Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

I will begin by indicating that the opposition recognises the government's desire to provide certainty to basin communities by placing a cap of 1,500 gigalitres on water purchases. On that basis we will not be standing in the way of this government initiative.

As with the Basin Plan itself and many aspects of it, there are conflicting points of view on the issue of water purchases versus infrastructure measures as the best means of achieving the outcomes of the Basin Plan. Labor has consulted with various stakeholders and with people with divergent points of view on these issues, and we have very carefully considered all of those views. We have also carefully considered the position of the basin states and, again, on that basis we will not be opposing this bill. Again, given the support of the basin states, we will not be standing in the way of this bill in the interests of bipartisanship—which has always, of course, underscored the strength of our progression to the point we have reached today.

The bill proposes to amend the Water Act 2007, to impose a duty on the Commonwealth not to exceed the 1,500 gigalitre limit on surface water purchases in the Murray-Darling Basin at the time of entering into the Water Purchase Agreement contract. Secondly, it amends the Murray-Darling Basin Plan 2012 to provide increased flexibility in the recovery of some 450 gigalitres of water through efficiency measures funded under the Water for the Environment Special Account.

The success of the Basin Plan has always rested on the bipartisan support I referred to. At the federal level, that has been very important, and of course we have strived to—as best we can—extend that to the states. Again, given the support of the basin states we are happy to support this proposition today. As many in this place will know, disagreement over the management of our most important river system and the food bowls which rely upon it actually predates the Federation. In the early years, the importance of the basin to agriculture in South Australia, Victoria and New South Wales led to the construction of numerous dams, weirs and locks. By the late 1960s drought, the overextraction of water for irrigation and rising salinity began to put the health of the Murray-Darling system on the radar of politicians and users alike and—of course—of the community more broadly.

By the drought of the early 2000s—otherwise known as the millennium drought—it had become clear that much more needed to be done and that politicians needed to act. Under the Howard government, the National Water Initiative was agreed and the Water Act 2007 was passed through this parliament. So both sides of this place can take credit for the significant reforms which have taken place in recent years. Now—in part at least, if not entirely—thanks to the good work of the former minister for water, the member for Watson, we have a plan that is restoring our rivers to health, supporting strong regional communities and ensuring sustainable food production.

The Murray-Darling Basin Plan has enjoyed bipartisan support—as I said—at all levels of government and across the political parties. Importantly, it has also had the support of farming, environmental and Indigenous groups. Not everyone has had their way, of course. Restructuring and reform in such an important area as this is always very difficult. I suppose it can be said that the bill before the House tonight is about redressing the issues still held by some of those basin communities in particular.

The Basin Plan brought into force in November 2012 will set basin-wide sustainable diversion limits and return 2,750 gigalitres to the environment. Basin states are required to prepare water resource plans that will give effect to the sustainable diversion limits from July 2019. Under the sustainable diversion limit adjustment mechanism, up to 650 gigalitres can be provided through supply measures and projects that deliver environmental outcomes with less water. Proposals for these supply measures are, I understand, in varying states of preparation and assessment. There is a bipartisan commitment to bridge the gap between what these supply measures can provide and the 2,750 gigalitres to be returned to the environment. On top of the 2,750-gigalitre target, an additional 450 gigalitres will be returned to the environment. Funding was provided through legislation in 2013 for this additional 450 gigalitres, which must be obtained through projects that ensure no social or economic downsides for basin communities, such as on-farm irrigation projects. There is $1.78 billion in the Water for the Environment Special Account, including $200 million for the removal of constraints identified in the constraints management strategy.

To date, more than 1,900 gigalitres has been recovered for the environment. This includes more than 1,160 gigalitres of water through water purchases, over 600 gigalitres through infrastructure investment and over 180 gigalitres through other basin state recovery actions. This is water that can be used at appropriate times and where it is needed to improve flows and help restore health throughout the system. Already, we have seen successful water releases overseen by the Commonwealth Environmental Water Holder and the state and regional water management agencies. Importantly, there has been significant Commonwealth investment in ensuring that farms remain productive as the plan is delivered. Indeed, $2 million a day is being and will be spent on efficiency and infrastructure measures out to 2019.

Progress on these environmental objectives is very significant. The system includes approximately 30,000 wetlands, over 60 species of fish, 124 families of macroinvertebrates, 98 species of waterbirds, four threatened water-dependent ecological communities and hundreds of plant species supported by key floodplains. It is obvious that this is a very important system to Australia. The health of the river channels themselves and the flora and fauna they support is not only vital in its own right but also vital for the economic and social wellbeing of basin communities.

Also related to the environmental needs and environmental flows, the Aboriginal nations and communities in the basin want and should have access to the flows they need to ensure the continuation of their culture and their social and economic wellbeing. Aboriginal people feel a deep connection to their land and the waters that flow through and across them. This needs to be recognised and provided for, not as an exercise in imperial patronage but by ensuring Aboriginal people are empowered through water rights.

I now want to turn to agriculture and its implications, which of course is of paramount interest to me. It is well known in this place that the basin supports around 40 per cent of Australia's agricultural production. According to ABS figures, in 2012-13 the basin accounted for more than 50 per cent of Australia's irrigated produce. There are some fascinating figures here that will surprise some in the House who have not had the opportunity to look at these issues in such detail, and I of course exempt the member for Riverina from that group. Almost 100 per cent of Australia's rice, 96 per cent of Australia's cotton, 75 per cent of Australia's grapes, 59 per cent of Australia's hay, 54 per cent of Australia's fruit, 52 per cent of Australia's production from sheep and livestock and 45 per cent of Australia's dairy come from the basin. Around two million people live and work in the basin, in communities ranging from centres with fewer than 1,000 people to large urban centres, such as Wagga Wagga, in the member for Riverina's electorate. A further 1.2 million people depend on its water to survive. All of this agricultural production and the two million people living in the basin rely on a healthy, functioning river system.

Many people in Australian agriculture do not have the benefits and advantages of a river system or an underground water system. Many of them, well into their third year of drought, are starting to understand the challenges of that more and more. With the growing prediction of another El Nino, we fear relief is not coming any time soon. It is now almost two years since the Prime Minister and his agriculture minister went to Longreach to tour around affected areas of that part of the world and therefore almost two years since the Prime Minister announced his first tranche of assistance for drought affected farmers. Two years on, sadly, the farmers are still wondering what it is all about.

Various attempts at utilising concessional loans have been abject failure. As much as they might like to, few in this place would challenge that proposition. As at April less than half of the money allocated for the Drought Concessional Loans Program has been taken up—much less than half, in fact—and less than three per cent of the drought recovery loans had been allocated. That latter point should not be too surprising to many in the House, because the title indicates that they are drought recovery loans and very, very few people in those parts of the world would consider themselves, or be deemed to be classified, as in recovery mode, unfortunately.

The tragedy of this is that the outcome goes beyond the obvious failure of the policy. In fact, farmers have been misled to believe that the government is providing all this drought assistance money when that is certainly not the case. The government has been claiming that up to $790 million is being provided or put on the books to assist drought affected farmers. But this is a bit of a cruel hoax. It makes the six o'clock news okay, but it has not helped the farmers. Why hasn't it helped the farmers? There are a number of reasons. Farmers either have not been able to qualify for the loans or, because of the nature of things, find that the loans do not extend to them any real benefit. In other words, the differential between the loan rates is often not sufficient to motivate them to go through the pain and the grief of the bank relationship and the paperwork—and of course many of them just do not qualify for the loans, particularly, as I said, those drought recovery loans.

In my view, the misrepresentation got worse recently when the government had the audacity to inflate the value of its agricultural white paper by including in the white paper the total value of every loan that might be lent out—or might not be lent out—over the course of the next 10 years. Have a think about that. It was the total value of the loans. If I loan the member for Corio $100—

Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Link to this | Hansard source

You won't get it back!

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

I say to the member for Riverina: I am very confident I will get it back. If the member for Corio is borrowing some money off me and the interest rate is two per cent, the cost is the interest rate, not the value of the loan. It is not the $100. The government is including in its white paper the total value of all these loans—hundreds of millions of dollars. That is if they are ever lent out, and, given what I have just said, they are not going to be lent out—and we hope the drought recovery loans are not going to be lent out, because it would mean that our people are going to be in drought for another 10 years. That is what it would indicate. But the government has taken the total value of the loan, rather than the cost of delivering the loan, over a 10-year period, and it ends up with a very big number—very, very clever.

But, to make it worse, the bond rate now is still just over two per cent, so the government is borrowing money at just over two per cent and it is lending money out, depending on which concessional loan scheme we are talking about, at somewhere between three and four per cent. You do not have to be a mathematician to work out that this is a win situation for the government. That is a little bit cute of me, because there are other costs. There are provisions for doubtful loans—obviously the government might not get some of this money back—and there are also administrative costs. But the cost of delivering these loans for government is very, very low.

To further exacerbate the problem, the last tranche of loans has still not been rolled out in some states. Why? Because the Commonwealth are insisting that the states pay for the administrative costs of the loans, at least in part. Have a think about that. Different state governments invest varying amounts of money in their own drought assistance programs. The Commonwealth are coming along and inflating this big figure, saying, 'We've got $720 million we're going to give away to farmers,' basically, but they do not tell us that they are borrowing at two per cent and lending at three per cent. Then they impose the administrative costs of delivering the loans—that is, those which are taken up—onto the state governments.

I struck this same problem in the period I was Minister for Agriculture, Fisheries and Forestry. We were still then trying to implement the farm financing loans, and I struck the same thing. A number of states had not been signed up. With the stroke of a pen, I said: 'This is ridiculous. Let's just pay the admin costs for the states and get this money out into the pockets of the farmers, where it is needed.' Now people have been suffering three years of drought, but, no, that is not what is happening, particularly in Queensland—

Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Link to this | Hansard source

Most of it is man-made drought.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

It is man-made drought? I see. That is an interesting intervention from the member for Riverina. The drought that our farmers are facing in Queensland and New South Wales is all man-made—and yet he is a climate change denier. We will return to that point later on maybe.

But this government had the audacity to say, 'We're handing out more than $700 million,' knowing that they are making money on the loans, that half of the loans are never go to be handed out and that, when they are handed out, the government are going to charge the state governments to hand them out. This is not providing much assistance to drought affected farmers.

Then, in the budget, knowing this, they decided that they probably should do a little bit more. There was one initiative in the budget which I support and I will give the government some credit for, and that was some further improvements to the Farm Management Deposits Scheme, because it does provide farmers with an incentive to put away in the good years for the bad. Pre the budget, the government had another good scheme, which provided a rebate for farmers who might want to invest in a new water infrastructure scheme—it might be to sink a new bore, for example. The problem was that the government put such a small amount of money into it that it was oversubscribed on about day two. Then Minister Joyce robbed some money from, I think, New South Wales to send some more to Queensland and made a complete botch of the whole thing. But on budget night they decided we should do more, so they did a couple of things. They introduced some accelerated depreciation initiatives around, for example, investment in fodder and other infrastructure projects to be depreciated over a much shorter period of time—in some cases fully in the first year. That is a hard policy to criticise, but the obvious springs to mind: first of all, you have got to have the money to invest, and, second, you have got to have a profit to offset the deduction from. If you been in drought for three years, you are not likely to have either. That is the truth of it. And on budget night we learnt that it was not going to come into force until 2017, something Minister Joyce was forced to correct—at our urging. But the fact remains that, without the profit and without the cash to invest in the first place, it is of limited benefit.

Then there was the $35 million project entitled Drought Communities Program, which we were told on budget night was going to allow all these local councils to spend money on shovel-ready projects in drought affected communities. This would stimulate the local economy. People would be buying fencing equipment, fence wire and all these things—maybe water infrastructure projects, maybe just a road in the local shire because the council does not have the money needed to do these projects. But there were a couple of problems with this. First of all, the money was much less than the money the government had cut from the same councils by removing the indexation on the financial assistance grants to local councils. They took a big bucket of money off them and gave them a much smaller bucket back. But here we are, four months on and not a project to be heard of—not a project nominated, let alone a sod turned or indeed a project completed. Four months on and we have heard nothing. This was an initiative to immediately stimulate local economies adversely affected by drought. Immediate stimulation and here we are, four months on and we have not even had a project approved, let alone started. What a farce that was.

That takes me to the national water infrastructure development fund. This was announced not in the budget but rather in the white paper. We were told in the white paper that this was going to be a great program to establish new water infrastructure projects around the country. There seemed to be an emphasis on north, which sounds like a reasonable thing to do. I indicated my support for the water infrastructure rebate. But where is the national water infrastructure development fund? We were told about it all those months ago in the white paper. We have not heard a word about it since. It was highly qualified; it indicated that projects would require the support of state governments and/or the private sector, and we all know how cash strapped state governments are, so we are not holding our breath for that to be forthcoming. But what projects are these? Where is the money coming from? How much is the Commonwealth going to contribute? Who is responsible for this fund? We do not seem even to know who is responsible for these projects. But it has been a long time coming, and we are waiting for the details.

On a related matter, I note that in the northern Australian white paper there was a $500 billion infrastructure fund. Five billion—did I say $5 billion? I meant to say a $5 billion. I hope I did not say $500 billion; I certainly meant to say $5 billion.

Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Link to this | Hansard source

You can correct the Hansard!

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

Minister Joyce has led the way on Hansard corrections! I have learned a lot from him—not that I intend to pursue his guidance.

There was a $5 billion infrastructure fund for northern Australia. This would imply, of course, that many of these would be water projects. They could be road projects or others, but the government likes to put dams in brackets after everything just to let people know they are the builders of dams. But the questions are: who is eligible to borrow this money, who is going to borrow this money, what are the projects that this money is going to fund and what will be the interest rate? Given that we are living in a very low interest rate environment, what will be the differential between what, for example, a business can raise elsewhere or indeed debt finance from a bank and what is going to be offered? Here we are, all these months on from the release of the northern Australian white paper and we do not know the answer to these questions. In fact, on many of these matters we do not even seem to know which ministers are responsible. I know it gets shuffled around a bit, because Minister Joyce has a go at a few things, it does not work out all that well and then it gets flicked over to Minister Macfarlane to tidy up et cetera.

There are many out there who are asking these obvious questions. When are some of these announcements going to come to fruition? There might be a simple answer to that. It may be that they might come to fruition just in time to become part of an election campaign but not in time to be spent—just in time to make some announcements during an election campaign but not enough time to be spent prior to the election. In other words, by the time the election comes around, primary producers in this country will have had three years of receiving false hope from this government and lots of talk about a whole range of projects, many contained within a failed white paper which has disappeared without a trace overnight because it was so lacking in substance. But there is one plan here and it is a very obvious plan: 'We'll just string Australia's farming community out a little bit longer. We'll keep promising all these things. In particular we'll keep promising drought affected communities we're there to help them.' But the bad news for the government is that they are starting to work it out.

You cannot continue this facade and this pea-and-thimble trick for a whole three years. Eventually they find you out, and people are finding this government out in the agriculture sector. Expectations were raised and raised very substantially. We heard a lot about farm-gate profit. The only thing this Minister for Agriculture has been able to claim is the final signature on free trade agreements for which the Labor Party has more ownership than this government, and that is the truth of it. The sad news—

Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Link to this | Hansard source

How can you stand there and say that?

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

I will tell the member for Riverina how I can stand here and say that. The former Labor government spent six years developing these agreements. They do not appear overnight.

Mr Marles interjecting—

I see the member for Corio nodding. He was the last minister to be working on them. Those opposite know that we were so close to securing those deals. Maybe another month or two might have got the set. Of course, it was not so difficult for those opposite, because they were prepared to sign at any cost. They just wanted to take the trophy. That is what it was all about for them, and that is why, sadly, we are having a debate about the China free trade agreement, a wonderful opportunity for Australian agriculture. There is only one group of people putting any of that at risk: those who sit opposite, who are not prepared to concede that there are deficiencies that can easily be fixed with the stroke of a pen without in any way offending the agreement which has been reached with our friends in China. It is about time they got out of the way and allowed those benefits to flow to Australian agriculture.

I close by accepting the invitation of the member for Riverina and simply ending where I began. That is to say that in our determination to maintain the longstanding, bipartisan approach to the development of the Murray-Darling Basin Plan we will be supporting this bill, and certainly from my perspective we also do so in the interests of those basin communities which have been seeking such change.

Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Link to this | Hansard source

I am pleased to hear that the shadow minister for agriculture and the Labor Party will support this important legislation before the House, the Water Amendment Bill 2015.

This has been coalition policy since the morning of Tuesday, 27 November 2012. I remember it well because I had a one-on-one meeting with the then opposition leader the night before to discuss this very policy. It is an important policy, because this bill gives effect to the government's commitment to legislate a cap on surface water purchases in the Murray-Darling Basin to 1,500 gigalitres. The coalition has been committed to a triple-bottom-line approach, recognising that there are social impacts, economic impacts and environmental impacts with whatever we do with the Murray-Darling Basin. We know as much as anybody that you are never going to get 100 per cent satisfaction from all sides of the argument when it comes to water. You are always going to get people who disagree with you. Some will say there is not enough water for the environment. Many will say there is not enough water for the irrigators to grow food and fibre.

I represent Riverina, one of the best food and fibre producing areas in the nation—

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

Hear, hear!

Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Link to this | Hansard source

'Hear, hear,' I hear the shadow agriculture minister say, and he is right to support me on that! As of March 2015 there are 1,162 gigalitres of the 1,500 gigalitre cap already obtained, leaving 338 gigalitres of headroom for the strategic purchase of gap-bridging surface water. I hope that strategic purchase is such that it is in fact not 338 gigalitres but much less, with the water infrastructure on-farm and off-farm that we are investing in right now. I hope it is much less and I certainly hope that it is not coming out of the Riverina, which has already given so much. The Commonwealth Environmental Water Holder, David Papps, is already the nation's largest irrigator.

This legislation has been warmly received. The National Farmers' Federation water task force chairman, Les Gordon, said in March 2015:

We look forward to working with the Government to secure the passage of legislation through the Senate to enshrine the Cap as law as soon as possible.

It has taken a bit longer than Mr Gordon would have liked, but it is here. John Dal Broi, the mayor of Griffith, said:

I've been an irrigator all my life and I distress at what is happening in this area. They've forgotten about why the water was there in the first place.

Echoing calls from around the region for a major change in water policy, Councillor Dal Broi said:

Nothing annoys me more than listening to governments of either persuasion saying we are the foodbowl of Asia … They're saying you can grow all this food, but we'll tie one hand behind your back. They agree with you but are they doing anything about it? No.

Tonight I can inform Councillor Dal Broi—and I will call him as soon as I have finished this speech—that we are in fact getting on with the job of capping water buyback, and I know he will be pleased.

I am now going to read from a 1946 edition of the book Water into Gold by Ernestine Hill, first published in 1937. I have referred to this excellent work previously in this House because it is such a valuable reference and provides an insightful snapshot into some history pertinent to the Riverina and aspects of this debate. Here is what the author writes of the Riverina from the early 1920s:

New South Wales, the mother-State, and still the rightful owner of the Murray, had many thousands of soldiers to repatriate, but it was wealthy now beyond the dreams of avarice, three times the size of Victoria, with three times the fertile lands of South Australia, and infinite resources to command. Since Federation it had suffered no relapse of the old-time jealousy. Indeed, it had, with the most amazing magnanimity, allowed Victoria to adopt the Murray for mallee irrigation farm schemes innumerable that were not, it must be admitted, a conspicuous success, and even with railways constructed across the stream, to serve its townships on the northern bank that were geographically, if not politically, more closely in touch with Melbourne than with Sydney.

New South Wales, as a matter of fact, was busy with schemes of its own. The great major tributary, the Murrumbidgee, was wholly within the boundaries. On this energies were concentrated for the time being, in yet another miracle of irrigation, that would restore a lost world, and transform the scorched sand-wastes of "Hay, Hell and Booligal" to a garden paradise yielding a million a year.

New South Wales cheerfully spent very nearly £8,000,000 in the construction of the magnificent Burrinjuck Dam, on the upper Murrumbidgee, east of Gundagai, with a capacity of thirty-three and a half billion cubic feet, the Berembed Weir, west of Wagga Wagga, the Yanco Weir, and in a thousand miles of channelling, advances to settlers for homes, towns, and railways to build for them, factories for their produce, roads and electric supplies, to bring into being a thousand farms.

Burrinjuck opened 300,000 acres for settlement within a hundred miles of it, regulated the flow of the river for 730 miles, assured constant water supplies for a million grazing acres, and bejewelled the darkness of the Australian night with the electric lights of Canberra, Queanbeyan, Gundagai, Tumut, Wagga, Junee, Cootamundra, Temora, Murrumburrah, Harden, Yass, Young, Grenfell, Cowra and Wyangala.

Two thousand settlers on the Murrumbidgee Irrigation Areas occupy 318,000 acres, many of them being returned soldiers, and there is unlimited scope for more. A note in the prospectuses of the Water and Irrigation Commission of New South Wales informs us that "Further farms will be made available as demand requires."

Eight thousand people are living on the Yanco Irrigation Area, with Leeton as the chief town, and 9,000 on the Mirrool area, the centre of which is Griffith. Fat lambs, dairying, fodder crops and fruit are the mainstay of the Murrumbidgee area, now exporting its excellent canned peaches and apricots to England. One co-operative canning factory alone in Leeton treats 120 tons a day. Practically the whole of the New South Wales production of canning peaches is grown in the district, with nearly 300,000 bushels of citrus a year, fresh fruits and vegetables for the Sydney market, and three-quarters of the total State production of grapes from 21,000 acres of orchard and vineland.

For the rest, the advancement of settlement may be estimated by the fact that there are now four towns of considerable size—Griffith, Leeton, Yanco and Yenda—three distinct railway lines—

And it goes on and on and on.

The book goes on to talk about the miracle of rice production in the Riverina. It was first planted in Yanco, when the New South Wales Water Conservation and Irrigation Commission began to take an interest in the enterprise. The book states:

Until 1923, Australia imported all her rice from the East, but in that year three varieties planted experimentally on a large scale at Yanco proved successful—Javan, Californian, and the seed obtained from Mr. Takasuka, of Nyah.

His hobby was rice. It continues:

The American adapted itself … to Australian conditions, and from the first twenty tons of seed distributed to settlers by the Government as an experiment, to-day—

we are talking early 1920s—

20,000 acres of "padi" fields have sprung up, adding their wealth to that of the dairy pastures and the orchards, in country that was once considered worthless save for sheep.

I should have said that that was actually when the book was reprinted in the 1940s. It says:

To-day the Murrumbidgee Irrigation Areas are producing sufficient table rice to supply Australia, 313 growers, on an average 80 acres each, reaping an annual … 368,000—

pounds—

from rice alone.

The ever-present problem of markets and the fear of overproduction are the only factors that hold the progress of the settlements in check.

Well, if only today markets and overproduction were the only impediments!

Indeed, our government has successfully negotiated preferential trade agreements which have opened up unprecedented opportunities for the Riverina and other regional areas. The previous Labor government, despite what you might have just heard from the previous speaker, at the behest of the Greens in the lower house in the 43rd Parliament forced a man-made drought on the Riverina and other irrigation areas and did very little by way of trying to forge new trade agreements.

This legislation goes some of the way to making things right. There is still more to be done—much more to be done. I was pleased to be able to read from that book Water into Gold, written 70 years ago, as I say. When you look at what was made available from the precious resource of water then and how it has transformed to today, you get a bit of a snapshot of just why the Riverina is such an important fibre and food bowl.

Jenny Ryan, the Administration Officer, Economic Development and Tourism, of Narrandera Shire Council today told me that two of Narrandera shire's businesses produce 6,510 20-foot-equivalent units in annual containerised freight. This does not include figures from the nut plantations in the Narrandera shire, one of which is an operation which will have more than a million trees under harvest within the next few years. It can also be noted that the Riverina produces 129,000 TEU, of which 72 per cent currently is transported by rail. They are 2013-14 figures.

If we look at the Griffith regional overview, there is more than $2 billion annual production in agriculture and horticulture just out of the Griffith City Council local government area alone. It is Australia's largest producer of wine. One out of every four glasses of wine comes from Griffith.

Richard Marles (Corio, Australian Labor Party, Shadow Minister for Immigration and Border Protection) Share this | Link to this | Hansard source

Really?

Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Link to this | Hansard source

Yes, really—to the member opposite. Absolutely. About half of the region's wine production is exported. It is the largest chicken meat producer in Australia. It supplies three-quarters of New South Wales's wine grapes. It supplies 70 per cent of the New South Wales citrus production, worth $98 million. It is the largest prune-growing area in Australia. In almond production it is going absolutely amazingly well. Its gross regional product in manufacturing—and these are just 2010 figures from the Australian Bureau of Statistics, so they would have gone a long way further since then—is $281 million; agriculture, $294 million; finance and insurance, $189 million; and retail trade, $86 million. That is just out of Griffith alone. You can imagine, when you include the Murrumbidgee shire, Leeton shire, Narrandera shire and Carrathool shire, just how valuable the Riverina is.

I was a little bit sorry that I had to come down and speak because Minister Joyce was unavailable to speak at that particular time, because I was very interested to hear what the Greens member for Melbourne was going to say about this. I hope that he gets on board, because, by goodness, we did not hear too much positive coming out of the Greens during the whole time that the Murray-Darling Basin issue was an absolute political hot potato in the 43rd Parliament. Indeed, what we saw from the Greens was totally destructive. They wanted all the water to go to the environment. To hell with the farmers; to hell with the irrigators; and to hell with those people who grow food and fibre for this nation. Never mind the bright city lights of Swanston Street. All he cared about was the environmental concerns.

The world's best environmentalists are the irrigation farmers I represent. They are the world's best environmentalists because they know, much more so than the member for Melbourne, that, if their river is not protected and does not flow, they are not going to have an income. But they cannot continue to do what they do on 17 per cent allocations. They cannot continue to do what they do for our nation and other nations besides when they are getting totally screwed over by man-made droughts forced upon them by what sometimes might seem to be well-intentioned governments but certainly were not when it came to putting what the Labor-Greens alliance did in the parliament from 2010 to 2013.

