It’s Time to Revisit Water Policy
There have been good rainfalls over Eastern Australia recently. Over the weekend and early this week drought there have been good rainfalls over Eastern Australia recently. Over the weekend and early this week drought-affected areas like the Monaro have had good falls. The big dams like Eucumbene and Jindabyne have begun to fill up and flow into the Murrumbidgee and the Murray have increased. All of this augurs well for the Murray Darling system which is good news for farmers and the environment.
Now, when there is plenty of water, is an ideal time to revisit the rules surrounding the distribution of water through the Murray Darling region.
Early this month the ACCC handed the government its interim report on the operation of the water market. Consideration of the report has been overwhelmed by the pandemic and the Treasurer has been tight-lipped about its conclusions but there are rumours that it points to extensive market manipulation by big water traders.
Many submissions to the inquiry from irrigators, agricultural industry bodies and water market participants have suggested something is seriously wrong.
Meanwhile, analysis of water trading data by natural resource management consultancy Auricht Projects and the University of Adelaide suggests the market is wide open to unethical manipulation and is potentially being used for tax minimisation and avoidance.
As reported by Flow recently, the Auditor General released a report that indicated that some water purchases did not meet the value for money standard. However, there is a problem with these recent reports and that is the absence of reliable data.
Experts have said there are all-pervasive and nightmarish flaws in the available data that make it virtually impossible for stakeholders to determine whether markets are being manipulated and water wrongly distributed.
One of the architects of the Murray Darling Basin Plan is Professor Mike Young, the professor of water and environmental policy at the University of Adelaide. Professor Young was an adviser to Malcolm Turnbull when he was water minister in the Howard government. He says the data on water is so flawed that it poses “serious problems” for managing the basin.
You don’t know which data systems to trust,” he says. “There is not even agreement on the systems… and if you’ve got flawed data and you’re trying to manage the system, you’ve got a serious problem. It’s nightmarish.”
The data for water trading is provided by the Bureau of Meteorology through a dashboard which resembles the online component of the Stock Exchange. However, the data on the dashboard is not always internally consistent, which makes water trading and price comparisons for farmers and irrigators difficult.
The federal government will need to get to work on this problem soon or it could cost them the next election. The Coalition has already lost the seat of Indi to an independent, Helen Haines and it failed to win Eden Monaro in a recent by-election. If it loses the seats of Farrer and Mallee at the next election, because of water issues, it will lose government.
The inspector general of water, Mick Keelty, produced a report earlier this year that made a series of suggestions for reforms. On some of these, the states dug in and refused to change water allocations. However, there is no reason for them to resist the standardization of data collection and the reform of water trading.