Federal Government releases 300-page Ernst Young report on Murray-Darling efficiency measures

The new Minister stopped short of explicitly stating the 450GL target, also known as ‘upwater’, can meet its requirement to be delivered with neutral or positive socio-economic impacts. 

But in this afternoon’s release of the Ernst and Young study into basin efficiency measures, Mr Littleproud called for a renewed commitment to the Basin Plan.

Consultancy Ernst and Young were commissioned by the Department of Agriculture and Water investigate upwater.

“We believe the 450GL can be delivered with neutral or positive socio-economic impacts,” the EY report said.

Mr Littleproud said the report “provides us with a pathway to delivering” the upwater. 

“It identifies a range of off-farm and urban water efficiency measures which can safely deliver some water savings without negative social or economic impacts,” Mr Littleproud said in a statement.

“I remain committed to delivering the plan to which all Basin governments agreed, the 450 GL and delivering efficiency measures without negative social or economic impacts.”

Mr Littleproud’s office was contacted for clarification on his statements. 

The Water Minster’s move will be controversial. South Australia has been outspoken in demands that the 450GL is delivered in full.

NSW and Victoria, as well as farm lobby farm groups, have argued 450GL is too much, and will have significant negative socio-economic impacts on irrigation towns.

NSW Water Minister Niall Blair today welcomed the report and acknowledged the ambition to deliver the full target, but noted knowledge gaps over the the economic impacts of on-farm efficiency programs required to achieve the 450GL.

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Murray Darling tensions are best encapsulated by the stalemate between South Australia and other basin states.

This came to a head in November 2016, when SA water minister Ian Hunter made national headlines when he claimed federal government had reneged on a promise to deliver the extra 450GL.

The then federal Water Minister Barnaby Joyce had written to Mr Hunter saying government couldn't fulfil its October 2015 promise "in full and on time".

In the letter, Mr Joyce said he could not foresee other basin states agreeing to deliver the water without significant social and economic harm.

Mr Joyce later said he wasn't reneging on the plan, but obeying the legislation - which forbids the recovery of additional water if it causes significant social and economic detriment to basin communities.

Mr Joyce’s replacement, David Littleproud, said in January he was committed to the full 450GL target, but acknowledged that the volume was contingent on socio-economic impacts.

The complicated Basin Plan legislation does not just mandate 450GL of upwater be found. It weighs the volume of water recovery against negative socio-economic impacts.

That means the amount of upwater to be recovered is contingent on the economic impact it has on Basin communities.

NSW and Victoria, as well as farm lobby groups, have argued upwater cannot be achieved without negative impacts on local economies that are based around irrigated agriculture.

Previous water reform and the Basin Plan itself spurred significant publicly-funded and co-investment into on-farm efficiencies.

NSW, Victorians and many irrigators say further efficiencies are not possible, most of the low-hanging fruit has already been plucked and therefore, capturing another 450GL would eat into the irrigation effort and cause negative economic impacts in struggling communities.

Progress on interstate agreement on how to deliver the upwater goal ground to a halt at a meeting of basin state ministers in November last year,

The South Australian Labor government’s Water Minister Ian Hunter  demanded NSW and Victoria commit to deliver 450GL in full by February 14.

That’s deadline for the Opposition and Crossbench to pass a disallowance motion against the Northern Basin Review, backed by NSW and Queensland because it would reduce water recovery in that region from 390GL to 320GL.

Mr Hunter said he would lobby Senators to block passage of Northern Basin amendments.

SA’s deadline was rejected. NSW Water Minister Niall Blair said “all bets are off” on cooperative negotiations and NSW would “chance our arm in the Senate”.

‘Upwater’ comprises 450 gigaltires of the overall Basin Plan push to return 3200GL to the river system.

The ‘recovery target’ is 2750GL, which is the volume needed to limit irrigation take to 10,873GL (known as the sustainable diversion limit or SDL), deemed the maximum amount of water take within a sustainable, healthy river system.

Plans to achieve the recovery target were ticked off recently, when 37 sustainable water efficiency projects, spread between the Basin states, were approved to return the equivalent of 605GL worth of flow.

SDL projects include new works to increase the effectiveness of wetland inundation with with environment water such as the construction of levees, regulators and a pipeline at Victoria’s Belsar-Yungera Floodplain, or reconfiguring weirs in Gunbower forest.

The water freed-up by SDL projects is known as ‘downwater’.

The 450GL in question is known as ‘upwater’, which comes on top of the 2750GL recovery target, is designed to aid river health.

Under the Basin Plan upwater will be amassed from publicly-funded modern farm irrigation infrastructure that provides water savings equivalent to 450GL.

Commissioned by the Murray-Darling Basin Ministerial Council last year, the more than 300 page report by EY follows four months of extensive community and stakeholder consultations across the Basin.

The EY report on other studies on the social and economic impacts of water efficiency measures, including the effects of off- and on-farm water infrastructure investment and water recovery programs.

“The EY study clearly acknowledges governments need to work with communities, irrigators and industry sectors to ensure that efficiency measures have neutral or positive social and economic outcomes—this is critical to better understanding the impacts of water efficiency measures,” Mr Littleproud said.

“I am keen to work with Basin states to begin implementing many of these efficiency measures within the next few months. We can lay out the pathway to do this when the Ministerial Council meets in April this year.

“I will not play politics with this. Political fighting creates uncertainty which affects the lives of real people.

The report also acknowledged that more work needs to be done to better understand and monitor the impacts of water efficiency measures