I was pleased that the Parliamentary Secretary to the Minister for the Environment, Bob Baldwin, came to my area on 5 August this year to announce $263.5 million for on-farm irrigation in New South Wales. That is going to be a game changer for the Riverina. It is also going to dovetail in well with this Water Amendment Bill that we are debating tonight. The Minister for the Environment, Greg Hunt, congratulated the successful funding recipients of round 5 of the On-Farm Irrigation Efficiency Program. He said:

Under the Coalition's Clean Water Plan, we're investing more than $12 billion in managing our waterways and key water infrastructure …

… This latest $263.5 million investment will assist irrigators in the southern Murray-Darling Basin modernise their on-farm irrigation infrastructure.

That money is going to be put to such good use to maximise every drop.

Farmers in my area have been accountable for a long time and will continue to be accountable—and they are accountable now. They have to be accountable for every single drop of water that they use. Never mind the water icon sites and the greenies and the Wentworth Group and all these other people who think that all the water needs to go down the river and straight out of the mouth of the Murray. Never mind the fact that they are not that accountable for the water. They are not, but I tell you what: the farmers in my patch are. They have to be accountable not least because it costs them money but also because they are made to be accountable by the innumerable bureaucracies that they have to answer to, more's the pity. But I am pleased that that quarter of a billion dollars worth of on-farm irrigation infrastructure is going to make a difference.

On 24 June this year the Senate resolved to establish a Select Committee on the Murray-Darling Basin Plan. The committee will enquire on the social, economic and environmental impacts of the Murray-Darling Basin Plan on regional communities. Public submissions may be made and will close on 20 September. I would urge that any Riverina irrigators listening to this speech make a public submission—and there will be many listening. I encourage members to pass this Water Amendment Bill unanimously, because that is what is required.

Lisa Chesters (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

This is one of those, I guess, rare moments for people in the country who may be listening or may be watching this debate unfold, where we have bipartisanship on this issue. I believe it is because this is one of those issues that have come before the House where we have consulted the stakeholders. The stakeholders have been to see us here. The stakeholders have invited us out to their communities—all the stakeholders. People have engaged with the farmers and the farming communities. People have engaged with the environmentalists and the environmental organisations, with the relevant state agencies and with the relevant federal agencies, as well as with our Indigenous communities—all associated with the Murray-Darling Basin Plan. No plan is perfect, and it is right and proper that it be reviewed. It is right and proper, as we see before us in the Water Amendment Bill 2015 tonight, that we revise the plan to reflect the social, economic and environmental purpose and needs of the Murray-Darling Basin Plan. The Murray-Darling Basin Plan, or Basin Plan, has bipartisan support at the federal level as well as support in the basin states, and that is a critical point, because for as long as we have been a Federation there has been struggle and conflict over water. We are a country that relies on this system of rivers for so much of our agricultural product but also so much of our environmental and social wellbeing and the communities that live in this area. So it is good to be able to stand here and say that through this consultation, through the work that has been done by lots of members of parliament, we have reached a bipartisan situation on this particular bill.

My own electorate, the Bendigo electorate, is part of the southern gateway to the Murray-Darling Basin. We have several rivers in the Bendigo electorate that feed into and contribute to the River Murray, and they flow through north and central Victoria. These are from as far down as Woodend and Kyneton in my electorate, all the way up through to the north. My predecessor Steve Gibbons was actively involved in the consultation and reform that occurred during the last parliament. So we know in Bendigo the importance of water. We also know in Bendigo, as well as the neighbouring electorates, what happens when we do not approach this in a methodical and bipartisan way to come to an agreement where all stakeholders have been engaged. We remember the water wars. We remember the conflict, which did not deliver a good outcome for the community; it just delivered not only conflict but heartbreak. And it is great to be able to stand here today to say that we have not gone through that to reach this bill and this position that is before us today.

I would also like to acknowledge the other electorates, particularly the Murray electorates, and I know how important this piece of reform before us is to their communities. I had the great privilege earlier on in the year to spend a couple of days up in the Murray and was hosted by the Murray-Darling Association. I want to particularly acknowledge and thank tonight Councillor Greg Toll, who is the president of the Murray-Darling Association, and the CEO of the organisation, Emma Bradbury, who were very kind to take this new MP on an engagement tour to learn firsthand from locals—whether they be farmers, the state or federal based organisations and authorities, or the environmental groups—about the impact and the rollout of the Murray-Darling Basin Plan. In many ways it was an education tour, and I would like to thank them for giving me the opportunity to learn from their constituencies the importance of a bipartisan approach to help bridge the gap in supply that can be provided, and making sure that reform that comes before this House does meet all those criteria—economic, social and environmental.

During my time, I learnt firsthand about the importance of water for rice farming. I know that rice farmers can sometimes get a bit of a bit of a bad rap. They seem to be big users of water, but what I learnt from being on the farm and meeting with rice farmers around Echuca is that the water that they use for their rice crop and the work that that does with the soil allows them to have high yields for the other crops that they have post the rice crop. It is something that I do not think a lot of Australians would understand. Yes, the rice crop might use a lot of water—and they only they only use the water if it is there—but there is yield potential for future crops because of what happens to the soil post the rice crop. That, to me, is a story that is not told broadly enough. They talked to me about the future of cropping that they can have on their land by having the rice crop—the fact that it does help them with other yields. I think that is an important point that we should note.

Also during this visit, I got the chance to see the production facility of Kagome Australia and learn from Kagome Australia, who are an integrated producer—not just a tomato grower but a manufacturer—about their relationships with their farmers but also their growing business model and economic markets. Currently they are the largest single grower of processing tomatoes and the largest Australian tomato-processing company. In fact, they supply 45 per cent of Australia's domestic consumption of processed tomatoes and assist many other large food manufacturers with the supply of tomatoes. You may not see Kagome when you walk into the shops, but what you do see is MasterFoods. What you do see is their product going into many of the big name brands that we see in our supermarkets. When I met with Kagome and I asked them, 'What would you like to see from your parliamentarians in this space?' they put water at the top of their list—making sure that water was available at a price that was relevant to their cost of production. They raised in this meeting how, because of the water market that had been established, they could not tell from year to year what the price of water would be. They worried about the cost of their production with that fluctuating water price.

Kagome, like many of the other people I met with, have actively engaged with the Commonwealth, whether it be through inviting local MPs and other MPs to come and learn their story or writing a submission for the Agricultural competitiveness white paper. This is one of the great success stories in Australia. They have put out there clearly the support that they need in terms of lowering their costs of production, and they put water at the top of that list. The Kagome example highlights a number of issues that need to be addressed, whether through this reform or other reforms, if we want to not only remain competitive but continue to be a vibrant food manufacturing area.

The Murray-Darling Basin Authority had many more examples and were quite keen to ensure that any MP who took the time to visit them met with a number of their stakeholders to learn firsthand why this bill that is before us today is so necessary. They talked about the Swiss cheese effect that is occurring in some parts of the Murray-Darling Basin. The Swiss cheese effect happens when dairy farmers choose to leave the land and sell their water rights. When that gets to a critical mass, when a number of them have sold their water rights, there is then pressure on the water authorities—will they continue to irrigate that part of the country? This issue is not just related to the Murray. It is an issue I could identify with, because it is a live issue we have in Harcourt, an apple-producing region in my electorate. The ongoing battle is whether the water authority will continue to deliver irrigation water to the area, because it comes down to the market—do they literally have enough people buying irrigation water to keep the service going?

They spoke about their concerns about that but, most importantly, they asked us to consider the bill before us today. This bill talks about bringing forward a cap. As we have heard from previous speakers, the Murray-Darling Basin Plan is delivering outcomes. It has recovered quite a lot of water for the environment. This has been done through water purchases, infrastructure investment and other basin state recovery action. It is important to acknowledge the role that all the basin states have played in this space.

This water can be used at appropriate times when it is needed to improve the flows and help restore the health of the system. We cannot underestimate—and we need to all stand and say this—that our farmers, like our environmentalists, acknowledge that we need a healthy environment. What I respect about the farmers in central and northern Victoria is that is the first thing they say to you. We all agree we need a healthy natural environment. It is how we get there and make sure we acknowledge that social, economic and environmental approach to water management.

Importantly, there has been significant Commonwealth investment to ensure that these communities and farms remain productive as the plan has developed. This occurred in the previous government and the current government. As I have mentioned, the basin supports agriculture on a grand scale. Up to 40 per cent of Australia's agricultural production is associated with the basin. I have mentioned the experience of my area and just to the north of me. I mentioned rice farming. The basin accounts for nearly 100 per cent of our rice farming, 96 per cent of our cotton, 75 per cent of Australia's grapes, 59 per cent of Australia's hay, 54 per cent of Australian fruit, 52 per cent of Australia's sheep and livestock production and 45 per cent of our dairy—and I have mentioned what we hope we can avoid occurring in dairy if this plan goes through.

Almost two million Australians live and work in the Murray-Darling Basin and its communities. It is everyone from the paddle steamers, the small businesses, the cafes, the public sector employees, the farmers and the associated workers. We know how important a healthy Murray is to these communities.

There are of course the environmental needs of the river. This system has some of the most beautiful natural land we have in this country from the north in Queensland and northern New South Wales through to Victoria and South Australia. We have an obligation to keep this area healthy and environmentally preserved for not just this generation but every future generation.

Then there are the cultural flows and acknowledging the deep connection that Aboriginal people feel towards land and water. There is a lot we can learn. Knowledge is passed on through generations and that can help us guide any policy we have in managing our river systems. I want to acknowledge the work of the Northern Basin Aboriginal Nations and the Murray Lower Darling Rivers Indigenous Nations. They have offered advice on not just the ongoing rollout of the plan but how to improve the plan. I acknowledge the Aboriginal people of my own local area—the Dja Dja Wurrung. They have been vocal about the need for healthy river systems.

Labor recognises that the government wishes to provide certainty to basin communities by placing a cap of 1,500 litres on water purchases. This is a sensible measure that will give those communities that I have spoken about tonight certainty to be able to plan, to move forward and to start working on how they can continue to grow so that they have got a future.

We have consulted with various stakeholders, some of whom I have recognised tonight, whether in my electorate, in parliament, on the road, on their properties or in their communities. We have carefully considered the position that has been put forward by the states and believe that only through working constructively together in this bipartisan way will we be able to achieve what all of us want to achieve: a Murray-Darling Basin Plan that delivers for the environment, that delivers for our communities, that delivers for our farmers and that delivers for all Australians.

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

It is a great pleasure tonight to discuss the Water Amendment Bill 2015 and the implementation of the cap. In opposition, I was shadow minister for water and this was a key objective and a key promise that we made, and something that is vitally important to Australian agriculture not just in the Murray-Darling Basin but across our nation for its agricultural output.

We must note at the start that it is not just the Murray-Darling Basin Plan that has returned water to the river. A lot of people think that the only time water has ever been put back into the system has been under the Murray-Darling Basin Plan, but that is not the case. During the Living Murray, $700 million was put aside and invested to recover 500 gigalitres of water. Water for Rivers, a joint initiative between the New South Wales, Victoria and Commonwealth governments, recovered 282 gigalitres—70 gigalitres for the Murray River and 212 gigalitres for the Snowy River and for environmental flows. There was the Loddon River sales deal and the water recovered as a consequence of the unbundling of prior water rights. The Northern Mallee Pipeline and the Wimmera Mallee Pipeline provided a mixture of regulated and unregulated water savings of 75 gigalitres.

What we had at the start of the Murray-Darling Basin Plan under the previous government was something that got very close to a riot in Australia. It was actually quite startling how out of control it became. They were even tempted to go into partnership with the Australian Greens. They were logical; they wanted about 6,000 gigs put back into the river. This would have brought destitution for any of the farming communities.

Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Link to this | Hansard source

And floods.

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

Yes, and floods in certain areas.

Dr Leigh interjecting—

I wouldn't be flippant because this absolutely drove people to the edge, that they would have a government that was so completely out of touch and out of control that this issue had raised it head. At that point in time, it was role of the coalition to make sure that if they had a choice between Sarah Hanson-Young and the coalition that we played our part. So we went into partnership with the Labor Party to try to mitigate the effects that they would otherwise have caused. They were in partnership at that point in time. There was a Labor Green Independent government and that government was discussing at one point taking 6,000 gigs out of the system. It would have been an absolute nightmare. We went to work to make sure that we could bring about a better outcome.

That better outcome is here tonight with a cap on buybacks being limited to 1,500 gigalitres. We want to make sure we change the objective so that we focus on the proper triple bottom line, which is economic, social and environmental. What we had before was environment, daylight, daylight, forget about everybody and then make excuses for the social and economic outcomes. That is not what we wanted. We wanted to make sure we maintained the fabric of the towns—the fabric of the Dirranbandis, the St Georges, the Milduras, the Berrys, the Deniliquins and the Griffiths—because the people in these towns have a right to an economic future. Water is wealth. It is so fundamentally important that we get this right.

Tonight, I listened to the member for Hunter's contribution. I diligently waited for their policy going forward. The Australian people have a right to hear their policies. It is getting to that time in the electoral cycle when we should start hearing what the alternative policies of an aspirant government might be. But we are not getting that. The only thing we get from the Labor Party on agriculture are comments on us, because we are the only ones with policies.

