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Labor has wrested support for its legislation to save the Murray–Darling Basin with concessions to the Greens and independent senators, but the plan’s heavy reliance on water buybacks will do little to appease farmers and state governments. By Mike Seccombe.

Murray–Darling plan wrenched across the line

Two women walking beside each another.
Greens Senator Sarah Hanson-Young and Environment Minister Tanya Plibersek.
Credit: AAP Image / Lukas Coch

By the standards of an industry in which a week is a proverbially long time, Monday’s press conference in Canberra was practically epochal.

Labor’s Tanya Plibersek and the Greens’ Sarah Hanson-Young fronted up together for a big policy announcement. A joint Labor–Greens presser, notes Hanson-Young, had not been witnessed in more than 11 years.

The last time it happened, Julia Gillard was prime minister. Labor was in minority government and dependent on the Greens and a couple of independents for its very survival, so it had to play nice and share a bit of credit.

But that is not the case in this parliament, where Labor has a majority in the House of Representatives, and Prime Minister Anthony Albanese, despite his “I fight Tories” mantra, often seems as eager to snipe at the party on Labor’s left as he is to chide the right-wing opposition under Peter Dutton.

While it’s true the Albanese government regularly has to make some concessions to the Greens’ demands for changes to get its proposed legislation through the Senate, this usually happens grudgingly after considerable public wrangling. As was the case with Labor’s eventual agreement to a significant increase in its spending on housing.

But here were Plibersek, Labor’s environment and water minister, and Hanson-Young, the Greens environment spokesperson, sharing credit for having crafted a major piece of legislation together, the Water Amendment (Restoring Our Rivers) Bill 2023, which is intended to bring some semblance of health back to Australia’s biggest river system, the Murray–Darling.

They were presenting as some kind of mutual admiration society. Plibersek lauded the Greens’ amendments to the bill as having improved it.

“I want to thank Sarah Hanson‑Young for the very constructive way we’ve worked together to deliver these important changes … and for her support subsequently for the bill,” she said.

Hanson-Young echoed those sentiments, thanking Plibersek for her “constructive” approach and saying how “pleased” she was to announce the Greens’ backing.

The subsequent media release quoted Plibersek: “We know better decisions are made when the Government works collaboratively with others.”

At their joint presser, both women appealed to other crossbench senators to get behind the bill, for at that point support was still a couple of votes shy of a majority.

In short order, they got the numbers. Independent ACT Senator David Pocock backed the bill after securing another couple of amendments, and when former Liberal David Van also agreed, they reached critical mass.

It all stood in refreshing contrast to the usual tribal hostility of politics, and particularly to the reflexive obstructionism of the Liberal–National opposition. And it was not before time.

Way back in 2007, during the devastating millennium drought, then prime minister John Howard, whose views on climate change literally changed with the weather, conceded its reality in a speech to the National Press Club. He acknowledged rainfall across southern Australia was declining and becoming more irregular.

He also acknowledged too much water was being taken out of Australia’s rivers.

“Against this backdrop, I announce today a $10 billion, 10-point plan to improve water efficiency and to address the over-allocation of water in rural Australia, particularly in the Murray–Darling Basin,” he said.

Howard promised increased environmental flows to restore the dying system and to address “once and for all water over-allocation in the Murray–Darling Basin”.

No detail of the plan is needed here, for it achieved little.

In fairness, this was not entirely the Howard government’s fault, for the plan was bedevilled from the start by conflict with and between the states. The Murray–Darling system extends across four states – Queensland, New South Wales, Victoria and South Australia – plus the ACT, and their competing demands ensured a continuing tragedy of the commons.

In 2012, the federal, state and territory governments agreed on a plan with the aim of restoring the health of the system by recovering 3200 gigalitres of water, principally through buybacks from farmers who had been over-allocated.

The target was subsequently wound back. The new figure announced by the Murray–Darling Basin Authority was 2075 gigalitres. In addition to this, the South Australian government demanded another 450 gigalitres, which was not mandated in legislation.

Implementation has been fraught. There are questions about how real some of the water savings are, and even bigger questions about value for the billions of dollars spent. These relate to the prices paid for some of the buybacks and especially to the cost of various water efficiency schemes, which mainly involve subsidies for things such as lining channels or improving irrigation systems.

This week, The Australia Institute released a damning report on the cost of two such efficiency schemes near Hay in the NSW Riverina. By its calculations, one $15.8 million proposal, from the Elwah Pumpers Group, would be the most expensive water recovery project to date, costing the equivalent of $38,515.69 per megalitre of water saved. That is close to 20 times the $2100 average cost of water buybacks. The other proposed scheme, by the Boxyards Road Water Group, would cost $8.8 million, equating to almost $26,000 per megalitre.

