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Tuesday, 25 November 2008
Page: 7210


Senator XENOPHON (5:23 PM) —There is no greater crisis facing this country than the crisis surrounding the availability of water, and nowhere is this clearer than along the Murray-Darling Basin. The Murray-Darling Basin covers one million square kilometres and extends through Queensland, New South Wales, the ACT and Victoria, ending up in my home state, South Australia. More than 50 per cent of all water consumed in this country comes from the Murray-Darling Basin. This is the nation’s food bowl and, put simply, the state of the river directly impacts upon the state of our nation. If the river is allowed to die, what will happen to our nation?

The Water Amendment Bill 2008 was designed to give effect to the intergovernmental agreement on Murray-Darling Basin reform by amending the Water Act 2007. In particular, the amendments reflect a concession by New South Wales, Victoria, South Australia, Queensland and the ACT to refer constitutional powers to the Commonwealth to enact measures including the transfer of the current powers and functions of the Murray-Darling Basin Commission to the Murray-Darling Basin Authority, broadening the role of the ACCC in relation to water market rules and water charge rules, and expanding the Basin Plan to include arrangements for critical human needs.

The bill is supposed to enable water resources in the Murray-Darling to be managed in the national interest, optimising environmental, economic and social outcomes. If the bill actually did this, that would be great. But it does not. Instead, it seems designed to make it seem more like the federal government is taking control of the basin from the states when in fact it is doing no such thing. So why do we need a federal government takeover? For years state governments have grossly mismanaged the Murray-Darling Basin. They have treated this precious resource like a watery version of the Magic Pudding, acting like they could take as much as they like without worrying about running out. The states cannot be trusted to act in the national interest, which is why we need a federal government takeover of the river system. With one river system there should be one set of rules. But this response to the crisis, which I believe is a half-hearted, piecemeal approach in the form of the Water Amendment Bill, is not a federal takeover in any real and substantive sense.

I have been urged, along with my fellow senators, to accept the bill in its current form. The government claims that any amendments would need to go back to the referring states for consideration and could potentially lead to the collapse of the IGA. First, may I say that it cannot be a very robust agreement if sensible amendments from the Senate could jeopardise the deal. To suggest that the bill should be passed despite some fundamental flaws and without at least considering areas of improvement is both unreasonable and irresponsible. For this bill to achieve what the government claims it will, substantial amendments are needed. One of the most concerning aspects of the current Basin Plan is that it is not due to be completed until 2011, with implementation taking up until 2019. To me, this is totally unacceptable. There must be a greater sense of urgency.

Members will recall that earlier this year I introduced a bill into the Senate aimed at addressing this issue by proposing the implementation of an interim Basin Plan to deal with the crisis affecting the Murray-Darling Basin and to ensure its environmental and economic sustainability until such time as the Basin Plan is implemented. In other words, it would give the Commonwealth and the minister the powers that are needed to deal urgently with the crisis. The irrigators in the Riverland and those who live and rely on the precious Lower Lakes and Coorong do not have years; they do not even have months. Some farming families are just weeks away from bankruptcy. For this reason I will be moving an amendment to implement an interim Basin Plan aimed at providing a short-term solution to the current crisis to give the authority to the government, to the minister, to deal with this.

Restriction on the trading of water is another area of concern, particularly given the severe constraints it imposes on the ability to purchase water for the southern Murray-Darling Basin regions. The argument for the cap is that it keeps water in a given region. However, as reported by the Age recently, in Victoria alone the cap is costing farmers some $19 million and the state’s economy almost $6 million as well as potential jobs. I commend Minister Wong for her moves recently in terms of there being some sanctions, some consequences, as a result of the states keeping the caps in place, at least with respect to emergency assistance packages. That is a good first step but it needs to go much, much further. I remain deeply concerned that Victoria appears to have used its four per cent cap as a bargaining tool while negotiating its entry into the IGA. My concern is that the lifting of the four per cent limit on water trade and the application of that limit on a consistent basis must be dealt with as a matter of urgency. If this actually happens it will be an important outcome, and I will be moving amendments in relation to the issue on the four per cent cap. It is something that must at the very least be debated.

