Measuring net community benefit in planning:
an economist’s perspective

1100-1230, Friday 28 May
Room E2 & E3

An overarching goal of planning is to improve the welfare of the community, now and in the future. This aspiration is often embedded within state and territory planning legislation as an objective of maximising ‘net community benefit’.

While there is little doubt maximising welfare is the intended outcome of our planning and design policies, there is little guidance for planners on how ‘net community benefit’ should be assessed or measured. As a result, a range of ad hoc and idiosyncratic approaches are used. These assessments are often subjective, apply random weightings to the various considerations, and struggle to compare short-term vs longer-term impacts meaningfully.
Importantly, the net community benefit generated by major infrastructure projects, economic policies or other government programs is routinely assessed using the cost-benefit analysis (CBA) methodology. CBA, also referred to as social cost-benefit analysis, is not – as many assume – just a form of financial analysis but is concerned with the full range of social, environmental and economic costs and benefits affecting communities.

SGS has routinely and successfully applied the CBA framework when evaluating a wide range of planning and design policies and would welcome the opportunity to demonstrate the virtues of this approach to other practitioners and bureaucrats.

Through the workshop, we will show how CBA can provide a rigorous, transparent and reliable methodology for assessing the merits of planning and design policies. With a better understanding of CBA, planners will be better placed to guide policy and decision-making that will maximise community welfare.

CBA requires some basic understanding of economics but, at its core, the framework requires vision, logic, data gathering, and measurement – competencies that are the natural domain of planners.

We propose to provide a 90-minute training session that will provide planners with an understanding of the central tenets of CBA, and some basic skills to assess net community benefit. We propose the following format:

§Planning and economic fundamentals (5 mins)
§Overview of cost-benefit analysis (15 mins)
§A step-by-step guide to assessing net community benefit (25 mins)
§Case studies of net community benefit assessment (15 mins)
§Techniques for valuing the impacts of planning and design policies (10 mins)
§Limitations of CBA and alternative evaluation techniques (5 mins)
§Discussion and Q&A (15 mins)

Target audience:
The workshop will be aimed at planners that want to understand how net community benefit can be measured and assessed using a range of accepted evaluation techniques. We would anticipate attendees will be interested in gaining a better understanding of the meaning of the term ‘net community benefit’, how it can be measured, and how objective evaluation can be used to promote a suite of policies that optimise community welfare.


Andrew Spencer

SGS Economics and Planning

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James Atkinson

Deicke Richards

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