Andrew Bartlett (Queensland, Australian Democrats) Share this | Link to this | Hansard source

I move:

That the following matter be referred to the Rural and Regional Affairs and Transport Committee for inquiry and report by 9 May 2007:

All aspects of the Federal Government’s 10 point National Plan for Water Security, including:

(a)

whether it will return sufficient water to the Murray-Darling Basin to meet the environmental needs of the Murray-Darling Basin catchment; and

(b)

what mechanisms are in place to ensure farmers and the environment obtain maximum value from the funds expended.

The case for this reference is pretty straightforward, so I will not go on at great length about it. The plan to put in place a rescue package of up to $10 billion over 10 years for the Murray-Darling Basin has been widely debated in this place. There have been many questions and plenty of debate, coverage and publicity in the wider community.

I emphasise at the start that, in proposing that this matter be examined by a Senate committee, I am not in any way attacking the intent behind the plan. Indeed, for a number of years the Democrats have called for the federal government to take a stronger lead role with regard to the Murray-Darling Basin, to, if necessary, take over control of the catchment and, if necessary, to look in the wider context at assuming greater powers in the environment area.

So the move in this direction is not something that the Democrats are critical of in principle. Indeed, one could argue that the move in this direction is somewhat overdue given how badly things have failed to date and how inadequate the various responses have been in tackling the threats to the Murray-Darling Basin. This reference to a Senate committee does not seek to score political points or to attack the general principle underlying the proposal. It is an attempt to increase the chances as much as possible so that the plan for water security actually is successful and effective.

It is widely known that the plan was put together at extremely short notice. It is also widely known that the plan was put together with minimal consultation—certainly no consultation with state governments and minimal or no consultation with affected stakeholders. As we also now know, despite the price tag of up to $10 billion, it was not even approved by cabinet. There was not even that level of consultation; there was not even that degree of adequate costing of the various measures within it. On top of that, it has also been extremely difficult to pin down exactly how the various components of the plan are going to operate, how decisions are going to be made with regard to expenditure and what criteria are going to be used.

I appreciate that not all of those things necessarily get worked out right at the start, but the simple fact is that, if you are going to have a major plan costing up to $10 billion with significant rearrangements with regard to the management of the Murray-Darling Basin and the structures that need to be put in place for the expenditure of a very large amount of public funds, it is desirable to have as many of the mechanisms relating to that as possible clearly out in the public arena. Some more have come out since the plan was first announced, but I think it is fair to say there is still a fair degree of work in progress around the whole thing.

Obviously, since the plan was first announced there have been a number of meetings and consultations with the relevant state governments, sufficiently so that three of the four state governments affected by the plan have signed on. That is all well and good, and of course they have a perfect right to do that. Although the federal government, which decided to put forward a plan and demand that everybody just fall in line, has expanded the negotiations for a few other governments to sit down in a room somewhere, decide on it and then go ahead with it, that still leaves out a fairly important part, which is the affected communities, the general public and people with wider expertise. This should not be something that is just stitched up between various governments to satisfy each of their various short-term political needs. That is part of how we got into the mess we are in now. The more public examination we have of the details and the more questioning, querying and detailing we have of what is proposed, the better chances are that this will work effectively. I would like to think that that is what all of us want here.

The other concern, which is a very reasonable concern to have given past history—particularly considering that this is an election year and large amounts of money are being promised—is that significant amounts will be channelled towards people on the basis of vote-gaining consequences rather than on the basis of maximum value from the funds expended. That is part of the rationale behind proposing that a Senate committee examine this. A short inquiry is proposed here and it would not in any way hold up the implementation of this plan, which I would agree is urgent. What it would do is increase the chances of it being implemented in an effective way that actually gives the taxpayer value for money. Even trying to nail down the basic issue of what is being proposed with regard to amounts of water being made available for environmental flows has proven to be quite difficult. Even trying to nail down the simplest matter of whether or not there will be the potential for water rights to be bought back from irrigators where necessary has proven to be difficult. Very different messages have been coming out from different members and ministers within the Howard government with regard to that. Of course, on top of that you have the different assurances, promises and needs at state level. The more this can be nailed down at the start the better the chances of it being implemented effectively.

