Allocation of Costs and Benefits in the Water Framework Directive: A Dutch Exploration - Water and Agriculture: Sustainability, Markets and Policies - page 36

3.1 Social cost benefit analysis and WFD
The costs and benefits of the implementation of the WFD are central to the SCBA
that is being executed in the Netherlands to aid WFD implementation. Where possible the
benefits should be expressed in monetary terms to facilitate comparison and balancing of
the costs. There are benefits that are difficult to express in money, such as nature and
landscape values (see above), but also benefits that are not expressed in money at all in
SCBAs like progressiveness, equal distribution of burdens, etc. Insight in the distribution
of the burden between sectors is, however, an important aspect. When considering major
trends in local charges at national level or maintaining a level playing field for business
sectors throughout the country, it is important that the decisions taken by regions and the
provided information is to some extent comparable. The selection and balancing of
measures based on cost-effectiveness (giving priority to the most cost-effective), as
required by the WFD, means that the cost-effectiveness of regional measures is in part
determined by local or regional circumstances.
To determine which measures are required to achieve the objectives of the WFD, a
suitable approach would be to combine various measures into policy scenarios. The
measures in the policy scenarios are subsequently evaluated in the SCBA for their
effectiveness per euro (in the cost-effectiveness analysis) and the social costs and benefits
(in the SCBA). The most cost-effective measures end up in programmes of measures. The
elaboration reveals how far the different programmes of measures go towards achieving
the objectives in a certain policy scenario. The elaboration and analysis of these policy
scenarios would provide insight into the extent to which the objectives are met, and the
total costs. In an SCBA the social impact is made visible. Policy scenarios thus offer the
basic information required to determine which line of policy is preferable and what
political decisions have to be made. This step is necessary to come to a pragmatic
implementation of the WFD and is preferred by the ministry of Agriculture, Nature and
Food Quality. A number of policy scenarios have to be compared in terms of achieving
objectives and social consequences (feasibility and affordability). This analysis is meant
as an exploration in which the present situation (= current situation including established
measures in current policy) is compared with a situation in which a maximum of WFD
objectives is achieved (100% realisation), not focussing directly on
(regional/personal/sectoral) desirable outcomes. It should be prevented that some sectors
are discarded beforehand because measures would be too expensive.
The measures included in the policy scenarios must, according to the WFD, be based
on the prioritising criterion of cost-effectiveness. When working out the costs and
benefits for the SCBA at national level, the state makes use of the (cost-effective)
programmes of measures drawn up by the regions. This is so that it can adequately
evaluate and weigh up the effects of generic and regional measures in relation to each
other, and also to facilitate analysis at national level in an SCBA. This gave rise to the
idea of elaborating a number of matters clearly at national level and using the results
universally as the basis for regional explorations. At the same time it is important to
ensure that there is proper scope for regional diversity. Each policy scenario would have
to consist of generic and region-specific measures. A national framework with generic
measures at regional level can have varying results for different themes and target groups.
For example, generic manure policy has different effects at regional level depending on
land use, soil properties, hydrology etc.