Helen Coonan (NSW, Liberal Party, Shadow Minister for Finance, Competition Policy and Deregulation) Share this | Link to this | Hansard source

I will speak very briefly in response to the Appropriation (Water Entitlements and Home Insulation) Bill 2009-2010 and Appropriation (Water Entitlements) Bill 2009-2010. We in the opposition have made it very clear that we will not obstruct the passage of these bills through the Senate even though we take issue with the purpose of the funding. I will be very brief in outlining our objections.

The bill seeks to provide funding of $1.4 billion to cover rebate payments made under the government’s home insulation pink batts program and to accelerate water buybacks within the Murray-Darling Basin system. The home insulation program has been riddled, of course, with reports of waste, rorting and safety fears. The bills before us now confirm that. It is also a program with a billion-dollar blow-out in the 2009-10 year alone. Back in February this year, when the program was announced, the opposition warned that the government induced demand would far outstrip supply, and in spite of these warnings Labor raced its home insulation rebate for homeowners through the parliament with minimal industry consultation. We are seeing the effects.

I now turn to the water buybacks within the Murray-Darling basin. The government wants to accelerate water purchasing in the Murray-Darling and provide for new water-purchase initiatives in 2009-10. To date, the government has secured the purchase of more than 600 gigalitres of water entitlements. The coalition also, in respect of this program, has abiding concerns about the acceleration of the water buybacks within the Murray-Darling Basin system, because it is to the detriment of replenishing and investing in farming infrastructure. Water infrastructure would deliver real water savings of hundreds of billions of litres a year. It would also improve the health of the river system and secure a future for our vital food producers. Instead of investing in infrastructure, the Rudd government’s alternative is to buy out farmers and farming communities, which will simply cost jobs and jeopardise our food security. The sad reality is that the government is buying entitlements to air, not real water. Most regrettably, the government is not assisting these farmers and farming communities to find new ways of sustainably farming or adjusting to the situation they find themselves in.

Nevertheless, we have of course said that if the government were serious about effective stimulus spending, they would looking at value for money, they would be investing in Australia’s water security and they would reduce real water losses through evaporation and seepage by piping lining and covering channels and dams. Instead, the government obviously intend to continue with a dodgy insulation program and phantom water buybacks and to ignore the infrastructure works that would really help to save the Murray-Darling Basin. I did indicate that we would not oppose this legislation, but even at this time of year and in the circumstances of these extended sittings of the Senate I think it is only right that I identify on behalf of the coalition our concerns about the serious deficiencies in the government’s approach to policy and administration in relation to both the Home Insulation Program and water buybacks in the Murray-Darling Basin. I commend the bill.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I will confine my remarks to the water buybacks. I believe that the future of the Murray-Darling Basin is vital to the future of this nation. We know that climate change is real; it is affecting the basin, but it is important that we have the right scheme to combat climate change. My concerns are that in my home state the basin has been ignored almost to the point of no return in previous years; that the Coorong, the lungs of the Murray, are drying up and choking; that regional communities from Queensland through to New South Wales, Victoria and South Australia are struggling to survive; and that citizens in capital cities are beginning to realise that their water supply is anything but assured. In Melbourne and in Adelaide these are matters of serious concern. As a nation we cannot ignore the fact that the Murray-Darling Basin holds approximately 42 per cent of the nation’s farmland and produces 75 per cent of our food. That is why it is essential to get more water into the basin, into the Murray-Darling system.

You cannot have a healthy irrigation industry unless you have a healthy river, and you need to look after the river before anything else. If we do not sort that out, if we do not address issues of salinity and appropriate flows to lower reaches of the Murray-Darling Basin and to the mouth of the Murray, then there is no hope. That is why I support any effort to purchase additional water to release it into the Murray-Darling system. I know that on my negotiations with the government in February of this year in terms of accelerating water buybacks there were some critics who said that it could not be done, that it was not possible. But, in fact, there was tremendous demand for those water buybacks, which at least gives some real hope for the Murray-Darling Basin.

The Appropriation (Water Entitlements) Bill 2009-2010 appropriates funds to bring forward approximately $650 million in water buybacks over the next six months. Approximately $320 million of this funding will go to immediate purchases due to the need indicated in the mid-year economic forecasts, and these changes need to be considered in the context of the approximately $900 million brought forward that I referred to previously. That agreement provided an extra $500 million in buybacks. That money has been spent and this bill shows that there is enormous demand for it.

Of course, it is important that purchasers be targeted appropriately, and I would like to acknowledge at this stage that a vital support in my negotiations earlier this year in relation to securing more water for the Murray was the Wentworth Group of concerned scientists, particularly Professor Mike Young and Professor Quentin Grafton. Professor Young made it clear that the Murray-Darling Basin needed more water and that there was no time to waste. He estimated that the Murray-Darling needed approximately $1 billion in water buybacks in the immediate future or it would be too late. Not only would delaying water purchases mean greater costs should we try and claw back later, there would be a real risk that there would be nothing left to save. I also spoke extensively with Professor Grafton, who made it clear that the water was available; there just needed to be the willpower to reform the system to release it.

Clearly, what has been shown, despite those doubters, is that there was a significant demand for people to sell their water for environmental purchases, which is an urgent and necessary part of recalibrating our river system. That is not the only thing that needs to be done, but it is an important and integral part that needs to be done to help our river system. I commend the government for showing initiative and taking up an opportunity to purchase more water more swiftly. I also commend Professor Grafton and Professor Young on their assessments that it is important that any approach to water purchases be structured, be targeted and be one that has a forensic approach to it. I look forward to the next estimates session so as to get further information in terms of water purchases. I think it is important that the urgency felt by communities about the environment is being addressed in part by this measure. I look forward to this bill being passed and to the water purchases doing what they are intended to do—give a fighting chance to the Murray-Darling Basin.

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Government in the Senate) Share this | Link to this | Hansard source

The Appropriation (Water Entitlements and Home Insulation) Bill 2009-2010 provides funding for the Home Insulation Program and departmental funding for costs associated with the acceleration of the water buybacks within the Murray-Darling Basin system. The measures provided for in this bill allow administered funding of $695.8 million for the Home Insulation Program to be brought forward from 2010-11 and departmental funds of $4.9 million to be brought forward: $4.4 million from 2013-14 and $0.5 million from 2013-15 from the Water for the Future Restoring the Balance in the Murray-Darling Basin Program.

The other bill, the Appropriation (Water Entitlements) Bill 2009-2010 provides critical funding for the Department of the Environment, Water, Heritage and the Arts and allows it to accelerate water buybacks within the Murray-Darling Basin system. The measures provided for in the bill will enable $650 million for water buybacks to be brought forward from later years of the Restoring the Balance in the Murray-Darling Basin Program under the government’s Water for the Future initiative. I thank all those who contributed their comments.

Question agreed to.

Bills read a second time.