Water Amendment (Long-term Average Sustainable Diversion Limit Adjustment) Bill 2012

I, too, rise to speak on the Water Amendment (Long-term Average Sustainable Diversion Limit Adjustment) Bill 2012. Firstly, can I say that I am an irrigator. I hold a water licence in South Australia and I am a member of a community that relies absolutely entirely on the Murray River for its very existence. There is not one person in the community in which I live that does not want a healthier river—a river that is in a robust enough condition to continue to provide for river users, a river that will continue to feed this country and many people who live overseas, and a river that will provide enjoyment and benefit for every Australian. My community is very, very keen to see a Basin Plan that will return certainty to their lives.

For the past five years, while the government has flip-flopped all over the place, developing numerous draft plans, desktop testing numerous scientific assumptions and spending millions and millions and millions of dollars of taxpayers' money, river communities have remained in limbo. There are fears now that nobody has actually been investing in these communities. People have been reluctant to spend money on infrastructure, on new plantings and on plant and equipment, because they just do not know what the future holds. We now have this huge investment lag which we are now going to need to deal with over the coming years. Just as an example, the current crisis that we have in our citrus industry has certainly been exacerbated by the fact that people have not had the confidence to change their plantings, and, hence, we now have an oversupply of some varieties while demand for new varieties cannot be met.

Another consequence of this prolonged inactivity and uncertainty in the market is the price of water. As long as the government continues to be such a significant player in the water market, the price of water will remain distorted. Once we have this plan in place, the government plainly needs to get out of the water market and let the market find its own level. In doing so we might get some confidence back into that market. Hopefully the trading of water will start to be done for sound economic reasons and we will stop seeing the short-term profiteering that we saw during the drought. Basically, we just need certainty so we can get on with our lives.

Hopefully, the adjustment mechanism proposed in this bill will give some comfort to the people in the community that I live in. There is no doubt that we do need a mechanism so that we can alter the SDL, because there is plainly every chance that the SDL is going to be wrong. Over the time we have been debating this in the short time I have been in this place, the number has kept on changing. The number is based on science, it is largely untested in the field and it is a constantly moving target. The adjustment mechanism will hopefully allow us to test the science in a real-world situation before we destroy further communities along the river by continuing to take overgenerous amounts of water out of our system before we have even seen whether we need them to achieve the outcomes that we are seeking.

I can talk about the obsession with his magic number. We have had 7,000, 4,000, 3,500, 3,200 and 2,750—all these numbers have been bandied around. But the real issue is not how much water we need but how, where and when we need it. We do not have an implementation plan. We have no environmental watering plan. In fact, as I am standing here today debating this particular bill, we do not even have a Murray-Darling Basin plan. Until we see a basin plan we are just having a chat about what might be. As one person tweeted on Q&A last night, 'A vision without execution is an hallucination'. Without either an implementation plan or an environmental watering plan, we are playing in the dark. We have none of these documents. It does give me some confidence that the mechanism to change the number exists, but none of us can have any confidence whatsoever that that number is right. I am not saying it is wrong, but we do not know whether it is right.

We do not know whether delivering the water when and where it is needed is even possible. The Committee for Economic Development of Australia report the Australian water project, of 2012, raises this issue when it says:

Better funding and coordination of environmental water allocation, monitoring, measuring and analysis is critical before any changes are made to the sustainable diversion limits.

I note that in the last two years we have seen significantly above-average flows but, as Senator Birmingham mentioned in his comments, we have not seen any great improvement in the Lower Lakes—simply because we have not done the necessary works to be able to achieve those environmental outcomes. It is not just water; it is what you do with it. So we need a much better understanding of how this water will be used before we can hope to come up with an SDL that maximises economic outcomes, protects our river communities and delivers good environmental outcomes. During a recent Senate committee hearing the Chief Executive of Murray Valley Winegrowers, Mark McKenzie, highlighted this issue when he said:

We do not have the capacity to fully assess the plan at this point for a couple of reasons. One is that we do not have a water recovery strategy and we do not have an environmental watering plan in final form. They are still works in progress. …

From our perspective, we have always held that it would be better to do the work first rather than push on with a target which, with respect, is a political target, not a target to deliver a plan which the whole community in the basin can sign off on. That said, we are fatigued and we need certainty. …

Mr McKenzie probably speaks for many, many people that live in these basin communities.

