Chapter 1
Introduction and background
Purpose of this interim report
1.1
The purpose of this interim report is to detail the concerns that the
committee has with the Murray-Darling Basin Authority's Proposed Basin Plan (the
Basin Plan).[1]
The committee's concerns arise because the Murray-Darling Basin Authority (MDBA)
has repeatedly ignored the major flaws in the Basin Plan, identified by virtually
all relevant stakeholders including farmers, rural communities, scientists,
environmentalists, and even the Basin states which referred their powers to the
Commonwealth in order to create the Basin Plan. The Minister for Sustainability,
Environment, Water, Population and Communities, the Hon Tony Burke MP, has stated
his intention to present the Basin Plan to Parliament this year.
1.2
As a result, the committee feels it has little choice but to release
this interim report now in a final effort to urge the Government to reconsider
the substance of the Basin Plan. Because the Basin Plan is a legislative
instrument, the Parliament has no ability to debate amendments to improve the
Basin Plan. The Basin Plan will either be agreed to as presented or disallowed
in its entirety.
1.3
The committee supports the need for a plan for managing the Murray‑Darling
Basin, however, it has concern with the lack of transparency and the process
followed in developing this Basin Plan.[2]
The committee notes that flooding rains of the last two years have returned
healthy water levels to the river. This event ended eight years of continuous dredging
of the Murray mouth to keep it open,[3]
relieved the serious water pressures faced by irrigators, the broader
agricultural sector and many rural and regional communities, and replenished
the water reserves of many important environmental assets.
1.4
Furthermore, with the significant gaps in the scientific analysis and
information underpinning the Basin Plan, Parliament will find it difficult to give
the Basin Plan the comprehensive and informed consideration it deserves.
1.5
The Basin Plan would commence in 2019 and continue through until 2029,
so it will inform water policy in the Basin for almost the next two decades. The
MDBA needs to assure Australians that its modelling and research will allow Parliament
to consider a Basin Plan that is based on the best available science, provides
value for taxpayers' money, is fair on irrigators and rural communities, and ensures
the long‑term ecological sustainability of the Basin. The MDBA also needs
to provide a Basin Plan that meets ecological targets and outcomes required by
the Water Act 2007 (the Act).
1.6
Due to the specific focus on the Basin Plan, there are a number of other
major issues that this interim report will not cover in detail, that the
committee considers essential to its broader inquiry. Instead, these other
issues will be given full consideration in the final report. These issues include:
- water trading and buyback arrangements, including the proposed
Nimmie‑Caira buyback;[4]
- the definition and allocation of different types of water, such
as high security, supplementary, and terminal;[5]
- environmental works and measures; and
- possible solutions for the long-term environmental and
consumptive water-use problems that are facing the Murray-Darling Basin.
Information about the inquiry
1.7
On 28 October 2010 the Senate referred the matter of the management of
Murray-Darling Basin to the Senate Rural and Regional Affairs and Transport
References Committee for inquiry. The committee is due to deliver its final
report for the inquiry on 1 November 2012.
1.8
The inquiry's terms of reference specifically require the committee to
investigate the 'the development and implementation of the Basin Plan.' The full
terms of reference are included in Appendix 1.
1.9
To date for the general inquiry (including the coal seam gas interim
report tabled on 30 November 2011), the committee has received and published
380 submissions. It has held a total of 12 public hearings in Canberra and
interstate. A list of submissions and witnesses can be found in appendices 2
and 3 respectively.
1.10
This report focuses on evidence received since the tabling of the
interim report on coal seam gas in November 2011, and particularly on hearings
since the beginning of April 2012 as these relate to the most recent and
relevant iterations of the Basin Plan.
Acknowledgements
1.11
The committee would like to thank all those organisations and
individuals that have made submissions to the inquiry and appeared as witnesses
at public hearings.
Note on references
1.12
References to committee Hansard are to the proof versions. Page numbers
may vary between the proof and official version of the Hansard.
Structure of the report
1.13
This report is set out in five short chapters. This first chapter
outlines the need for the interim report, information to the inquiry and the
background to the Basin Plan. Chapter 2 discusses the issue of surface water
and the key criticisms raised in the inquiry regarding the development of the
Sustainable Diversion Limits (SDLs) and the target to return 2750 gigalitres
per year (GL/y). Chapter 3 deals with the issue of ground water in the
Basin Plan and, in particular, the Basin Plan's inadequate treatment of ground
water and surface water connectivity. Chapter 4 discusses the failure of the
Basin Plan to meet its own stated environmental outcomes and outlines the
socio-economic impacts of the plan. Finally, chapter 5 provides an overview
of the committee's findings and details the recommendations of the report.
