NATURAL RESOURCES MANAGEMENT (COMMERCIAL FORESTS) AMENDMENT BILL

Introduction and First Reading

The Hon. J.W. WEATHERILL (Cheltenham—Minister for Environment and Conservation, Minister for Early Childhood Development, Minister for Aboriginal Affairs and Reconciliation, Minister Assisting the Premier in Cabinet Business and Public Sector Management) (16:29): Obtained leave and introduced a bill for an act to amend the Natural Resources Management Act 2004. Read a first time.

Second Reading

The Hon. J.W. WEATHERILL (Cheltenham—Minister for Environment and Conservation, Minister for Early Childhood Development, Minister for Aboriginal Affairs and Reconciliation, Minister Assisting the Premier in Cabinet Business and Public Sector Management) (16:29): I move:

That this bill be now read a second time.

I seek leave to have the second reading explanation inserted in Hansard without my reading it.

Leave granted.

In the context of the unprecedented challenges we face as a result of drought, climate change and increasing demands on South Australia's limited water resources, it is imperative that the Government is able to meet its responsibilities for managing water resources sustainably. The demands on water are many—flows must be secured for critical human needs, sustainable industry development and environmental assets. An important component of this broader challenge is to ensure that the Government's support for commercial plantation forestry is aligned with its vital responsibilities for managing water resources sustainably.

In response to this challenge the Government has adopted the Statewide policy framework entitled: Managing the water resource impacts of plantation forestry. The goal of the Statewide policy framework is that South Australia achieve ecologically sustainable development of plantation forests, while protecting and managing our water resources for all users now and in the future.

The policy framework sets high-level principles, describes a number of water resource management options, and provides a decision support tool to help planners and decision-makers work out the best management option for a specific set of circumstances. The framework acknowledges that both permits and forest water licences can be appropriate tools to manage the water resource impacts of plantation forests. The Natural Resources Management Act 2004 currently allows a permit system to be applied by regulation, however, there is no provision for forest water licensing. Accordingly, this Bill seeks to establish a mechanism within the Natural Resources Management Act 2004 (NRM Act) that would enable forest water licensing where it is considered a reasonable measure to take to improve the management of a water resource.

However, which management option is ultimately applied will depend on whether a water resource is prescribed or not under the NRM Act, the condition of and extent of pressure on water resources, the current and future likely extent of plantation forests, and their impacts relative to other water uses. Proposals for managing the water resource impacts of plantation forests will be subject to public consultation through the NRM and water allocation planning processes required by the NRM Act. In addition, where forest water licensing is proposed, a declaration by the Minister responsible for the NRM Act, following a referral to the Minister with primary responsibility for commercial forestry, is also required before forest water licensing can be implemented.

The impacts of commercial plantation forests on water resources

Where commercial plantations are a significant land use in a catchment or landscape, they may reduce the amount of water that can be accessed by other users or the environment and may impact on the security of water resources themselves. In South Australia, plantation forestry is currently a significant land use in the higher rainfall areas of the Lower South East, Kangaroo Island and the Mount Lofty Ranges.

In areas where commercial forestry expands after water use has been licensed, new plantations can intercept water that otherwise may have recharged groundwater, flowed to streams and wetlands, or would have been available for allocation. Where they are established on aquifers that are shallow, plantations may also directly extract groundwater. Therefore, if commercial forestry expands to cover a significant portion of a catchment or landscape the amount of water available to licensed water users and the environment can be less.

The problem that can arise is that where it is found that water is over-allocated and it is confirmed that the water resource is at risk of imminent degradation, the amount of water allocated to current water licence holders can be reduced but the water use of plantation forests cannot. This situation can lead to inequity in the treatment of water users where water use needs to be reduced and if commercial plantation forests are using significant amounts of available water. For example, the South East NRM Board, in conjunction with its regional community, has been developing a draft water allocation plan for the Lower Limestone Coast Prescribed Wells Area. Preliminary drafts of that plan have proposed forest water licensing so that plantation forestry can equitably share in reductions to water allocation should it become necessary.

The forest water licensing system

To provide certainty to all water users regarding the processes that will be applied when considering such matters across the State, the Bill seeks to establish a system of forest water licensing that integrates with the current water licensing system. The Bill provides a mechanism in the NRM Act for commercial forestry to be licensed for its water use, and for this use to be reduced along with that of other licensed water users, in areas where this is necessary for the long-term integrity of a prescribed water resource and the water allocations held by current licensees. However, the Bill also recognises the different nature of commercial forestry from other licensed water use—including that forest water use can not be 'turned off' quickly and that the planting of different tree species may lead to different levels of forest water use. Therefore it, provides that, where necessary, forest water allocations may only be reduced after harvest or partial harvest of a plantation has occurred or as authorised by regulation.

The Government will also promote use of the option in the Bill that allows the Minister to approve schemes prepared by forest managers that set how and when reduced water use will be achieved. This will allow plantations to be managed in ways that optimise commercial forestry outcomes while contributing to water resource sustainability.

The proposed system of forest water licensing also integrates with the current water licensing system to simplify administration and to facilitate trade in water between licensed water users and forest industry sectors. When forest water licensing is initiated, the Bill provides that existing plantations are recognised as existing users, and forest water licences and allocations are granted to reflect the water those plantations require.