Andrew Leigh (Fraser, Australian Labor Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

How about the white paper?

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

I am glad you bring up the white paper because we have it and I want to go through it. It took us to put a further $500 million towards the National Water Infrastructure Development Fund. The facilitation letter has now been sent to me and Agriculture will be taking that forward and making sure we get the process underway. We have already been in discussion with state governments, including state Labor governments, about the rollout of this program. That is just one part.

We have also started discussions with the Productivity Commission regarding regulations affecting agriculture. We have also made sure there is country-of-origin labelling. It never happened under you guys on the other side, but it is happening under us. We have progressed this. We are going to give people a form of labelling that is diagrammatic, that reflects proportionality, that is compulsory and that is simple.

Andrew Leigh (Fraser, Australian Labor Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

When?

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

The process will be rolling out at the start of next year. It never happened under you on the other side. It is easy for you because nothing ever happens under the Labor Party in agriculture, not a thing except bad news. Although they did do one thing: they shut down the live cattle trade. They managed that. That was a great day in the office, that one!

We are streamlining the regulation of agricultural and veterinary chemicals. That is part of the white paper and that is underway. We are standing behind cooperatives. We have been having the discussions with cooperatives. We had CBH in the office today as we start that process of trying to make sure that that runs out further. We are going through the selection process right now for a commissioner to sit with the ACCC so that farmers get a fairer deal. That is a policy that has happened under us. It never happened under Labor because no policies for agriculture happen under Labor. They do not believe in agriculture. All Labor can ever do is comment on our policies because this is the only side that has policies.

We brought forward opt-in for income tax averaging. We had opt-out and now we have opt-in. Once you got out of income tax averaging, you were unable to get back in. We are putting it back in so that after 10 years you can get back in. We are doing this.

We have already brought forward 100 per cent write-off on fences, 100 per cent write-off on water reticulation, a write-off over three years on fodder. These are the processes that are already happening, that we have already done, that are already there. We have done freight modelling for agriculture expansion to try and attract money into agriculture, to attract money for the construction of major nation-building infrastructure. We are already starting the process of better seasonal forecasting. We are putting $29.9 million towards trying to get multi-peril crop insurance up and running. We could go on.

Those opposite pooh-poohed the drought recovery loans because that is nothing. They only ever comment on our policies because they have got none of their own. They said what have we been doing? At this point in time, the total value of loans that have been allocated is $354.87 million—so I am informed right now—between farm finance, drought concessional and drought recovery. What is also important here is 675 applications have been approved. Do you know how many were approved under them? We had eight approved under the Labor Party-Greens-Independent coalition and 675 under us. That is a vast difference. You have to look to the government as to who actually does something in agriculture. We are actually doing it.

The Labor Party got farm household allowance, which is not a loan but a direct payment to those doing it tough, out to 367 people. Under us, 4,522 customers have received the payment. We can see the difference a government makes. We heard from the shadow minister for agriculture, the member for Hunter, that I had died without a trace. What do you call that? A block of flats? It is on the front page. It is not a bad 'look at me'. It is quite obvious that not only did we work hard but we got the respect back from people because they knew we had gone into bat for them.

We heard from the shadow minister for agriculture. It is like a booby prize for the Labor Party—anything agriculture, they hate it. They always wish they had something else, anything—a trip overseas. It is a bad-luck day when they get the Minister for Agriculture. But for us, it is the centre of government. We love it because it represents our work, our key constituency and the things that we need to do, the things that we are doing right now.

The member for Hunter said that the China free-trade agreement had more to do with them than us. I had a look. It started back in 2005. I was trying to remember who the government was back then and I thought, 'Hang on, it was the coalition that started it and the coalition that delivered on it.' Or we are going to do deliver on it if the Labor Party ever decide to come out and publicly state they will support it like the Premier of South Australia, Jay Weatherill, wants it supported. The Premier of Victoria, Daniel Andrews, wants it supported. The Premier of Queensland Annastacia Palaszczuk wants it publicly supported like the premiers of every state. Other people I have some respect for like Bob Hawke wants it supported. Martin Ferguson wants it supported. Simon Crean wants it supported. Who does not want it supported? The love child of the BLF, the CFMEU, does not want it supported. Who do those opposite listen to? They listen to the love child of the BLF. Norm Gallagher, he is back. He is running Labor Party policy.

I know the shadow minister opposite knows full well it is a very bad look for a prospective government to look at its biggest client in the face and say, 'We are considering whether we want to do business with you.' That is a very peculiar thing for a prospective government to say out there away from the sensationalism of the BLF. You would probably do better to listen to the VFF or the NFF or AgForce. They would be better people to listen to than the BLF, but, anyway, you have made your choice. You have built your cross and now you are happily climbing up on it.

What we are doing is making sure that agriculture is at the centre of government. What we have done is made one of the most major policy deliveries in my time in parliament. What we are waiting for is that at some point in time, when all the angels are aligned, when all the things are right that a Labor Party member will come into this chamber and actually deliver what their policy for the future is going to be, any policy, any idea or maybe a question at question time about policy rather than a grab bag of gotcha moments. Because that is what competency does.

You should be spending your time in opposition—and the way you are going, you may be there for a fair while—developing policy. That is what we did. And then when we came to government, we delivered the white paper and we delivered the policy outcomes. If you cannot deliver any sort of vision, any sort of plan for the future in agriculture then when are you going to deliver your plans?

Mr Stephen Jones interjecting—

We have heard his agricultural policy is now family violence. That is incredible. We will run that one out there. I will take the interjection. The interjection from the member opposite was that his plan, as close as he could get to agriculture, was an issue about family violence. Family violence is extremely important and it needs proper diligence but it has nothing much to do with agriculture. Until you are able to come in here and talk about agriculture then we are going to call you for what you are. It is a pastime. You are incompetent. You have no hope because, if you do not have the acumen to come up with agricultural policy after two years, I believe you do not have any agricultural policy.

We will continue working as hard as we can on the policies that we have delivered. We will start rolling out the infrastructure, which we are already doing. We have got Chaffey Dam under way. We have got Tasmanian irrigation schemes underway. We are rolling forward now with the 1,500 gigawatt cap on the Murray-Darling Basin. This will put some form of security back into the Murray-Darling Basin, which was absolutely decimated by the previous governments and their interaction with the Greens and the Independents, which left us in a bizarre position. There is only one group of people that the Australian people need to listen to if they want to hear agricultural policy and that is the coalition, because the Labor Party, the Greens and the Independents have offered and do offer nothing. (Time expired).

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

I consider us very lucky, and it is very timely, to have Minister Joyce in a key portfolio with respect to water. I thought the minister might like to hear this. We deeply appreciate his presence there and we hold high hopes that he will be able to bring to fruition where we want to go with water, which is where the water is, which is of course in Northern Australia and specifically in North Queensland. We want to add that Minister Lynam has the makings of a very good minister in the state government. We are uniquely placed at the present moment to move aggressively forward in this area.

The history is pretty simple, and I suppose I am a major player. The two great leaders are a bloke called Harry Clarke who was the Chairman of the Dalrymple Shire, an area as big as Tasmania, and Freddy Tritton the long-serving—30 years, I think—chairman of the Richmond Shire Council and the great pioneer in water in North Queensland, particularly inland North Queensland. They told me to go out after the Bradfield Scheme, so I did some checking up and found this Bradfield was a pretty smart bloke. He built the Sydney Harbour Bridge. He built the underground railway system in Sydney that is still being used today. It won the international prize—

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

Story Bridge.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

He built the Story Bridge. He built the Burrinjuck Dam. He built the weir that supplies Sydney with its water supply even to this very day. He was not a fool. The Bradfield scheme, of course, in every way was an excellent proposal. It took a little tiny bit of the giant floodwaters of North Queensland and turned it inland into Lake Eyre. Lake Eyre would then evaporate—if it is full of water, it will evaporate—bringing 30 million megalitres across the Murray-Darling Basin, which is only 22 million megalitres, and it would make it rain in inland Australia, specifically over the Murray-Darling Basin. The other way he proposed that it could be done—but it was the day before big D9 dozers and heavy earthmoving equipment—was to dig a ditch up from Spencer Gulf and fill it that way.

In 1986 a professor from the University of Queensland who would prefer not to have his name mentioned, a bloke called Roy Stankey, who is the smartest man I have ever met in my lifetime and a very great Australian, and I drew up the revised Bradfield scheme. Roy Stankey's family were pioneering—drilling bores—back in the 1890s. Instead of sending the water down to Lake Eyre we said, 'We'll use it in inland Queensland on the great rolling black soil plains of North Queensland,' and we said that you would fill Lake Eyre from Spencer Gulf. Have we lost our vision in this country? Can't we think big anymore? Have we become intellectual pygmies? Is our vision restricted by closed lenses?

Let me move from the area of what should be to the area of what will be. Through the machinations of the democratic system, my little tiny political party that I belong to now has immense power. We have an extremely close relationship with the Speaker of the House, Peter Wellington, and he has said that he will back us on irrigation. We remain very confident that Minister Joyce will achieve big things down here for us as well.

I suppose it is a political point, but in the 26 years since Bjelke-Petersen was stabbed in the back there has hardly been a single irrigation licence issued in Queensland. In North Queensland, with 220 million megalitres of Australia's 380 million megalitres, we use just a little over one million megalitres. Out of 220 million megalitres we are allowed to use just one million megalitres. In the Murray-Darling, which covers a fifth of Australia's surface area, they have 22 million megalitres and even now they are still allowed to take seven million megalitres out. We have got 10 times that amount of water and we are only allowed to use one tenth of the water that they are using. What is wrong here? For 25 or 26 years—whatever it is—in Queensland there has been no water development whatsoever except the dirty, filthy corrupt thing which no-one else is going to talk about, and I am not going to talk about either. The one exception in that period of time is a disgrace to government.

After 25 years, the LNP gets elected and they then move to do something about it. This is their idea about doing something about it. This is according to the newspaper, because they will not give us any information—and the incoming government will not either, I might add. They issued three licences: one to the person who owns the biggest cattle station in Queensland, one to the third-biggest cattle owning corporation in Australia and the third one to an absolutely great bloke. He is a good mate of mine and one of the most fantastic blokes, but he also happens to be the fourth- or fifth- biggest cattle owner in Australia. We give a golden handshake to three giants, and nobody else gets anything.

Shortly, we will be releasing the KAP policy. That will synthesise and bring together all the great ideas that have been going around and distil them into a working framework from which we can move forward, and I hope we enjoy positive attitudes from the LNP and the ALP towards these water development programs. We are uniquely placed, and I served for almost a decade as the northern development minister. For those critics of where we have been going, I might add that we secured the Bradfield Scheme. Bjelke-Petersen announced it and put up $5 million to start engineering work immediately. That was back in the eighties. Some three months later, Liberal Prime Minister Malcolm Fraser also announced that they would be involved in the building of the Bradfield Scheme, so we got it. Within eight months both of them were gone, which tragically is what happened when Bradfield first put it up. Edward Theodore, of course, was a wildly enthusiastic backer, and he was gone eight months later because of the Great Depression. So we have not had a lot of luck.

That is the record, but let us forget about the past. Let us now say that the ALP has a positive attitude and the LNP has a positive attitude. I must thank both of them in this House, because the ALP decided to contribute $3 million for an update on the figures on the key dam for all development in North Queensland. The Hells Gate Dam is the key dam for Bradfield and for any movement forward. It is just west of Townsville on the third biggest river in Australia, the Burdekin River. The ALP allocated $3 million. They lost government, and the Liberal Party, after some consternation, sent the $3 million cheque through. So both parties in this place now have a positive attitude towards water development in the north. And this is a very big scheme.

Let me start where the scheme should start. Instead of the very rich and powerful, we have four—and one of them is a great mate of mine. There are few people on the planet I admire more than him. But why did you not give it to everybody? This proposal would give it to everybody. Some 1,500 families would benefit, not four and not a corporation, which is not even a person. In fact, everyone who would want water would be able to get it. Every single person would benefit at the first level.

There is a second level. I was heavily involved in negotiations to get the live cattle trade reopened. The Indonesian ambassador in the discussions with me said, 'We are paying $4 to land in Jakarta, and your cattlemen are being paid only $1.80. What is happening to the $2.20?' We were only getting $1.20 at that stage. The cattlemen were getting $1 and Indonesians were paying $4. What was going on here? I thought it was price gouging, and there is a lot of price gouging, but it really was not. It was just a hopelessly inefficient system we had for transferring live cattle out of Australia to Indonesia, the Philippines and everywhere else.

They hold them in a yard for a week and have to bring hay, in the case of Townsville, 500 or 600 kilometres from Clermont. In the case of Darwin, I do not know. But, in the case of Townsville, no-one is going to take cattle—if they have any brains—in a truck from Queensland nearly 1,000 kilometres across to Darwin. They just cannot afford that. They are only getting paid $1,000 for the beast and it probably costs them 160 or 170 bucks to get it there, so their margin would be gone.

