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Monday, 18 March 2013
Page: 2548

Dr STONE (Murray) (20:56): I wish to talk about a very significant grievance I have about what is occurring in northern Victoria in my electorate of Murray. One of the most often repeated and strongly stated messages from across the Murray-Darling Basin has been the irrigators' plea to stop the water buybacks. Numerous evaluations of the impact of the buybacks have noted the stranded assets, lost on-farm food manufacturing and transport jobs, less sustainable communities, collapsed land values and environmental degradation where dried-off farms blow dust in summer and sprout weeds the rest of the time. People who have been away for a while walk into my office at Shepparton and talk about their shock at seeing the changes. They cannot believe the sight of all those abandoned dairies that were once a continuous lush landscape of highly productive irrigated agriculture.

Ten years ago the Goulburn-Murray water area had 1,900 gigalitres producing billions of dollars worth of beef, cereal, dairy and fruit production annually. This productivity supported more than 20 food factories and a thriving irrigation services sector. Five years ago water sales out of the district had reduced this volume to 1,600 gigalitres. This volume has now been sold down to 900 gigalitres. If 100 megalitres creates one job and there are 1,000 megalitres in a gigalitre, there is little wonder that we have seen a major exodus of workforce directly and indirectly employed in agribusiness, and along with them go their families.

The Victorian government has now taken a lead from Senator Penny Wong and Minister Burke in targeting irrigators to sell off more of what is left of their high security Goulburn-Murray irrigation water. This is a further blow to the recovery of northern Victoria from seven years of drought. On Friday the minister for water—or is that the minister for selling water—announced that he wanted the strategic purchase of another 25 to 50 gigalitres of water from irrigators as part of the Goulburn-Murray Water Connections project. What does strategic purchase mean? It is supposed to mean the carefully planned purchase of water from one or more irrigators which is not found to have detrimental third-party impacts, for example on the economy, and which can be justified on the grounds that it improves the efficiency of remaining irrigators or better sustains the environment?

According to Victorian minister Peter Walsh and his Department of Sustainability and Environment, drying off farms on spur channels, some half of the system, is 'strategic'. Others argue, however, that this is no way to try to save the skin of the deeply indebted, inefficient and grossly overstaffed Goulburn-Murray Water Authority. This is not about farmers and the strategic use of their water; this is about trying to save a large number of public service jobs. Astonishingly, the current Victorian government has chosen to follow the Bracks and Brumby governments which took water off drought-stricken food producers in northern Victoria to flush down the north-south pipeline to Melbourne. The pipeline was stopped after a massive community backlash which saw the Labor state seat of Seymour change to Liberal to give the one-seat majority to the coalition in that most recent cliffhanger election.

Irrigators thought that they and their communities had been saved with the new coalition state government. But the new Minister for Water has chosen instead to try to save the indebted and ailing state run Goulburn-Murray Water. Minister Walsh should have drastically downsized the 700-person workforce—now hopelessly mismanaging the irrigation system. It should be noted that the bigger and more efficient New South Wales irrigator-owned cooperatives only need some 250 staff to do the same job. Instead, on the advice of his department, Minister Walsh has chosen to downsize the irrigation system itself, reducing its footprint to half, destroying the production security and economies of scale which are essential for sustaining the local food manufacturing sector.

No amount of reciting the big new food export opportunities in Asia can alter the fact that the capacity of Victorian northern irrigators is being deliberately and rapidly reduced, as their high-security water is being traded to the Commonwealth Environmental Water Holder. This new environmental water is not being used to sustain the environment. Gross mismanagement of this water or failure to use it at all is leaving the community scratching its head and leaving others simply in despair.

In the joint press release issued on Sunday on this new so-called strategic purchase program for water, Minister Walsh said:

This will be a voluntary strategic purchase program for eligible spur channel irrigators from the Goulburn-Murray Irrigation District areas of Central Goulburn, Murray Valley, Loddon Valley, Rochester-Campaspe, Shepparton and Torrumbarry.

The program, which opens from Monday—

that is today—

will offer frequent opportunities for sales in the coming months.

…   …   …

Federal Minister for Water Tony Burke said the Connections Project was the largest Commonwealth Government investment in irrigation infrastructure, with more than $2 billion of State and Federal funding committed to date.

Let me remind everybody that this connections project aims to halve the irrigation system and reduce therefore exponentially the capacity of this area to produce volumes of food, particularly to sustain a food manufacturing sector.

The joint press release further states:

The Connections Project offers a number of choices, including connecting to an upgraded backbone, developing shared supply infrastructure, relocating closer to the backbone, or transitioning to a non-irrigated farm.

Let us talk about what that really means. Connecting to an upgraded backbone usually involves pumping water and it involves the costs of energy, either electric or diesel pumps that were never before required, and so will substantially put up the price of irrigation for farms.

Developing shared supply infrastructure means that you are supposed to cluster with your five, 10, 15 or maybe 25 fellow irrigators on a spur and together you are meant to manage the water scheduling, the system maintenance and the delivery of that water. You are supposed to hold your water entitlement together in common. Together, you are liable for any accidents or non-payments for that water. You are supposed to act as if you are a small irrigation system all by yourself, except of course you do not have the economies of scale and you do not have the spare capacity to run the system yourself unless you employ someone to do that. The costs for you are going to go up exponentially.

In terms of relocating closer to the backbone, irrigators regularly come to me complaining that they have been forced to consider doing this. This means selling their current property, which might be an 800-cow dairy which your family has developed over several generations. You are meant to have that property dried off—the water taken off—and it would then be worth a fraction of its value. You are meant to consider buying an alternative irrigation property that typically has been dried off some time ago and that, typically, would require a bank loan. The most recent case I have been working with involved a bank loan of at least another half a million dollars to shift from one perfectly viable, highly desirable irrigation farm to another closer to the backbone and involved a substantial new debt that no-one in agriculture anywhere in Australia wants.

The final option, transitioning to a non-irrigated farm, means you substantially devalue your property and take the irrigation water and its infrastructure off your farm. Your farm then becomes virtually unsaleable. Also, it means that on your dried-off farm, you are going to depend on local rainfall, which in my area is less than 15 inches a year. If you fail to agree to any of those options—and I have numbers of letters from irrigators given these ultimatums—and you are one of the last on the spur to cave in to the demands of this new so-called connecting project then you are told that in one year and one day you can see your water cut off, you can see your situation taken out of your hands and you will lose your irrigation water under the new regulations of the state government.

This is the most heinous situation in terms of irrigated agriculture being destroyed in northern Victoria, all in the name of trying to salvage the wreckage of the Goulburn-Murray Water authority. This is unconscionable. It is not about trying to find water for Victoria's in-valley targets of 650 gigalitres. What happened to previous notification that that was only 627 gigalitres? The whole thing seems to me to be desperate measures for a desperate situation. And the victims of all of this are food producers in northern Victoria, jobs, communities, families and a whole culture of people working for themselves, developing something from nothing and producing some of the finest and cleanest and greenest food available anywhere in the world. It is about not trusting individuals to modernise their own properties. This is a shocking situation. (Time expired)