The Use of Scenarios in National Policy Venues
Scenario planning in the Netherlands has a long history. After the Second World War, Nobel Prize Winner Jan Tinbergen became the first director of the Central Planning Bureau (CPB) which was legally mandated to provide economic forecasts for economic policy. The need to optimize public investments in rebuilding the post-war economy and a strong belief in the possibility of influencing economic development were the main drivers behind this mandate. In addition, trade unions and employers agreed to use the CPB forecasts as the basis for wage agreements. Forecasts have used econometric models based on the latest macroeconomic knowledge and historical data, and assumptions on external factors (such as the development of world trade, oil prices and the population projection) and on existing or new policy measures (taxes, expenditures, social security, and so on). The CPB has the legal mandate to define the baseline scenario that includes existing policy measures. In an iterative process involving the Ministry of Finance, additional policy measures have been formulated that would be needed to meet policy targets, for example on employment, income distribution or government debt. Ultimately the cabinet of ministers have decided on policy changes. The organization's role in policy formulation grew in the 1980s, due to an agreement by political parties to subject their election manifestos to assessment by the CPB.
Due to the Netherlands' high population density, spatial planning is important to make the most efficient use of available land. It became the mandate of the Spatial Planning Bureau (currently entitled the Netherlands Environmental Assessment Agency) to define the scenarios that are to be used as the basis for the political spatial planning process. Long-term economic forecasts of the CPB form a quantitative input for scenario development on land use, transport, energy and environment. However, contrasting normative scenarios have proved to be more important in stimulating public debate.
Spatial plans are formulated at different government levels, where the national plan describes the long-term vision (the desirable future, but consistent with CPB forecasts) in the form of a land-use map for the Netherlands 25 years ahead, and a list of government investment projects. The national plan contains political choices, for example on suburbanization or concentration of housing, on the protection of valuable nature areas and landscapes, or on the direction of investments (to harbours and airports or to the development of rural areas). Provinces have the task of translating the national plan into regional plans, which in turn are the basis for detailed land designation maps by the local governments. The latter are decisive for acquiring a building permit. At each government level a participatory approach in the development of spatial plans has been successfully applied. Participatory spatial planning has proved to be a good vehicle to discuss desirable developments in neighbourhoods, regions or the country as a whole.
Development of environmental forecasts for the coming 25 years started in the Netherlands in the 1980s. The first environmental scenarios were developed to support the national energy debate: should the country use coal, gas or nuclear energy for power production or should it focus more on energy saving and renewables? While the public debate focused on the safety risks of nuclear energy and the health and ecosystem risks of coal, the long-term environmental scenarios (based on the economic forecasts of the CPB) were important to assess the costs and impacts of different options.
In the study by RIVM (National Institute for Public Health and Environment) Concern for Tomorrow (RIVM 1988), the focus of the scenarios was broadened to other issues, such as pollution of air and water, toxic chemicals, manure, waste treatment and climate change. The scenario method was rather simple: extrapolations based on trends in population growth, activity levels and available technologies. However, the comprehensive approach gave new insights into the urgency and common drivers of environmental problems, the limitations of end-of-pipe technologies and the need for structural changes, for example in waste treatment, energy, transport and agriculture. After Concern for Tomorrow, RIVM was given a legal mandate to develop environmental forecasts on a regular basis and to make ex ante environmental impact assessments of policy proposals. RIVM (now renamed the Netherlands Environmental Assessment Agency) received a legal mandate to develop both a baseline scenario and a maximum feasible scenario that includes technical and non-technical measures (and their additional costs). This frames the policy formulation envelope. It remains the responsibility of policymakers to decide on the measures that will be included in the National Environmental Policy Plan.
In order to maintain credibility, broad consensus among experts on data, methods and results proved to be important. Therefore, RIVM organized close cooperation with expert institutes in the field of agriculture, transport, energy and nature conservation. Participatory methods with representatives from government, industry and NGOs were limited to the definition of ambition levels for environmental protection and the identification of new measures. Although uncertainties in economic developments were grasped using high, medium and low economic growth forecasts produced by the CPB, in practice policymakers were often unable to use the uncertainty ranges and simply adopted the medium projection as the basis for policymaking.
The 'surprise-free' approach was quite effective as long as the need for environmental protection was relatively undisputed and the authority of experts was accepted. This changed in the beginning of the twenty-first century when scepticism about environmental problems grew and the
Figure 3.3 Four normative futures developed in the RIVM Sustainability Outlook, symbolized by four emblematic books
monopoly enjoyed by experts over knowledge declined, due in part to the expansion of the Internet. Many environmental issues (not only climate change, but also air pollution, nitrate in groundwater, electromagnetic fields or pesticides) were perceived as 'wicked' problems, with a high degree of scientific controversy and of conflicting interests or values.
'Sustainable development' is perhaps the most 'wicked problem' of all, with many different opinions on what it means and what should be done. In order to facilitate the development of a sustainable development strategy, in 2004 RIVM was asked by the Dutch Cabinet to develop a Sustainability Outlook with four normative futures (see Figure 3.3; RIVM 2004). From a survey among 40,000 people, four major worldviews were selected. For each of these, the main trends, worries and desired policy measures were identified via additional surveys among 2500 people. In four focus groups of about 20 selected people each (representatives of a certain worldview), narratives, cause-effect diagrams and images for the scenarios were developed. The scenarios were thus the result of a broad participatory approach. Quantitative figures were not crucial, but only used for illustration (and derived from CPB forecasts). Each normative scenario contained a consistent storyline: trends, external developments and chosen policy strategies would lead to the desired future (a so-called 'utopia').
What each group thought of the scenarios developed by the others was also analysed. It soon became clear what the main weaknesses were in each of the four scenarios, for example risk of excessive bureaucracy, overly optimistic assumptions about the ability of markets to produce timely technological solutions, too much emphasis on voluntary contributions without a solution for free-rider problems. The analysis of weaknesses made it possible for policymakers to make their policy strategy more robust. Moreover, it was possible to identify which policy measures would be no-regret in all scenarios (for example, efficiency improvements) and which measures would face strong opposition (for example, stricter regulation). During simulated negotiation sessions with experts and policymakers, possibilities for consensus were identified. For example, emissions trading was identified as a compromise between the taxation and regulation of C02.