All I can talk about with authority is Townsville. You have extremely valuable land being used for holding cattle. You do not hold cattle in the middle of a big city. That is the last place you would do that. The inefficiencies of doing that—having to bring the hay in to feed them for a week, keeping them under veterinary conditions and then bringing in the hay for the boat—are quite crazy. So we will be proposing 30 or 40 medium-sized irrigation projects that will see cattle walk from irrigation block to irrigation block, onto a ferry and out to a big boat, so that instead of $2 out of every $4 going to this inefficient system it would be in the range of 30c or 40c. This would benefit the people of Indonesia and would benefit the people of Australia. It would honour, from our side, my undertaking, as the self-appointed chief negotiator, to fix up the efficiencies, so they do not have to pay $4 but $3. Our cattlemen, instead of getting $1, would get $2 a kilogram. That is the second rung.

The third rung concerns towns like Mareeba, Georgetown and Charters Towers as well as the mid-west towns of Cloncurry, Richmond and Hughenden. These towns will have microdevelopments of from 7,000 hectares up to maybe 15,000 or 20,000 hectares. We call them microschemes because they are very small, but they will create tremendous benefits for the people of those areas. In the case of Richmond and Hughenden, it almost certainly will double the population. On their population figures, they are both dying at the moment, and Cloncurry is not faring that much better.

I will conclude on this note. We have a map, which I should have brought to the parliament—I will table it later. It has Cape York Peninsula in red and Victoria in red, and they are both about the same size. There is a big difference between Cape York and Victoria. Cape York gets a nearly 70-inch rainfall, nearly three times the rainfall of Victoria. Victoria has 4½ million cattle, and you might say, 'Well, Victoria is half sheep and half wheat, so Cape York, which is all cattle, should have maybe six million head of cattle.' It does not have six million head of cattle; it does not have four million; it does not have one million—it has 150,000 head of cattle. And it is not only about irrigation here; it is about title deeds for the first Australians, which I have spoken on 100 times in the House. But if you do this for us and give us these schemes, not only will you create 10,000 or 15,000 jobs but you will also provide an extra $7,000 million a year in income for the Australian people. (Time expired)

Mark Coulton (Parkes, National Party) Share this | Link to this | Hansard source

I would like to speak on and endorse the Water Amendment Bill 2015 and gladly bring the debate back to the Murray-Darling Basin. This bill has been introduced to legislate the limit of buybacks at 1,500 gigalitres. I am pleased to say that, at this stage, this bill appears to have bipartisan support and it also appears to have the support of the basin states—and that is very important. Legislating the buyback cap was a promise that was made by the Prime Minister prior to the last election, and it forms part of the Australian government's commitment to the Murray-Darling Basin communities. The legislation will deliver further certainty to farmers and irrigators in the basin.

I can proudly say that I represent 25 per cent of the Murray-Darling Basin. The border rivers of the Macintyre, Barwon and Darling, through to the Gwydir, Namoi, Macquarie and Lachlan major rivers, make up the Parkes electorate. This bill will ensure that future environmental water recovery to achieve the 2,750-gigalitre target under the Murray-Darling Basin Plan occurs through infrastructure investment and system efficiencies, providing a win-win for the environment and regional communities. We are seeing some of those infrastructure works happening in my electorate, and probably the standouts are the three off-river modernisation schemes in the Macquarie. I attended the official opening of the Trangie-Nevertire scheme, where I represented the minister. It is a remarkable piece of engineering. That scheme was originally designed to, basically, drought-proof a traditional grazing area that had morphed into an irrigation area, which, because of its size and original design, was incredibly inefficient. So that group of farmers agreed to reduce the size of the scheme to allow the farmers on the periphery of the scheme to go into a stock and domestic system and allow for the lining of the channels and modernisation of individual farms through centre pivots and lateral-move irrigators to reduce the wastage in that scheme. Last year, in a very dry, low-allocation year, record crops of cotton were grown in the Macquarie valley.

This proves that this government is focused on recovering water through investment in infrastructure as a priority rather than through buybacks. This legislation will provide further definition of what has been carried out on the ground. We have prioritised infrastructure over water. In the past, we have seen what indiscriminate purchases can do in the basin. The purchase of the Twynam Pastoral Company water from Collymongle Station has led to the devastation of the town of Collarenebri. One hundred permanent jobs have come off that one farm with the purchase of that water, and the economy of Collarenebri, I believe, will never recover to where it was before that purchase.

So it has been a rocky road through the last years to get to this point with the Murray-Darling Basin Plan. This plan has come on top of water-sharing plans that happened previously, brought in by the basin state governments. We have seen reform for the irrigation industry and for the river communities in my electorate that has been going on now for probably more than 20 years. This legislation will certainly give some certainty that the indiscriminate buybacks will cease and that we will see a focus on investment and engineering. But we have a way to go and we are going to require a level of maturity in this. We are going to need a level of goodwill and we need to understand the complexities of the Murray-Darling Basin.

Because of the complex nature of this vital river system, when we try to explain what can be done in simple terms we can end up with a lot of misinformation and a lot of people marginalised in the process. The Murray-Darling Basin is the food bowl of Australia. The communities in my electorate rely on this water. When we look at restructure and what might replace some of the water that has been lost to protect the environment, the reality is that there is nothing you can put into a western town that will generate interest and wealth like a megalitre of water. There is nothing that compares to water to put life into these towns. We should acknowledge the great sacrifice and contribution by these communities and these farmers in an attempt to make the Murray-Darling Basin environmentally sustainable.

But there are some more things that we need to do. I believe there is a real desire for the communities to have a clearer justification for some of the water that has gone to the environment. This is happening at the moment. I believe the Commonwealth Environmental Water Holder is committed to having an audit of where the water has gone and the benefits that water has had for the environment. A lot of this is the responsibility of the states, but we need a level of communication and cooperation so that, with the management of the rivers, environmental water and productive water can piggyback with each other so that we can get a better outcome by having both systems working in cooperation, not independently. Over the years, we have seen environmental flows caught in with productive flows, in the Gwydir and Macquarie valleys in particular, leading to indiscriminate flooding of crops and, through that, a loss of production. So we do have a way to go to get to a better understanding of that.

When we speak of engineering works, we really need to be progressing the issues around Menindee Lakes. The Broken Hill water supply is a particularly difficult situation. The amount of water that is lost through evaporation, not only in the delivery of water down to Menindee but what is lost in that system, is unacceptable. We are going to have to bite the bullet on Broken Hill's water supply and on getting some efficiencies in the system around Menindee. I do not think the irrigators and the communities in my area have a desire to go back to the start of this process. They are committed to this process, but not at all costs. They want to see that we are auditing where we are up to to make sure that the modelling that was done earlier on can be backed up by actual figures and measurements of where we are going with the environmental water compared to the productive water.

The reality at the moment is that, bar the Lachlan River catchment, which has had some good rainfall, most of the dams in the northern basin are empty or nearly empty. But regardless of what sort of a plan we have, if we do not have rainfall and water in the dams, those communities are going to suffer. I should acknowledge that things are looking particularly bleak for the border rivers—the Barwon and the Darling—and for the Gwydir, Namoi and Macquarie rivers when it comes to this coming irrigation season. So we are desperately hanging out for some rainfall. For the benefit of my southern colleagues and those further down the river in southern New South Wales, Victoria and South Australia, it should be remembered that the rivers in the northern basin are ephemeral streams. They do not have regular snow melt and there is not a constant supply of water coming into them. Traditionally they go from flood to drought on a regular basis. We had a flood in 2012, then we had a couple of good irrigation seasons and now we are back in drought. I think there should be an acknowledgement that sometimes there is just not the water to contribute further down the basin. I think we are going to see that this year. The northern basin is having a particularly tough time of it. We can only hope that we see a wet summer coming up.

I am very proud to have played a part in pursuing this bill. I acknowledge the work done by Parliamentary Secretary Baldwin and, before that, Parliamentary Secretary Birmingham and the support from Minister Hunt. I also acknowledge my other colleagues in the basin who have worked very hard to make sure that we have this legislation that can give some comfort and certainty to communities and irrigators right throughout the basin that the era of willy-nilly buybacks on an ad hoc basis has come to an end. We are going to focus on productivity, engineering and a triple bottom line for the communities in the basin. We are going to get to an end point where the communities, farmers and irrigators in the Murray-Darling Basin can have some certainty which they can base their planning upon into the future. At the moment, they are fatigued by this reform that has been going on for many years. Hopefully, this legislation will give them some comfort when it comes to their future endeavours.

Tony Zappia (Makin, Australian Labor Party, Shadow Parliamentary Secretary for Manufacturing) Share this | Link to this | Hansard source

The Water Amendment Bill 2015 effectively amends the Water Act 2007 to impose a statutory limit of 1,500 gigalitres on voluntary water purchases across the Murray-Darling Basin as part of the restoration of 3,200 gigalitres of water to the system.

This year marks the 100th anniversary since the signing of the first River Murray Waters Agreement in 1915 and the formation of the River Murray Commission two years later, in 1917. The importance of the river system to Australia's future was well understood by our forefathers 100 years ago, when Australia's population was five million, and well before the establishment of the basin irrigation communities, including the soldier settlements that were developed after World War I and World War II. Indeed, towns like Murray Bridge in South Australia, South Australia's Riverland region, Mildura, Swan Hill, Shepparton, Griffith and so many others along the river, grew subsequent to World War I and World War II.

Today, the basin is home to some two million Australians, of which 1.2 million rely on the water to survive. It covers an area of about one million square kilometres. It accounts for 40 per cent of Australia's agricultural production and over 50 per cent of Australia's irrigated produce. It also produces 100 per cent of Australia's rice and accounts for 96 per cent of Australia's cotton production and 75 per cent of Australia's grape production. Importantly, it is still home to a substantial number of Australia's Indigenous people, who live along the river system. The basin is equally a national environmental asset, being home to some 30,000 wetlands and hundreds of species of fish, birds and plant and animal life.

The reality is that the 1915 agreement was not effective in securing the health of the basin or the livelihoods of the basin communities, as was evident from the effects of the decade-long millennium drought which began in the late 1990s. As a member of the House committee that visited and met with basin communities in 2010 and in the early parts of 2011, I saw firsthand the disastrous effects on families, on whole communities and on the environment that mismanagement of the river system had caused. I saw farmers who had gone broke, the economies of towns collapsing, with numerous businesses closing down, and environmental assets, including Ramsar-listed wetlands in South Australia's Lower Lakes, reaching catastrophic conditions. Given the severity of the millennium drought, even the best basin plan would not have averted some of the dire consequences that we saw. However, a responsible plan would have lessened the consequences, perhaps would have prevented the parochial bickering between the states that occurred at the time and certainly would have provided a much clearer direction and more certainty for the hundreds and perhaps thousands of growers who were directly affected by the drought.

The basin plan that was brought together by Labor under the leadership of the membership for Watson, who was the relevant minister at the time, ensured that, finally, after about 100 years, there was a science-based plan agreed to by each of the states, the ACT and the federal government. It was a plan that was also based on extensive community consultation, including with the Indigenous communities, and discussions with scientists, growers and environmentalists. It was a plan that had the input of all of the people who had a stake in the basin system. The critical outcome of the plan, as I saw it, was the return of 2,750 gigalitres of water to the system and then the return of an additional 450 gigalitres to the environment, subject to there being no negative impact on communities. In total, 3,200 gigalitres of water would ultimately be returned to the river system in the years ahead.

This bill does not change the 3,200 gigalitre target. What it changes is how we get there. I personally accept that we can reach the 3,200 gigalitre target with a 1,500 gigalitre cap on voluntary buybacks. Already, 1,900 gigalitres has been returned, with some 1,160 gigalitres having been returned through water purchases and 600 gigalitres having been returned through infrastructure improvements.

During the work of the committee, I was always of the view that most of the returns should come from efficiency measures, even though, initially, it may be more expensive than securing the water through buybacks. In the long term, however, securing the water from efficiency investments makes much more sense, because it does not constrain productivity by taking water from farmers or cause the exit of farmers from the land, in turn affecting the viability of regional communities. Furthermore, it makes no sense at all to continue wasting water because of the use of inefficient irrigation systems. Work over recent years has shown that achieving the water returns through efficiency measures is possible. Both on-farm and off-farm water savings measures can be found across the basin. Indeed, the work of the committee identified many opportunities for water efficiency investments that could be made. Those, from memory, appear in appendix E of the committee's report.

No group understands better or has invested more money into efficiency measures than our farmers. They understand that water efficiency is important to their future. From open-furrow irrigation systems, the farmers have invested in highly efficient sprinkler systems, dripper systems, moisture-monitoring equipment and expensive land-levelling processes that avoid water wastage through run-off. Having made those investments, often running into hundreds of thousands of dollars, those irrigators are entitled to some certainty about their future, and that is why the basin plan was so important.

However, we should not become complacent because the drought is behind us, because good rains have restored the general health of the basin in recent years and because farmers themselves have learned from the drought and made important and necessary adjustments. We do not know when the next drought will come, but at some stage, I suspect, it will. When it does, basin communities will be much better prepared because of the work done in recent years and, in particular, because we now have a basin plan in place. Of course, the plan needs to be constantly reviewed and, if necessary, adjusted as required. That is exactly what this bill does. It looks at where we are at right now and it looks at what is possible in the years ahead and how we can change from achieving that 3,200-gigalitre target through water purchases to achieving it through efficiency investments.

