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Mining project’s economic impact on local communities, as a social determinant of health: A documentary analysis of Environmental Impact Assessments

Abstract

Australian mining developments cause indirect economic impacts on nearby communities leading to poor health and wellbeing of local residents. Economic instability is a recognised social determinant of health (SDoH), however SDoHs are rarely considered in Environmental Impact Assessments (EIAs). This is a policy instrument used to assess impacts of major infrastructure projects for development approval. This research aimed to determine the extent economic impacts as a SDoH are considered in three Environmental Impact Statements (EISs) of mining projects in the New South Wales, Australia.

We adopted an exploratory case study design following (Yin 2012). Three cases were purposively sampled as being of concern to the local community who had sought legal advice about the content of the EIS (although not necessarily for health reasons). Two were in the Hunter Valley and open cut mines (Watermark and Warkworth Continuation) and the third is a comparative case in the Liverpool Plains and an underground extension (Mandalong). We adapted a generic health focused EIA coding framework to investigate how economic indicators as SDoH were explicitly mentioned in EISs, and applied this to the three cases.

Economic indicators as SDoH were rarely considered. There was a greater focus on population characteristics rather than the potential economic impacts of the mining projects on the communities. Causal association of economic determinants and health outcomes were insufficiently reported compared to best practice, and health data was not used to inform assessments. Despite two EISs – Warkworth Continuation and Watermark – associating some economic indicators to health outcomes, impacts were not adequately discussed when compared to the known literature on economic impacts of mines.

Our findings show that the three EISs were inadequately utilised to determine economic impacts of mining projects on the health and wellbeing of local communities. The evidence base linking economic impacts of mines to health is underdeveloped, which compromises assessing the quality of economic coverage in EISs. EIA scoping should enable sufficient inclusion of broader determinants of health using appropriate methodology, and the economic-focused content of EISs should be subject to rigorous peer-review process to fully inform government approvals for projects.

Keywords

Mining, Environmental Impact Assessment, EIA, EIS, Economic impacts, Social determinants of health

1. Introduction

1.1 Detrimental economic impacts of mining, EIA, and health

Australian mining developments cause indirect economic impacts on nearby communities leading to poor health and wellbeing of local residents.(1) Key health outcomes caused by flow-on effects from mining projects include poorer physical, psychological, and cognitive functions from sustained economic hardship(2, 3), and solastalgia, a term referring to the distress induced by environmental change(4). The causal pathways of mining developments on negative health outcomes are summarised in Figure 1. A simplification of the scenario is mining developments typically cause an influx in population due to out-of-region mining employees moving closer to work. This leads to an increase in demand for housing and rental properties in communities with insufficient housing supply and inadequate property development(5, 6), causing an increase in housing prices. Population influx concurrently leads to an increased cost of living (defined as inflation at the local level) due to mining workers on higher salaries contributing to the local economy, and also small businesses struggling to retain employees as they migrate to high-paid mining jobs. These factors result in significant financial stress placed on many local residents, whereby some are forced to move out(6), and many more suffer negative health outcomes.(2)

This is of great concern for vulnerable residents in the community as indirect health outcomes from mining development exacerbate pre-existing socioeconomic disparities and income inequalities.(1) Further, mining developments create dualisation in local communities where a large divide wedges between those on high salaries working for mining companies and residents who do not work for mining companies on low uninflated wages.(6, 7)

Figure 1. Causal pathway of mining development indirectly influencing health outcomes of local community residents through indirect economic factors, based on published literature. (↑ means increase, ↓ means decrease).

1.2 Economic impacts as social determinants of health and EISs

Economic instability is a recognised social determinant of health (SDoH)(1); a term referring to social, economic, and political circumstances creating an environment which impacts the health and wellbeing of an individual.(8) Assessment of how mining projects impact surrounding environments is conducted through the policy mechanism of Environmental Impact Statements (EISs); however, SDoH are rarely or inadequately considered.(9) These reports are used to inform decision-makers in state-governments to approve major infrastructure projects, but tend to overlook the developmental project’s causal influence on local resident’s health outcomes or perpetuating socioeconomic inequalities. Previous research has only focused broadly on how and why health is considered in EISs.(9) Therefore, as part of a larger research project, a narrow focus on economic impacts as SDoH will be taken to conduct a documentary analysis of New South Wales (NSW) mining project’s EISs including appendices. Three cases were purposively sampled as being of concern to the local community who had sought legal advice about the content of the EIS (although not necessarily for health reasons). Two were in the Hunter Valley and open cut mines (Watermark Coal Project(10) and Warkworth Continuation(11)) and the third is a comparative case in the Liverpool Plains and an underground extension (Mandalong Southern Extension)(12).