The other point that is worth mentioning is that it will enable clear, public, focused input from people with expertise in this area. It is one thing to have the direct stakeholders involved—and it is right that they be involved—but it is another to ensure that independent experts do have input at the start rather than after a lot of the decisions have been made. That has not happened adequately to date, in my view. This would be a simple and effective process for increasing the opportunity for that to happen.

Frankly, given all of the justifiable concern about how rapidly this proposal was put together and the completely inadequate consultation that has occurred to date, I would find it bizarre in the extreme if there were not support for this motion from the opposition. Despite agreements that have been entered into by state governments, it is a simple fact, as it always is with the federal government holding the purse strings, that they also hold the whip hand. There is plenty of opportunity for things to change down the track—for commitments to be modified and for core promises to become non-core promises as political imperatives come into play. The more things can be nailed down at the start the greater the chance of that being avoided.

This is a simple proposal from the Democrats to maximise public scrutiny of what is a major policy announcement and plan by the federal government. It is something that obviously can be scrutinised intermittently through Senate estimates—and I am sure it will be—but the appropriate time to have an examination of the adequacy and detail of this very significant and very expensive new plan is at the start. This allows for further input to occur that has not happened to date. It is a clear example of a Senate process doing what Senate processes are there for: to hold governments to account, including state governments; to enable greater transparency about the expenditure of public funds; to enable greater scrutiny of the public policy issues and the administrative procedures involved; and to allow public input from those who are directly affected, from independent experts who have knowledge of the issues involved and from those who are concerned about ensuring that the long-term environmental health of the Murray-Darling Basin gets adequately factored in.

In proposing this, I am not in any way suggesting that this is not the intention of either the federal government or the state Labor governments involved in this plan. What I am saying, though—and history has shown this to be true any number of times—is that, if you have at the start of these sorts of plans the fullest possible scrutiny and the fullest possible non-partisan, independent checks and balances through an examination of the detail, then you significantly improve the chances of them being effective. It is very important for the future health of the Murray-Darling Basin, for the many communities that rely on the healthy river system and for the taxpaying public in general, who have $10 billion on the line here, that this proposal be effective.

As I said at the start, proposals such as this are ones that the Democrats have called for a number of times over many years, so we are not in any way attacking the principle. What we are seeking to do is to have proper public scrutiny of the implementation, and that has not occurred to date. I think it would be highly desirable that it did occur, and via a Senate committee process.

Rachel Siewert (WA, Australian Greens) Share this | Link to this | Hansard source

The Greens will be supporting the Democrats’ motion to refer the National Plan for Water Security to a committee. We believe this is an extremely important issue. The government is spending a large amount of taxpayers’ money, and, as Senator Bartlett stated and as became evident in the many estimates questions that were asked, there has been no proper analysis of the costs. During estimates when we asked for an explanation of the costs and how they were arrived at, no information could be provided—not even back-of-the-envelope estimations.

When we asked for targets, none of that information was available. There has been no update on the basis of how targets have been set for the Murray-Darling Basin. In fact, the 10-point, $10 billion plan does not include any targets. Presumably we are still stuck with the 500-gigalitres target, which, as I have said on many occasions in this place, is the lowest common denominator target. This was the target all the states could agree on and it was the lowest of the low that the scientists recommended. Scientists said that 3,500 gigalitres were required to give the Murray-Darling a good chance to recover. We have no idea whether that can be achieved through this process and we do not even know if that is the target, because the government has not committed to a target. All we can assume is that we are working on the 500-gigalitres target.

We are getting more information every day. A couple of weeks ago, the State of the Darling—interim hydrology report was released. That says that basically the Darling is in a state. It is a severely degraded river that is getting worse. It is suffering from loss of volume flow, the wetlands are drying out, there is a loss of flood events, there are fish migration problems and, besides what the river is suffering from now, there are increased risks from climate change. I will go back to that in a minute. The current estimates indicate that reductions in average flows of 20 per cent or more may occur by 2030. I would say that is on the low side, if you take the example from Western Australia where a 20 per cent reduction in rainfall led to a reduction in run-off of 64 per cent. I suggest that that estimated reduction in average flows is on the conservative side.