Background to the MDB Plan
1.14
There is a long history of water reform in Australia and water
management has long been an issue of national importance. A large component of
Australian water reform has focussed on the future environmental, social and
economic health of the Murray-Darling Basin. The work of the Australian
Government and Basin states led to the passing of the Act to 'deal with the
management of water resources in the Basin in the national interest.'[6]
Why an effective Basin plan is
necessary
1.15
The Basin is home to 11 per cent of Australia's population and 20 major
rivers including the Darling, the Murray and the Murrumbidgee. According to the
Australian Bureau of Statistics (ABS), the Murray-Darling Basin accounts for 40
per cent (or $15 billion per annum) of Australia's gross value of
agricultural production and 65 per cent of Australia's irrigated farms.[7]
1.16
The Murray-Darling Basin has recently experienced what has been
described as a "devastating millennium drought" where many
communities in the Basin were confronted with the prospect of running out of
water. Many irrigators and other water users had their annual water allocations
cut to zero. The drought lead to continual dredging of the Murray mouth to keep
it open, between 2002 and 2010, following four incredibly dry years and over
extraction of water. The lack of water put stress on both the natural environment
and on rural communities and farmers that relied on water allocations.[8]
1.17
Despite recent rains, severe droughts will inevitability come again and the
development of an effective Basin Plan is a vital step to sensibly and
responsibly managing water resources for the long-term. It is necessary that
any Basin Plan proposed to Parliament is based on the best available science
and modelling and will provide assurance that water will be available to
support environmental, social and economic outcomes for future Australians.
Establishment of the MDBA to
deliver the Basin Plan
1.18
The MDBA was established pursuant to the Act to develop a robust Basin
Plan. The objects of the Act provide clear parameters about the management of
the water resources, including to:
- give effect to international agreements relevant to the use and
management of Basin water resources (such as, the Ramsar
Convention which relates to the protection of wetlands, and various agreements
regarding migratory birds and animals);[9]
- promote the use and management of the Basin water resources 'in a
way that optimises economic, social and environmental outcomes';[10]
-
ensure the return to Environmentally Sustainable Levels of Take (ELST)
and to protect, restore and provide for the ecological values and ecosystem
services of the Murray-Darling Basin;
- improve water security of the Basin water resources; and
-
ensure that the management of Basin water resources takes into
account the broader management of natural resources in the Basin.[11]
1.19
The MDBA undertook a lengthy process in developing this Basin Plan. The
steps undertaken by the MDBA are outlined briefly below.
Guide to the Proposed Basin Plan, October
2010
1.20
In October 2010, the MDBA released the Guide to the Proposed Basin
Plan (the Guide) which outlined proposals for public consultation. The MDBA
stated that the Guide was the 'landmark first-stage document in the process of
establishing a plan' for the long-term management of the Basin.[12]
1.21
The Guide proposed that the additional surface water needed for the
environment ranged from 3000 to 7600 GL/y.[13]
However, the MDBA determined that reductions that exceed 4000 GL/y would not
meet the requirements of the Act and accordingly the Authority only examined scenarios
between 3000 and 4000 GL/y.[14]
The MDBA has altered this range over time.
1.22
The Guide, and the subsequent consultation process, received a great
deal of criticism. This criticism has been outlined in multiple public reports,
including the House of Representatives Standing Committee on Regional Australia
inquiry into the impact of the Guide to the Murray-Darling Basin Plan report
titled, Of drought and flooding rains (the Windsor Report).[15]
1.23
Central to the proposals outlined in the Guide was that they reflected
the best available science at that point in time.
Proposed Basin Plan, November 2011
1.24
The MDBA continued to amend its proposals, based on stakeholder feedback,
which led to the release of the Basin Plan on 28 November 2011. This
document, again, was developed for the purposes of further consultation.
Accompanying the Basin Plan (November 2011) was the Plain English Summary of
the proposed basin plan which attempted to set out a summary of the
proposals in easy to understand language.
1.25
In the Basin Plan (November 2011), the MDBA outlined specific long-term ESLT
including identifying the return of surface water for environmental purposes to
be 2750 GL/y (a critique of this figure is provided in Chapter 2).
1.26
In the Basin Plan (November 2011), there was a significant increase of
groundwater extraction by 2600 GL/y from that included in the Guide. The
increase was made by the MDBA based on the inclusion of the work that various
state governments had undertaken to establish caps on sustainable use for
groundwater resources, such as the ACT Plan limit, the Achieving Sustainable
Groundwater Entitlements program in New South Wales, South Australian natural
resource management regulations, and local groundwater management rules in
Victoria and Queensland.[16]
Since this significant shift, there have been other changes made to the overall
groundwater SDL in subsequent versions of the Basin Plan (more detail is
provided in Chapter 3).
