House of Assembly Fifty-First Parliament, Third Session (51-3) 51 3 Parliament of South Australia House of Assembly published Ministerial Statement Ministerial Statement Murray River MURRAY RIVER The Hon. M.D. RANN House of Assembly Ramsay Premier Minister for Economic Development Minister for Social Inclusion Minister for the Arts Minister for Sustainability and Climate Change The Hon. M.D. RANN (Ramsay—Premier, Minister for Economic Development, Minister for Social Inclusion, Minister for the Arts, Minister for Sustainability and Climate Change) (14:06): I seek leave to make a ministerial statement. Leave granted. The Hon. M.D. RANN House of Assembly The Hon. M.D. RANN: South Australia continues to be at the forefront of national reform and investment in water security. We are building a desalination plant for Adelaide. We are substantially increasing the use of recycled water and stormwater. We are investing in incentives and education to support the community to save water, and we are driving the national agenda for a better deal for the River Murray. Today, South Australia became the first basin state— Members interjecting: The Speaker House of Assembly The SPEAKER: Order! The Hon. M.D. RANN House of Assembly The Hon. M.D. RANN: —to introduce historic legislation to refer constitutional powers to the commonwealth for the management of the Murray-Darling Basin. I know that there is a bit of agitation on the other side following the historic reshuffle. Some have described it already as a missed opportunity. Of course, demoting a member who has been fighting for the Lower Lakes shows how much they feel about the issue on that side of the house. Earlier today, the Minister for the River Murray introduced the landmark legislation making South Australia the first Murray-Darling Basin jurisdiction to introduce this legislation. Members interjecting: The Speaker House of Assembly The SPEAKER: Order! The Hon. M.D. RANN House of Assembly The Hon. M.D. RANN: I look forward to bipartisan support for the passage of these nationally significant reforms. The legislation, when passed, together with complementary commonwealth legislation and legislation in other Murray-Darling Basin jurisdictions, will bring into operation the independent Murray-Darling Basin Authority. Just remember that; remember it is the independent authority. It is the one that Malcolm Turnbull did not want to have when he was the federal water minister. I hope you remember that. For the first time in over a hundred years, the overall management of the Murray-Darling system will be the responsibility of a single independent authority that will make decisions in the best interests of the river system. I remember when Malcolm Turnbull came into my office and said, 'You are out on a limb on this one. You are on your own.' Well, we have managed to achieve it because we worked hard to achieve it, despite the fact that the Liberal Party did not want an independent commission to run the River Murray. This is a great achievement for South Australia and for Australia. The issues facing our community and, in particular, our irrigation communities as a consequence of the worst drought in recorded history required more immediate action. Today, I have made a major announcement to help South Australian irrigators. The government will provide certainty to irrigators by underwriting critical water allocations. This will secure the survival of permanent perennial plantings for irrigators whose farming businesses are assessed to be viable in the long term. You saw what was negotiated at the weekend in terms of assistance for exit packages. We are giving support for those who need to go, and we are giving support to those who can stay. This will be achieved through the purchase of water, where necessary, on the open market to meet critical needs to supplement available allocations from existing entitlements. The cost of the scheme will depend on the take-up rate and the actual allocation from existing entitlements, which is dependent on River Murray inflows and advice from the Murray-Darling Basin Commission. The scheme, funded by this state government, could cost up to $67 million. Irrigators have indicated to the Minister for the River Murray and to the Minister for Agriculture, Food and Fisheries their concern about the loss of perennial plantings resulting from a combination of the high cost of water and low returns from reduced yields and prices. Many irrigators have no option but to cease watering their permanent plantings. This would mean the potential loss of hundreds of millions of dollars of citrus, wine grape, almond and stone fruit orchards. If this were allowed to occur, there would be inevitable long-term damage to the economy and social fabric of both the region and our state. The scheme complements the commonwealth exit package that I announced with the Prime Minister on Saturday. The commonwealth scheme will allow struggling small irrigators who wish to exit horticultural production to receive a cash payment of up to $150,000 plus $20,000 to remove irrigation infrastructure and for retraining. The scheme is available to producers with allotments of up to 15 hectares who are also prepared to sell their water licences to the commonwealth as part of the water-purchasing scheme for the environment. Most importantly, eligible irrigators who take up the packages will be entitled to remain on their properties. It gives those individuals the opportunity to exit the industry with some financial security and restructure their lives. So, again, what we have done is renegotiate with the commonwealth to ensure that there are exit packages that do not require irrigators to leave their properties; they can stay on their properties, they can stay in their homes and they can stay in their communities. Those who need to go will be given support, and those who can stay