The report also talked about the continued increase of surface water use. In other words, they have not managed to stop the increased use of that water system. It also says that they need to ensure that they do not allow increased flood plain harvesting diversions, and there is also concern about current and future groundwater use. The list goes on and on about the potential impacts for the Murray-Darling system.

No proper analysis was done of the needs of the river. This plan was not based on a considered management plan; this was based on a ‘let’s put something together real quick over Christmas, starting in November’ proposal. This was not raised at the water summit. At the water summit certain actions were put in place. One of them was to give CSIRO just 12 months to go away and determine the sustainable, harvestable water from each of the catchments in the Murray-Darling Basin. Twelve months is a very short period, and they do not have all of the information they need to be able to do that.

They were given 12 months in November. On 25 January the Prime Minister announced a $10 billion water plan, which was not canvassed with the states. There was no consultation with communities, with landowners, with irrigators, with the states, with the broader community, with environment groups or with local groups that know their wetlands inside out and back to front. None of those groups were consulted. There are no costings and there are no targets. Victoria still has not agreed to the $10 billion plan.

Now we have South Australia very seriously canvassing the concept of cutting off the water supply to at least nine of their wetlands. Water is absolutely critical to these nine wetlands. Last week I talked about Lake Bonney, which is in a dire situation. If it does not get water within the next 12 months, they might as well not bother because salinity will have risen to such an extent. If they cut off water supply to that lake, it will have dire consequences for the broader environment because salinity will have been driven so high in that lake. It is do or die for that system. It is do or die for a number of the wetlands of the Murray-Darling system.

The government now has at its disposal an even stronger mechanism to start helping those wetlands, but it is refusing to do so. It keeps saying: ‘Yes, we know we need to be buying water allocations. We know this is urgent.’ I put up several motions on this issue very recently, but the government would not commit to urgently buying the water resources that are needed to help these wetlands. It did not support a motion on World Water Day. The motion simply acknowledged the potential decision of South Australia to cut off water to lakes. It talked about the impacts of climate change as outlined by Dr Wendy Craik of the Murray-Darling Basin Commission. It also talked about the need to supply water urgently to these wetlands and the fact that water management plans should be written to ensure that changes due to climate change are taken into account.

I question the government’s commitment to ensuring that this issue is dealt with expeditiously. When will the $12 billion start hitting the ground so real water can be returned to the system? We know that, at this stage, only about 350 gigalitres have been found from the existing programs and none of that water has been returned to the river system. While the government is spruiking its credentials that it is putting $10 billion into the Murray-Darling system, that money is not having an impact now because at least nine wetlands in South Australia are potentially going to be cut off from a water supply—their lifeblood. Not only that; the State of the environment report found that 22 of the 64 Ramsar wetlands are suffering from some form of degradation and their ecological character is being changed. It is outrageous. Why isn’t the government prepared to take more urgent action to find the water now so that we can save these wetlands?

Just last week, Dr Wendy Craik also talked about the impact of climate change and the potential for significant long-term impacts on the Murray-Darling system. These issues need to be factored into the water management plans. Are they being factored in? We do not know. Who is going to be reviewing them? We also have conflict within the coalition, with several ministers saying that the water licences will be bought back more or less as a last resort. It is too late for that. We need to be buying them urgently now. We cannot leave it as a last resort. When do we get to that point where it is a last resort? I believe that we have reached that point and we need to take action now.

As a compromise with the states, the government have agreed to some independent advice. They have also committed to table in parliament where they disagree with that independent advice. However, the big issue is that they have not agreed to table anything to do with the finances. If the independent panel advises the government, presumably, on policy and the government do not take that advice, they said they will table that advice in parliament. But they will not table the advice they receive on the finances—what is being bought with public money and how they will buy back the water allocation licences. Nothing has been made public about the costing and how it has been worked out—what we will get for the $10 billion—and the government is refusing to table in parliament the advice of the independent panel on how that money will be spent. I am deeply suspicious that we will see a return to the bad old days when decisions about what licences will be purchased will be based on expediency in a particular electorate, for example. There will be fights not over whether the water licence is an appropriate one to purchase but over who does or who does not want it in their electorate. We will see a return to those bad old days of pork-barrelling. It smacks so much of that. It is: ‘In which electorates can we best spend this money?’ rather than, ‘What is best for the Murray-Darling Basin?’ We have gone way past that now because this river is under the biggest threat it has faced, and it will soon reach the point where these wetlands in particular will not be recoverable. We can see that from the scientific evidence.

