Bridget McKenzie (Victoria, National Party) Share this | Link to this | Hansard source

I present the interim report of the Rural and Regional Affairs and Transport References Committee on the management of the Murray-Darling Basin Plan, together with the Hansard record of proceedings and documents presented to the committee.

Ordered that the report be printed.

I move:

That the Senate take note of the report.

The report highlights the concerns and shortcomings of the existing Murray-Darling Basin Plan. This is an interim report and some of the issues contained within it will be fully addressed when the final report is handed down. I think it is crucially important that the Senate takes note of this committee's interim report.

In the limited time available, please let me say how important the basin is to regional Australians, and paint a picture for those struggling to understand why so many people are—rightly so—up in arms over the decisions being made by Labor and their coalition colleagues, the Greens, on this issue. To start, the basin is home to 2.1 million people, more than 900,000 of whom are employed within the basin—33 per cent in manufacturing, with a lot of that in food processing, and 11 per cent in agriculture. About a quarter of the basin's residents live in Victoria, the state I am so proudly representing in this place, with about 27,000 people employed in agriculture and other sectors dependent on it.

The dairy industry in northern Victoria, where we have a lot of irrigated country, produces 74 per cent of the basin's milk. The Goulburn Murray irrigation district dairy industry is the region's largest user of irrigation water, so any loss of access to water would have serious ramifications when it comes to the viability of dairy businesses and processing facilities.

It is not only dairy that relies heavily on irrigation water; Mildura has a thriving horticulture sector producing nearly all of Australia's dried fruit, 75 per cent of table grapes and 94 per cent of our citrus. The Mildura Development Corporation expects the region has a great future in food production but says:

… we will see impacts from some of the issues that are coming out of the current draft of the Murray-Darling Basin Plan—

in our own communities. Those directly affected, such as those in Mildura and Shepparton and throughout the Southern Basin in my home state of Victoria, find it very difficult to understand how this is being played out. I am talking about your lovely report, Senator Heffernan.

The committee travelled to Mildura and heard evidence, and Cheryl Rix from Western Murray Irrigation Ltd told the Rural and Regional Affairs and Transport Committee hearing in April this year:

In terms of the basin plan … you can't even get across the technical information that they are putting out, and it is all hidden anyway—it is like a treasure hunt trying to work out what it means for you.

Treasure hunting is the right phrase to use, because for those communities along the Murray the great treasure that they have built their entire existence on is the treasure of the water that flows from the great Murray River and how it is used in those irrigation systems. If the people who live and work on the irrigation systems cannot work it out then we have some real issues.

I am sure Ms Rix is not the only person to be confused by the government's multiple Murray-Darling Basin Plan drafts; we are now on the fourth version. Perhaps Mark McKenzie, of Murray Valley Winegrowers, put it best when he said:

We believe there quite clearly needs to be some balancing … we are all vitally interested in the health of the basin…

Farmers are the great conservationists and environmentalists of our nation—

Our lifeblood depends on it. We are absolutely dependent here.

These are the people, products and profit of the Murray-Darling Basin. Each is vitally important and together they ensure that Australia's food bowl is strong and prosperous. Given the government's commentary on Australia being Asia's food bowl, and the growing food scarcity projected, we need to be ensuring that we give Australia's farmers the water they need to do what they do best, which is produce the cleanest, greenest produce on the planet, and to continue to do it in a sustainable manner.

The people of the basin have an acute understanding of the need to look after it and do not want to see its health jeopardised. At the same time, they must be able to continue to make a living from the region. You need to make a dollar to stay in business, and farms are not social projects; they are small businesses. All of these industries underpin towns such as Shepparton, Cobram and Swan Hill, right throughout my home state.

The interim report points to various effects that could weaken the basin should the current plan be fully implemented. I draw the Senate's attention to recommendation 7. The committee recommends that the MDBA 'clearly and publicly explain the socioeconomic impacts of the 2,750-gigalitre target and any subsequently modelled target' because we want to know (a) that the river is healthy and (b) that there will still be the people and the industries along the river to produce the food for our nation and the world and to continue our way of life. People are important in this conversation, and sometimes I think that is lost.

One aspect of the report that was raised is something that has severely impacted the Victorian irrigators: the Swiss cheese effect. This goes to an issue where the government, in buying water for the environment, has done it in a very unstrategic manner and this has resulted in some—I hope—unintended consequences in some irrigation districts in my home state. The loss of water or sale of water back to the Commonwealth stops irrigation districts shrinking because the loss of water has been taken randomly across the district. Someone at the end of a channel is having to pay all the costs for the upkeep of that channel because the government has decided to indiscriminately purchase high-security water from Victoria's irrigators.