1.3 Background of mining projects

The Mandalong Southern Extension project is in the Lake Macquarie Local Government Area, and is an extension of a current underground coal mine. Operations commenced in 2005 by Centennial Mandalong Pty Ltd, and after the proposed extension would employ 420 full-time employees. The EIS is considerably smaller compared to the Warkworth Continuation and Watermark EISs. (do I need to say how many pages or something quantitative?)

The Warkworth Continuation is operated by Warkworth Mining Limited and located in the Hunter Valley region, north-east of Bulga and south-west of Singleton. The EIS is for a continuation of the project from 2015. At the time of the EIS, around 1200 employees worked for the mining company and the EIS proposed an additional 57 full-time people would be employed.

The Watermark Coal Project operated by the Shenhua Group, is in the Liverpool Plains catchment of NSW, within the Gunnedah Local Government Area. It commenced in 2008 and expects to hire up to 600 employees at the peak of the project. The EIS is considerably larger than the Mandalong and Warkworth Continuation EISs.

2. Methodology

This research aimed to determine whether economic impacts of mining developments on local communities were considered as a SDoH in the EISs. This includes recognition of financial stress and economic instability of non-mining workforce residents as a contributor to poor mental health outcomes. Documentary analysis of selected EISs was conducted by applying established social science methods.(9, 13) This is one aspect of a broader body of research investigating health in EISs of major infrastructure projects as part of the EA process.(14) Additional research including stakeholder interviews is congruently undertaken to gain an in-depth understanding of health considerations in EIAs.

2.1 Multiple Case Design

An explanatory case study design was adopted following Yin (15), to enable comparative analysis of how and why phenomena occur by recognising similarities and differences across case studies.(13) The three selected cases were purposively sampled, with inclusion criteria including the EIS being publicly available for a proposed NSW mining project; the EIS was dated within the last 5 years; a preliminary screen of EISs found health was included; and an EDO verification that the mining project was of concern to the local community who had sought legal advice about the content of the EIS (although not necessarily for health reasons). Is this right?

2.2 Data Collection
EISs were publicly available and sourced from government register of major projects. Include link – http://www.majorprojects.planning.nsw.gov.au is this the link?

2.3 Data Analysis

A comprehensive health focused coding framework was adapted from previous research and applied to the three cases using NVivo software (see Appendix 1).(9, 13) The framework was designed to effectively assess the inclusion of health explicitly and implicitly in the EISs by integrating work the research team previously conducted(9), as well as necessary requirements recognised for impact assessments to include health(16), and best practice approaches to include health in EISs.(17) Coding and analysis was also informed by a framework designed to determine how social determinants of health are included in policy documents.(18)

The existing framework was modified for this research to encompass how economic impacts are framed and conceptualised in EISs as SDoH. Hence, ‘a priori’ codes were included based on known economic indicators as SDoH(19) and common themes which arose in published literature as determined through a scoping rapid literature review. ‘A posteriori’ codes were added during the preliminary analysis of EISs; for example, the terminology used instead of dualisation in the EISs was ‘two-speed economy’ and this term was used when searching other documents.

There are three steps of the EIS coding framework. Firstly, the EISs were searched using the selected search terms. Secondly, these terms were reviewed to assess the broader context of their inclusion and compared against best practice approaches to the technical inclusion of health in EIS, specifically in relation to economic impacts, to determine whether ‘community health baseline profiles’, ‘causal pathways’, ‘health data and evidence’, and ‘health equity’ were identified and discussed. Finally, after coding the documents, discourse analysis of EISs was guided by questions pertaining to language, pre-suppositions, and intent or purpose of documents.(20)

“Theory/calculation
A Theory section should extend, not repeat, the background to the article already dealt with in the Introduction and lay the foundation for further work. In contrast, a Calculation section represents a practical development from a theoretical basis.” – the author guidelines mentions this, unclear if it must be included

3. Results

Documentary analysis of the EISs demonstrated the inadequate inclusion of economic indicators listed in the coding analysis framework, and the health outcomes related to the economic impacts are rarely and insufficiently included (as shown in Table 1). The term ‘insufficient’ is used if economic indicators were identified but not discussed, or only mentioned in community consultation or stakeholder engagement. There were distinct differences across the cases, where the Mandalong EIS mentioned economic indicators the least, and did not relate them as SDoH, and the Watermark EIS considered economic indicators the most, and as SDoH.