We also have to contend with the issue of the federal government taking control of the allocation of water and its management, and how they will undertake the natural resource management part of that process. You cannot manage water without dealing with the natural resource management issues, and then you get involved with the tricky issues of people stealing water. There is evidence that that is happening in New South Wales where environmental flows are released to wetlands and never make it to the wetlands. There are photos of where that has occurred. There are photos of where it is being syphoned off, but nobody is doing anything about it. I appreciate that these are extremely complex issues, but they are issues that need to be dealt with. The photographic evidence is there and no-one has taken any action. How those issues will be resolved through a federal management process is yet to be articulated and that is one of the things that would also come out in such a review.

As Senator Bartlett said, he has proposed a relatively short time frame for this review. It is not one that will tie up the process for a long time, but it will be the only chance for members of the community and this place to find out more detail about the plan. How is it going to be implemented? Where is the money going to be spent? Which wetlands are going to be saved? How much water is going to be returned to the river through the efficiency measures? How much water is going to be returned to the river through buying back the licences because of overallocation? What is the government going to do about the licences that have been bought through managed investment schemes which major corporations now want to offload because the MIS process has been changed? Major corporations have been left holding a number of licences that contain large amounts of water. I bet companies are looking to have them conveniently bought out. That may be appropriate; we may want some of that water back. But how do we know that the system is actually going to work effectively and that that is in fact priority water that needs to be bought back?

As I said, there are major corporations that now own large amounts of water because they have bought up the licences. They have also distorted the water market because they have entered the market and bought at prices that have now pushed up the water market, which of course makes the water more expensive for the government to buy back when they try to acquire the water licences. How do we know that money is not going to be offered to farmers for water efficiency measures and that those funds will not then subsequently be bought out through overallocation? I asked that question at estimates and I must say that I got an answer which I thought was okay. They said that they would not be doing that and that that was silly, but that has subsequently been contradicted by media reports and things that have been said in the House of Representatives. So I get one answer that I am assured by and in another place, in other fora, I hear different answers. So now I am no longer satisfied that we will in fact be doing this in an orderly way, that there is some sort of sensible plan for how these issues will be dealt with. I do not think there is.

This sort of inquiry would help us find out whether there is, in fact, a comprehensive plan to implement the plan. I do not think there is. I do not think the government have had time to put that together, and that is why they do not like this sort of inquiry. It will be like the emperor with new clothes: $10 billion is being spent but we do not know where it is going. If there is a review, that will become obvious. The government do not want this to be looked at, because there are no costings, there are no targets and they do not know where the water is coming from. Farmers have questioned the amounts that have been bandied about in the national plan. The Farmers Federation have questioned those figures. They do not think the water is in the efficiency measures. They maintain that they have made significant advances on the water efficiency measures, so they do not think it is there. What does that do to the rest of the flimsy arguments in the national water plan?

When I asked for information about the water that is going to be acquired through these various measures, no references could be given—none. We kept getting told at estimates that this information was provided by experts. When I asked for the references, they were not there. The only reference I was given was the plan itself. So in questioning the plan and the references, when I wanted the information justified, I was given the plan itself. Anybody could have pulled those figures from anywhere to put into that plan. I want actual scientific papers that show that those are the sorts of savings that we can expect from these measures.

There is $10 billion. Like Senator Bartlett, I think that we need to spend that sort of money on the river, but we need to make sure that it is properly targeted, properly allocated and that the decisions that are made are transparent, accountable and based on independent scientific advice, because we will never save the river if we continue to do more of the same, which is what this has been set up to do. It has been set up to continue more of the same, with no accountability on where money is spent. Sensible decisions are not made on a scientific basis and the money is flushed down the drain because no-one is prepared to bite the bullet and actually make the really tough decisions about where water needs to be acquired, how much needs to be acquired and where land use will have to change into the future.