There is no doubt in my mind that food production will continue to be a major economic driver for Australia in the coming years. It is a subject that is often referred to in this place and a subject referred to when we talk about the growth of Asia and indeed the global population. Global markets create export and growth opportunities for Australian food producers, particularly because of the clean, green, good-quality food Australia produces. That point was well made only last night by Taiwan's trade minister when he addressed a gathering here at Parliament House. Additionally, the now-lower Australian dollar, global population growth, the rising middle class across Asia, the loss of existing agricultural land in other parts of the world, water shortages in other parts of the world and water and land pollution in other countries, combined with Australia's agricultural expertise and CSIRO research, all add to Australia's natural advantages and growth opportunities in food production.

I want to divert for just a moment to talk about the water shortages that are occurring in other parts of the world. In China, India, Sub-Saharan Africa and the Middle East, the water systems are already stressed. In many parts of the USA, the water systems are already stressed. It is clear from an analysis of what is happening around the world that water shortages in years to come are going to have a severe impact on the ability of nations to continue to produce food, including Australia if we do not manage our water systems better. The Murray-Darling Basin Plan is doing exactly that. It is a national effort at managing one of the nation's most important water resources better than we have done to date. Yes, there has been some pain in getting to this point, but we are getting there, and if we need to finetune it, as I said only moments ago, then that is what we should do.

There is no better opportunity, given the water shortages that are emerging in other countries of the world, for Australia to capitalise on the opportunities that food producing offers this country. We already have communities that are established, where infrastructure is already in place and where the farmers have settled in and have the know-how, the skills and the ability to increase their food production. And we should give them every opportunity to do so, not only because they have already made substantial investments in their properties and their farms but because it is in the national interest for us to do that. The Murray-Darling Basin has it all in terms of the infrastructure that has already been established there. Water security is the single thing that will provide the greatest confidence to the growers who are already there.

In closing, I want to speak very briefly about the importance of the system to South Australia. Because South Australia is at the end of the system, we are very reliant on water inflows and extractions that occur upstream, particularly in the states of New South Wales and Victoria. We saw, at the height of the drought, the absolute devastation that was caused to the Lower Lakes and to Riverland communities, including Renmark, Berri, Barmera, Loxton and Murray Bridge, as a result of no water being available to many of the growers there. These communities were all established about 100 years ago—in fact, straight after World War I in most cases; Loxton was established after World War II. But they are communities that have for decades and decades existed through their reliance on the River Murray water system, and they are communities made up of real people. Some 30,000 people live in what we call the Riverland area of South Australia—real people who have put their life savings and their work into their properties. They too have entitlement to continue to have water security. It is sometimes disappointing to hear comments made about the fact that the water falls interstate and that therefore the first rights to that water should go to the people who live where it falls. That is certainly the interpretation I draw from some of the comments I hear.

The other point I make is about a question that is occasionally asked: what is the point of allowing water to flow through the Lower Lakes and out to sea and seeing it just go to waste? A river dies if it does not flow. We saw the emergence of that at the height of the drought. Two things happen. Firstly, the waters from the sea come inwards and the salt levels continue to go upstream further and further. We saw them moving upstream right through to I think Blanchetown in South Australia, which is probably halfway up the river system in South Australia. The second thing that happens if the river does not flow is this: each year, through the Murray Mouth, somewhere between 1.5 million and two million tonnes of salt are washed out and carried out to sea; if the river does not flow, that salt remains in the system, and slowly the whole system dies. So it is important not just because we want to try and preserve and save the environmental assets of the lower lakes; it is important for the whole river system to ensure that the flows continue because, if they do not, everybody loses out. So to those people in the eastern states who think it is simply a waste of water to see it flowing out to sea I say: 'Think again.'

As the member for Hunter made clear when he opened the remarks on behalf of the opposition with respect to this legislation, we support this legislation. It is legislation that largely keeps intact the plan to return 3,200 gigalitres of water to the basin, and that is, in my view, the key target that we should be aiming for.

Andrew Broad (Mallee, National Party) Share this | Link to this | Hansard source

Can I commend the opposition for their support for the Water Amendment Bill 2015 and thank the member for Makin for some of his wise words. He talked about a confidence, which I think is very important for irrigators. There are times when we need to amend legislation to make it better, so it is nice to see some bipartisanship around what I think is an essential topic—the water within the Murray-Darling Basin.

What is so special about the Murray-Darling Basin? Not only is it essentially our largest water supply but, complementing that large water supply, it also has the great soil. When you combine water and soil, that gives potential. When you put that with confidence and people, you create productivity and growth and wealth. Water is the key ingredient to growth and wealth in a very, very dry country. We do live in a very dry country, and we do need to have very good water management. If we look at the Murray-Darling Basin system over the last 100 years, we see that as we developed opportunities through the early 1920s and 1930s we saw that a great dream of turning water and labour into food could be realised. However, through the 1950s and 1960s a lot of allocations were attributed to people who wanted to extract water out of that system. It needs to be stated that, if you look over the last 100 years at Australia's average annual rainfall in the Murray-Darling Basin, you can see that the 1950s and 1960s were the wet years. There is no doubt that there was an overallocation attributed to the Murray-Darling Basin. Then, as we saw things come back into the 100-year average, we realised that there is some work that needs to be done around trying to find that balance—a balance between good river health and extraction for food production and so that we can grow those communities.

I think the Murray-Darling Basin Plan is a very rough attempt at that, and it is going to require amendments. It is going to require changes as we attempt to get it better. But, if I think through the issue here, it is all about confidence. If we can instil confidence in our irrigators—and producing food is risky—then we can instil better environmental outcomes. I will explain this: if you are not confident that you have certainty in your water then you are not going to spend what is sometimes hundreds of thousands or sometimes up to a million dollars in piping, in tape-and-drip irrigation and in better water management principles. If you are not confident, you are not going to invest in better genetics—be it genetics in horticultural crops or genetics in livestock. If you are not confident, you are not going to put in a new rotary dairy that is going to drive productivity, because you are nervous. What we saw when the Murray-Darling Basin Plan first came out was a stripping of confidence. There was a nervousness. I attended Murray-Darling Basin meetings—I was president of the Victorian Farmers Federation—and the question people were asking then was: 'Are you going to take away my water? You're not going to take away my water!' And it would become very adversarial. I think that robbed confidence.

Of course, we do have to find the balance between good environmental health and irrigation communities being viable, but we will not take away people's water. We need to instil some confidence, so attempting to put a 1,500-gig cap on buybacks is the first step towards restoring legislative confidence for our irrigation producers. It is saying that we still have a commitment to establish 2,750 gigalitres of water, we still have a commitment of 1,500 gigalitres of that being part of the Commonwealth Environmental Water Holder, but we are going to achieve the rest by investing in major infrastructure, by investing in environmental infrastructure and by doing things that are necessary to get to that figure, but also growing our wealth and opportunities.

I see great wealth and opportunities in our region, but I also see that we need to put some rigour around how we manage the 1,500-gig cap of that Commonwealth Environmental Water Portfolio when we get to that level. The principle that an environmental entitlement is the same as an irrigation entitlement is very sound—so when things are wet we all have more water, and when things are dry we all have a little less. And it needs to be understood that we no longer have a natural system. We have a working river, but a working river does not necessarily mean it is an unhealthy river. If there is one thing I have learnt about irrigation communities, it is that they are often the great environmentalists. They are people who live on that river. They are people who are passionate about good river red gums. They are passionate about ensuring that our rivers have good fish life. They have great suggestions. If there is one thing I think we can take out of the lessons from a poorly-consulted Murray-Darling Basin Plan, it is that we need to listen more to irrigation communities and talk at them less. What we saw in those Murray-Darling Basin Plan meetings were very well-skilled bureaucrats speaking down to people who may not have been as articulate but who actually knew more than those bureaucrats would ever know, because the people in those rural irrigation communities—those country towns on the river systems—had generations of knowledge around the river system, and they have a lot to offer.

I think what we have learnt in our irrigation communities, because water is expensive, is how to manage it frugally. My hope is that the Commonwealth Environmental Water Holder will put a deemed rate on the 1,500 gigs that they hold so that they can then put some financial rigour around an environmental water holding assessment. For example, if they choose to water a wetland and they say that a megalitre of water to water that wetland costs $75 a megalitre, they can then say, 'We could water that wetland for, say, $300,000,' or 'Perhaps we could sell some of that water for, say, $50,000 and use some of the money from the sale of that water to build some environmental infrastructure to also achieve the same level of outcome in that environmental wetland.'

You can see what I am getting at. By putting a deemed value on the 1,500 gigs and seeing it as a resource that belongs to the government we can then, over time, and with the knowledge of our rural irrigation and river communities invest in things like fish stairways, environmental infrastructure—the odd pipe and pump here and there—and actually achieve good environmental outcomes, just like we do with our irrigation infrastructure.

The Murray-Darling Basin Plan does not currently allow the Commonwealth Environmental Water Holder the freedom to sell water onto the temporary water market and then reinvest in environmental infrastructure. A change to allow this would provide an improved basin over a number of years, at little cost to the Australian taxpayer. It would also allow the government to work with communities on project suggestions, implementations and the restoration of some of the trust between governments and water users. I think that is something that really needs to be talked about.

I have a strong belief in the future of irrigated agriculture. I have a strong belief in the ingenuity and the mindset that is out there. I would like to reflect on some things that have taken place in my electorate, for example, the Hattah Lakes project, which has just been an amazing sort of thing to watch. Substantial money was put into pumps. Water was then moved through Hattah Lakes. It was given a watering and then it drained off those lakes so not only is it watered but it then freed up environmental water to come back and rewater other patches. There is some stuff that can be done and I think there are some great opportunities.

But one way of achieving the management of good environmental water is going to require those who manage the asset to be living in the communities where that asset is managed. I have a strong belief that, if you cannot look out of the window at what you are managing, you do not manage it very well. It does concern me that the Murray-Darling Basin Authority is based in Canberra, as opposed to being based in those communities.

We can argue all day about where the spots should be located, but the more people you have living in irrigation, river towns and those communities who are managing the Murray-Darling Basin, managing our environmental water, the more organically they will feel the needs of that river system. If they can organically feel that, they will then, in turn, manage it better. Those who live in Wodonga, for example, have a greater understanding of the river health. Those who live in Renmark will understand the river health. Those who live in Mildura will understand the river health and those who live down in the Lower Lakes will understand the river health. Having that managed out of Canberra I do not think necessarily achieves the best outcome—no aspersions thrown against those who work in that department! However, by living in those communities you really do feel it.

The Murray River is a fantastic river and so is the Darling River. I think the challenge for the Murray-Darling Basin Plan needs to look beyond the 2,750 gigs as a number because, ultimately, river health is not just about a figure. River health is measured in many other ways. I think we need to be very careful that we are mindful of the constraints within the Murray system to achieve that amount of water, when there is no water coming down the Darling River.

The river is a natural river and there is the Barmah Choke, which will put restrictions on it. And we simply do not have the physical ability to take water out of Hume, all the way down to South Australia without having some constraint issues to tackle the Barmah Choke.

That is why I think there is a strong argument for further investment in Menindee Lakes. Menindee of course is a high-evaporation storage and there is no doubt about that. Its location is in a hot area. It is not far from where I live. When I am bored, I often get in my little plane, fly over it and have a look at it. Engineering works can be done there. Whilst it is not the greatest and most efficient storage, it is a storage and the last storage within the Darling River. Looking at how we can do some engineering works within the Darling River and Menindee affords us the opportunity, when the Murray and Darling join up at Wentworth, to ensure some surety around the Lower Lakes, and some security of water for the Riverland. And that is an area of prosperity that I want to see grow. I want the Sunraysia and the Riverland to really capture the opportunities that we have found through the free trade agreements, particularly around citrus, table grapes and almonds, which we are seeing expand. But the only way we are going to do that is to look at some of those engineering works. That will require real dollars from the government but, ultimately, the thing that separates us and should separate us as a great government is how we are prepared to invest in the major water infrastructure that will address one of the greatest challenges in the dry country that we live in.

I think we can do it. I think the best outcomes are only achieved when you work with real communities. And the best outcomes are only achieved when a level of bipartisanship and understanding is achieved in this place. It is pleasing that both sides of the parliament are recognising the need to put a 1,500 gig cap on the buybacks. It is pleasing that we recognise that when you instil confidence in people they will then invest, grow their business, grow their wealth, manage water better and we will get river health. That is why am really happy to speak on this bill. I look forward to it going through the Senate, being implemented and getting some confidence back in the Murray-Darling Basin and the communities who live there.

Cathy McGowan (Indi, Independent) Share this | Link to this | Hansard source

I welcome the contribution of my colleague, the member for Mallee, the great work that he does in his community and his real concern for the river. Thanks for your comments.

I am pleased to speak to the Water Amendment Bill 2015. By way of introduction, I would like to inform the House that 50 per cent of the water that falls in the Murray-Darling Basin falls in the electorate of Indi. This figure has been verified by a number of reputable sources, including the Goulburn Broken Catchment Management Authority and the North East CMA. This water falls as rain—obviously—but also as snow in the mountains of the great Australian Alps.