Table 1. Comparison of case studies using coding analysis framework for investigating economic impacts as a SDoH in EISs.

3.1 Mandalong EIS

The Mandalong EIS did not explicitly mention the economic indicators of cost of living, dualisation or two-speed economies, housing affordability, or the out-migration of residents. The EIS mentioned the economic indicator of population influx into the community as unlikely to occur, due to their expectations of employing local residents, as outlined in the Social Impact Assessment (SIA), although this is not substantiated. This economic indicator was not linked to health in any way. Other economic indicators were implicitly mentioned. For example, the Economic Impact Assessment alluded to cost of living, when they discuss higher disposable incomes of mining employees fuelling increased consumption activity in the regional economies. Also, employment diversity in the region was reported in the ‘Population Characteristics’ section in the SIA, however this was a scoping assessment and did not mention mining impacts on non-mining employment. Due to the lack of consideration of economic indicators as SDoH, no causal pathways linking mining projects to health was proposed, vulnerable groups were not considered and no health data was used.

3.2 Warkworth Continuation EIS

The Warkworth Continuation EIS mentioned housing affordability, and insufficiently mentioned cost of living, dualisation, and non-mining employment diversity. Housing affordability of surrounding suburbs and local government areas was the only economic indicator recognised as a determinant of health by linking it to housing stress. This was described using the Australian Bureau of Statistic’s definition where a household spending more than 30% of income on mortgage or rent is in housing stress. This instance was considered as insufficiently using health data. This inclusion of housing affordability was regarded as insufficient because specific health outcomes were not linked to these measures. Further, dualisation was referred to as ‘two-speed economy’ alongside cost of living in the ‘Stakeholder perceptions and study outcomes’ section of the SIA and was included in the main report. Although an adequate definition is provided, this economic indicator was not further explored in relation to the mining project and relevant mitigation measures were not proposed. Further, this section also mentions local business stakeholders raising concerns for losing skilled non-mining employees to higher salaries offered in mining jobs. Also, population influxes increasing housing demand were not mentioned explicitly, however, the report included anecdotal evidence of reduced rental costs and availability when there was a slowing of the mining industry. Due to the nature of evidence and lack of further discussion, this instance was considered to not include the relevant economic indicator. Moreover, socioeconomic inequalities were only mentioned in the context of ‘if the project did not proceed’, and although vulnerable groups were identified, consideration of the impact of economic indicators on their health was not in sufficient detail.

3.3 Watermark EIS

WatermarkEISs considered all economic indicators, however cost of living and dualisation – also referred to as two-speed economies – were only mentioned in stakeholder consultations rather than the SIA like the other economic indicators. Similar to Warkworth Continuation, health was only associated with housing affordability and housing stress. Vulnerable groups mentioned as being negatively affected by the mining project included those who were homeless, lower income groups, lower socioeconomic families being forced to move out. This was considered insufficiently mentioned as associated health outcomes such as financial stress are not mentioned. Stress in the community was, however, mentioned in relation to inequity in social and economic opportunities, housing and cost of living among Aboriginal residents.

4. Discussion

Results show the explicit inclusion of economic impacts of mining projects on local communities as a SDoH was rare across the EIS case studies. When economic indicators were considered, there was a greater focus on population characteristics rather the potential economic impacts of the mining projects on the communities. Causal association of economic determinants and health outcomes was insufficiently reported compared to best practice and health data was not used to inform assessments, expect for housing stress percentages. Although differential distribution of health across vulnerable groups were occasionally mentioned, discussion was limited.

