Minister for Sustainability, Environment, Water, Population and Communities
Draft Murray-Darling Basin Plan
28 November 2011
TONY BURKE: Thanks very much. Today, as you’re all aware, the Murray-Darling Basin Authority released its Draft Plan. That means, as of today, we are now in the formal statutory process. We'll have twenty weeks from now of public consultation. That has been expanded from the statutory period making sure that we cover over for the Christmas break as well. After that, next year we'll go through a final formal process and then we'll have a document that lays on the table here in the Federal Parliament.
Up until now it's been possible for members of parliament to simply talk back and forth and argue about the process. But ultimately from both sides of politics we need to own an outcome that has failed every previous generation of politics.
That is, for generations now we have allowed the Murray-Darling Basin to be governed as though rivers would respect state boundaries. That ends today. What we have to do now is make sure that we deal with the Basin as a whole, that we restore its system to health. That we make sure that we do have a sustainable river system that's then able to support food production. That's able to support the Basin communities.
QUESTION: Environmentalists say they were hoping for seven thousand gigalitres of water to be returned to the system and they're saying that this proposal isn't scientifically backed. What's your response to their comments?
TONY BURKE: Okay, a few things on those claims. First of all that would mean roughly halving the drawdown on water that happens throughout the Basin. So let's not pretend that that's a modest claim. That would be an extraordinarily ambitious claim. Secondly though, once you get much beyond three thousand gigalitres of water you actually can't legally manage it.
The reason for that is you do have capacity constraints throughout the system. At the heart of this reform what we're talking about doing is reserving an amount of water for environmental flows. And those environmental flows aren't just a gradual trickle down the river; they're flooding events of environmental sites.
Once you get beyond about the three thousand gigalitres figure you start to enter a situation where to hold flooding events in those sorts of volumes you are involved in flooding private property. You have challenges in actually distributing the water because of channel capacity, in distributing it in those sorts of volumes to environmental sites.
So there'll be some things that in the environmental world you would be able to say well this would make perfect sense as a landing place, but you do have capacity constraints throughout the system. And that's one of the reasons why the authority have ended up with the numbers that they have.
QUESTION: But the plan's been criticised for a lack of detail both in share productions and in the lack of details in the environmental watering plan. Are you satisfied it's a robust and detailed document?
TONY BURKE: Yes I am, Lauren. If I can talk about each of those two areas. First of all the detail that's been criticised on the basis of the shared flows across the system is because the authority have targeted the different restraints on water to the environmental outcomes they're trying to achieve. So within each catchment there is an amount of water that needs to be dedicated to the environmental assets within the catchment.
But then you also have some needs for the end of system flow to make sure that you're flushing salt out through the end of the system. And for those amounts they have something shared across the catchments. Now that means the numbers that they're talking about precisely match the outcomes that they're seeking.
The second half of your question, Lauren, deals with the use of environmental water, in particular the environmental watering plan. One of the things that the authority has stressed is the best way to utilise environmental water will involve a level of local knowledge and localism.
The people who would like us to have a completely defined environmental watering plan are saying that effectively they'd like the national government to have no localism at all. Because that’s what you do if you have a highly prescriptive environmental watering plan.
From what I've seen at the moment I think the Murray-Darling Basin Authority have got the balance on that right between what you want to have in terms of national, definitive requirements and what you want to do through local engagement. But all of that will be flushed out as well during the course of the consultation period that we now enter.
QUESTION: Do you think that this plan in its current form or the draft has got the capacity to deliver a triple bottom line outcome where rural communities won't be devastated?
TONY BURKE: Yes I do, Colin. I do. What we have with what's in front of us at the moment in environmental terms deals with the key environmental outcomes that need to be achieved. It does make sure that you've got the Murray mouth open nine years out of ten and that has not only an environmental outcome but also has an important outcome for irrigation in being able to flush the salt out through the system.
You also have a staged process for communities between now and 2019. Now some people have said, nothing happens until 2019, that is just plain wrong. We are already on the numbers released today forty‑five per cent of the way there. Between now and 2019 each year through a combination of infrastructure improvements, and through the purchase of water, we're able to steadily manage communities through the transition.
There is no better time than now to do that for two simple reasons. The best time to have a transition for communities is when there's a lot of water in the system, that's certainly true at the moment. And secondly, at a time when you have a strong jobs market within Australia is the best time to manage this sort of transition as well.
QUESTION: How confident are you that the plan will withstand the legal challenge in terms of the justification of the act?