Overlaying all of that is what impact climate change will have on those predictions and whether the government are tough enough to stand up to the community. Unfortunately, they will have to stand up to the community and say, ‘We need to change these water management plans.’ Are they going to be able to do that? Will the plan deliver the sort of change that we expect if we are going to save the Murray River?

Kerry O'Brien (Tasmania, Australian Labor Party, Shadow Minister for Primary Industries, Fisheries and Forestry) Share this | Link to this | Hansard source

It is pretty plain that, at a federal level, Labor has consistently called for a national approach on the issue of water. We think that the Commonwealth has a strong responsibility to take a leadership role on water. We think a minister for water should be appointed in the federal government. We think a single Commonwealth water authority should be created. We think the commitment of more funds for water management and efficiency programs right across Australia is the right decision. We think the development of water trading and economic instruments to drive reforms is important. We want the government to maximise its purchase of overallocated water entitlements. And we want the existing $2 billion Australian water fund to be used on practical projects.

Having said that, the Prime Minister’s plan for national water security is clearly consistent with many of these objectives and therefore received federal Labor support. We welcome the government’s adoption of proposals for a minister for water, the creation of a single Commonwealth water authority and the commitment of more funds for water management and efficiency programs in rural Australia. However, we think it is reasonable for all stakeholders to have an opportunity to scrutinise the national water plan and continue to ensure that the details are correct—that the government is getting its plan right. We want those details out there for the public to scrutinise, and that is the reason that we will be supporting this motion.

It is curious that the government on the one hand has used its numbers in this place to refer an inquiry on water to the very same committee. The Senate Standing Committee on Rural and Regional Affairs and Transport has an inquiry into the options for additional water supplies for south-east Queensland. So it is right to have an inquiry into a proposal to build a relatively small, but very important, water project in south-east Queensland so that that part of Australia does not actually run out of potable water—apparently it is right because some members of the government think they can play a bit of politics in the state of Queensland—but it is not right to allow the parliament to examine, in a committee chaired by a member of the government and with a government majority, the details of a $10 billion national plan, which has attracted criticism from the National Farmers Federation, the New South Wales irrigators and a host of other organisations that normally support the actions of this government. Apparently it just is not right for the Senate to look at something like that.

I think Senator Siewert hit the nail on the head: it is not right because the more you look at it, the more you discover that the government still have not worked out exactly what they are going to do. And if we have this inquiry, then there will be more instances of the bureaucrats—the public servants employed in the Department of the Environment and Water Resources—being unable to answer questions about exactly how the scheme is going to work; how money is going to be spent; how much will be paid for water; whether it will need to be compulsorily acquired; and what will happen in the catchments where, after CSIRO determines what cap each of the 22 catchments in the Murray-Darling Basin needs to have, water was allocated beyond the cap of those catchments. It would be nice to know. It would be a very appropriate role for a committee of this parliament to have. It would certainly advise the public. It would probably advise the parliament pretty well about what the government’s intentions were. But I guess the government’s main problem is that it might embarrass the government. It might actually show that all of the issues that need to be considered have not been properly considered.

It is very clear from the evidence that more effort went into the writing of the Prime Minister’s speech than into the government’s financing and time lines of the original national water plan. The plan did not go to cabinet—the plan on which there was no economic modelling by Treasury or Finance; and the plan which, less than a week before the announcement, the department of finance was asked to ‘run an eye lightly over the costings’, I think that was the terminology used. Surprisingly, the cursory review by those key agencies was dismissed by Senator Minchin, who said that $10 billion was not really all that much money. As I recall, that was not the way the matter was announced by the Prime Minister. I thought $10 billion was a very large amount of money. But apparently for the department of finance it is small change.

On top of all that, none of the water commissioners were briefed until the morning of the speech. It is interesting, of course, that Mr Ian Sinclair has stated that the Murray-Darling Basin Commission was not asked for any advice. Indeed, the states and territories were given contrary advice at the time of that famous Melbourne Cup day water summit. So, on the first Tuesday in November, this grand scheme was not in contemplation—or enough in contemplation for the premiers of the states and territories to be given any sort of heads up on the matter.

