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Address to the Australian Water Congress, Sydney

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Restoring confidence in Murray-Darling reform

Posted on April 18, 2012 10:05



Mark Twain famously said that "whiskey is for drinking; water is for fighting over". If there is one statement that all sides of the debate o the Murray‐Darling Basin Authority’s proposed Basin Plan would surely agree on, it is that never a truer statement was uttered.

Despite the fighting, it is a pleasure to be here at the Australian Water Congress to address the policies and strategies required to effectiv implement a new Murray-Darling Basin Plan. With the lodgement period for receipt of submissions having closed this week, we have enter a new phase of the debate over Murray-Darling reform.

Ensuring a credible final Basin Plan is critical. The MDBA must address the concerns that exist about the robustness of both the scientific analysis and the economic analysis. They must address concerns about the lack of certainty in the Plan for irrigation communities and the lack of certainty for environmental assets. And they certainly must address the concerns about the potentially allowable groundwater extractions proposed in the Plan.

While the Murray-Darling Basin Authority considers the competing arguments over the application of the most robust science and best economic evidence to finalise a Basin Plan, it is important that we use this window to consider not just what a final Plan may look like, but also how we can best implement it. It is also crucial that we use this time to remind all Australians why this reform is necessary and to re-

establish a level of public confidence in and support for the reform being undertaken. It is on these points that I will focus my remarks tod

Ending 115 years of argument and mismanagement Basin reform remains controversial and stirs passions, for different reasons, in communities up and down the Murray-Darling. It was ever thus.

115 years ago, at the time of federation, Charles Cameron Kingston, the then South Australian Premier, spoke of the decision not to have federal management of the Murray‐Darling at the 1897 Federation Convention in Adelaide.

Kingston said that:

"I hope it may be reconsidered and that a measure of hope may be held out that the federal parliament will be trusted with federal questions of the gravity involved in the use of the waters of the Murray."

One year later Kingston attended the 1898 Melbourne Constitutional Convention and again said of the ongoing debate that:

"We ought to give the federal parliament which we propose to call into existence the power, when it deems fit, to legislate on t question in order to remove this fertile source of conflict and friction between colonies."

115 years later and this certainly remains a fertile source of friction between the colonies, or states as we now know them. The only way that we can hope to remove that friction is by having effective national management of the Murray-Darling, where decisions are taken fair equitably and based on the best available evidence, without particular regard for the interests or arguments of any one state or territory.

The original colonies met to discuss navigation and management of the Murray as early as 1863. In 1887 South Australia initiated the first Royal Commission on the River Murray, which was followed in 1902 by the Corowa Conference and the subsequent Interstate Royal Commission on the River Murray, which reported on “the conservation and distribution of the waters of the Murray and its tributaries for t purpose of irrigation, navigation and water supply”.

From here we saw the advent of the highly regulated system we know today, with the series of locks, barrages, dams and weirs attemptin to maintain water levels at heights that allow for both navigation and the reliable extraction of water. The meetings continued, with the Ri Murray Waters Agreement signed in 1915 and the River Murray Commission established in 1917.

Disquiet at the outcomes of those meetings also continued. Simpson Newland, a prominent South Australian, wrote in 1926:

"Successive governments of South Australia played ignominious paths attending years of useless conferences discussing and wrangling with our sister states on the division of the water calculated to flow for given periods through certain gauges. So far New South Wales and Victoria were concerned the true object of these conferences was to discover how little South Australia could be induced to accept and to gain time to push on with their own works in their respective states."

I am sure there are equally critical quotes from prominent New South Welshmen or Victorians of the era arguing the demands of South Australians were unreasonable and unnecessary. It all sounds quite like the utterances of today’s Premiers over the last few weeks, or the predecessors over many, many years.