TONY BURKE: Everything that the Murray-Darling Basin Authority has done, as far as I can tell, is completely consistent with the requirements of the the Water Act. It matches the advice that I tabled in the parliament last time, last year. And you know they have the Water Act they have then built a plan precisely matching within that. There's still a period of consultation to work that through, but the legal requirements of the Water Act have been met.
QUESTION: Are you telling Jay Weatherill not to do it?
TONY BURKE: I beg your pardon?
QUESTION: Are you telling Jay Weatherill not to go ahead with any legal challenge?
TONY BURKE: Well look certainly if the benchmark is four thousand gigalitres. From all the advice that I've received, we have capacity constraints in the system, that regardless of the legal outcomes we would not be able to manage four thousand gigalitres. And I don't think anyone would view it as a sensible use of taxpayers' money to be purchasing water for environmental flows that you then can't use.
So certainly every state premier will have a different interest in this and they'll use the consultation period to argue the interests of their state. That's what they should do, that's the right thing to do. But out of all of this we have to end up with a situation where we have a national approach to the Basin.
I have to say of all the states, South Australia probably have the most at stake in that, in having a national outcome. If I can give in terms of a specific South Australian outcome. I've spoken about nine years out of ten for the mouth of the Murray to be open. And you referred to Premier Wetherill's call for four thousand gigalitres.
The figures released today would have the mouth of the Murray open eighty-nine per cent of the time over one hundred years. The four thousand gigalitres' figure would have the mouth of the Murray open just under ninety-two per cent of the time over the course of one hundred years.
So in terms of environmental outcomes for South Australia the significant outcomes that they would seek to have achieved are achieved in what's been tabled today.
QUESTION: It sounds as Victoria says that they are disproportionately affected by this. What do you say to that and also do you think some states will just have to I guess be affected in different ways on this and it's just the nature of this plan?
TONY BURKE: Every state will be able to come up with a reason why they are affected differently to ever other state and they'll all be correct in arguing that. One of the things that is true of Victoria at the moment, Victoria have more than any other state been able to come up with the most effective infrastructure projects to provide winds for efficiency and winds for the recovery of environmental water.
Now other states will complain about how well Victoria have done so far in the use of infrastructure money. There will be arguments up and down the Basin and that's why we've gone since federation without having sensible reform and getting this right.
Every state will have a valid argument as to why they're different. Every catchment will have a valid argument as to why they're different. That can no longer be used as a way to avoid reform.
QUESTION: The Opposition says that it's going to destroy farming communities and will lead to higher food prices because food will have to be imported. What's your reaction to that?
TONY BURKE: I must say I disagree with the premise of your question. Your premise says the Opposition says and then you followed it on with a single statement. That's not reflective of what the Opposition's been saying on the Murray-Darling Basin. What you've just said is reflective of what Barnaby Joyce says when he talks to irrigation communities and throughout the north of the Basin.
It's not necessarily anything to do with what Simon Birmingham or Jamie Briggs say when they're doing media talking about the South Australian outcomes. For a long time and I know we often argue about Tony Abbott having no policies. That's not the problem with this one. The problem with this one is they've both policies and they're contradictory.
That cannot keep happening. And I think the time's up now for the Coalition. They can't argue one thing in South Australia and something completely different throughout irrigation communities. What they need to acknowledge now is they are either in favour of reform or they're against reform and they'll have to vote on that next year.
QUESTION: Could this plan drive up the cost of food prices?
TONY BURKE: There's an argument about food production in the Basin that I think we just all need to take a bit of breath on. In the order of about thirty per cent of the gross value of production throughout the Basin, it's a little bit lower. It's around that benchmark, goes to industries like cotton or industries like the growth of grapes for the purpose of wine.
These are not products which are going to be responsible for easing hunger throughout the world. I don't have a problem with these crops being grown. My view is that farmers should have a sustainable amount of water that they're able to acquire and with their entitlement they should then decide what's the most profitable thing to do on their land. I don't think we should tell them what to grow.
But we should not pretend that the Murray-Darling Basin is entirely about food. It's not purely for those purposes and for everything beyond the food issue, everywhere where we have a water-saving where it is someone selling part of their entitlement, that is because they have found further efficiencies and they are selling water they no longer require. Whenever we get infrastructure improvements, that has no negative impact on food production. Often for example, with the Victorian NVIRP projects food production ends up becoming more efficient than ever, but we get a return of water to the environment.
There's a whole lot of extreme arguments that have been put so far. Today will be no different, but we do need to just take a breath on some of the claims that are being made about food.
