More green, more gold

As the federal budget looms and global uncertainty takes hold, the usual debates over spending priorities are heating up. But amid the talk of deficits and belt-tightening, one of Australia’s most valuable assets risks being overlooked yet again – our natural capital and unique environment.

From the Great Barrier Reef to the bushlands of the interior, Australia’s natural environment and the resources it provides are more than a national treasure; they are the cornerstone of our economy.

A recent Nature Economics Report from the 30By30.org.au campaign found that nature contributes more than $511 billion to the Australian economy each year. That’s nearly 20% of our GDP, on par with the mining and finance sectors combined.

This value isn’t just from creating jobs in conservation. Nature generates income in its own right – through tourism, agriculture, and fisheries – and underpins the productivity of other sectors by providing clean water, fertile soils, pollination, and climate regulation. It also saves money by reducing disaster recovery costs and protecting infrastructure from floods, fires and storms. In short, nature is not just beautiful – it’s economically indispensable.

Yet despite this staggering contribution, investment in protecting and restoring our natural environment receives just 0.1% of the federal budget. That’s not a typo. For every dollar we spend on nature, recent analysis found in the ALCA Nature Spend Tracker shows we spend 17 on subsidies that actively harm it.

The result? Australia now holds the unenviable title of one of the world’s worst-performing developed nations on biodiversity loss, with an estimated 17 ecosystems on the brink of collapse.

This is not just an environmental crisis, but an economic one for current and future generations.

Our natural systems provide essential services that underpin everything from agriculture and tourism to public health and disaster resilience. Wetlands filter our water. Forests store carbon and trees cool our cities. Shellfish reefs and mangroves underpin commercial fisheries and act as natural seawalls, buffering communities from storm surges and erosion and keeping our water clear and swimmable. Compounds discovered in plants and animals even account for 30 percent of new medicines.

When we neglect these systems, we don’t just lose species, we lose productivity, safety, national resilience and billions in economic value. We lose what makes us unique, we lose our identity.

The good news is that investing in nature pays off. The recent Nature’s Dividends report by The Nature Conservancy in the US analysed more than 1,500 studies to find that conservation delivers an average return on investment of 4:1. While those results are from the US, the picture is very similar in Australia. It’s a cost-benefit ratio that makes our large infrastructure projects look deficient. These benefits extend to all of us; urban, regional and rural, coastal and inland.

Every dollar spent on restoring forests or wetlands can save up to $7 in disaster recovery costs. In Australia, modelling shows that increasing nature investment to just 1% of the federal budget could boost annual labour productivity growth by over 40% – a return that rivals the most ambitious economic reforms.

This isn’t just about protecting koalas or coral reefs (though we should). It’s about safeguarding the natural infrastructure that supports our economy and way of life in a world of rising climate risks and geopolitical uncertainty.

Internationally, some governments are waking up to this reality. The European Union is embedding sustainability into its industrial strategy, using green investment to drive energy independence and supply chain sovereignty. New regulations, such as the Carbon Border Adjustment Mechanism (CBAM), are already requiring exporters to meet strict standards. If Australia doesn’t keep pace, our producers risk being locked out of key markets.

So what’s the solution?

First, we need to stop treating conservation as a luxury. The upcoming budget is a chance to reset. A commitment to invest 1% of the federal budget in nature – around $3-4 billion annually – would be a solid start. This funding could support large-scale restoration projects, green our urban spaces, expand protected areas, help farmers and Traditional Owners manage land for biodiversity and carbon and create jobs, jobs, and more jobs across this vast continent that people actually want to do.

Second, we must unlock private and philanthropic capital. Public investment and clear planning and policy in what I call the ‘restoration economy’ must act as a catalyst, giving businesses and investors the confidence to back nature-positive projects. Australia’s emerging Nature Repair Market could be a step in the right direction, but it needs scale and certainty to succeed.

Finally, we need to embed nature into our economic thinking. That means valuing natural capital in our national accounts, bringing nature into our boardrooms, reforming nature-negative subsidies that incentivise environmental harm, and ensuring that every major policy – from infrastructure to trade – considers its impact on our valuable ecosystems.

The question isn’t whether we can afford to invest in nature. It’s whether we can continue to afford not to, and whether we think it’s fair that our children and grandchildren bear the cost.

Australia has a choice. We can continue down the path of environmental decline, with all the economic and social losses that entails. Or we can lead the world in building an economy that recognises conservation not as a cost, but as the smartest investment we can make.