I also think that most people in the basin just want a plan. I know that the people in South Australia just want a plan, and I also think that every South Australian would agree that a healthy river is extremely important. I do not think you would get much argument from the farmers who rely on the river that a healthy river is in their best interests. What they will argue about is taking water from productive use before all other avenues of water savings have been exhausted. This has been argued right across the basin.

During the same water hearing I was referring to, the Chief Executive of the NFF, Matt Linnegar, also commented:

… a limit [should] be placed on any future buyback in light of the social and economic consequences that would follow.

Mr Tom Chesson from the National Irrigators Council also argued that buybacks must be a last resort.

There are a number of options available to achieve water outcomes without resorting to further buybacks, and they are off-farm infrastructure improvements to increase efficiency in the delivery of water, environmental works and measures, removal and reduction of constraints to the river flow and on-farm efficiency measures. All these measures must be pursued so that we can find out exactly how much water can be secured, without reducing productivity in one of Australia's key sectors—primary production.

I would like to draw the attention of senators again to the CEDA report, the water project report, where it said:

A rigorous investigation is required into the food supply chain for irrigated agriculture-from water, to crops, to international food markets-to remove blockages and constraints so Australia can take advantage of increasing international demand.

If we are serious about taking advantage of the opportunities of the Asian century that this government is talking about, we need the capacity to expand our food production. One the one hand, the government is saying that Australia needs to take opportunities in China; while, on the other hand, the government is restricting our opportunities to participate in this sort of planning. This is not only happening with the Murray-Darling Basin Plan. We only have to look at what is happening in our fisheries at the moment, with the restrictions on being able to fish in areas around Australia. We are restricting our fishery when we do not have any species of fish that are being threatened by overfishing—which is interesting in itself.

As I stand here today, just over 1,500 gigalitres of water has been returned to the basin using the money allocated to it in the $10 billion fund. Very little has come from infrastructure projects, and the rest has come from buybacks—water that has been taken out of productive use. Much of this water has been purchased from desperate sellers—not people who wanted to sell their water, not people who were making money out of selling their water, but people who were desperate to get the banks off their backs. People were living in situations of such total uncertainty about their products and their ability to invest in their businesses that they just had to sell their water. I think this is a very, very sad situation to find ourselves in.

It is time that the Infrastructure Fund lifted its game and started putting back its share of water into the communal bucket. With $5.8 billion allocated to infrastructure projects, what have we got to show for it? My understanding is that we have secured around 280 or 290 gigalitres of water so far out of a $5.8 billion fund. This is an absolute disgrace! What is a further disappointment is the need for the constant requests to the MDBA for information specifically about how that money has been spent. To the best of my knowledge, those questions have not been answered. I heard those questions being asked in estimates. They were put again to the department during the Senate hearing on this matter just a couple of weeks ago. Without this information, it is very difficult to know how much money is likely to be needed to secure the additional water in order to reach the targets that are on the table and that are assumed to be in the plan, as well as any subsequent money needed should the circumstances occur where the SDL is lowered through the mechanism that this bill seeks to legislate.

The more sceptical of us would say that the reason we do not have the breakdown of this money is that maybe the money has been used for purposes that were outside the intent of the fund. Maybe the agency has spent vast amounts on consultancies and on its own administration. Maybe the government knows that there is insufficient money left in the bucket to fulfil the promises it has made, particularly the promise that the Prime Minister made to the people of South Australia to return 3,200 gigalitres of water to the river.

As I said, the food producers and the communities support the river. They also support the MDBA in its endeavours to come up with a plan—a plan that will provide for the ongoing management and operation of the system in a sustainable manner. These communities have already given up a huge amount of water over the last few years to return it to environmental flows, and so it is very disappointing when we hear that the environmental lobby is fixated on buyback as the way to achieve water recovery. My question is: why should they care?