The whole issue of the north-south pipeline and the way the Victorian government has approached this is something of very serious concern to me and many others. The act of—I believe—state sanctioned environmental vandalism to take 75 billion litres of water out of the Murray-Darling Basin for the use of Melbourne is something that should not be countenanced. I do not resile from my position that the north-south pipeline project should not proceed, especially given that there has not been an independently prepared due diligence report and comprehensive audit of the savings asserted by the Victorian government. Victoria’s own Auditor-General, Mr Des Pearson, has been critical of the project and has cast doubt over the anticipated water savings the project will yield. In his report Planning for water infrastructure in Victoria, released on 9 April this year, Mr Pearson concluded that the level of information provided to the community on water supply projects has been inadequate and needs to be improved. Specifically he noted that processes underpinning the Victorian water plan fell short of the standard the department applied when developing the white paper and the central region strategy. He further criticised the Victorian water plan for:

… widely varying levels of rigour around the plan’s costs and expected water savings benefits.

Despite this and despite the concerns of communities across the basin, Victoria has been given the green light for a project that I believe is environmentally indefensible. And yet it is made clear in the CSIRO report into sustainable yields in the basin released just yesterday that the one state most at risk from the impact of climate change is Victoria. Incidentally, I believe an organisation like the CSIRO has the independence and rigour needed to properly audit the merits of a proposal like the north-south pipeline, and that is why I foreshadow that in the committee stage of this bill I will support coalition amendments that will seek to stop the north-south pipeline.

I also think there is an issue of equity that needs to be considered. For many years South Australian farmers and irrigators across the Riverland have spent their own money modernising their farms to ensure they are amongst the most efficient users of water in the country. In fact, in the many visits I have had to the Riverland in the last 12 months, one of the points made to me has been that the Riverland started getting its act together after 1967, after the prolonged drought. From 1967 onwards they have been getting on with the business of being a very water efficient region. I issue a challenge to anyone who doubts that the Riverland, in terms of its productive capacity, is one of the most water efficient regions—if not the most water efficient region—in the nation.

It was put to me by citrus growers when I visited the Riverland just last week that they have an issue with the eastern states getting the lion’s share of the $5.8 billion allocated by the federal government to pay to modernise irrigation practices—so, in effect, those regions that have done the wrong thing or have not dealt with the issue of water saving with alacrity over the years are being rewarded for poor or bad behaviour. They are being rewarded to the tune of hundreds of millions of dollars because in a sense they did not get their act together on water for decades. That is why I propose to move an amendment to Senator Nash’s structural adjustment package amendments—to have the authority give some consideration to the history of water-saving measures in a particular region in the context of structural adjustment packages. If a region such as the Riverland has done the hard yards over many years, that should be taken into account in any structural adjustment. I think that is equitable and fair.

There is also a concern about how water buyback is being dealt with. Obviously I welcome any additional environmental flows into the Murray. But there is a concern about the urgency in relation to the time frame. I agree with the Wentworth Group of Concerned Scientists and experts such as Professor Mike Young who talk about the urgency of bringing more water into the system, of dealing with overallocation and dealing with it in an equitable way.

A lot of the debate has also focused on the definition of ‘critical human needs’. I look forward to the debate on that in the committee stage. There is conjecture as to what ‘critical human needs’ actually are. I note that Senator Fisher has been quite outspoken on her concerns in relation to that. Is it simply drinking water or is it water for showers and toilets? Does it cover gardens; does it cover commercial industries? I believe that is an important issue for consideration in the committee stage.