From the Murray Valley in the north of the electorate of Indi down to the Goulburn in the south, Indi is in fact a watershed electorate. Indi is a catchment electorate—it is the catchment for the Murray-Darling Basin. This water flows into the rivers and creeks of Indi, the tributaries of the Murray river. Let me name them: the mighty Goulburn, the Broken, the King, the Ovens, the Kiewa, the Mitta, the Dart and, the grandest of all our rivers, the mighty Murray. Embedded in these valleys and on these rivers are the dams of the Dart, the Hume, the Nillahcootie and the Eildon—the places where we store this environmental water.

Right across the electorate—in every community and in every valley—the people care deeply about how our water is used. We care that our water is needed and used efficiently and effectively. We care that our water is used for the environment and is used well. Water is used for farming, for our towns and for our regional centres. The water is for our industries and manufacturers. The water is for our recreation, for our wild life and for our wellbeing. Water to drink and to cook and clean with. Water for our parks and gardens. We care about its use.

Currently, a very large percentage of our water is exported. It is exported to our neighbours in the Mallee, to the flat landers, to the irrigation lands and to the cities and towns of South Australia. It is of use and benefit, I am sure. However, the rules for this export are outlined for us by this parliament in the rules around the Murray-Darling Basin Plan. They have been well-debated and argued, and compromises have been made and agreements reached. This legislation before the House tonight is proposing to change some of these rules. Following consultation and negotiations with the minister and relevant staff, I am pleased to support these changes. But in doing so, I would like to draw attention to a number of issues raised by members of my constituency—issues relevant particularly to the implementation of the plan. These issues centre around the constraint strategies. How will the environmental water get from the rivers and dams of Indi to the environmental sites in the west? Who will bear the cost? How will compensation be made?

On the Goulburn River the Goulburn Broken CMA is the key authority responsible for this planning. The Murray-Darling Basin Authority, with technical support from Goulburn Broken CMA, is developing a business case for addressing environmental flow constraints along the Goulburn River. Funding for the development of the business case is being provided by the state of Victoria from the Australian government's water special account as part of implementing the Basin Plan. The development of the business case commenced in May 2015 and the final business case is required to be completed by November 2015. The business case will assess the feasibility of delivering increased environmental flows along the river to inundate the lower Goulburn River floodplain—overbank flows would benefit the network of billabongs, wetlands and river red gum forests on the floodplain and the many native animals they support; what land, businesses and infrastructure could be affected by delivering increased environmental flows, which may include farms, fisheries, caravan parks, roads and bridges; and the options to mitigate or offset potential impacts and their costs, which include easements over private property and modifying or building new infrastructure.

In the north of the electorate a similar process will need to be carried out on environmental flows released from the Hume dam. However, I understand this work has not yet commenced. I look forward to working closely with the relevant authorities.

Let me proceed by reading a letter from a farmer and community leader from the Yea community in the shire of Murrindindi, Jan Beer. Jan Beer expresses her concerns strongly:

Dear Cathy,

As my Federal representative in the electorate of Indi, I'm writing to ask you to make representation to the Minister for the Environment, Mr. Greg Hunt, the Parliamentary Secretary for Water, Mr. Bob Baldwin and the Murray Darling Basin Authority (MDBA) regarding my concerns on the Constraints Management Strategy (CMS) under the Murray Darling Basin Plan.

Jan goes on to outline her concerns:

(1) The river channel capacity of the Goulburn River at Molesworth in the Upper Goulburn Catchment is 9,500Megalitres/day (ML/day). The MDBA are proposing environmental flows of 20,000ML/day, which they describe as "small overbank flows", but are in reality over double the channel full volume. This flow completely inundates the high value agricultural river flats at Molesworth and cuts access in many other properties downstream. Flows of 15,000ML/day and 20,000ML/day are totally untenable.

(2) No extensive Cost/Benefit Analysis or Socio-Economic Impact Study on proposed flooding of the Upper Goulburn catchment have been undertaken. The MDBA have commissioned at least 22 socio-economic reports in the Murray Darling Basin and all but one of these reports were on impacts of reduced irrigation, with the other one covering flooding in the Northern Basin—

We need it for our community in the Yea area.

(3) The Constraints Management Strategy 2013-2014 Page 32, states that during Phase 2 there would be "a property-by-property assessment with regard to landholder impacts and mitigation options." The MDBA and Goulburn Broken Catchment Association (GBCMA) now state there is insufficient time and insufficient money for this to take place. Instead, saying there will be "limited opportunities to work at farm-scale levels". Now only 2-3 case studies of farms will occur and 2-3 "specialist case" studies, that is, trout farms, caravan parks.

(4) The Victorian Government is required to acquire easements as a mitigation process, over land that will be intentionally flooded. Mitigation means to alleviate, lessen the pain or impact. An easement is NOT mitigation for landholders. It devalues the affected land and total farm value.

An easement is in reality mitigation for Goulburn Murray Water and GBCMA who are the government agencies deemed to be legally liable and responsible for damages caused by flooding.

Phase 2 of the Constraints Management Strategy states that evaluation and analysis of the proposed project must be based on extensive investigation and research to support the decision-making process.

Jan writes:

I do not believe that this process, which should demonstrate that the Strategy is viable and technically and economically achievable, is being undertaken.

As part of the Murray Darling Basin Plan, this is a multi billion dollar project, involving the expenditure of tax payer's money, therefore who will be liable and responsible when it is found that decision-makers have not been fully informed of all aspects with a detailed risk analysis.

Indeed, who will be liable? Who will take responsibility and how will compensation be paid?

In conclusion, while I do support this bill, I call on the minister and the parliamentary secretary to work closely with farmers such as Jan Beer, to clearly and accurately communicate with them and to address their concerns. I call on the minister and the parliamentary secretary to make that special effort to work with catchment farmers and with the people and the communities right across Indi. After all, it is our water and it is 50 per cent of the water in the basin.

Tony Pasin (Barker, Liberal Party) Share this | Link to this | Hansard source

I was reminded recently by the chair of the Murray-Darling Basin Authority, a former Speaker in this place and former member for Wakefield, Neil Andrew, of a famed quote by humourist Mark Twain. Mark Twain is credited as having said, 'Whiskey is for drinking and water is for fighting over'—and isn't that so true in this nation with respect to the history surrounding the Murray-Darling? But I am pleased to say that in recent times we have had a proud history of bipartisan support when it comes to the Murray-Darling Basin, the Murray-Darling Basin Plan and the bill that is currently before the House, which will cap water buybacks to 1,500 gigalitres. So I congratulate this place and particularly those on the other side for what has been a bipartisan approach with respect to the plan and, importantly, on the bill before us, the Water Amendment Bill 2015, and the plan to legislate a buyback ceiling. I take this opportunity to acknowledge the contribution made by the member for Indi. Whilst she ended by indicating that it is water—and I think the term might have been 'our water'—can I encourage the member for Indi to accept that this is the nation's water resource. I think it is important as we stand here in the national parliament to understand that.

Why was I so energised and why have I worked so hard to deliver the legislation which sets the cap? Quite frankly, it is because buybacks kill communities. If you as a federal government come into a community with—pardon the pun—a big bucket of cash and buy up water to meet the targets in the plan, you do, in my respectful and humble opinion, irrevocable and long-term damage to the community itself. As the member for Barker, I have a heavy burden in this place. I am, in a sense, the South Australian who represents the river and river communities. In the House tonight we have the member for Mayo, who also represents some portion of the river, and the member for Wakefield—who succeeded David Fawcett, who succeeded Neil Andrew, who is now the authority chair, as I mentioned earlier with respect to the famed quote from Mark Twain.

The heavy burden is that you come to this place knowing that it will be your responsibility to stand up for river communities in South Australia who face the difficulty of a geography that is against them, with respect. That is why I am so pleased that this parliament has, over some considerable time, come to a bipartisan approach when it comes to the Murray-Darling Basin Plan. We were fighting over this before Federation. Indeed, some people in my community often quip that we would have been well placed in the early 1900s to give responsibility for the Murray to Western Australia and Tasmania, because self-interest is something that has held us back and has created difficulties.

Regarding the heavy burden I spoke about, I think I am ideally placed. I represent the communities on the river but I do not come from the communities on the river. I am an irrigator. Some of the favourite times of my childhood were spent carrying irrigation pipes around our property in the south-east of South Australia on those hot summer nights and laying those aluminium pipes down with my now late brother and father. So I understand the importance of irrigation entitlements and the need for certainty around them. But I do not come from the river communities in Barker; I come from the south-east, where we irrigate from aquifers. So, in a sense, I understand their plight but I am not tarred with any particular interest along the river. I am not, for example, from the irrigation communities of the northern parts of my electorate in the Riverland—Renmark, Loxton, Berri, Waikerie and other communities. Equally, I am not from the Lower Lakes. So I am ideally placed to advocate on behalf of the South Australian river communities and to bring balance to my judgement.

This government, I am proud to say, understands the importance of the river in terms of the lifeblood that it literally pumps into communities. It always takes my breath away when I travel into the Riverland, whether it is via the Barossa or up from the southern regions. You are surrounded by land that is marginal. You come up close to the river and you see these great orchards of green, these great productive environments, these hotbeds of community activity. Meeting with people there, first of all I saw the relief in their eyes when they came to realise that the Murray-Darling Basin Plan had been secured. I congratulate all who were in this place before I came here for having achieved that. It was a significant achievement, one that I remind this House we had been seeking to secure for close to a century—an independent authority with responsibility for the whole of the Murray-Darling Basin system. I saw their relief and now I see them clamouring for certainty. They hear from us—from people on both sides of this place—that it is the stated desire to ensure that this plan is implemented on time and in full. I spoke earlier about that heavy burden, and there it is—'on time and in full'.

But, while we are talking about certainty, here is an opportunity to deliver some certainty. We said, in the lead-up to the last election, that we were going to work towards this cap, that we were going to prioritise water efficiency investments in lieu of purchases. It has always been a target. As a result of this bill, it will be a legislated cap. I remind the House that this is not where we want to end up, but it provides certainty to communities to say that we will not go past this level of buyback, reminding everyone that it is clear that buybacks kill communities.

'On time and in full' is effectively the macro aim, but there is some work that we need to do in addition to the work that we are doing tonight—and I congratulate the parliamentary secretary for having, pardon the pun, negotiated the waters to get us to where we are. We heard from the member for Mallee—and, goodness, he is right—about water storage. In a nation as dry as ours, which enjoys the rainfall that we do, we allow far too much of it to escape. We have not invested in the type of water storage infrastructure that will provide for us insurance in times of drought, and we must do that. Again, that is something that is some way off, but I know it is something that the parliamentary secretary and this government are focused on.

But there is something that we can do sooner than that, and I think it is important that we do it, and it is this. Members of this place might not know, but the Commonwealth Environmental Water Holder, the largest single water holder in the nation—who, in my view, holds those water rights on behalf of all of us effectively on trust—is entitled to trade. You heard it from the member for Mallee. Indeed, in my respectful submission, the Commonwealth Environmental Water Holder ought to trade where he can. But unfortunately the legislative framework at the moment prevents him from using the proceeds of those trades for any endeavour other than purchasing more water rights. That kind of runs contrary to what we are seeking to do by this bill. So I encourage all in this place—and I know the parliamentary secretary is working towards this as a response to the review—to come to a point where the Commonwealth Environmental Water Holder, referred to in this place as the CEWH, is able to trade water: inject that water, if you like, back into productive infrastructure, given the right environmental settings, and take the revenue from that transaction and invest it in some of the works and measures that perhaps the member for Mallee was talking about.

We take our commitment to this plan seriously. We are investing $2.5 million every day to 30 June 2019 in the future of the basin. We know that this basin is ideally placed to meet the food tasks that will come out of Asia. There are 500 million Asians living in the middle class today. By 2020 it is anticipated that 3.5 billion Asians will have achieved that status. They crave the types of foodstuffs that will be delivered out of regions like Barker but particularly out of the Riverland, products of irrigated horticulture. We must secure the future of those communities today, to ensure that they can service that demand long into the future.

On a day such as this, I would be remiss if I did not turn briefly to the China-Australia Free Trade Agreement. Farmers in my electorate are ecstatic about the prospects on the horizon as a result of the three free trade agreements that this government has secured—with Korea, with Japan and, of course, with the globe's most populous nation, China. They see the opportunity. They are excited about the opportunity. But I began by talking about certainty. Just like irrigators on the river want the certainty that comes with legislated protections, so too do my farmers up and down the electorate, not just those who live between block 6and the mouth of the river but all of them. They want the certainty to know that people in this place want to secure the future of Australian agriculture by providing for them access to markets like China that are, again—pardon the pun—ripe for the picking.

I have watched them in the last month or so go from elation, understanding the opportunities finally on their doorstep. It is the current minister who refers to agriculture in this way. Bullish prospects are a bit like free beer: a shingle that hangs above the bar in your local pub, an enticing prospect—free beer tomorrow—but one that never seems to realise itself. That is why I have watched them go from optimism to despair. The despair they have arrived at is because all of a sudden, for base political purposes, those on the other side of this place have decided to play politics with the China-Australia Free Trade Agreement.

It has been a difficult thing to watch these farmers who have endured drought, who have endured every difficulty the world and the environment can throw at them, go from optimism to despair. I ask those on the other side to consult their consciences and support our efforts to secure the ChAFTA.