Recognising over-extraction was a real problem The Murray-Darling has gone through more than a century of argument but it took a once in a century drought to force our hand. It took emergency management measures across the Basin; record low allocations to irrigators; communities facing immense economic and socia stress; and environmental problems of a scale not previously encountered for a federal government - John Howard’s federal government - to finally say that the era of bickering between the states must end and be replaced with national management of our greatest river syste

Today, some argue that Howard’s national takeover was an over-reaction to the Millennium Drought. I reject that argument. Certainly droughts and flooding rains are a natural part of the Murray-Darling. One will cause the system great stress; the other will instigate the return of life. That is the natural order of a river system.

What matters most so far as the management of our river system is concerned are the years between drought and flood. To maintain a healthy river, on which irrigated agriculture can flourish and in which the environmental assets we most value are preserved, we must maintain a certain level of resilience ahead of droughts. We must ensure the system does not operate like it is in a permanent drought in but flood years.

The four decades leading up to the Millennium Drought saw unparalleled growth in use of the waters of the Murray-Darling. Annual extraction of water grew from around 6,000GL in the mid 1960s to around 12,000GL by 2000. Two thirds of that increase occurred in New South Wales, one sixth in Victoria and the remaining one sixth was shared between the top of the system in Queensland and at the bottom

in South Australia.

During this time we saw the Murray Mouth close over, first requiring dredging in 1981. We saw increasing concerns that resulted in new strategies to manage salinity in the system. We saw increasing community concern about the health of iconic environmental sites.

The excessive use of waters from the Murray-Darling was a clear concern of governments well before the Millennium Drought.

Such was the concern that we saw major reforms to water management, including the 1995 imposition of an interim national cap on wate extractions and the addition of Queensland and the ACT as parties to the Murray-Darling Basin Agreement.

In 2004 the National Water Initiative was signed, delivering a new approach to the way Australia manages, measures, prices and trades water. It was also seen as an attempt by the states to address over‐allocation.

A Murray-Darling without borders Three years on from the NWI and faced with, at best, slow progress, then Prime Minister John Howard declared that enough was enough. He said it was time for national management of the Murray-Darling and that in managing the system we should pay the same attention to state borders as the rivers themselves do: namely, none. Yes, the states have expertise. They have a key role to play and should not be shut out of the process. But overall planning to manage the use of this finite resource should be undertaken at a national level rather than continuing an ultimately vain, century long hope for agreement or cooperation between the states.

I entered the Senate in 2007. As a new, young Senator, I made clear my position in support of national management. I spoke on the Wat Bill of 2007, which laid the legislative framework for establishment of the Murray‐Darling Basin Authority and development of a holistic Ba Plan for the sustainable use of the system’s water resources. In those debates I described the intended MDBA as:

"An independent, expert body, it is charged with the responsibility of developing an evidence based Basin Plan that balances th needs of all stakeholders."

I highlight those last few words, "balances the needs of all stakeholders" … my intent and, I believe, the intent of all from both sides of th parliament was, at that time, clear.

I went on and highlighted that this was not just a legislative solution, but also that the accompanying $10 billion in funding was an integra part of the reform package:

"The funding provides support for the structural adjustment necessary in the community that is needed to deal with living with


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less water. It provides support for both on‐farm and off‐farm infrastructure, privately owned and publicly owned infrastructure, ensure that it can all be delivered in a more efficient and effective manner; to ensure that ultimately, given the finite resources the river system, we will be able to do more with less."

These reforms were, at their heart, balanced reforms. They recognised that change required adjustment by farmers and irrigators and the communities they live in. They recognised that these farmers were not to blame for the issues of over-allocation, but had only done what their respective state governments had asked of them.

Wise use of this $10 billion package was essential to make the difficult decisions of the new Water Act possible and to ensure that we did end up with a balanced outcome … a balanced outcome for the economy, for the communities of the Basin and for the environment and ecology of the river system.

Reform off the rails Today, the states are bickering as much as ever before. Upstream communities lack faith in the reform process because they don’t believe can be achieved without the decimation of their economies and their social infrastructure. Downstream communities lack faith in the reform process because they fear it has become another politicised talkfest that will fail to achieve long term sustainability. This crisis in confidence from all stakeholders can be attributed to multiple failures in implementation.