According to Dr Sarah Ann Wheeler, professor of water economics at the University of Adelaide – whose work is frequently cited by Plibersek – a little more than $4.5 billion had been spent on efficiency measures as of early last year.

The average cost of these so-called efficiency schemes was more than three times the cost of water buybacks, Wheeler found – which makes them not efficient at all for taxpayers who have footed the enormous bill. Yet for the better part of a decade, these schemes have been essentially the only game in town. We can thank the National Party for that.

“The Morrison government effectively stopped using buybacks as a tool when Barnaby Joyce became federal water minister,” Wheeler wrote in The Conversation this year.

Plibersek hammered the point on ABC TV on Monday night. Her interviewer, Sarah Ferguson, noted the previous government made buybacks contingent on meeting a social impact test, whereby a buyback would have to be shown to have no negative effect on a rural community before it could happen.

“It was there for a reason,” suggested Ferguson.

Replied Plibersek: “It was there to stop water purchases. That’s why the National Party supported it.”

She went on to cite a report from the Productivity Commission that was strongly critical of the progress under the previous government and its opposition to buybacks – even when it stymied willing sellers – and the reliance on costly efficiency measures.

“The National Party would say it’s fine for farmers to sell water to each other, it’s fine for farmers to sell water to the Canadian public service pension fund … to companies associated with the Chinese government … to mining companies to use for mining purposes. The only time they’re not allowed to sell water, according to the opponents of voluntary water purchase, is if they’re selling it to the Australian government to put back into the river system,” said Plibersek.

In 10 years under the previous government, she said, only two of a promised 450 gigalitres of environmental water had been delivered.

“At that rate, we would be delivering the Murray–Darling Basin Plan sometime around the year 4000.”

Oddly, though, Plibersek also said this: “I don’t prefer buybacks to infrastructure ... This will be one tool in the box. The other tools in the box will be the water-saving and water-efficiency projects.”

This was likely a dodge, because the farmers’ lobby is deadset against the government purchase of water. Last week a coalition of groups led by the National Farmers’ Federation organised protests in several Riverina towns.

“Basin communities on the frontline of the Government’s rewrite of the Murray–Darling Basin Plan will protest today with one clear message: NO more water buybacks from farmers…” said the media release.

The Plibersek plan is also facing political resistance from some states. She has singled out, in particular, the Victorian government – a Labor government – for exaggerating the impact of buybacks on farming communities. Queensland and NSW are likely to be displeased, too, if they find their farmers are affected by buybacks.

It’s a very difficult problem. There are two possible reasons Albanese dropped it on Plibersek. One is that she is a very detail-oriented minister. The other is he deliberately gave a leadership rival a hospital pass.

Even farmers are by no means united. Those in the southern part of the basin, along the Murray and its tributaries, believe they have suffered for the over-extraction of water by those in the north, particularly cotton irrigators along the Darling and its tributaries.

They have some reason to feel aggrieved. When water-flows in the Darling slowed to a trickle during the last drought, the basin authority responded by pumping more down the Murray. Yet even as the river flooded past his property, Chris Brooks, who farms near Barooga, had his water allocation cut to zero. For three years.

He is one of more than 1000 Murray basin farmers pursuing a $750 million class action against the Murray–Darling Basin Authority for lost income.

“Those bastards in the north,” Brooks called his fellow farmers on the Darling. “I’m saying buy it from those guys, and let it run down the Darling and let it fill Menindee.

“But Tanya wants it from the Murray River storage, which is Hume [Dam], which is ours. So if you take another 400 or 350 or 300 out of us, it cuts our volume of water in half.”

He is just assuming that. There is as yet no clarity on where the extra environmental water might be acquired, although the amended bill, we are told, will ensure “the flexibility to allow additional water recovery in the northern basin”.

The Plibersek–Hanson-Young agreement promises to deliver the extra 450 gigalitres of environmental water by December 2027. It also promises independent auditing and mandatory reporting of progress, $100 million for an Aboriginal Water Entitlements Program and greater powers to federal regulators, including power to scrap “State Government infrastructure projects that are deemed unviable”.

Given the excessive cost of such projects, it is likely many of them will be canned, despite Plibersek’s insistence she is “happy to consider” any projects the states put up.

This is one point on which she and Hanson-Young differ – if not in substance, then certainly in emphasis.

“The reality,” the Greens senator tells The Saturday Paper, “is the only way that 450 is going to be delivered is through buybacks.”

And fiscal reality suggests she’s right. Too much taxpayer money has already been wasted. If Australia’s great river system is to be saved, the government needs to buy that water, pronto.

This article was first published in the print edition of The Saturday Paper on December 2, 2023 as "A bridge over troubled water".

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