsive to the changing situations to remain effective.
Senator RHIANNON: Is there any intention for Australian aid funded REDD projects to provide carbon offset credits that could be used by Australian companies either voluntarily or as part of compliance requirements in an Australian emissions trading scheme?
Mr Carrasco: That would be a question that you would need to refer to the Department of Climate Change and Energy Efficiency, but my understanding is no.


* The figure of 50,000 tree seedlings comes from Olbrei and Howes. According to an article in The Australian, a Climate Change Department spokesman claims that the figure is 1.2 million seedlings. Which would bring the total to 1.2% of the target.

^^ Back to text

PHOTO Credit: Mott MacDonald, the company that worked on a pre-feasibility study for restoring the ex-mega rice project peatland area under the KFCP.

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  1. Oh well, it seems that it is finally dawning on the Australian authorities that going around planting loads of trees on other peoples’ land is going to do little to ‘reduce’ the country’s world-beating per capita carbon emissions. Well done to Senator Milne for asking the questions that needed asking about the KFCP.

    I’d like to make a suggestion, Chris: in 2006, Sir Nicholas Stern, former Chief Economist at the World Bank, stated in his highly influential report on the economics of climate change that “Forests offer the single largest opportunity for cost-effective and immediate reduction of carbon emissions”. I wonder whether you might be able to arrange an interview with him in order to ask whether, in the light of experience, he might like to reconsider that view, where exactly he went wrong in his thinking, and what the consequences have been?

    It would be particularly interesting to hear what he has to say about his former employer’s attempts over the last 5 years to secure these “cost effective and immediate” reductions in forest carbon emissions…

  2. Chris, thanks for your detailed coverage of developments with the Kalimantan Forests and Climate Partnership. Yes, that figure of just 50,000 seedlings planted as of February 2012 is correct. Another 1.3 million seedlings were apparently in plant nurseries at that time, as per AusAID reporting to a Senate Estimates committee on 16 February – see last page of the report here.

    As you reported, Australian government officials attributed the lack of progress on KFCP to land tenure issues, and concluded that land tenure will be a major stumbling block for future implementation of REDD. What is noticeably absent from Australian thinking on REDD in Indonesia is an appreciation of the part played by corruption, illegal logging, poor rule of law, and the oil palm, timber, and paper/pulp industries in undermining REDD. The fact is that REDD cannot succeed if these issues are not addressed. There is nothing new about any of this: the lessons from many years of failed forest sector reform efforts in Indonesia are well-known and largely applicable to REDD, and yet they do not seem to inform Australia’s REDD program for Indonesia.

    Officials also highlighted that KFCP had been re-cast as a demonstration activity. Rather than aiming to rehabilitate the whole project area, they say, the aim of the project is to develop successful approaches that could be scaled up and replicated elsewhere. That would be an excellent result if it were to actually happen. The problem is that the world of foreign aid is littered with successful demonstration projects which were never replicated. AusAID’s independent evaluation made the point that `there are already a large number of demonstration activities in Indonesia, most operating as projects outside GOI systems, with little evidence to date of them influencing policy at the national or provincial levels’. In the case of KFCP, no strategy for scaling up any KFCP successes can be found in the design document.

    The point is that at the end of the day, the measure of success of a demonstration project, or any REDD initiative, is not whether a strategy was developed, or baseline emission levels established, or a monitoring system demonstrated. The only measure that matters is whether deforestation and forest emissions in Indonesia have declined. We have not seen any such result with KFCP, nor any indication of a path by which this might happen.

    Officials answered question on progress with REDD in the UNFCCC negotiations along the lines that REDD is complex, it will take a long time, Australia is working hard, something might happen in four years time, but this all depends on the `general dynamic’. The problem with this mind-set is that Indonesia’s forests can’t wait. Indonesia, with deforestation rates by most accounts well over 1 million hectares or 10,000 square kilometres a year, now has the world’s highest rate of deforestation, overtaking Brazil, which in recent years has brought deforestation down to around 7,000 km2/year. In four years time another 5 million hectares of Indonesian forest will be gone.

    The best thing AusAID could do in relation to KFCP would be to return to the original vision and restore the entire project area. Re-flooding and re-planting the whole of the deforested southern half of the project area (Block A NW) is the only way to protect the whole area and prevent any project achievements being destroyed by fire during the next El Nino. Greenhouse emission reductions would be worthwhile in their own right, and KFCP might even successfully demonstrate how peatland restoration and possibly REDD can work. For once, local communities would receive lasting benefits from an aid project, and the hard-working local KFCP field staff would see results from their efforts. This means more money would need to be injected into the project, and AusAID would need to adopt a longer and more realistic timeframe of at least 10 years.

    In relation to the $100 million Indonesia Australia Forest Carbon Partnership, AusAID should undertake a major re-think, aimed at shifting the program from its current focus on technical issues to one that is informed by the systemic governance failures that lie at the heart of Indonesia’s deforestation problem. Such an approach could support those Indonesian agencies and civil society entities that are working hard to achieve progress on these issues.

    Erik Olbrei
    Co-author, `A very real and practical contribution: Lessons from the Kalimantan Forests and Climate Partnership’. ANU Crawford School Discussion Paper 16/2012.

  3. I’m an Australian working in Jakarta for the past 2 years. “Land tenure issues” sounds like code for the corruption that pervades Indonesian government and the poor protection of land titles that continues to hamper the country’s development generally.

    A$30m is an astonishing amount of money spent on a mere 50,000 seedlings in a country with such low labour costs. Where exactly has this money gone?