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Thursday, 25 September 2014
Page: 7110


Senator FIFIELD (VictoriaManager of Government Business in the Senate and Assistant Minister for Social Services) (12:18): I move:

That this bill be now read a second time.

I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—

Since the Australian Government and all state and territory governments agreed to the National Water Initiative (NWI) in 2004, there has been considerable progress in national water reform, through enhancing the security of irrigation water entitlements, enabling water markets and trade, strengthening Australia's water resource information base and improving urban water security.

The Abbott Government is committed to continuing to progress national water reform and to supporting and promoting implementation of the NWI. However, this should be done as efficiently as possible. As such, we have determined it is no longer necessary to retain a separate body to undertake the functions of the National Water Commission (NWC). Instead, and in line with the Governments ongoing commitment to the NWI principles, key NWC functions will be retained and transferred to existing Commonwealth agencies.

The purpose of this Bill is to repeal the National Water Commission Act 2004 in order to abolish the NWC with effect from 1 January 2015.

The Bill delivers on the Government's commitment announced in the 2014-15 Budget to cease the operations of the NWC by the end of 2014, while transferring key functions to existing Commonwealth agencies. The abolition of the NWC is expected to result in a saving of $20.9 million over the forward estimates, further improving the budget bottom line. The findings of the Commission of Audit were taken into account in making this decision, which recommended abolishing the NWC as a standalone agency.

The National Water Commission's roles are of a monitoring and reporting nature. It does not deliver programs or have any approval or regulatory functions.

The National Water Commission has reported to the Commonwealth and state and territory jurisdictions on the national benefits that result from the implementation by governments of the NWI, such as the creation of water entitlements as a tradeable asset, the development of water markets, improved environmental protection for our rivers and wetlands, and improved urban water security for our towns and cities.

I would like to thank all the staff of the National Water Commission for the contribution they have made to water reform over the last decade. Their role in reporting on the rate of reform has been significant and they all should be extremely proud of their work.

Given both the substantial progress already made in water reform and the current fiscal environment, there is no longer adequate justification for a stand-alone agency to monitor Australia's progress on water reform. In line with reform priorities to improve efficiencies across the Australian Government and to improve the budgetary outlook, the NWC will cease its functions following the release of its assessment of national water reform in October this year. The budget does not provide funding beyond December and the winding up of the NWC is well advanced.

The key task going forward is to ensure that the principles of the NWI continue to be upheld across the water sector, from urban pricing principles to the management of rural and environmental water, and the effective implementation of the Murray-Darling Basin Plan (Basin Plan).

The Government reaffirms its commitment to the NWI and will ensure that the key audit and review functions required under the NWI and Water Act 2007 (Water Act) are continued, in a rigorous manner, and with appropriate independent oversight.

The triennial assessments of progress toward achieving the NWI objectives and outcomes by state and territory governments and the independent audit of implementation of the Basin Plan and associated water resource plans will continue as statutory functions, but will now be undertaken by the Productivity Commission (PC). The PC will also be responsible for the biennial National Water Planning Report Card which is produced under the Triennial Assessment.

The Productivity Commission will also undertake independent audits on implementation of the Murray-Darling Basin Plan, as required by the Water Act. Retention of this function is necessary to ensure continuing public confidence in the implementation of the Basin Plan.

As the Productivity Commission collates performance data for other National Agreements and National Partnership Agreements, it is well placed to take on the audit of progress in implementing the Basin Plan from 2018, the Triennial Assessment of NWI implementation and producing a biennial National Water Planning Report Card.

By allocating the assessment and audit functions to the PC, stakeholders will benefit from the PC's reputation for independence, the confidence in which it is held by the Australian public and governments, as well as its performance and benchmarking expertise. The Government is confident that the PC will strengthen and improve the reporting and analysis of the progress of water reform across Australia.

In addition to the statutory functions that will be transferred to the PC, the Department of the Environment (the Department) will take on responsibility for assessing milestone payments to Murray-Darling Basin states against the performance milestones specified in the National Partnership Agreement on Implementing Murray-Darling Basin reform, and for providing ongoing advice on the status of relevant state and territory water resource plans to the Clean Energy Regulator, as required under the Carbon Credits (Carbon Farming Initiative) Regulations 2011.

The Department will also be responsible for monitoring water markets and producing an annual water markets report, which will be undertaken for the Department by the Australian Bureau of Agricultural and Resource Economics and Sciences.

The retention of these key functions by existing agencies was flagged in the 2014-15 Budget papers, including the transfer of appropriate funding to support these functions, and will ensure the commitment by all governments to deliver on agreed reforms is realised.

I will now turn to the details of the Bill.

The Bill provides that certain key assessment and audit functions of the NWC that are considered essential in the future will continue but be undertaken by different agencies. The

Bill amends the Water Act 2007 to provide that the triennial assessments of NWI implementation by state and territory governments and the independent audit of the Murray-Darling Basin Plan Implementation will be undertaken as statutory functions by the PC.

The Bill makes consequential changes to the Water Act to reflect the fact that the NWC will cease to exist. To this end, references to the NWC in the Water Act will be removed, including references which allow for the sharing of information with the NWC or concerning its administration.

Lastly, the Bill provides for transitional arrangements for the closure of the NWC's activities.

The Bill and other measures put in place by the Government will ensure continuation of all important functions of the NWC in a more efficient and effective manner.

Debate adjourned.