Final Ken Matthews report says ‘certain stakeholders’ put water reforms at risk

State opposition meanwhile, says Mr Matthews’ final review had far from delivered a promised clean bill of health for Regional Water Minister Niall Blair, with much, if not most, of the changes recommended simply not made yet.

While noting state government was ‘quick out of the blocks’ to address compliance shortfalls raised by his interim report last month, Mr Matthews said community concern had, if anything, intensified.

“The issue is not going away,” Mr Matthews wrote in his final report, released this morning. 

Despite his final water report adding more to state government’s teetering to-do pile, Mr Matthews was keen to distance himself from the view that non-compliance was rife across the state. 

He said the overwhelming honest majority of NSW irrigators are firmly in favour of action against a small minority “who may not be playing by the rules”.

Mr Matthews recommended NSW officials hurry up their water reform master plan – which he said was still incomplete after 11 weeks, while also noting the budget and staff needed for the reforms had not been explicitly assigned.

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He alluded to ‘certain stakeholders’ posing a risk to reform outcomes – although noting the overwhelmingly honest majority of irrigators take compliance seriously, and are “firmly in favour of action against a small minority”.

“While stakeholder response to the Interim Report was overwhelmingly positive, certain important stakeholders have already expressed concern about two of the major reforms: water metering; and improved transparency of information about water usage,” Mr Matthews wrote.

“There will inevitably be some practical adjustments within the general policy outcomes sought.

“However, if too many ‘adjustments’ accumulate, there is a risk of gradually losing the current unprecedented opportunity to achieve long-overdue remedies to NSW compliance problems.”

He recommended government announce an independent audit and evaluation in 12 months’ time of results against ministers’ original target outcomes.

Minister for Regional Water Niall Blair thanked Mr Matthews and his team for their work.

“Mr Matthews acknowledges (we were) ‘quick out-of-the-blocks’ to accept the diagnosis and to adopt the prescription,” Mr Blair said. 

“His overall assessment of the progress we are making has been positive.

“However, the report also highlighted concerns that unless we continue to drive these reforms the package is at risk of delay. 

“I want to be very clear, government is firmly committed to delivering these reforms for the good of the community and all stakeholders and there is no room for any delay.”

Government will now consider the final report in detail, alongside recent findings of the NSW Ombudsman and the Murray Darling Basin Authority, with a comprehensive response to be presented to the Murray–Darling Basin Ministerial Council and published in December.

Mr Blair commissioned Mr Matthews to review the state’s water management and compliance, after a controversial report by  ABC’s Four Corners program in July.

Pumped alleged that a small number of powerful Cotton irrigators in northern NSW had been stealing taxpayer-bought water indented for environmental flows. 

Deputy Director General of Water Gavin Hanlon was recorded in an exclusive meeting with a small group of irrigators offering to provide confidential information to guide their lobbying efforts in Murray Darling Basin Plan consultation. He has since resigned. 

ICAC has also launched preliminary inquiries into the actions of the NSW Government.

The interim report by Mr Matthews, released last month, said irrigators’ social licence to operate had been put at stake by systemic failure in the Department of Primary Industries’ Water division.

Since then the NSW Ombudsman highlighted further significant flaws in the state’s management of the public resource.

The Ombudsman said this month the state’s water compliance agencies, the cops on the beat for water theft and illegal works, were in “disarray” from 2006 to 2009 and despite numerous recommendations to government water agencies not much had improved since.

Frequent restructures had damaged the ability of the agency to deliver an effective compliance and enforcement program, the Ombudsman said, with more parking inspectors at the City of Canada Bay Council than on the state’s water compliance team.

On Monday NSW Labor backed its South Australian Labor counterparts and their state-based Royal Commission into Murray Darling Basin compliance and management. 

SA Premier Jay Weatherill was adamant the probe would compel bureaucrats from NSW to come forward with evidence, while NSW Opposition water spokesman Chris Minns called on Premier Gladys Berejiklian to “open the books” and prove without a doubt that nothing was amiss. 

On Thursday, Mr Minns said the final Matthews report was a tactful but forceful admission much of the suggested changes had not been made. 

“Given this report shows that water reform is not even half done why is Niall Blair dragging his feet when it comes to fixing this broken system?”

NSW Green MP Jeremy Buckingham said Mr Matthews’ report was one of four in the last few days that had rung the alarm bell over the progress of the Murray Darling Basin Plan, and necessitated a Federal Royal Commission.

“Everywhere we look, the National Party, in cahoots with big irrigators and tame bureaucrats, are conniving and manoeuvring to keep irrigators canals full, and stop water being returned to our rivers and wetlands,” Mr Buckingham said. 

The reports Mr Buckingham mentioned include the Murray Darling Basin Authority Water compliance review, the Wentworth Group of Concerned Scientists Review of water reform, and the Australian National Audit Office review of NSW’ Protection and use of Environmental Water in the Murray-Darling Basin. 

State government recently passed legislation to establish the new Natural Resources Access Regulator, an independent body which will take compliance and enforcement of water laws from Water NSW.

The bill squeaked through parliament just before the summer break.

Recruitment for the three-member panel is underway. 

“This bill sets us on a pathway to restoring the community's confidence in water resource regulation in NSW. It represents the beginning of a period of reform and improvement for compliance and enforcement in the regional water portfolio,” Mr Blair told parliament.

To manage the implementation process, the department (through the Crown Lands and Water Division) has developed a Matthews Reforms Implementation Project Master Plan.

The plan already identifies 20 separate projects to be undertaken and Mr Matthews anticipates more.  

But he’s worried it is taking too long.

“I am concerned that 11 weeks after the government’s decisions, the plan is still not complete,” Mr Matthews said.

In light of the Interim Report, the Department of Industry introduced an external whistleblower service to report water fraud and misconduct, and additional departmental cultural transformation programs for staff.

After the “inappropriate” teleconference aired on Four Corners, featuring Gavin Hanlon and selected irrigation industry leaders, Mr Matthews said it was important for future contact to be non-exclusive and involve a wider range of staff.

“But that is no reason for the department to be hesitant about close consultation with irrigator groups in the future,” Mr Matthews said. 

He said it would be appropriate for a transparent, open primary irrigators’ consultation forum to be established.

Mr Matthews also recommend the department seek to provide greater access for environmental stakeholders who, until now, have primarily engaged with water matters through the the Office of Environment and Heritage.

“Re-setting these relationships will not happen overnight and may require patient leadership and modelling behaviour by divisional leaders,” Mr Matthews said.