will be given support. Irrigators who do not wish to exit and who can demonstrate the viability of their business will be able to apply for a critical water allocation which will, in effect, be an advance on future allocation improvements. The government will underwrite the difference between the allocation from existing entitlements and the amount required for the survival of perennial plantings. Irrigators' allocations are currently at 11 per cent. This is insufficient to keep perennial crops alive. The critical water needs of each crop will be calculated and the South Australian government will underwrite the difference between the critical crop water needs and the allocation. The critical water needs for survival of perennial plantings vary according to the type of crop. For example, in the Riverland grapes will survive on around two megalitres per hectare, while citrus will require around five megalitres per hectare. The scheme will assist in providing critical water for the survival of perennial plantings and will not be available beyond that to underwrite production. The assessment will not take into account carryover water or temporary top-up allocations traded in during the current irrigation year. Such volumes are considered part of an irrigator's purchases for the purpose of crop production. The underwriting arrangements I have announced today will be available for properties which have long-term future viability. Irrigators whose farming businesses are no longer viable and who are eligible to access the commonwealth exit package will not be eligible for access to the critical water allocation for permanent plantings. The South Australian government will be providing support to inform irrigators on the measures available and the criteria for each. We welcome the recent commitment by the Prime Minister to help struggling irrigators exit their farming activities, to stay on their land and to sell their water licences to restore water to the environment. While the package is for the whole of the Murray-Darling Basin, I understand that the majority of irrigators to benefit from it will be in South Australia's Riverland. I have been personally negotiating with the Prime Minister and the South Australian minister for agriculture and I have also been negotiating with the federal agriculture minister Tony Burke for this exit package since June this year. Our state minister for agriculture joined me in Canberra for meetings with Tony Burke and then I met with the Prime Minister on several occasions. The decline in the health of the Lower Lakes and Coorong as a consequence of continuing lower flows to South Australia is another issue that threatens the viability of our communities and the environment. Recently, a federal parliamentary Senate inquiry was established to investigate short and long-term management options for the Coorong and Lower Lakes. We welcomed this inquiry, and last Friday the Minister for the River Murray led a South Australian delegation and personally presented our submission to the Senate committee. Our submission clearly outlined the case for a short-term fresh water solution for the Lower Lakes, highlighting that the Coorong and Lower Lakes region is an internationally important wetland system, which is Ramsar listed and the subject of international agreements on bird migration. In the short term, South Australia would require up to 60 gigalitres of additional fresh water to maintain the lakes in a fresh condition, while managing the risk of acidification until the end of September 2009. This would allow future management options to be reassessed, following next year's winter and early spring rainfall and inflows. The 60 gigalitres of fresh water required in the short term may be contributed from localised rainfall and inflows, unregulated flows from a significant rainfall event upstream or through improvements in the Murray-Darling Basin shared resource. However, we recognise— Members interjecting: The Hon. M.D. RANN House of Assembly The Hon. M.D. RANN: This is it; you would not listen to the member from the area and you have demoted him. This is what he has been telling you. However, we recognise that if severe drought conditions continue there would be a point at which the minimum quantities of fresh water required may not be available and the introduction of sea water may be necessary, but only as a measure of last resort. Importantly, the decision to construct a temporary weir below Wellington is on hold following an improvement in conditions at the Lower Lakes as a result of local rainfall and inflows to the Lower Lakes from streams in the eastern Mount Lofty Ranges. Conditions in the Lower Lakes and River Murray inflows will continue to be monitored closely to inform the government's decision-making process. Adelaide's desalination plant is vital to reduce our reliance on the Murray and to supply a quarter of Adelaide's water needs from a climate-independent source. Yesterday, I announced that the desalination plant will be fast tracked to be delivered 12 months ahead of schedule. The three consortia which have been short listed to deliver the plant tell us that they can deliver first water by December 2010. Under this revised timeline, the plant would operate at a lower capacity initially, with water delivery gradually increasing to 150 million litres a day by June 2011. I can inform the house that the three short-listed companies announced yesterday are: Addwater, a consortia of Veolia Water and John Holland; Water First, a consortia of companies, including Degremont, Thiess and Thiess Services; and Adelaide Aqua, a consortia of companies, including Acciona Agua, United Utilities, McConnell Dowell and Abigroup Contractors. This government continues to work tirelessly in our efforts to save the Murray and to ensure South Australia's water supply is secured for the future.