Finally, the government had after all introduced a piece of legislation—the Murray-Darling Basin Amendment Bill 2006—in December 2006. That bill asked the parliament to assume that the existing structures at that time would remain intact. Indeed, far from proposing the changes that the Prime Minister announced in January, it was proposing minor changes to the then-existing plans. So there was no contemplation at that time about these measures. What are we faced with in this cobbled together announcement—the plan that is being made up as we go?

David Johnston (WA, Liberal Party, Minister for Justice and Customs) Share this | Link to this | Hansard source

You support it!

Kerry O'Brien (Tasmania, Australian Labor Party, Shadow Minister for Primary Industries, Fisheries and Forestry) Share this | Link to this | Hansard source

It is the principle which we support, that is right. Senator Johnston says we support the plan. We would like to know the details of the plan.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Maybe Senator Johnston will tell us—

Kerry O'Brien (Tasmania, Australian Labor Party, Shadow Minister for Primary Industries, Fisheries and Forestry) Share this | Link to this | Hansard source

I suspect you ask too much of Senator Johnston. He is here to tell us why the government is not going to support the motion; I suspect he is not here to tell us the detail of the plan that we would like to know, because only the inquiry would achieve that.

We are concerned with this lack of detail and that, under pressure from the National Party, the Prime Minister’s plan to deal with water overallocation in the Murray-Darling Basin and to buy back water entitlements will be diverted or diluted. On Sunday, 28 January Mr Turnbull said:

There might be an area where you buy out the farms, close down a channel because it’s inefficient.

Mr Turnbull is now meekly saying that buying water entitlements would only be a last resort. There is no doubt that overallocation of water licences is a primary source of the current water crisis. If we are to believe the evidence that has been given at estimates, the Department of the Environment and Water Resources is going to establish a view as to what the appropriate cap is for each of the 22 catchments and some of those catchments will have water allocations that exceed this cap. What does one do when that occurs? If you have a cap, that implies you are not going to allow water beyond that amount to be used by those entitled to draw water from the catchment. What do we do? Clearly the government has to find some way to maximise the opportunity to deal with the overallocation of water entitlements, whether it be in some voluntary buyback scheme, entering the market or some other measure.

Those issues certainly have not been clearly addressed by the government. There is a bit of ebbing and flowing by the government on the question of the buying back of water. There are concerns within organisations like the National Farmers Federation about just how that will work and the impact on their constituent members who have water entitlements. Some in this place have asserted views about which industries should be using water and which should not. I have made it pretty plain that from Labor’s point of view it is not a matter of picking which crop farmers grow but it is a matter of managing the water that is available. Labor will not be saying that a particular commodity cannot be irrigated. We believe that ultimately the market will decide that based on the value of water over time. But it is critical that water is returned to the Murray-Darling, and it is also critical that the $10 billion that the Prime Minister announced is used widely and in an accountable fashion.

There is nothing unreasonable in the proposition that this matter be referred to this committee for inquiry. The government might say, ‘You can ask all the questions you like at estimates.’ Certainly, some of these questions can be asked at the estimates hearings, but estimates is not the place where organisations such as the National Farmers Federation or the New South Wales Irrigators Council, the state or territory governments or private individuals can put a view and have that tested by the parliament. An inquiry such as this would be such a vehicle.

This attitude is in absolute contrast to the way members opposite have been keen to establish an inquiry into the building of the Traveston Dam in Queensland—in the context of this, a minor project; although very important to south-east Queensland—but, as I understand it, will not countenance an inquiry into what the government claims will be one of the most important water projects this government has seen. Frankly, by voting against this the government will be showing a great lack of faith in its own project. But we will vote for it.