4.1 Quantitative methods used in EISs to measure economic indicators as SDoH

The limited coverage of economic indicators as SDoH is incongruent with previous literature which found significant socio-economic impacts of mining projects.(6, 7) Despite the Warkworth Continuation and Watermark EISs mentioning a small number of economic indicators and at times relating them to health outcomes, they did not adequately discuss these impacts or consider findings from previous research. Notably, elevated levels of inequality are associated with resource-dependent communities where lower-income earners are greatly disadvantaged.(21) This occurrence can be masked when using certain statistical data such as median household income levels. For instance, a previous quantitative analysis found high gross value of minerals production was associated with positive socio-economic impacts on the community. However, the authors emphasise their method used aggregated region-wide data which misrepresented within-region impacts mentioned in other research articles.(7)  Therefore, the measures used in the EISs, such as region-wide median household income, could greatly skew the representation of economic impacts on the communities, thereby downplaying economic impacts as SDoH. Nonetheless, it’s important to recognise these measures are widely used; however, this indicates an opportunity to refine EIS requirements to better utilise measures of within-region socioeconomic inequality differences.

Another instance is the use of the housing stress measure in the Warkworth Continuation and Watermark EISs. The Warkworth Continuation EIS concluded housing stress was low across the regional area and attributed high mining-related wages to this occurrence, and the Watermark EIS highlighted Gunnedah as possessing the highest levels of housing stress compared to NSW, and rental stress being the highest in Tamworth. Both projects use the common definition of housing stress as a household paying more than 30% of income on housing costs. However, this definition of housing stress is misleading as it implies a certain proportion of households possess financial stress, even though this measure has been shown to be weakly associated with wellbeing indicators including health and financial stress.(22) Furthermore, it masks housing affordability issues faced by non-mining employees in the community as this measure is incapable of determining all households in stress and who are dealing with the same financial pressures. Also, people who have moved to other regions in search for more affordable housing are not accounted for when using the housing stress measure, but this is an important factor to consider when assessing housing affordability. Nonetheless, the simplicity of the current housing stress measure is appealing to policy makers, despite failing to accurately and reliably measure households facing financial stress. Thus, policy makers are poorly informed by the housing stress measure when producing housing policies to improve household wellbeing(23); and providing accommodation for mining employees was proposed as mitigation strategies in the EISs. Rowley et al.(22) has suggested an important indicator of long-lasting housing stress is the duration a household is in housing stress as well as considering the catalyst putting the household into housing stress, whether it was by choice or situational factors such as housing cost or income changes. Therefore, refining the use of housing stress in EISs and including it as a requirement would enable better analysis of economic stability of residents, as a SDoH.

4.2 Omission of external research

Additionally, housing affordability and housing related issues were given the greatest weighing across the EISs compared to the other economic impacts. However, it is interesting to note that the Hunter Research Foundation Centre, part of the University of Newcastle, has reported economic-related wellbeing results of the Hunter community through a cross-sectional analysis.(24) The latest report included measures of financial stress which indicated 26% of community members experienced shortage of money to meet daily needs and one in five households reported they were worse off than a year ago because of the increased cost of living or job loss. These households also reported being physically or mentally unwell and reducing or stopping private health insurance. This Hunter wellbeing research has been conducted since 2011, before the Mandalong, Warkworth Continuation, and Watermark EISs were prepared. The consideration of economic indicators as SDoH in these EISs would have been bolstered by including this data, particularly because it is context-specific to the Hunter region. This indicates important data was missing from the EISs conducted, and future consideration of external wellbeing data should be included in the preparation of SIAs.

4.3 Limited attention and mitigation of resident’s concerns

Furthermore, the economic indicators were typically mentioned in community consultations and stakeholder engagements, either in a separate report or part of the SIA. For example, the concept of two-speed economies was only raised during stakeholder engagement as part of the Warkworth Continuation SIA, alongside retention of skilled non-mining employees in local small businesses and structural diversification of the non-mining economy. However, the mitigation measures did not include potential solutions for potential two-speed economies, nor was this further discussed. This also occurred in the Watermark mining project which either did not address some of the issues raised or inadequately addressed issues raised from the stakeholder engagement sessions. For example, one resident mentioned, “food, housing, rent costs; everything goes up in price. Will make it worse for the residents who are already here”. However, cost of living was not discussed in any of the EIS reports or appendices, it was only outlined as a stakeholder concern in the SIA. This is despite cost of living being listed in Directors Guideline Requirements (DGR). The lack of consideration of cost of living, especially when raised by a concerned community member is inappropriate and reflects those preparing the EIS have overlooked not only the concern, but also the literature indicating cost of living is a significant and commonplace issue in mining communities.(1, 25)