QUESTION: On the socio-economics the plan says that there will be flow on effects to communities but this says that it can't quantify the scale of those effects until it's determined whether water will returned through buybacks or infrastructure and where those returns will happen. Given all of that, how can you be sure this plan will deliver a triple bottom line if we don’t know what sort of socio-economic toll we're looking at?
TONY BURKE: The greatest thing the communities have to be able to transition this reform through is that it is staged between now and 2019. That creates an opportunity not only for communities to engage with the Government programs that are there about efficiencies and strengthening the base in communities.
It also means growers will do what they've always done and find more efficient ways of growing their produce year after year after year. And environmentally because we've been fortunate with the recent rains a staged process between now and 2019 doesn't carry negative environmental consequences either. So I'm very confident that the timeframe provides a breathing space that communities need.
Up until now we have had difficulty unlocking and getting gout the infrastructure money. There's a number of projects for example like Menindee Lakes, where the current New South Wales Government unilaterally terminated the offer that we had for that money to go ahead and put four hundred million dollars attached to those projects.
We're renegotiating with New South Wales to try to get those projects going again but the infrastructure dollars are starting to flow now. And that provides a real opportunity for communities.
QUESTION: Your consultation meetings that will be held over the next little while, will you be attending any of them to defend the plan?
TONY BURKE: My purpose of the consultation isn't defence. My purpose for the consultation is to be able to make sure that I'm hearing the different views so that we're able to factor that in for a document which ultimately I have to personally sign off on. There'll be a number of community meetings.
Some of them will be official Murray-Darling Basin ones for the authority. Some of them will be ones organised by communities. I will be attending every meeting that I can, as much as the diary allows. I, as you may be aware I committed to one that was a public meeting I was invited to in Griffith that was to be held tomorrow.
They have now changed the date of that for a couple of weeks later, I'll still be in Griffith, but obviously the public meeting that I'd originally accepted is not going ahead. There'll be another community meeting that I'm attending in Shepparton. My intention is to be at as many community meetings as I'm able to be at.
Obviously there'll be some that'll be held at times that I can't make it but whenever I can be there I will be.
QUESTION: Is there a way to deliver this plan without job losses?
TONY BURKE: Oh there's no way of delivering Murray-Darling Basin reform through business as usual. You can't do that. We do have a problem of over‑allocation. And what that means is we need to end up with a situation where there is more water reserved for environmental uses for the health of the Basin than there has been in the past.
Now that does mean that communities, many communities will see a situation where between now and 2019, the total volume of entitlements that's for productive purposes within their area will be lower.
From the perspective of any individual irrigator though let's not forget, if an irrigator doesn't want to part with any of their water, then we have no interest in taking it from them. We only buy from people who have chosen to put their water on the market and if an irrigator doesn't want to sell, we don't want to buy.
QUESTION: Given we're not looking at catchment by catchment reductions, we're looking at shared reductions across mainly the southern Basin and it will operate as a market mechanism, do you have any plans to introduce additional compensation for say small towns using water inefficiently at the moment that might be hardest hit by this sort of market mechanism?
TONY BURKE: One of the things that I've been wanting to do is to find new ways of unlocking the infrastructure money. Part of the problem and part of the frustration in having substantial amounts of money that took so long to get out the door, was the fact that it had to be a partnership between us and the states and therefore you essentially had too many people with their fingerprints on the same project and you'd end up with arguments going back and forth about what was the best way to spend money and then for years no money got spent.
My approach is to provide a much higher degree of flexibility for the states in how they spend that infrastructure money and that then means that for individual projects, for targeting where the infrastructure dollars will go, they have a much higher degree of discretion for that and there's a direct arrangement that I've made as a standing offer to the states as to how much water would then be returned to the environment as a result of those dollars.
So the sorts of projects you refer to may well be projects that go ahead but I very much have taken the hands off in order to get the money out the door to give the states a higher level of discretion to pick exactly where they want that money targeted.
QUESTION: So when can the infrastructure money start to flow?
TONY BURKE: Well in terms of the northern Victoria infrastructure projects I announced them with the Victorian Water Minister a couple of months ago. That's in the order of about $1.2 billion so that money is off and running now. There are New South Wales projects under the old system where they are very much ready for approval and New South Wales and the Commonwealth and very close to being able to publicly announce those.
For the remaining monies, if people don't want to continue to work through the old agreement between the Commonwealth and the states and want to use the outcomes based model that I described, the money is available immediately and it's a matter for the states. If they want to target particular projects, so long as they're willing to meet the outcomes model where they determine the water projects that they want to spend on and there's a set amount of water that's then returned to the environment to make sure that we're bridging the gap then that offer is available and available now.
