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Thursday, 21 June 2012
Page: 7566

Dr STONE (Murray) (11:38): You would not be surprised, given that I am the member for Murray in northern Victoria, that I would be most concerned about the future of water planning, assessment of programs, monitoring and auditing. With the coalition, I strongly support the continuation of this body, the National Water Commission, with, of course, the expectation that it will be properly resourced and funded, and that it will be given the tasks that it should be given. We have had recent examples where funds allocated by this government, for example, to look into mining and water related issues, particularly coal seam gas, were not given to the commission but to the federal department. That is a concern. So we support this bill but we will also, when we are in government, make sure that it is a very soundly functioning commission. The commission was initiated in 2004 under the Howard government regime. The coalition, under John Howard, understood that water is a critical concern in this nation. We do not have problems and conflicts with other countries sharing borders and river systems, where catchments and valleys are shared one nation with another. Australia is a nation with a highly variable rainfall of bust, boom, drought and flooding rains in cycles. Recently we had one of the worst droughts on record in eastern Australia, but we are told the Federation drought was fairly similar, of some eight to 10 years duration. In between those very extraordinary dry years we have had floods. Eighteen months ago in my electorate, floods destroyed agribusinesses in the western half of the electorate. Then this year, some four months ago, floods destroyed agribusinesses and a number of small towns in the eastern half of the electorate. In Australia we face droughts and flooding rains. It is complicated not by international neighbours who share water resources but by different states and the ACT which have since before Federation had their own water law, in particular their own responses to who owns the water and whether or not it is vested in the Crown. We are still battling the problem of jurisdictions wishing to hold on to their independence when it comes to water catchment, distribution, water pricing and indeed water law.

It is a complex business in Australia; hence the coalition created the National Water Commission in 2004. We gave it a sunset clause and that sunset has just arrived. This bill removes that sunset clause to give a future to the commission, and we support that. The commission has into the future a role in the assessment of progress under the National Water Initiative. Every three years it is to examine progress. It will also review the Murray-Darling Basin Plan every five years. It will also be expected to look at specific programs, as it has in the past. In the past it has looked at the Water Smart Australia Program, Raising the National Water Standards program and the Community Water Grants program. It has promoted national water standards across industries, it has developed a National Water Sector Training Strategy and undertaken general research into water policy issues such as trading of water rights, coal seam gas and groundwater. It has performed an important function in its first life cycle. We expect it to be even more rigorous and well-resourced into the future, albeit not perhaps in the near future because of the financial problems of this government. It will have a smaller staff, we are told. The review of Dr David Rosalky was comprehensive. He recommended the continuation of the commission, and we respect his recommendations. We note that the government has obviously taken those on board; hence we have this bill before us today, which will continue the life of the commission.

As I said before, we do have a real challenge in Australia bringing together a national response to water allocation and who owns the water. We have a great deal of research still to do to properly assess our groundwater assets and what is an appropriate groundwater extraction regime. That is not necessarily known right across Australia at this point, yet we have been extracting water from, for example, the Great Artesian Basin at a rate which we now realise is not sustainable.

Under the Howard government we had a major capping program where a number of those Great Artesian Basin bores flowed free. We now have many capped. So we have some hope in some parts of the Great Artesian Basin by allowing time for the watertable to replenish. We know it is essential that all of those free-flowing bores are capped as soon as possible and where bore water is used that it is properly metered and monitored and that a proper price is attached to the consumption of that water because, where you do have proper pricing of water, you can hope to have it managed effectively and used in the way that delivers highest productivity.

Australia is very well known internationally as being the world's best in terms of arid zone cereal production. It is less well known—but it is a fact—that we are also the world's most productive rice growers. In the case of arid zone cereal growing, clearly we do not tend to store water and use it on those crops, but with rice growing it depends on water being available through storage of that water and then allocation through irrigation systems. Often those storages are on farm. We in Victoria have had publicly owned irrigation systems since 1886. In fact, irrigation in my electorate began with my ancestors very close to where they had selected; they had already been there since the 1860s and they enjoyed the first irrigation boom times 20 years after they had settled in the 1880s.

The tragedy for us in Victoria is that, because of that work of the pioneers and the 100-plus years of irrigation system development, we are now being targeted for water to be taken because it is high-security water to be put into the Environmental Water Holder's bucket. This is part of the Murray-Darling Basin Authority's latest plan proposal. Everybody knows—except, it seems, the minister and the Greens—that the best way to manage a sustainable environment for the Murray-Darling Basin is to have a viable agribusiness sector. If you have a beggared, bankrupted irrigation community, they cannot invest on their properties or manage their water as effectively as they know they must, because they simply do not have the financial resources to, for example, do more laser grading or invest in more innovative water technologies like subsurface irrigation. We have already lost over 600 gigalitres of water from the northern irrigation system. We are now teetering on the brink of having a non-viable system because of the loss of numbers of irrigators and the price impost that is left to those who continue to irrigate. The prices for our irrigation water are now just at the point where many cannot pay and, if you are a dairy farmer or fruit grower, you have to work out if the cost of the water to you in fact can produce sufficiently to make it a worthwhile business.