David Johnston (WA, Liberal Party, Minister for Justice and Customs) Share this | Link to this | Hansard source

This is a classic example of the capacity of the opposition in this place to want to bask in the glory of a good initiative and yet nitpick and be dragged kicking and screaming to some policy position. That is the thing with Labor: they do not want to do any of the hard work and come up with an initiative of their own; they simply want to sit back and say, ‘Yes, we support it but, oh, we don’t like this part of it and we don’t like that part of it.’ They have done none of the hard work to get to any policy position that has any credibility.

The government do not support this referral for the reasons set out by Senator Siewert; we want to get on with the job. We have a drought on; this water crisis is very crucial and needs to be addressed. We want to see things start to happen. Yet, Senator Siewert in the very same breath says, ‘We are happy to muddle along and send this off to a committee to review.’ I want to know what the ALP’s position really is on this. Do they want to muddle along or do they want to get on with the job and actually address water in the Murray-Darling? Do they want to address water? I do not think they do; they just want to try to score a few cheap political points because they have not got any policy. They have been sitting on their backsides for the last 10 years and suddenly they realise that an election is coming up. They think: ‘We might get elected—gee, we’d better have some policies. Knock us down with a feather! The Prime Minister has announced a $10 billion plan to try to fix the Murray-Darling. What are we going to do? We’d better get on board. It could be embarrassing.’

The projected drought and the prospect of long-term climate change underscore the need to make dramatic improvements in water management practices. The Murray-Darling Basin is overallocated. Current levels of water use are not sustainable and future inflows to the basin are expected to reduce at a rate of around 10 to 15 per cent per decade—around 3,200 gigalitres by 2020. Governance of the Murray-Darling Basin has been poor. The cap is not complied with and voting arrangements guarantee that lowest common denominator decisions are made. This issue cannot be addressed without radical change. The National Water Initiative signed by the Commonwealth and all the state and territory governments is a gold standard framework for water management, but implementation by some of the states has been lagging in key areas. If the above realities are ignored, both the irrigation sector and the health of our waterways are at risk—hence the Prime Minister’s proactive steps.

The objective of the Prime Minister’s $10 billion National Plan for Water Security is to increase productivity with less water use while improving the health of our key river systems. The focus of the plan is on rural Australia, where more than 70 per cent of water occurs. This will give states additional capacity to address urban water storage by requiring a combination of better planning, increased investment and full cost-recovery pricing. The plan will focus on dramatically lifting water use efficiency in irrigation schemes nationally as well as addressing the serious issues of water overallocation in the Murray-Darling Basin. Improved governance arrangements will mean that more consistent decisions may be applied across the basin as well as a streamlined water-trading regime as a common template for catchment water sharing plans and a basin-wide environmental watering plan. The $10 billion National Plan for Water Security is a bold new initiative that will accelerate the National Water Initiative and build on work begun under the Living Murray initiative and the $2 billion Australian government Water Fund. With strong leadership from the Commonwealth these combined initiatives are Australia’s greatest opportunity to put water management on a sustainable footing within a decade.

I turn to the state of the Murray-Darling hydrology report. This report will assist us to better understand the hydrology of the Darling Basin and the complex water management issues faced by the region. It will provide a useful contribution into considerations on future directions for water management in the Darling Basin. The Prime Minister’s National Plan for Water Security ensures that the northern Murray-Darling Basin will be included in the work that the Australian government will be undertaking in addressing the ongoing water management issues in the Murray-Darling Basin. The Australian government is also supporting actions that will improve the health of some key environmental assets in the northern Murray-Darling Basin. For example, we are providing around $85 million to support programs in New South Wales to improve the health of important wetlands such as the Gwydir Wetlands and the Macquarie Marshes.

Turning to the World Wildlife Fund report, which says that the Murray-Darling Basin is one of the most threatened river systems in the world, I want to say that sustainable and efficient water use is a prime objective of the government’s $10 billion National Plan for Water Security. The programs in the plan to improve irrigation efficiency and deal with overallocation will make more water available for the river systems in the long run. This will include increased water to improve river health. The World Wildlife Fund’s report highlights the problems in the system. Current arrangements in the Murray-Darling Basin are hampered by parochial interests, blame shifting—and we all know about blame shifting across the chamber here—underresourcing by state governments and avoidance of difficult decisions such as implementing the cap on diversions. And of course the states have been dilatory in following through and enforcing their own rules.

