The implications from the findings are that regulation and voluntary action are not ideal policy vehicles because they are likely to be ineffective. It is clear from the analysis that the status quo is not an option. Voluntary action coupled with incentives is likely to result in an inequitable outcome and involve high costs.
Therefore the two remaining viable options are a market mechanism to trade contaminants and self-management of catchments coupled with penalties for non-compliance. It is considered that self-management would be more effective than the creation of a trading mechanism because self-management is likely to involve greater adoption of mitigation measures. A market trading mechanism is focussed on the trading of allocations for contaminants as opposed to undertaking mitigation measures so it is unlikely to be as effective in terms of the degree, extent and rate at which mitigation measures are expected to be adopted by farmers.
In terms of equity a self-management approach could led to an inequitable outcome in instances where people are obligated to undertake action to remedy a problem even though it was caused by someone else. The same idea applies to a market trading mechanism in that all farmers face a cap on nutrients even though some may have been responsible users in the past. The difference is that in a market mechanism farmers would not be compelled to undertake action compared to a self-management approach where farmers would be required to adopt measures.
Overall it is considered that a self-management catchment approach coupled with penalties for non-compliance is preferable to a market mechanism to trade contaminants. This is because it is likely to be more effective in achieving the desired outcomes and is more cost effective than the establishment of a market mechanism. Admittedly, self-management is potentially more inequitable than a market mechanism but it is considered that this will only be the case for a few individuals. The implications derived from the analysis may need to be modified as further information is available. Particularly in relation to the effectiveness of market mechanisms which trade nutrients.