This effect not only impacts irrigators but also irrigation authorities when the price of water increases and the rest of the community that services the irrigation businesses suffers. This is what we are seeing right across the Goulburn Valley now. These are the issues that need to be addressed for a successful plan to be implemented. A successful plan means a healthy river going forward and it also means healthy and successful local regional communities.

In Victoria we are proud of our irrigators, who have always been at the forefront of adopting new technologies to become more efficient—and they are. It is evidenced by our tomato growers in the Goulburn Valley, who went from producing 30 tonnes per acre to 90 tonnes per acre by moving from flood irrigation to subsurface irrigation. This is as efficient as you get, dripping water as it is needed at the most environmentally proactive time of the day to decrease evaporation et cetera. You cannot get any more efficient than that. These tomato growers as well as the horticulturalists right around the Goulburn Valley have permanent plantings. They cannot afford to swap to another commodity in drought. They cannot afford to swap to another commodity when water prices differentiate, the way some other producers and commodity growers are able to do in other sections of the basin. Technology is really great at solving our environmental problems, which you will see is a theme of mine if you look at my comments on the carbon tax legislation. The advent of subsurface irrigation is also indicative of our irrigators' adaptability. If this Murray-Darling Basin Plan goes too far it will stifle this innovation and put it under enormous pressure. Once again science and innovation in new and efficient use of new technologies will drive the efficient use of water, and that is something to get excited about. My Senate colleagues and I are consistently working towards ensuring that issues which impact viability are addressed. We have a tough task ahead of us.

This was not the only report handed down about the Murray-Darling Basin Plan. There was also a report from the minister about the hydraulic modelling of the relaxation of operational constraints in the southern connected systems. This report was implemented stating 3,200 gig of environmental water would be recovered without constraint. I am aware of many farms, caravan parks and the like that would suffer from undue environmental watering leading to greater flooding along the river channels. That would be a totally unacceptable outcome for the people of Victoria. The report makes some really fantastic commentary and I look forward to contributing to the final iteration.

Fiona Nash (NSW, National Party, Shadow Parliamentary Secretary for Regional Education) Share this | Link to this | Hansard source

I rise to make some remarks on the tabling of the report of the Rural and Regional Affairs Transport References Committee and I will be brief because I know that many of my colleagues want to make a contribution. Firstly, I thank the secretariat for the work that they are continuing to do in relation to the Murray-Darling Basin. It is indeed a very complex issue, and I take my hat off to them for the work they are doing in support of the committee by putting the information and our views forward. While we on this committee may not always agree, we all have a very genuine interest in ensuring that we get a better environment for the future and we are absolutely prepared to put in the time and the effort to look at the detail of all of the issues before us when it comes to the Murray-Darling Basin Plan and its impact on our community and on the environment. I have to say this is in stark contrast to the Standing Committee on Regional Australia inquiry into the recent amendments, the bill coming forward changing the sustainable diversion limits. This committee is chaired by Mr Tony Windsor. It held no hearings and has tabled a report based on no submissions from the stakeholders. While we on this committee may not always agree, I believe we are very genuine in our attempt to properly consider the detail that relates to these issues.

One of the things that concerns people out in the community is the fact that the government simply does not understand the potential impact of permanently removing water from these rural communities. People genuinely think that this government does not understand, and I support them in that belief. The government simply does not understand what impact that is going to have and not only what it is going to have but what it is currently having. The uncertainty that this has created—and we have already seen a significant amount of buyback—and the very negative impact that it has had on our rural communities cannot be understated. Another of the concerns of those in our rural communities is the fact that equal weighting has not been given to the impact on the environment and the social and economic impact. Again, we have seen that in a report this week on recovering the additional environmental water, looking at 3,200 gigalitres, for which only the environmental effects were modelled. The government has failed to look at an equitable environmental, social and economic impact when it comes to our rural communities. When talking about the constraints, there was no modelling or assessment of whether the constraints tested in the study could be relaxed.

I think this contributes to making this whole process an absolute dog's breakfast. When we look at the target of 2,750 gig—and colleagues on the committee will be well aware of this and support me in saying this—there is simply no evidential basis for the proposal of that figure. When we tried to get figures out of the Commonwealth Environmental Water Holder for the water that they already had bought back, and I think it is about 1,400 gig, and where there had been potential environmental benefit from the reclaiming of that water, they simply could not give us an answer. What they did do was to give us a response of 3,451 pages expecting that miraculously we could turn that into an answer for the committee. That is simply not good enough. Indeed, we asked for a summarised brief which to date—and I stand to be corrected—has not arrived back at the committee.

It is no wonder people in the community have no confidence that the government can get this process right. At the end of the day—and I concur with the comments made by my very good colleague Senator McKenzie—this is about impact on people; the very human impact of these decisions and what is happening has to properly be taken into account. With this report, we have tabled a number of recommendations.

