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Opening address to the Murray Darling Association's National Local Government Environmental Flows Conference, Mildura.

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Speech Federal Minister for the Environment and Heritage The Hon Dr David Kemp, MP

Murray Darling Association's National Local Government Environmental Flows Conference 9-10 July 2003, Mildura Wednesday, 9 July 2003

Opening address to the Murray Darling Association's National Local Government Environmental Flows Conference

Ladies and Gentlemen:

It is a pleasure to be in Mildura today to open the Murray Darling Association's National Local Government Environmental Flows Conference.

In September last year I opened the 58th Annual Conference of the Murray Darling Association at Whyalla, in South Australia, which is a location that amplifies the vast needs that are met by our one great river system.

I was impressed then with the role the Association has played in the development and conservation of the Murray Darling system.

Today I applaud it for its initiative in organising this Conference on environmental flows - which is one of the critical issues confronting not only the Murray Darling Basin, but indeed the nation.

And I want to emphasise today that this national aspect of the basin's future health can hardly be overstated.

It is of as much interest to those of you who have come here from outside the basin as it is to those representatives from within the Murray Darling Association net.

Quite simply, the Murray Darling basin is the engine room of Australian agricultural production.

With 16% of Australia's land area, it generates around one-third of the nation's agricultural output.

Australia simply cannot afford a decline in the productive capacity of the industries of the basin and the bottom line is that the productive health of the basin is inextricably linked to the environmental health of the basin.

A healthier river means a healthier economy, not just in the basin, but nationally.

The Living Murray Initiative is not, as I think some still view it, a purely environmental issue.

It is, obviously and appropriately, a cause of deep concern that native fish numbers, across the river system, have declined by some 90 % since we regulated the river.

It is a tragedy that we have lost an estimated 80% of the water birds in the Basin since the 1970's.

It is deeply disturbing that we are perhaps now in the advanced stages of losing hundreds of thousands of River Red Gums - the iconic tree of the riverbanks and the floodplains.

The closure of the Murray mouth is symbolic of the degradation of the system, and poses a very major threat to the health of the Coorong, an internationally recognised wetland.

It is obvious that these environmental issues are concerns that have helped galvanise the governments of the basin to action about improved environmental flows.

But behind them are the productivity issues that are at the heart of the process - and are inextricably linked to environmental degradation.

We need a Living Murray not only environmentally, but crucially - for a Living economy for the Murray, and a Living society for the Murray.

The simple fact is that we cannot have one without the other.

Environmental, Economic and Social Goals are linked

Salinity is perhaps the single clearest example of the synergies between an environmentally Living - or threatened - Murray, and an economically Living - or threatened - Murray.

Salinity is a biodiversity issue within itself, one of the causes of the dire threat to River Red Gums, which underscores more generally the value of native vegetation - both in biodiversity terms and in terms of the service that it provides farmers and graziers by protecting the quality of their land - by holding water tables, and salinity, in check.

Salinity imposes massive productivity constraints on the industries of the basin. It illustrates the key message that I believe we all need to take on board:

An environmental loss can be an economic loss, and thus - to ensure the sustainability of the economy of the basin, we simply have to have an environmentally healthy basin.

Almost half of the 21 priority regions for the Howard Government's National Action Plan for Salinity and Water Quality are in the Murray Darling Basin - even though the Basin represents some 16% of our land mass.

When we embarked on the development of the basin - which has delivered such remarkable economic and social dividends to this nation, we did not comprehend that we were doing so in an environment which had, embedded in it, the threat of salinity.

We have known for many decades that salinity from the irrigation districts was, and remains, a threat to the productivity of industries, but it is only quite recently that we have recognised that, in the medium term, a much more insidious impact on productivity - and on the environment - will flow from dryland salinity.

The Basin salinity audit of 1999 identified clearly, for the first time, that it is dryland salinity that threatens to reduce the water quality of the River Murray to the extent that salinity levels will exceed the World Health Organisation's limit of 800 ec's for potable water, in Adelaide, two days out of five within 50 years - principally because of the clearing of the Mallee country, in both Victoria and South Australia, decades ago.

This influx of salt, anticipated to have a major impact within 20 to 30 years in those downstream sectors of the river, will massively complement the salinity from irrigation, and from other dryland sources that are being unleashed because of the extent of clearing for both agriculture and grazing - virtually basin-wide.

For Adelaide's one million people, in the driest state of the driest continent on the planet, with a reliance on the Murray of 90% at times, that outcome would obviously be nothing short of a major social and economic disaster that would have major national ramifications - and the current drought is giving us a glimmer of what the beginnings of such a world might look like.