The crisis in confidence among downstream communities and environmental groups has been driven by a series of factors, including:

· delays overseen by Minister Burke that have stretched the eventual implementation of the Basin Plan out from 2014 to 2019; · the false start that was the Guide to the proposed Basin Plan, released in 2010, which raised expectations that were shattered when the actual proposed Basin Plan was released a year later; and · the resignation of the original chairman of the MDBA in circumstances that have never been fully clarified due to the Labor

Government’s secretive approach to their legal interpretations of the Water Act.

Meanwhile, the crisis in confidence afflicting upstream communities and irrigator groups has equally been affected by a different yet equal damning series of factors, including:

· the admitted failure to properly model economic and social consequences before the release of the Guide in 2010; · Labor’s aggressive pursuit of non-strategic water buybacks at a rate more than double what was budgeted, without any plan to buy the water against in what appeared to be a purely headline driven strategy; · the utter failure to successfully deliver on water-saving infrastructure projects, with less than $300 million of the budgeted $6

billion in funds known to have been delivered; and · Labor’s scandalous use of around $500 million in funds budgeted for water-saving infrastructure projects on activities that don’t save a drop of water, including television advertising.

This was never going to be an easy reform and it may be impossible to make everybody happy, but it has been made so much harder by a series of blunders that has eroded the confidence of virtually every stakeholder within the Murray-Darling Basin.

Restoring confidence starts locally If we are to get this reform back on track we must start at the local level and we must use the time while the final Basin Plan is under development to reconsider the approach to its ultimate implementation. One of the greatest failings of the Basin plan process to date is the silence on implementation. Minister Burke has dropped the ball here a is not the MDBA’s responsibility to outline how the plan should be implemented, it is his responsibility.

We can help address the crisis in confidence that exists both upstream and downstream by empowering communities with greater levels o local management and local control in implementing both the water savings targets they face and the delivery of the environmental water they will receive.

Communities throughout the Basin face the challenge of how to implement new Sustainable Diversion Limits under the Basin Plan. Right now, that implementation is largely being dictated by state and federal governments attempting to enforce adjustment solutions on local communities, with the proportion to be achieved through buybacks as well as the nature of both on-farm and off-farm infrastructure being

imposed from above. Clearly, this approach is not working.

Having already taken the decision to delay implementation of the Basin Plan there may now be sufficient time to empower local communit to develop their own, fully integrated, plans to achieve reductions locally. Rather than the current, silo based funding models of buybacks versus infrastructure, government could offer a package of money that could be applied as local communities see fit, so long as the requir water is returned to the system.

Communities would develop their own proposal, outlining how they would achieve the water use reduction target given the funding available. Funding could be provided equally on a dollar per mega-litre to be recovered basis to regions across the Basin. They could determine what infrastructure projects would work, what buybacks would work, what retirement of inefficient systems would work or what changes to crops or local industry would work. This approach could reduce fears, increase community ownership of the Basin Plan and allo for great ingenuity and local knowledge.

This approach would also significantly reduce bureaucratic control at both state and federal levels. Considering the appallingly slow progre being made on infrastructure programs and the long pattern of behaviour from state governments of big promises followed by little deliver empowering communities may actually speed up progress and deliver greater results for each dollar spent.

Local communities know what will work in their areas. Instead of applying one size fits all solutions on communities, locals will be able to weave in solutions that benefit local economies and meet local needs to the fullest extent.

Importantly, this approach can also provide greater equity. More efficient irrigation regions that have difficulty accessing existing infrastructure programs would, across the whole package of funds available, have the potential to receive funding that is proportionate to volume of water they are required to return to the system.

It does not negate the need of government to pursue major system reforms, like the efficiency savings available through infrastructure wo on the Menindee Lakes. But equally, the stalled progress of such works highlights the need to get governments out of the way and empow locals to deliver what not only is required for the Murray-Darling system, but what will also work for their local community.