The Australian National Environmental Defenders Office said at a recent hearing that research indicates that buying water access rights is the most cost-effective means of returning water to the environment. One would like to think that the Environmental Defenders Office might be thinking about the implications of buying back that water from communities and not worrying about whether it is going to deliver an environmental outcome. During the hearings, these same sentiments were expressed by other groups like the Australian Conservation Foundation and the Wentworth Group. I would say to these groups: 'Your agenda is to get enough water to meet your environmental targets. How that water is achieved should not be of any concern to you.' They should leave the irrigators alone and allow all the other mechanisms that I have mentioned to provide the water before seeking water through buybacks.

We know that water buybacks have a detrimental impact on our regional communities. The debate about doing it just through buybacks does nothing to achieve a conciliatory outcome on this issue. I will give an example of the terrible impacts that buyback has created in my own local community. It has the Swiss cheese effect, whereby blocks are left completely without water. All of a sudden, you have fewer irrigators in your community, but the same amount of infrastructure still has to be paid for by the irrigation trusts in the region. So you end up with a situation where fewer people are paying for more infrastructure costs and the land is being left vacant. I say to those who support buyback: think very, very seriously before suggesting buyback as a priority for returning water to the environment.
Before I finish, I would like to put on the record South Australia's record of responsible use of water over the past 40 years. Since 1969, we have not breached our cap. I think every other state would agree that we are very efficient irrigators. We have relied on high security for much of the working of our irrigation operations in South Australia. I would also like to put on the record how the South Australian River Communities group has been working to try to get a fair deal for South Australia.

I would like to acknowledge the huge contribution of people like Ben Haslett, who is a very successful primary producer in our Riverland region who has given up hundreds of hours of his time to fight this cause on behalf of the irrigators of South Australia. I also acknowledge Gavin McMahon from the Central Irrigation Trust, who has also given up the most extraordinary amount of his time in an endeavour to see if we can get an outcome from this plan. I think they would all like to see a great plan for the whole of Australia, but the interests of South Australia have been foremost in their minds. I acknowledge all the other people who preside on the South Australian River Communities committee. I think we need to pay tribute to the huge amount of work that they have done.

I would also like to say that I am very pleased that the government has agreed to changes to this bill in the process of the debate in the other place. I specifically refer to the amendments for the minister to retain oversight of the plan and for the parliament to retain its power to allow and disallow. This is especially important given the comments of the National Farmers' Federation about how they had lost all confidence in the Murray-Darling Basin Authority and its ability to come up with proper and good outcomes. So I hope retaining the legislative instrument and also the minister's ability to oversee this plan will go some way to appeasing the concerns of the communities throughout the Murray-Darling Basin that the Murray-Darling Basin Authority has not been serving their best interests and instead has been playing puppet to some political masters.

I understand that this bill is required to be passed to enable the minister to present the final Murray-Darling Basin Plan. On that basis I am very keen to support this bill because, like almost every other person who has been involved in this process, I want to see the plan. If you went out and surveyed everybody who has had any involvement in developing this plan over the last five years, I think they would all be extremely fatigued and be saying, 'Just show us the plan.' But, in supporting this bill, there must be a rock-solid guarantee that the socioeconomic integrity of our river communities is not jeopardised. We need to ensure we meet the requirement that there is no detrimental socioeconomic impact to this bill on our communities when it comes to any changes or any distribution of water from this river. I will support anything that goes to the crux of covering off the socioeconomic impacts of this bill, subsequent bills or the plan. It is absolutely essential.

Implicit in this is the promise of the Prime Minister and Minister Burke that there will be no compulsory acquisition of water to achieve any of the targets that have been set through this process, whether that be the original 2,750 gigalitres, the extra 450 gigalitres that was promised recently by the minister to appease the South Australian premier or the adjustment mechanism that may or may not be required resulting from this bill.

I want to be able to support the plan and I will do so if it delivers the triple bottom line of social, economic and environmental factors and addresses the issues by minimising the cost to communities, delivering improved environmental outcomes and enabling increased efficiency in the irrigation sector. We cannot take support for this bill as support for the final plan. To do so at this stage would be premature and negligent because, as we have said on numerous occasions, we have not seen the plan yet. There is on our side, however, a genuine and honest commitment to progress water reform in the Murray-Darling Basin. I therefore hope that we can reach agreement on the passage of this bill so we can see the final plan and all of us can get on with

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