All states will remain in the Murray Darling Basin Plan following a potentially precarious Ministerial Council meeting on Tuesday, with NSW having threatened to leave the Plan in recent weeks.
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"We are still all here, we are still in the Murray Darling Basin Plan, despite conjecture and noise from commentators that it was all going to fall over," federal Water Resources Minister David Littleproud said following the meeting.
But although the states agreed to remain in the Plan, they did not agree to a water-sharing agreement review by interim Inspector-General of the Murray Darling Basin, Mick Keelty.
Victoria and South Australia pushing back on the federal government's promise of the independent review, a commitment Minister Littleproud made to the 'Can the Plan' rally earlier this month.
However, Mr Littleproud said the federal government would move forward with the review, with or without the states.
"We have made a commitment, we respect the sovereignty of the states not to cooperate but we will continue," Mr Littleproud said.
"It will start as early as next week and if the state's are so inclined to come on the journey with us, cooperate and provide further information then we're only too willing."
Mr Littleproud said he accepted the states' premise that they were already doing everything right but said the review was an opportunity to 'truth-test' that statement, to give everyone else the same confidence.
"If they're so confident let the sun shine in, let him (Mick Keelty) have a look at it," he said.
"Federal government will be drafting legislation in the coming weeks.
"We need them (the states) to mirror that legislation if it's to have teeth."
Victoria Water Minister, Lisa Neville said she did not think a water share review would be worthwhile.
"Victoria doesn't want to be in a position where we are penalised, because we run our system in a very conservative way, so we make sure we have always got some high security allocations," Ms Neville said.
"We work within the rules, and our message is, what are we trying to fix?
"I think it creates an expectation for people, who are doing it really tough, that there is water available, and it just isn't there."
NSW makes it clear they will not contribute to 450GL
NSW used the meeting to impress that while they would remain in the plan, the state had simply "no more water to give."
NSW Water Minister, Melinda Pavey said she made it very clear that NSW would not deliver the Water Resource Plans and NSW would not contribute to the additional 450GL in water recovery targets.
"NSW is in the grips of the worst drought on record and our communities have been crying out for change for a long time," Ms Pavey said.
Mr Littleproud said NSW had already signed up to an agreement that an initial 62GL must be recovered.
"They legally must, they all committed to that 12 months ago and they all made pledges to get to the 62GL," Mr Littleproud said.
"After that it's the Commonwealth who has to go out and try and create an environment where community groups, organisations, councils come forward with water saving projects that can go towards that 450GL.
"The reality is we'll continue to put it out there, advertise but if people aren't putting through projects, we can't achieve the full 450GL in time."
Ms Pavey said NSW had successfully fought for a reassessment of the deliverability of the Sustainable Diversion Limit projects and their contribution of 605GL - which could mean a delay in the delivery of this water, leading to legislative changes to the Plan.