We have seen the mouth of the Murray close - and salinity levels in the very lowest reaches of the river reach extraordinary levels.

Last week salinity at Milang on Lake Alexandrina was 1120 ec's. At Meningie on Lake Albert, 1400 ec's, and at the Goolwa barrages, 5010.

Water from both lakes is therefore undrinkable, by World Health Organisation standards, and the water is marginal for irrigation purposes. Hard up against the closed barrages the water is essentially useless for either, and indeed almost any, purpose.

The combination of the closure of the mouth, and extraordinary salinity levels, threaten therefore, not just an environmental cost, particularly for the Coorong: They represent a massive threat to the productivity of agriculture in the lower reaches of the river, and they give us a glimpse of what will be if we do not move promptly to better protect environmental and economic activity.

These facts provide another basis for the key message that we simply have to improve the health of the Murray to sustain the productivity, and the most basic aspects of the amenity, of the basin.

A National Action Plan Initiative

I am therefore pleased to announce here today another step towards protecting that productivity, in Victoria, through a joint $7.25 million investment by the Commonwealth and Victorian governments in NAP projects.

Activities that will be funded include projects to predict the likely impacts of environmental intervention on salinity and water quality in Lower Murray communities in the Mallee in consultation with those communities; a salt interception and harvesting scheme associated with new industry at Pyramid Hill, and

an examination of how areas generating salinity can be managed by hybrid engineering/agronomic technologies.

These are projects symptomatic of the commitment that we have to achieving sustainability, and I believe that they help demonstrate that this is NOT a debate about soft environmental sentiment: It is a debate, and a policy arena, that is about survival.

And that survival is not going to be achieved through The Living Murray Initiative alone, which is the second key message I wanted to give to this audience today.

Nor can it , nor will it, be achieved through what I know to be the fear of many people in the Basin: That governments will simply seize water to return to the environment.

The Howard Government's Commitment to the Murray/Darling

Let me illustrate the breadth of the actions that the Howard Government has under way: Since 1996/97 $365 million has been spent in the Murray Darling Basin through the Howard Government's Natural Heritage Trust alone - with $186 million of that linked directly to the Murray and other rivers in the basin.

Some $40 million has been so far approved for projects in the Basin under the Howard Government's National Action Plan for Salinity and Water Quality - with much more to come: We anticipate combined annual expenditure from the NHT and the NAP across the Basin will exceed $60 million a year.

The Howard Government, and other governments of the basin, are also contributing more through the Murray Darling Basin Commission, where the Budget this year is for $96 million, compared with $80 million last year, and it will rise again over the next two years to $110 million - and then to $116 million.

These commitments, I believe, show that the Howard Government's actions and leadership through The Living Murray process is not a recent reaction, in isolation, to purely environmental concerns: It is of a piece with a much wider awakening to environmental degradation - and to the threat that environmental degradation poses to the economy and the communities of the Murray basin - that has been abroad for many years - and in the case of salinity, for decades.

So I would emphasise that the Commonwealth's commitment to improving the environmental health of the Murray, and the productivity of the Murray, is not restricted to the environmental flows process and debate.

It considerably predates it - and I think we need to have that very much in consideration as we contextualise what is being sought, through The Living Murray, and the way in which people perceive the process.

The Living Murray process is not a bid to hijack productive water.

It is a bid to find a fairer and better way to use the water we have so that we can produce a healthier river, and a healthier, more soundly based economy.

And I'm pleased to say that I believe the consultation process is now getting much closer to delivering an

acceptable set of answers - which takes me again to the third of the major points I wanted to make to this audience - which relates to the way in which water is to be recovered.

It's too early to go into much detail, but the potential for improved water efficiencies, massive on and off-farm, can, I believe, deliver a good measure of the win-win situation that we in the Howard Government, and I believe in the States, are striving for: improved river health with improved productivity - improved profitability for the basin and the nation.

Sharing the benefits of increased efficiencies between industry, society, and the environment could deliver that potentially significantly increased productivity.

Some of you will know that there are horticulture irrigators in the system who have doubled their production using only 60% of their former water use - through the installation of drip-irrigation, or other forms of very efficient water use, such as below-canopy sprinklers. Irrigators of other crops are also making major efforts to reduce consumption, while boosting productivity.

These forms of recovery provide an opportunity for environmental solutions that can underpin greater production and a more secure economic foundation for the communities of the Basin.

I would like to comment on the discussions about the volumes of water being considered in The Living Murray process.

This is NOT a debate about whether we ought to return 350, 750, or 1500 gigalitres of water to the Murray.