QUESTION: Given that the states are going to have responsibility for, greater responsibility for infrastructure projects as well as for developing environmental watering plans, aren't you effectively giving power back to the states, the sort of power that was seized by John Howard in 2007 to make this a national Murray-Darling Basin?
TONY BURKE: Oh look in terms of the infrastructure projects I have without a doubt given the states a higher degree of flexibility in how that money is spent and that was after years of the money not being spent at all which I viewed as a bad policy outcome. So in terms of infrastructure money, yes that's certainly true.
On the commonwealth environmental watering plan I don't accept the premise of the question. The Water Act itself is quite specific that the states are to come up with environmental watering plans once we've established the high level principles of one.
The states then come up with their detailed water resource plans. They have to do so in a way that meets my satisfaction and if they're not able to do so and if they don't come up with plans that create the optimised use of water, then there are step-in powers for the Murray-Darling Basin Authority at the end of that.
Now I don't expect that we'll get to those step-in powers. I think we'll end up with a more co-operative situation than that but certainly the Act presumes that the first call will be we put down some high level principles, the states put forward their water resource plans under that and by doing it in that way you get the opportunity for the high degree of localism that I spoke about.
QUESTION: Minister just on the question of constraints, sorry just on the question of constraints you said that anything much above 3000 would bump up against legal constraints...
TONY BURKE: That's how I've been advised.
QUESTION: ...et cetera yet the authority modelled thirty-two-hundred and originally floated up to four thousand. Was that simply never realistic?
TONY BURKE: Well no you need to do two things. One you need to ask the questions of, if you could manage it to what extent would you get ideal environmental outcomes. Now the constraints are things like you've got the Barmah choke, you've got a number of channels where there are limits to how quickly water can be put through it and the volumes that can be put through individual channels when you try to reach environmental sites.
You have places where if you increase the flooding event for an environmental asset then you can inadvertently be flooding bridges or private property on the way through. For a lot of these system constraints because some people will then argue the quite valid environmental argument, well why don't you spend some of your infrastructure money and remove the constraint.
The problem is for many of these constraints you remove one and there's another cascading immediately behind it. So you for example buy an easement over one private property and immediately before you get to the next megalitre you're flowing over their neighbour as well.
So these constraints are real. They depend in part on how you deal with the environmental events. Certainly could you use seven-thousand-six-hundred by simply having the river system flow a centimetre higher than it currently does, well I guess you could do that but you wouldn't get much of a positive environmental outcome out of it.
So the system constraints are real but I think the authority did the right thing in doing modelling separate from the system constraints argument to say well if you could manage it, environmentally what would be the outcomes of different flow regimes.
QUESTION: Just on the infrastructure issue again, could the amount of money that the federal government is putting up or the cost sharing arrangements with the states be altered to get those states on board that aren't happy with the reductions in the cuts that they've got to make.
TONY BURKE: Oh look there are - oh you're saying the share between the states?
QUESTION: No - well the cost sharing arrangements between the Federal Government and the state for infrastructure in a particular - could that arrangement - you bear more of the cost, the states bear less for those states that are particularly unhappy with facing the cuts.
TONY BURKE: Look effectively on the cost sharing arrangements I have unlocked that through the outcomes based proposal. The outcomes based proposal says that you have a ratio between the value of the infrastructure project and how much water would have to be returned to the environment.
Then they have full discretion as to how they spend it. If they have a project which returns more water to the environment than that then that's a matter for them. If they have a project which returns less water to the environment than that, then they can provide the water to the market. It gives them that high degree of flexibility and I think that's the right way to do it.
We couldn't go on with a situation where the buy-back money was easy to get out the door but the infrastructure money was just being part of endless delay.
QUESTION: The Windsor Rules Review, when will that start and are you confident that it's actually going to provide some savings when it finally all comes down?
TONY BURKE: The concept of reviewing river rules and some of these principles are among the capacity constraints that I referred to. Rules about how quickly you're allowed to have flows out of individual dams and things like that. For those rules the review will be under way and I'll leave it for others from the authority to give you the precise timelines and starting conclusion of those sorts of things.
All the modelling that's been done does say there are substantial gains towards bridging the gap that can be met through unlocking some of those rules. I've seen a broad enough area of variation about just how far it will go on bridging the gap that I'm not going to commit to an individual figure in advance of that review taking place.
QUESTION: Are you confident that all of the recommendations to come out of Tony Windsor's committee are being catered for in this draft?
TONY BURKE: There are a number of recommendations that went to the government and we've provided our response there. The authority also has made very specific undertakings in response to that inquiry and I'm very confident that all of those being followed up.