Other instances of issues raised and not addressed are residents indicating “local shops have been shutting down” and they have been “losing tradesmen to the mine…locals will have to increase pay for services to cover the costs”. In the SIA, these issues appear to be implicitly addressed through pre-existing council measures in place to ensure diversification of local small businesses, although this appears to be quite inadequate in addressing the community’s concerns. Further, the stakeholder engagement report included residents wanting to see “details of socio-economic offsets” included in the EIS. Socio-economic off-sets were discussed in the main report to a limited extent, as it focused on higher salaries of the mining force who would not have benefited otherwise. The Preliminary Risk Assessment section of the main report ranked social and economic project-related issues as having medium levels of risk, and after stakeholder engagement, ranked it as having low levels of risk. This was said to be altered due to key risks being analysed against the Shenhua Watermark Risk Assessment Matrix, further discussed in Revised Risk Assessment report. The matrix, however, appears significantly limited and it is unclear exactly which risks, risk consequences, and likelihood of risks were considered and how they were considered. These instances indicate some members of the community, who raised significant issues, also covered in the literature, were not heard. Greater attention to these details appears to be required in future EIS approval processes.

4.4 EIS preparation and framing

It is important to recognise the way in which EISs are prepared and results framed to better understand how health could be better included in the future. A prime example is in the ‘Executive Summary’ of the Warkworth Continuation EISs which essentially suggests they ensured requirements in government policies were met using objective evidence, which was given preference over subjective concerns of neighbours raised in the social impact analysis. They state, “Therefore, while not wanting to minimise the subjective concerns of immediate neighbours, the impacts of the proposal need to be considered in this light.” This indicates that economic-related issues raised in community consultation and stakeholder engagement is not enough for economic indicators as SDoH to be considered. A potential improvement would be to modify EIS requirements to explicitly list a number of SDoH to be assessed, including economic indicators such those included in the coding framework.

Further, the results of this documentary analysis demonstrated the variability of including economic indicators in the EISs. The Mandalong assessment considered them the least, and economic indicators as SDoH were not mentioned at all. This is despite DGR stating to include “Potential direct and indirect economic benefits of the project on local and regional communities and the State” and then listing “cost of living, including housing affordability” as a likely impact that will arise and may be included in the assessment. Further research into EIS requirement adherence is needed to understand why these economic indicators were not mentioned.

4.5 Limitations

This EIS documentary analysis has some limitations. Firstly, the economic indicators selected for the coding framework were based on previous research findings; however, there may be other economic indicators worthy of consideration that were not included in this analysis. This is partially because the evidence base linking economic impacts of mines to health is underdeveloped, and therefore compromises assessing the quality of economic coverage in EISs. Secondly, this documentary analysis narrowly focused on the economic impacts of mining developments on nearby residents, and did not consider other social and environmental impacts. Therefore, future research could investigate how economic indicators are weighed in the documents compared to other impacts. Lastly, analysis focused on EIS content alone, therefore this analysis did not account for how and why economic impacts of mining projects as SDoH are considered. This limited context did not allow for exploration into broader influences on the EIS process, including political and corporate influences.

5. Conclusions

This analysis demonstrates economic indicators as SDoH were minimally considered in the EISs, and therefore the EIS process has not been adequately utilised to determine economic impacts of mining projects on the health and wellbeing of local communities. Since previous literature has found specific economic indicators in this context have contributed to poorer health outcomes such as financial stress(2, 6, 7, 23), the EISs have missed an opportunity to explore the true impacts of mining development on local communities. Therefore, the /EIS requirements should be modified to enable sufficient inclusion of broader determinants of health using appropriate methodology to determine within-region measures. The economic-focused content of EISs should be subject to rigorous peer-review process to fully inform government approvals for projects.

References

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Appendix 1: Coding and Analysis Framework for investigating economic impacts as a SDoH in EISs