The independence and the actual powers of the Murray-Darling Basin Authority are also a concern. I refer honourable senators to an article by Jack Waterford, the editor-at-large of the Canberra Times, who wrote an opinion piece entitled ‘Black hole in the basin “fix”’ back on 9 July, a few days after the IGA was signed. He talked about his concerns about the minister having the final say in the Basin Plan—which is a good thing—after a lot of toing and froing on the processes set out in the bill. But, at the end of the day, the implementation is up to the states. Mr Waterford was of the view that ‘If anyone kicks up a fuss on anything, paralysis is virtually inevitable’ in terms of the way the plan is implemented and dealt with. I think Mr Waterford is reflecting the belief of many in the community that there ought to be a greater degree of federal control over the river system. I will be urging the government to consider an amendment to ensure that, when preparing a Basin Plan, the Murray-Darling Basin Authority takes a whole-of-basin approach, taking into account environmental, economic and hydrological considerations. There is no point having an authority unless you give it real authority.

I understand that the CSIRO has an important role in preparing its sustainable yield report. I think it is important that the CSIRO has an ongoing role to monitor in a robust, independent way the progress of assertions made as to water savings, water efficiencies and the north-south pipeline. You need an independent body with that level of expertise to do that. I also think it is important that the implementation of the act be reviewed on a regular basis by another independent body such as the Productivity Commission to look at the whole issue of water savings and efficiencies and ensure that the objects of the bill are carried out effectively and efficiently in the context of the aims of the bill.

On the issue of auditing: on 14 August the Prime Minister announced new water initiatives in response to the situation in the Murray-Darling Basin. One of those included what he claimed would be a comprehensive audit of both public and private water storages in the basin. My question to the minister for consideration and response in the committee stage is: can the minister advise what has happened to the audit that was announced, what is the progress of the audit, when will the results of the audit be provided and what were the parameters, in the context of the methodology, resources and rigour, in undertaking that audit? That audit was announced over three months ago, and my understanding was that it ought to have been released by now.

I also have a query in relation to the Menindee Lakes in New South Wales. Why aren’t the Menindee Lakes counted until they reach an arbitrary level of 640 gigalitres, a level that seems to be always just out of reach? And that is something that New South Wales can control anyway, by releasing water from the Menindee Lakes. I note also that, when I visited the Menindee Lakes a number of weeks ago, the Darling River Action Group were quite adamant that for the last 10 years they had been talking about some fundamental projects, some key projects, to reduce the level of evaporation of those lakes of several hundred gigalitres a year and about the fact that Broken Hill, with the 10 to 20 gigalitres that it needs for water on an annual basis, needs to store about 200 gigalitres in the Menindee Lakes because of the level of evaporation and the lack of works that have been carried out.

I acknowledge that the bill does give South Australia carryover water rights for the first time. On the surface this seems like a good thing. But, if gross mismanagement and overallocation of the river are allowed to continue because of the flaws in this bill, how much water will be left to carry over? Will it be carryover water or will it be carryover air?

Finally, I note that the Greens will be moving amendments in relation to a quantitative regime for sharing water in the Basin Plan, something that Professor Mike Young and the Wentworth Group of Concerned Scientists have been outspoken on—and I can indicate my support for those. The government describes the Water Amendment Bill as a historic agreement for the long-term reform of water management in the Murray-Darling Basin. It describes a ‘new era of cooperative arrangements between the Commonwealth and the states’. I wish I could share the government’s enthusiasm. I am concerned that there is simply too much scope for the paralysis that Mr Waterford refers to.

I urge the government to have the same political determination that the Hawke government brought to the issue of the Franklin Dam, to use its constitutional powers to take on the states in order that we have one river system with one set of rules, and to heed the advice of constitutional law experts, such as Professor John Williams from the University of Adelaide law school, who are adamant that the federal government has the power to fix this problem. It needs to have the political will as well. I will support this bill going through to the committee stage, but I reserve my position in relation to the third reading stage based on the way the amendments are dealt with by this place.