However, it isn’t just on the water savings side that we could benefit from greater community involvement. The Murray-Darling Basin Authority has also been talking about localism in terms of environmental water use. This is a step in the right direction, but we need to giv local communities more confidence that they will have a clear role in ensuring environmental water secured for local environmental assets used as efficiently as possible.

It is absurd to suggest that bureaucrats in Canberra know more about what environmental sites need, how to manage them and how wate can be delivered to them most efficiently than do locals on the ground, who in many cases already care for these sites.

One of the greatest concerns I have about the proposed Basin Plan relates to environmental watering. The MDBA has largely devolved developing environmental watering plans to State Governments and, while they likely have more knowledge in this area than do federal bureaucrats, I hear constant concerns from local communities that they don’t even know what the recovered environmental water will be used to achieve.

This is extremely problematic on two fronts. First, how do you sell the environmental benefits to Basin communities when you say how much water needs to be recovered from a district but fail to clearly say what you expect it to mean for the local sites of local importance. Basin communities need to know the environmental benefits they will see in their local areas.

Secondly, in actually developing environmental watering plans locals will know how to achieve the desired outcomes with the least amount water. A local is much more likely to know that using existing pipes or channels to get water to an environmental site may require much l water than would be required if you were using flooding and overland flows.

Local elders might also better know the patterns of how different sites were naturally watered historically. Over-watering can be as harmf as under-watering and some sites might need water less frequently than expected. We shouldn’t discount local knowledge, we should maximise use of it if we want to gain maximum efficiency. Let us let the people who see, live and know local environmental sites decide h our desired environmental outcomes are best achieved.

Too often in this debate we get caught up on headline numbers that are generally meaningless. What matters are tangible environmental outcomes. It is just as important to think cleverly and strategically about how we manage water flows as it is to consider how much water flowing.

If an environmental outcome can be achieved in different ways with 500ML or 1GL I would rather it be done with 500ML. Some people ar too hung up with being able to say that 1GL is needed and that’s what we must get without looking at what’s important - the actual environmental outcome of maintaining a healthy river for everyone.

By engaging local expertise in implementation of the Murray-Darling Basin Plan I believe we will maximise the benefits to communities of t billions of dollars we are investing in the Basin, maximise the environmental outcomes for the river system and maximise the chances of getting this reform back on track.

A reform worth finishing More than two million people live in the Murray-Darling Basin. Around 39 per cent of our agricultural output is estimated to be generated i the Basin. And some of our most precious environmental assets can be found in the Basin.

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It should not be too much to expect that a country with the capacity of Australia can maintain healthy communities living alongside a heal river, who grow food not just for us, but for the rest of the world.

Of course this reform is not easy. John Howard and Malcolm Turnbull never thought it would be when they embarked on it. It will require sacrifices and trade-offs across all three pillars that are enshrined in the Act - economic, social and environmental. But, at the end of it, hopefully we will end at least 115 years of debate and have a more sustainable system, providing a fair flow for everyone and giving some long term sustainability to both the river system and to all of those farmers and communities who rely on it.

By getting it right and getting it back on track we can work towards a future with healthy rivers, healthy communities and a healthy productive base in Australia's food bowl. Get it wrong and we risk years or decades of more uncertainty, infighting and degradation.

I despair that the current government appears to have let a malaise set in on this reform. They no longer sell its importance and appear to shove responsibility for making this reform work off onto anybody but themselves. When the going has gotten tough, this Government seems to have retreated, abdicated responsibility and been all too willing to allow delay and uncertainty to plague this important reform, rather than admitting their mistakes and laying out a plan to restore necessary community confidence.

Opportunities for reforms like this one come along all too infrequently. The window on this reform is shutting fast. Just because it has rain and some bad decisions have been made, we cannot allow the momentum for reform to slip away.

A competent Coalition Government made the decision to pursue Murray‐Darling reform. Having started that process we must remain committed to seeing it through. We must reject complacency about the need to act and restore confidence in the reforms being undertak That starts with getting back to basics and bringing local communities with us on the journey, not leaving them behind.

Posted in: Speeches

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