OPINION
Bold suggestions are flowing from prominent Nationals MPs about environmental water use options, raising false hope among drought hit farmers.
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Nationals leader Michael McCormack and special drought envoy Barnaby Joyce are raising the prospect of an emergency release of environmental water that’s doomed to fail.
Allocations are at zero in many areas and the need for water is dire.
Crops are failing and an emergency water allocation could save some potential financial losses and produce some desperately-needed livestock feed.
While supplying farmers is a worthy cause, releasing Commonwealth-owned environmental water could open a pandora’s box.
How do you ensure the water gets to who needs it and will they grow fodder with?
What of shortchanging the people who managed for drought and held-off from cropping this season? And what guarantees the fodder would be sold soon, not held back for higher profits?
Since his appointment to the role in August, Drought Envoy Barnaby Joyce has been calling for Commonwealth-owned environmental water assets to be released to irrigators.
On Thursday Deputy Prime Minister and Nationals Leader Michael McCormack chimed in, saying all options to help farmers will be looked at, including potential legislative changes to legalise allocation of environment water to irrigators.
“In these areas of national emergency you have to look at these things,” Mr McCormack said.
The Nats are following the lead of federal Liberal MP Sussan Ley, who represents the NSW Riverina electorate.
She floated the idea of a contract arrangement where irrigators borrow from state and/or Commonwealth environmental holdings and repay the balance down the track.
There are several reasons why significantly more environment water won’t become available.
Dry run
Firstly, selling or gifting environmental water holdings is illegal. And there is no legal instrument to allow a temporary borrow for irrigators either.
Murray Darling Basin Authority chief executive Phillip Glyde runs the agency with ultimate responsibility for water allocation. He pointed out the “strict” legal restrictions governing the openly-traded water market.
“The rules say that while water can be traded in some circumstances it must deliver equivalent environmental outcomes. That’s the whole point of the Basin Plan,” Mr Glyde said.
“The alternative is a river system that eventually can’t support anything.”
The there’s the risk of distorting the water market.
While Mr McCormack said he is investigating new laws, but even if the government manages to guide them through a notoriously tricky Senate, they would run the risk of literally flooding the market and eroding the value assets held by mum-and-dad irrigators and corporate farmers.
Thirdly, there’s the risk to farmers’ social licence. If we assume environment water can be released, and its sold rather than granted for free, it’s likely the lion’s share would be sucked up by cotton growers and permanent plantings.
Temporary water is around $370 a megalitre in the Murray Valley, more than three times the long term average of $120 and struggling croppers who need a hand could struggle to enter the market.
Southern exposure
Across the Murray Darling Basin about 8 per cent of stored water in NSW dams is environment water, and 13pc in Victoria.
Farm groups in the NSW Murray - Lower Darling catchment have campaigned loudly on the need for water.
In late August around 500 farmers gathered in Deniliquin to discuss ideas to alleviate the lack of allocation and make emergency supply available.
Some groups have emphasised the need to work within the rules, others have been more combative, arguing for the independent environment water manager the Commonwealth Environment Water Holder, to be forced to release its holdings.
Using that catchment as an example, the water allocation balance sheet shows irrigators already own most of the water.
That means while many irrigators are short of supply, others are sitting on significant volumes.
For the water-boffins, it breaks down like this:
- The catchment total water resource is 940 gigalitres.
- Irrigators own 431GL of Carryover and 185GL of high security entitlement.
- The environment ledger holds 185GL of carryover and 141GL of high security.
NSW Water Minister Niall Blair has encouraged private water holders to sell some of their carryover assets into the market.
Carryover is water purchased in a previous year and stored away for later use. It can be used even when water restrictions prevent watering with assets purchased in the current year.
“Carryover is held by other farmers. They may be growing different crops, but it’s not just government that can pull the lever on this. I’d be grateful if they could put some of that on the market,” Mr Blair said.
NSW Environment Minister Gabrielle Upton has committed to sell 15GL into the market, with the proceeds going to drought relief measures.
And in a neighbouring catchment in Victoria, Goulburn Valley, the Commonwealth has sold 20GL.