1.27
The Basin Plan (November 2011) also sets out proposals for further
discussion over a 20-week consultation period. It was intended that the results
of this consultation would then 'inform the development of the Basin Plan.'[17]
1.28
As a part of the public consultation for the Basin Plan, three public MDBA
meetings were staged in Victoria at Shepparton on 13 December 2011, Mildura on
10 February 2012 and Swan Hill on 22 February 2012. The Shepparton and
Mildura meetings were held during peak harvest (grain and grapes). Consequently
less than a 1000 people attended these meetings in total for irrigation
districts representing approximately 35 000 customers.[18]
Proposed Basin Plan – a revised
draft, May 2012
1.29
Following the consultation period for the Basin Plan (November 2011),
the MDBA released the Basin Plan (May 2012).[19]
This version incorporated changes arising from the consultation process and
also reflected new information. The surface water to be returned to the
environment remained at 2750 GL/y; however, the groundwater SDL decreased from
4340 GL/y to 3184 GL/y.[20]
1.30
With the Basin Plan (May 2012), the MDBA was confident it had captured a
balanced view and the Basin Plan (May 2012) was provided to the Murray-Darling Basin
Ministerial Council. The Ministerial Council (which consists of all Basin water
ministers and the Federal water minister) had a six week period to consider and
comment on the Basin Plan (May 2012) and make suggested changes.[21]
Ministerial Council comments on
draft Proposed Plan
1.31
On July 2012 the Ministerial Council provided its additional comments on
the Basin Plan (May 2012) to the MDBA. These comments outlined the areas of
disagreement with the Basin Plan (May 2012). Specifically, the comments and
requests raised by the Council as a whole included the following:
- an SDL adjustment mechanism to be developed which recognises
works and measures, investment in infrastructure and on‑farm water
efficiency to recover water;
- further modelling of a 3200 GL/y 'without constraints' scenarios
to be undertaken to determine what environmental outcomes may be achieved;
- equitable downstream apportionment and water recovery to be
divided fairly between states;
- removal of the formal 2015 review in the Basin Plan;
- SDLs to commence in 2019 and accredited water resource plans to
stand for 10 years (i.e. until 2029);
- additional work to be undertaken regarding groundwater SDLs; and
-
insertion of a clause making it clear that the obligation to
'bridge the gap' between current and future SDLs will not be passed from the Commonwealth
to the states.[22]
1.32
In addition to the Council's feedback as a whole, each Basin state
Minister provided detailed comments to the MDBA for further consideration.
These comments detailed state specific concerns, including the call for more
water to be recovered for environmental purposes (South Australia), and less
water to be returned to the environment (i.e. Victoria, New South Wales) due to
social and economic impacts on communities.[23]
Altered Proposed Basin Plan, August
2012
1.33
Following receipt of the Ministerial Council comments, the MDBA sought
further advice from 'the Basin Community Committee, national peak bodies, key
scientists and technical experts, indigenous representatives and local
government representatives from areas most likely to be affected by the
Ministers' propositions.'[24]
1.34
On 28 August 2012, after this further consultation, the MDBA released the
Basin Plan (August 2012) along with two volumes of documents outlining its
views on the matters raised by the Ministerial Council. Discussion of the
feedback it received through consultation on these matters was also provided.
The MDBA indicated it had attempted to incorporate matters where there was a
consensus position among Basin states; however, many other matters that
individual states expressed opposing views on were difficult to accommodate.[25]
1.35
The return of surface water to the environment stayed at 2750 GL/y.
However, the groundwater SDL changed again, this time from 3184 GL/y to
3324 GL/y.
1.36
Key matters considered by the MDBA, and therefore reflected in the Basin
Plan (August 2012) included:
- apportionment of downstream shares among jurisdictions to be
consistent, equitable and transparent. The options to achieve this were subject
to further discussion within the Ministerial Council to reach a consensus
position. As such no formal changes were made on this issue in the Basin Plan;
-
inclusion of an SDL Adjustment Mechanism to take into account
'efficiencies and savings achieved through various initiatives in the Basin
that could lead to adjustment of SDLs.'[26]
The Basin Plan (August 2012) provided a framework and the MDBA indicated it
would continue to work with jurisdictions to finalise detailed guidelines
underpinning this mechanism; and
- further adjustment to groundwater SDLs based on additional
information provided by Basin states regarding groundwater aquifers.[27]
1.37
The Basin Plan (August 2012) was provided to the Minister Burke on
28 August 2012. Any further changes to the Basin Plan can only be
instigated by Minister Burke, and not from individual Basin state Ministers. However,
Minister Burke indicated that he would continue to work with all Basin states
to finalise the Basin Plan in 2012.[28]
Minister Burke stated that the Basin Plan (August 2012) is closer 'to a genuine
consensus position to reform of the Murray-Darling Basin.'[29]
1.38
When the MDBA provided the Basin Plan to the Ministerial Council for
consideration, Minister Burke stated publicly that he did not consider it went
far enough. He stated that the 2750 GL/y figure was not 'as environmentally
ambitious for the health of the basin' and he wanted to see the further
modelling for 3200 GL/y.[30]
Despite this, Minister Burke has remained adamant that the Basin Plan will be
put before Parliament, and 'signed off' by the end of 2012.[31]
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