Nola Marino (Forrest, Liberal Party) Share this | Link to this | Hansard source

Most people have no idea of the hardships inflicted on people in the Murray-Darling Basin by federal and state Labor governments. I will give a brief history to show where Labor failed so badly. The National Water Initiative was pioneered by Deputy Prime Minister John Anderson in 2004, triggered by the New South Wales Labor government's attack on New South Wales groundwater licensees. The New South Wales government had invited a cross-section of people to assist in the drafting of water management plans. However, in 2003, when these plans were published in the government gazette, they bore no resemblance to the plans as drafted and recommended to the New South Wales minister. The plans as published provided for a 49 per cent across-the-board cut to all groundwater licences in New South Wales without compensation.

As most irrigated properties in the New South Wales Murray-Darling Basin are not viable without water, the value of the land is also dependent on that water. Many farmers faced bankruptcy as their farms dropped below the value of the mortgage on their land. Whilst the water-sharing plans were challenged in the courts, Deputy Prime Minister John Anderson stepped in to insist on the irrigators. One of the outcomes was the 2004 National Water Initiative, which amongst other things enshrined the concept of permanent tradeable water entitlements that cannot be compulsorily acquired without compensation on the whim of a state government.

Remember that state governments by the late 1970s had virtually ceased major maintenance and renewals on government owned irrigation schemes, many of which had been constructed by hand by soldier-settlers in the 1920s. Irrigation assets had been actively allowed to deteriorate past the end of their useful lives, and government owned schemes often had water losses of up to 48 per cent as well as financial losses under state government management. As a result, the Keating government pressured state governments to transfer these loss-making irrigation schemes to local grower-irrigator ownership to reduce the pressure on state government finances.

In 2006, a group of irrigator owned schemes formed the Bondi Group to promote a greater awareness of their work to improve water efficiency and how these schemes operated with the NWI. The majority of the Bondi Group members owned and operated what had been loss-making schemes when they were under government control. The irrigators—the farmers—actually turned these into financially sustainable systems. Harvey Water in my electorate was a member of the Bondi Group. Others were Ord Irrigation and Gascoyne Water from WA; Coleambally Irrigation, Murray Irrigation and Western Murray, amongst others in the Murray-Darling Basin; Clyde Water Trust from Tasmania, the oldest continuously operating irrigation scheme in Australia, established in 1832; North and South Burdekin boards from Queensland; and Pioneer Valley in Queensland, the newest irrigation scheme in Australia, which in 2006 was and still is in the process of being transferred to irrigator ownership. The Bondi Group met with the then parliamentary secretary for water, Malcolm Turnbull, in 2006-07, focusing on the latest ideas in water efficiency being introduced by those irrigator owned schemes such as total channel control and new channel lining technology. Harvey Water and Coleambally in particular were recognised worldwide for their groundbreaking work in irrigator funded water-saving infrastructure upgrades.

The Bondi Group was proud of the progress their members had made in infrastructure upgrades and water saving—improvements that would never have been made if they were still in state government ownership. These were practical water savings being made at a time when state governments were in general not even doing routine maintenance and renewals.

In January 2007, Prime Minister John Howard delivered what is known in the water industry as the Australia Day Speech, setting out a $10 billion national water plan. The then Minister for the Environment and Water Resources, Malcolm Turnbull, in the second reading speech on the Water Bill 2007, stated:

This Water Bill is the first water reform program introduced into this parliament in 106 years. It is truly a nation-building bill, not only for this generation but also for the generations to come. It will ensure the sustainability of one of Australia’s great natural assets. It will underpin our nation’s water resources and it will secure the future for the industries, the communities and the environments that rely on them.

While the Howard government focused on providing better outcomes not only for the environment but also for basin communities, the incoming Labor government decided to take a wrecking ball to those basin communities. The Labor government guide to the Murray-Darling Basin Plan was prepared without public consultation, largely in secret by the members of the Wentworth Group. The guide was met with shock and distress by basin communities. Even ABARE felt compelled to raise serious concern about the guide. ABARE calculated the gross value of irrigated agricultural production based on a figure of 3,500 gigalitres, or a cut of 29.1 per cent of total water use. The ABARE report found such a move would cut production by 15 per cent, or $940 million each year. The worst-hit areas would be the Murrumbidgee, Gwydir, Goulburn and Murray regions of New South Wales, with at least 88 towns across the basin affected in some way.

An inquiry into the impact of the Murray-Darling Basin Plan in regional Australia made a series of recommendations that, needless to say, Labor totally ignored. There were also a series of Senate inquiries on problems relating to the Murray-Darling Basin that exposed Labor's underlying problem. The problem was that the Labor government had absolutely no idea at all about irrigation and had no clear understanding of the nature of water entitlements or allocation, or the difference between high-security water and low- or general security water.

Let me explain the differences and the impact that lack of understanding would have on Labor's buyback. Water entitlements under the Water Act come from the definition used by irrigator owned schemes across Australia. It means the right of access to a certain maximum number of megalitres of water in an irrigation year. It is the right to the water, not the water itself. One water entitlement equates to the right to access one megalitre. Water allocation under the Water Act again comes from the definition used by irrigator owned schemes across Australia. Allocation is the percentage of volumetric water actually available in an irrigation year. For example, if you held 100 water entitlements and the allocation announcement was 40 per cent, you would be entitled to take 40 megalitres of actual volumetric water in the irrigation year.

The definitions were drawn from the privatised irrigation schemes because similar concepts under state law all use different terminology, while privatised schemes throughout Australia use consistent terminology. Irrigation allocation in the basin is prioritised based on different levels of security. For example, town water has the highest priority and has 100 per cent allocation. Water for industrial and commercial use has the next level of priority. High-security irrigation water, usually acquired for permanent planting, is next. General or low-security water has the lowest priority and is used for annual crops. Supplementary water covers a range of different levels of security and in some cases is water only available in flood events. In other cases it relates to water entitlements that are being cancelled in the future. In some instances the concept of separate environmental priority water has been introduced. These water entitlements are converted based on a specific formula from high- or general security water. It is not a one-for-one conversion.

So why was a sound understanding of these concepts so important? Because the water target is not the total number of water entitlements but the allocation that needs to be available in any given year. During the peak of the drought, allocation announcements in the Murray for the general security water were often nil, and in the Murrumbidgee allocation for general security water was usually less than 10 per cent. On the other hand, the high-security allocations in the Murrumbidgee were usually 85 per cent. In many circumstances it was generally believed that there would never be an allocation for supplementary flow. So what was the focus of the Labor buyback? To buy water entitlements for the lowest price possible, focusing on general security water. There are many examples of millions of dollars being wasted in the Labor buyback, and one of the best known is the Toorale Station debacle.

The Labor minister at the time announced that Toorale Station had been purchased for $23.75 million and that Labor believed it would return about 20,000 megalitres of water to the environment in an average year. However, Ross's Billabong only held about 10,000 megalitres. More importantly, the water entitlements were supplementary flow entitlements that flow naturally into the land depression in a flood year. The water entitlements are listed on the Department of the Environment's website as 9.720 gigalitres of unregulated river special additional high-flow entitlement. This 'recovery' is not shown in the table because there is currently no long-term diversion limit equivalent factor available to estimate the long-term average annual yield recovery volume for this entitlement.

So $23.75 million dollars of public money were spent without one drop of water effectively being able to be credited to the Labor buyback program. The Labor buyback program focused on water for the lowest possible price for entitlements, not on volumetric yield—the actual water. Nor did it take into account the cost to infrastructure assets as water entitlements were sold away from expensive irrigation infrastructure.

The Labor government was creating a massive stranded assets problem for irrigator owned schemes and state government infrastructure operators. Minister Wong treated the local communities concerned with contempt, decimating the Gwydir community in 2009 with the purchase of 240 gigalitres of general security Gwydir water entitlements for $303 million from Twynam Agricultural Group. At that stage, the New South Wales Labor government finally issued a carefully drafted notice in the Government Gazette of the State of New South Wales that embargoed the purchase of water entitlements by the Commonwealth whilst leaving open water trading by irrigators.

New South Wales was embittered by the fact that almost all of the buyback had focused on New South Wales, as the Victorian Labor government had largely stymied buybacks in their state. The socioeconomic damage and stranded asset problem at that stage was almost entirely happening in New South Wales. The embargo lasted for almost four months whilst negotiations raged between the Commonwealth and New South Wales. The outcome was a change in Labor government policy on the buyback approach, if not the buyback itself. More lessons were learned the hard way when Commonwealth environmental flows caused serious flooding in the Murrumbidgee in 2010.

A great deal has been learned over the years since the introduction of the Water Act in 2007. The Water Amendment Bill we see before the House refocuses government policy on water saving through infrastructure upgrades and efficient water use, in accordance with the original intention of the National Water Initiative 10-point plan. New methods of delivering water more efficiently by water shepherding and the award-winning Computer Aided River Management system, CARM for short, developed by Water for Rivers, has been developed to meet the new challenges. Water efficiency now is not just a goal for the irrigation community but is also a goal for environmental water holders, as it should be, so that everyone in the basin treats water as the precious resource that it is. It is certainly worth more than gold in my view, and in a country like Australia the importance and quality of water cannot be underestimated. On that I conclude my remarks.

David Gillespie (Lyne, National Party) Share this | Link to this | Hansard source

It is with great admiration that I would like to compliment the member for Forrest for her speech. She stole most of my thunder there, but I will digress and go back to a bit of the history of irrigation in this country. Several explorers, such as Oxley in 1821, found the south-west of the state a very inhospitable place. Charles Sturt similarly found the south-west of the state and the Murray-Darling Basin very inhospitable. In fact, the Murray and the Darling and areas of the Murrumbidgee were best described as a chain of ponds, with many dry riverbeds along the exploration routes of all these explorers. In fact, when Oxley first visited in 1821, he thought he would be the last man to visit this area because it was so inhospitable.

Go forward 150 years to the flourishing period of the Murrumbidgee Irrigation Area. You could, as a start-up irrigator and farmer, move down into the Murrumbidgee Irrigation Area, purchase licences for irrigation and purchase land, which was—I digress—dirt cheap, no pun intended. Land in these areas without water is worth probably a dollar an acre at the most because without water it is worth nothing. You can run a few sheep, live off the saltbush and rely on a few waterholes. But with water the vast breadbasket of the Murray-Darling all of a sudden assumes a huge beneficial property, and that is that you can grow stuff—stuff called food, stuff called fibre; primary production. All of these are ancient terms that seem to be forgotten! Whether it was the Tigris and the Euphrates or the Tiber, civilisations rose out of water assets. It is fundamental to civilisation. That is why water is so important.

The founding fathers of this nation worked that out pretty quickly. It is inhospitable in vast areas of our wonderful nation, but, if you add water, all of a sudden you turn it into a food bowl. There is a lot of conversation happening about the potential of the north of our country. It goes without saying that there is more water there than you can poke a stick at, more water than you can imagine. But what it does not have is the infrastructure to store and distribute it. We have huge amounts of water in the Ord River scheme, but do we have the irrigation system that we have in the Murray-Darling, in the Murrumbidgee or in the other tributaries? At this stage we do not, and we are going piecemeal in developing it. We also have the extremes of nature up there. We have cyclones. We have destruction. We have remoteness.

But in the south-east of this nation we have the Murray-Darling Basin, which is developed and which has the other ingredients for primary production. It has population. It has the infrastructure. It is close to its markets. And it has 150 years of blood, sweat and tears of the pioneers of our nation.

If we go backwards into recent history, we all remember the drought that ravaged the south-east of this nation for about 10 years. As the Government Whip has so elegantly outlined, there is a big difference between water licences and the nominal figure attached to them and the allocation that is given to the irrigators that hold the licences. There is high-security water. There is general security water. The general security licences were a lot cheaper to purchase because the water was not guaranteed. The high-security licences were developed for people with permanent rather than annual crops, like citrus, like grapes—like all those things. Once you grow a plant, you need to have some certainty that you are going to be able to keep it alive, whereas, if you have an annual crop and there is no water and it fails, you have lost and burnt an awful lot of capital, but it is not the end of your enterprise. There is always another crop next year.

During the drought we saw all those horrible images of dry riverbeds. The general impression for those people not living in the area or not involved in irrigation, the stated cause of those dramatic pictures, was that there were these wicked people called irrigators sucking the life out of the rivers. What most people do not realise is that the amount of water allocated to the licences is not what irrigators ever receive. They receive an allocation. During the drought years, people with licences worth $10 million, $15 million or $20 million were getting one per cent or zero per cent of their licence value because irrigators did not have the water either. That is what happens in a drought, for goodness sake. Sure, on paper there might have been overallocation of resources, but at least in Australia we have managed irrigation systems, and they are generally pretty well managed. The water initiatives by the former Deputy Prime Minister, which were referred to, were a really great initiative. They led to a much more sensible allocation of resources. But, having established that, we have a history in the south-east of the country of the Murray-Darling Basin developing huge areas of otherwise useless land into highly productive land, and we should not necessarily look at the far North as the solution to us becoming the food bowl of Asia, because we have a food bowl of Asia already in New South Wales, Victoria and southern Queensland.

Debate interrupted.