We have the $1 billion granted by the federal government to the so-called Food Bowl Modernisation Project stage 2. Unfortunately that stage 2 entails halving the footprint of the irrigation system in northern Victoria. By halving that irrigation footprint, you then have to ask if the 23 food factories have a future. You have a halving of the irrigation footprint so that the state-owned irrigation authority, Goulburn-Murray Water, can reduce its costs. This is, unfortunately, totally different to the objectives of the irrigators. If you combine Goulburn-Murray Water's objectives with the objectives of the federal government which is buying back water from those irrigators under a so-called 'willing seller' regime, you have a perfect storm. You have farmers who are debt stressed as a consequence of the drought and who are still under the pressure of the banks to sell their water so that they can retire debt. When they receive a successful outcome with one of the federal parliament water tenders and the funds flow to them, the funds for the water do not go to adjustment on their properties, to buy another tractor or to put more fertiliser on their property; the funds go straight to the banks. Any number of accountants will recite that situation to the minister, and I am sure he has heard it very many times.

The recommendation of the Standing Committee on Rural and Regional Affairs, chaired by Tony Windsor, was that no more water be purchased through the federal government initiatives related to the Murray-Darling Basin environmental water. We stressed that some strategic buyback might be possible when it had no other impacts on the Basin. Unfortunately, we have seen from the government another tender rolled out with $40 million brought forward into this financial year specifically to buy more water out of the high-security southern part of the basin. I am most concerned that just yesterday it was announced where that water was to be taken from: it is all from northern Victoria and the northern Riverina part of Victoria. It is to go from productive use, particularly in what has been the almond-growing sector. None of us has a problem with buying or selling water in Victoria or the rest of the Murray-Darling Basin. In fact, when I worked for the Rural Water Corporation in the 1980s in Victoria, my task was to bring about transferrable water entitlement legislation and to sell it to the community. I have been instrumental in establishing water markets in Australia and I am proud about that. The problem is when the water is sold out of productive use to the environment, where it disappears for all time—although we are now told that maybe we will have a trading regime in the future, but that trading has a great capacity simply to distort the farmers' markets.

We have to see that there is an alternative to the way this government is progressing and to the way the Murray-Darling plan proposal is currently heading. There is a win-win-win scenario. You do not need to take any more water out of production from the basin. You invest in works, environmental works and measures and you better account for the water already in the system for the environment. We have the Barmah Forest, that has had an environmental flow going right back to the 1970s. We know that that flow has not been properly managed at all times. We know that the environmental water goes into the Barmah Forest and then on to Gunbower and out the other end, and so on down to Koondrook. This water is not at the current time properly accounted for as water that is reused and reused for environmental purposes down river.

We also have a problem with the Murray-Darling Basin Plan proposal right now, where even if we do have states or the Commonwealth invest in savings through improved environmental works and measures—for example, Lindsay Island is often cited—that saving is not then seen as part of the contribution to the sustainable delivery limits bucket of water held by the environmental water holder.

We have an extraordinary problem in Australia. We started out in 2004 to make it better. We have not got to a situation yet in Australia where all of the states are singing from the same hymn sheet about how their water law relates to both groundwater and surface water extractions. There are still differences in Queensland compared to, say, the southern Murray-Darling Basin in terms of who owns the water, where the water is vested—whether it is with the Crown—and that has to be sorted out. We still have problems of water in the markets, where the loss of water—literally the transfer costs of the water—is not accounted for in the market place. If you buy the water 10 kilometres from Eildon dam, that megalitre of water is what you take delivery of down in Adelaide and the losses along the way on the river are not taken into account. We do not have the Commonwealth paying the costs of storage for the environmental water that is sitting in dams like Eildon and taking the place of irrigators' water, to the point where there is a real worry now about whose water is going to be able to be stored into the future.

There is a range of issues that need to be addressed if we are going to meet both the national and international food demands of the future. We already import some 37 per cent of all our manufactured food to Australia. People are blitzed by the statistics that we have this massive export of food out of Australia, but most of that food is unprocessed wheat and dairy powder. In fact, we are already a net importer of a lot of our manufactured foods, particularly fruit and vegetable frozen product and concentrated product. We cannot smile our way out of this and say, 'All will be well'. We are a nation that has to be clever about our water law and about how we monitor, audit and assess our water consumption, about who is managing the water across state and territory borders. There is a role for—obviously—the National Water Commission into the future. It has to be better than it has been. We acknowledge that, but simply to have allowed it to have died or faded into the sunset was not a good option. As a coalition we support this bill, but as the member for Murray let me say that water policy is the issue which is at the moment causing suicides in my electorate and making us wonder if we have any future at all. Thank you.