The Commonwealth needs a broad referral of powers for the management of water resources in the basin to deliver the outcomes that all Australians expect to be delivered. The government is concerned about the impact of climate change on the Murray-Darling Basin. The Prime Minister and the Murray-Darling Basin state premiers at the 7 November 2006 Water Summit commissioned the CSIRO to report by the end of 2007 on sustainable yields of surface and groundwater systems within the Murray-Darling Basin, including in the light of climate change. This work is now under way and involved a considerable commitment of resources by the CSIRO.

Also the government is helping to fund the three-year $7 million South Eastern Australian Climate Initiative. The work of the South Eastern Australian Climate Initiative will be used in the CSIRO sustainable yield project. These two projects are complementary and together will contribute to our understanding and management of this important issue for the Murray-Darling Basin. And I pause to say that we did not need a committee report to get on with the job and provide these important initiatives. The Australian government expects jurisdictions to complete the Living Murray initiative water recovery commitments of up to 500 gigalitres by June 2009. There are already four projects approved by jurisdictions that will recover 240 gigalitres costing $179 million. The Australian government’s role in water recovery has primarily been as an investor while the states are committed to developing water recovery projects. We have consistently pursued the states through the Murray-Darling Basin Commission processes to bring forward projects and investment plans for the approved projects, but to this point they have not been so willing to come to the party. That is the problem. One response from government has been to request tenders for water savings through efficiency measures, which are currently being assessed.

In talking about farmers, the National Plan for Water Security will increase water security for irrigators, the community and the environment. It will do this by improving productivity of water use, reducing wastage, giving irrigators greater opportunity to trade, improving monitoring and management as well as buying water entitlements. Given the level of overallocation in the basin, achieving the objective of secure water entitlements cannot be achieved without reducing use. In addition to efficiency measures, this will require buying some water entitlements and it may require the closure of some inefficient channel systems or those at risk of salinity. Irrigation companies and industry councils will be asked to help develop measures to improve water use efficiency in particular areas. There is no intention to compulsorily acquire water entitlements. The CSIRO sustainable yield project will inform the development of a new sustainable cap for the Murray-Darling Basin. There will also be socioeconomic analysis and community consultation as part of the development of the new cap. Current state water shares and water-sharing plans will be maintained as per the Murray-Darling Basin agreement. However, the new cap will need to be reflected in catchment water plans when they are revised and at the end of the current terms.

With respect to disconnecting wetlands, contingency planning to secure urban water supplies in the southern Murray-Darling Basin during 2007 and 2008 have been considered by officials at the Prime Minister’s and premiers’ request. The Acting Prime Minister and premiers recently agreed to implement some measures immediately, including disconnecting selected permanent wetlands that are artificially inundated. The wetlands proposed for disconnection are generally those that have been artificially inundated with permanent water because they are used to store water. Under natural conditions it is likely that these wetlands would be dry in the current season, and drought and disconnection may help mimic a more natural wetting and drying regime which is likely to be beneficial providing they receive flooding waters in future when required. Wetlands, where disconnection would be problematic in terms of environmental and cultural heritage impacts, will not be affected by this measure. Any action that will or is likely to have an impact on matters of national environmental significance will be the subject of the Environmental Protection and Biodiversity Conservation Act 1999.

The $10 billion National Plan for Water Security announced by the Prime Minister on 25 January this year aims to dramatically improve water use efficiency in the river systems of the Murray-Darling Basin. Implementation of the plan will restore the health of wetlands in the basin and the Australian government is helping to improve environmental flows. On World Wetlands Day over $91 million for six projects for restoring water to Australia’s wetlands was announced by our government. The Water Smart Australia program is providing $7.7 million to a project that will increase flows into the Coorong with benefits to nearby wetlands. The Living Murray initiative is also improving environmental flows to icon sites in South Australia. I can assure the Senate that the Prime Minister’s plan is a very good one. It is a bold one and it is being implemented as I speak. It is happening now. We do not need to refer matters to a Senate committee. We cannot afford to wait any longer. Let us get on with the job.

Question negatived.

(Quorum formed)