There were a variety of views among the committee on the report and the recommendations that should go forward, but I believe they are very sensible recommendations that really do highlight the lack of proper process that has been in place, from this government and from the Murray-Darling Basin Authority, to try to determine a proper outcome. It seems that every time we turn around there is yet another dog's breakfast moment of something that has, again, not been done properly.

Finally, one of the things that really concerns people out in the community, that we are very well aware of, is the fact that the government has focused so strongly on water buyback and not nearly so much on improving water efficiencies, infrastructure, the environmental works and measures work that needs to be done. It is $1.9 billion, I think, on water buybacks compared with about $494 million on investments in the infrastructure—which we know can make a real difference to the sustainability of water usage into the future without the impact on our communities of permanently removing that water through buyback.

I am conscious that other colleagues want to make a contribution and I just note that out in our rural communities there is so much concern—not only about the end point of permanently removing that water but about the dog's breakfast process that we have seen to date from the government, from the Murray-Darling Basin Authority, in trying to get to an end point. I commend our committee—while we do have different views—for being prepared to properly and diligently look at this process, look at the outcomes, and try to assist in the process of getting the right outcomes for rural communities.

Bill Heffernan (NSW, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the tabling of the interim report on the Murray-Darling Basin. We will be, as a committee, analysing the final plan when it is put down by the government.

All governments of all persuasions, throughout the history of Australia, have managed to muck up the management of water. It is a bit like the railways. It took them a long time to work out that you did not have to get off the train at Albury; you should have the same gauge to Melbourne. The same sort of thinking has occurred in water. The attempt in recent years, by the previous government and this government, to come to terms with that is commendable. But I have to say that part of what we have discovered in this inquiry is that this solution really is not a scientific solution; it is a political compromise. I further say, as the previous speakers have mentioned, that we do have to bring irrigation into the modern age with technology and efficiency. The most efficient irrigation in Australia is the Israeli-Spanish technology—which is comparable to your tomato people, Senator McKenzie—of root zone irrigation, which is 40 times more efficient than furrow cotton on the use of water for the production of income.

Sadly, the science prediction, at 40 per cent accuracy for 2050, means that in most river systems in the lower Murray-Darling Basin, if that science—which has vagary attached to it—is 40 per cent right, there will be zero allocation in most seasons for general purpose water. That will be quite a challenge and it really does mean that we have got to go to more efficient use of water. The minimum prediction for the loss of run-off from a two per cent increase in temperature and a 15 per cent decline in run-off from the Murray-Darling Basin, which has 6.2 per cent of Australia's run-off, 23,400 gigalitres of run-off and 14,000-odd of extraction—bear in mind that the killing sentence in all of that is that 38 per cent of the run-off comes from just two per cent of the landscape—is 3,500 gigalitres by 2050. While this is a plan, it is an interim plan and we are going to have to learn to do a lot more with a lot less in the future if we are to manage the global food task.

I am grateful to the committee and to the secretariat—for putting up with me, especially, but for the input they have had into it. I would not let this occasion go by without mentioning that this is a seriously difficult job, because of the politics involved. Once again I would like to raise the prospect of the difficulty of the politics involved and of coming to terms with the various states—a bit like the gauge of the railway line. New South Wales at the present time is attempting to sell water from the lower Murrumbidgee to the Commonwealth, as part of the buyback plan for this plan. One of the tricks that they are employing is trying to con the Commonwealth into using water money, which as previous speakers have mentioned has been used mainly for water buybacks rather than water-saving infrastructure. They are actually saying to the lower Murrumbidgee irrigators, 'We'll give you 2¼ times the value for your water,' having issued the licence last Thursday but having determined the price months ago, before they even issued the licence to buy it back. The licence is issued for nothing, by the way. Something like $200 million is involved in the deal, which is all commercial-in-confidence: various people, including Mr Harris in New South Wales and the government of New South Wales and the federal government, do not think the taxpayers are entitled to know the details of it. So it is all commercial-in-confidence. They will not tell us what the market value is so that we can determine what 2¼ times the market value is. The trick behind it all—in New South Wales saying that they have got agreement and the Commonwealth has now got the plan before them to buy water at 2¼ times its real value—is to get the Commonwealth to put money in so that New South Wales can not only buy the water licences back but buy the land back that goes with the water, because the landholders have said, 'You can't have our water unless you buy our land.' So it is almost political blackmail.

These are difficult issues and a lot of due diligence and a lot of hard work will be required by the Rural and Regional Affairs and Transport References Committee that I chair, and it will require the patience of the secretariat and witnesses to come to a sensible resolution as to not only what we know now but also what we have got to figure out that the future holds for us. It is a great pleasure to speak to this motion, and our work is only part done.

Question agreed to.