Those are simply reference points. They give us benchmarks for establishing an understanding of the economic and social and environmental impacts associated with returning water to the Murray.

They will help to inform us as to optimum, achievable, outcomes at different levels of flow.

The only other significance of those numbers is that science tells us the potential for environmental benefits at the lower end of the volume scale is low, and moderate at the higher end.

Achieving Sustainability

The answers to the joint challenges of environmental and economic sustainability involve much more than the simple number of gigalitres to be returned to the river.

It will involve significant issues of river management.

Water can be manipulated. The Murray Darling Basin Commission has been a superb manipulator of water for economic and social ends.

For decades, while extraordinary variations in the river's flow rates make life difficult, it has ensured that consumptive users, as far away as Whyalla in South Australia, get their water with the regularity that Mounties get their man. It looks easy, but I know it's not, and it has been a remarkable achievement.

Now, with the realisation that we need to manage the river in order to not only meet consumptive needs,

but to meet the environmental conditions that underpin productive and community sustainability, I'm sure the Commission can meet the challenge.

We are steadily learning that changes to river management can simulate, at least for some wetlands, a much closer to natural flooding cycle - so that we can stimulate bird breeding events.

This is already being achieved in relation to the Barmah-Millewa forest, with some outstanding results.

We can fulfil our biodiversity obligation to the Straw Necked Ibis - among many other species - and thereby increase the numbers of one of the most effective, natural, insect control mechanisms available to farmers in the Basin.

We can enhance the social fabric of river communities, and our biodiversity obligations, by simultaneously providing the threatened Murray Cod with opportunities to breed in those same managed floods, and we can help the Yellowbelly - or Callop - depending on where you live or fish on the river - to roam widely, as is their want, by devising ways they can pass through locks and weirs.

And perhaps we can increase species variety and numbers back to significant levels to sustain not only recreational fishing - so important for our tourism - but also a commercial fishery.

Simulation of flooding events, through management, can also help the River Red Gum and the Black Box on the floodplains.

We are seeking to establish the Daughterless Carp, in a bid to reduce the numbers of that pestilence in the River.

So measures we can and are and will be using to achieve a Living Murray will not only increase volumes of environmental flows in the river, but embrace a suite of water management issues with clear economic goals, and benefits.

Further away from the river and the floodplain, other measures can be implemented, in terms of dryland farming techniques, to reduce the threat of salinity both on and off-farm, with significant, biodiversity related, economic benefits.

For example, the effect of long term cropping and fertilisers in southern Australia has reduced the microbial biodiversity by some 60% in the top 10 centimetres.

Such soils are less productive, more prone to water or wind erosion, and it becomes increasingly expensive to artificially maintain their productiveness.

The value of this microbial life in soils has been measured, in an organic South Australian orange grove, as providing the equivalent of $30 of nitrogen per hectare. In a conventional grove, where there is a high use of chemicals, the benefit from degraded microbial life is only $5 per hectare.

Less intrusive techniques will also mean less run-off, and less erosion, which means higher water quality - for the environment, and for downstream consumers: Again, we see here the continuum, the synergy, between a healthy environment, and a healthy economy.

At its meeting in May, the Murray Darling Basin Ministerial Council instructed the Murray Darling

Basin Commission to provide Ministers, before their next meeting, with a proposal for what has been termed a first step towards improving the health of the River Murray.

Rather than call it a first step, perhaps it is more accurately called the next step.

As we have seen over the decades, and more recently through the Howard Government's NHT and NAP we, and I mean the people of the basin as well, have already taken many steps.

The next step will hopefully be a precursor to further significant initiatives next year.

The Commission, and governments, will be continuing to work to put forward a more holistic proposal for delivering a healthy, working, river.

I believe we will be able to achieve that through a mixture of measures and a range of management tools and complementary actions for improved water quality, not just increased environmental flows.

I would also hope that the Council of Australian Governments will have made real progress towards the establishment of a basin-wide water trading system - a crucial ingredient in delivering a healthy, working river.

It will be one of the key ingredients in ensuring that we can have a working river that delivers more with less, and indeed the transition to higher value, more efficiently produced crops, could have a massive positive impact on the profitability of the region.

That is certainly what Warren Truss, the Chair of the Murray Darling Basin Ministerial Council, and I want to work towards.

I believe that is also the intent of the State and Territory Ministers on the Council: An environmentally healthier river, and an economically healthier river, with enhanced amenity for the people of the basin and the country.

I commend that plan to you, and I wish you well in your deliberations over the next two days, particularly on the role that local government can play in delivering a healthy, working, living Murray.

We simply have to have it.

I declare the conference open. Thank you.