Whether or not forest water licensing applies, and continues to apply to a particular area, is subject to a flexible and transparent process that involves the declaration of a 'forestry area'. This process:

is informed by regional input through the water allocation planning process for a particular water resource—that is, the water allocation plan must identify the significance of the water resource impacts of commercial forests for that resource and it must recommend forest water licensing before the Minister responsible for the NRM Act can declare a forestry area that will be subject to licensing;

requires the Minister for the NRM Act to consult the Minister primarily responsible for commercial forestry before making a decision to declare an area to which forest water licensing will apply, and this decision must be on the basis that forest water licensing is a reasonable measure to take to improve management of that particular water resource; and

allows the decision to implement forest water licensing to be reviewed at any time—that is, the Minister can vary the declaration of a forestry area, amend the area in which forest water licensing applies, or revoke a declaration, where considered appropriate.

Water Allocation Planning

The forest water licensing system envisaged by the Bill also provides for a water allocation plan to determine the water use of commercial plantations taking into account factors relevant to that region and to distinguish between different classes of forests. A plan may also recommend that particular types of forestry be exempt from licensing requirements, for example farm forestry or forestry planted for salinity benefits.

In developing proposals to manage the water resource impacts of plantation forestry, regional NRM boards will be required to ensure they are consistent with the policy framework, which includes demonstrating that not only are the water resources being managed sustainably, but are being managed in a way that will support the development of prosperous industries and optimise net benefits to the community.

Once a forestry area has been declared, and the initial forest water licences and allocations have been issued, policy included in the relevant water allocation plan will apply to managing all water licences including forest water licences. Water allocation plans are prepared by regional NRM boards and are adopted by the Minister with responsibility for the NRM Act. They are required to set out water availability, the condition of the water resource, levels of allocation and, if necessary, how reductions will be implemented to protect the water resource.

Water allocation plans also identify where water remains available for future development, and govern how trades (transfers and variations to allocations) can occur. As statutory public consultation requirements apply to the preparation and revision of water allocation plans under the NRM Act, the system allows all interested parties to engage in the planning process.

In this way, transparency is embedded in the forest water licensing system and responsibility is shared with regional communities and affected parties for exploring options for addressing regional water resource management issues, including those related to commercial forestry. Policy options that may be explored by communities for inclusion in water allocation plans are constrained by the objects and principles of the NRM Act and policies that include the State NRM Plan 2006 and the Statewide policy framework for managing the water resource impacts of plantation forestry.

In summary, the proposed forest water licensing system envisaged by this Bill is intentionally different from the licensing system that applies to other water users to reflect the different nature of the activity. However, forest water licensing integrates with the water planning and allocation systems in the NRM Act to facilitate trade between forestry and other water users, to ensure that administrative systems are as simple and effective as possible, and to provide for both plantation forest industry development and sustainable water resources management.

I commend the Bill to Members.

Explanation of Clauses

Part 1—Preliminary

1—Short title

This clause provides for the short title of the measure.

2—Commencement

The measure will be brought into operation by proclamation.

3—Amendment provisions

This clause is formal.

Part 2—Amendment of Natural Resources Management Act 2004

4—Amendment of section 3—Interpretation

This clause inserts new definitions associated with the provisions to be inserted into the principal Act by this Act. A key definition will be commercial forests, which will be taken to mean a forest plantation where the forest vegetation is grown or maintained so that it can be harvested or used for commercial purposes (including through the commercial exploitation of the carbon absorption capacity of the forest vegetation).

5—Amendment of section 76—Preparation of water allocation plans

The scheme envisaged by this measure will include the preparation of amendments to any relevant water allocation plan to identify appropriate principles and methodologies to determine the impact that commercial forests may have on the prescribed water resource and to identify the commercial forests that are to be subject to the licensing scheme.

6—Amendment of section 101—Declaration of levies

The Minister will be able to declare and impose a levy in relation to commercial forests that are subject to a licence under this scheme.

7—Amendment of section 104—Liability for levy

This is a consequential amendment.

8—Amendment of section 124—Right to take water subject to certain requirements

This amendment makes it clear that rights of access to water apply subject to any requirement to have a licence with respect to a commercial forest.

9—Amendment of section 125—Declaration of prescribed water resources

This amendment recognises that it may be appropriate for a proposal to declare a water resource to be a prescribed water resource under the Act to set out any proposals to introduce controls relating to commercial forests under new Part 5A.

10—Amendment of section 127—Water affecting activities

This amendment recognises that a water allocation plan may regulate the activity of undertaking commercial forestry.

11—Amendment of section 152—Allocation of water

A water allocation will be able to be obtained from the holder of a forest water licence (subject to any conversion or adjustment under the provisions of any relevant water allocation plan).

12—Insertion of Chapter 7 Part 5A

This clause sets out a new scheme for the regulation of commercial forests under a licensing system in declared forestry areas.

13—Amendment of section 193—Protection orders

The scheme set out in section 193 of the Act to provide for protection orders will extend to the ability to be able to issue an order for the purpose of securing compliance with Chapter 7 Part 5A.

14—Amendment of section 195—Reparation orders

It will be possible to issue a reparation order to address any harm to a natural resource by contravention of Chapter 7 Part 5A.

15—Amendment of section 197—Reparation authorisations

It will also be possible to issue a reparation authorisation in relation to any harm caused to a natural resource by contravention of Chapter 7 Part 5A.

16—Amendment of section 202—Right of appeal

This is a consequential amendment.

17—Amendment of section 216—Criminal jurisdiction of Court

A number of offences under the Act—especially related to natural resource management—lie within the criminal jurisdiction of the ERD Court. This amendment will provide that an offence against new section 169L will also lie within that jurisdiction.

18—Amendment of section 226—NRM Register

19—Variation of Schedule 3A—The Water Register

These clauses contain consequential amendments.

Debate adjourned on motion of Mr Williams.