NATURAL RESOURCES MANAGEMENT (COMMERCIAL FORESTS) AMENDMENT BILL

Second Reading

Adjourned debate on second reading.

(Continued from 27 July 2011.)

Mr PEGLER (Mount Gambier) (15:39): I rise to speak on the Natural Resources Management (Commercial Forests) Amendment Bill. The bill that we have before us is extremely important to the people, businesses, and the environment of Mt Gambier and the entire South-East. The implications of the ridiculous proposal by the state Labor government to sell our forests pale into insignificance compared to the importance of the passage of this bill.

This bill provides the necessary tools for the people of the South-East to enable them to develop long-term regulations, policies and plans to manage the water of the South-East in a sustainable manner for the benefit of all stakeholders, be they dryland farmers, forest growers, irrigators, urban users, businesses or the environment. My people have lived in the district since the 1850s and in that time they have been farmers, irrigators, business owners and forest growers, so this bill is very important to me.

Over the past 15 years, I have consulted widely with all stakeholders in my community regarding the management of our water resources. The shadow minister for environment and conservation, Hon. Michelle Lensink MLC, put out a media release on 4 August claiming that I had been silent on this issue. I can assure her that my constituents and the stakeholders in the South-East do not concur with her sentiments.

She also says in her media release that, under the changes, any new plantation will be required to purchase a water licence. The fact of the matter is that all new plantations already require a water licence under the planning act in areas that are at or near full allocation, which is most of the South-East. In considering this bill it is important that we understand the resource that we are dealing with and what the present water balance of the aquifer is.

The member for MacKillop has given a very lengthy description of the history of water in the South-East. In summary, the South-East was originally a very wet landscape with much of the land being treeless and inundated with water for much of the year. Drainage was introduced and vast areas of land were then made available for improved pasture production, forestry and irrigated crops. This land has proven to be some of the most productive in the state.

The aquifer that this bill is aimed at is the upper unconfined aquifer of the Lower Limestone Coast Prescribed Wells Area. This aquifer is quite unique and robust. It principally relies on the rain that falls on the surface for recharge. The water in the aquifer is slow moving and the water that is not utilised eventually flows out to the sea through springs, creeks and drains. For the aquifer to remain robust, this outflow must occur as it takes the salt out of the landscape and holds the sea back from inundating the aquifer.

Because of our very low variability in rainfall (15 per cent in Mt Gambier which is one of the lowest in Australia) the recharge levels are fairly constant over the long term. This bill gives us the tools to develop management plans that give consideration to all significant activities that affect both the interception of recharge and the direct extraction of water by pumping, evaporation, discharge from springs and drains and direct extraction from the aquifer by plantation forestry.

The figures that I am about to quote come from the South-East Water Science Review, which was commissioned by the Lower Limestone Coast Taskforce to examine the science behind the water allocation process in the South-East region. The review was conducted by the Environment Institute at University of Adelaide and focused on the hydrological science, hydrogeological science, ecological science and aspects of the geographic information systems behind decision making in the South-East.

It also commissioned hydrogeological and economic modelling and conducted a land capability assessment and a review of water available in the drainage system. This paper is essential reading for all elected members of both houses of this parliament so that they can make decisions based on the best science and fact rather than hearsay. The acknowledgements on the last page of this report certainly give it credibility.

The inflows affecting the water balance are as follows: there is 78 per cent (1,256 gigalitres) recharge from rainfall, 19 per cent from rainfall on surface water bodies, and 1 per cent each from surface water inflows and drainage from flood irrigation. The outflows affecting the water balance are: 43 per cent from the evaporation from surface water bodies, 19 per cent from groundwater extraction for pumping, 14 per cent from interception of recharge from plantation forestry, 8 per cent from direct extraction from plantation forestry, 7 per cent each from discharge from springs and drains, and 1 per cent from stock and domestic use. In other words, forestry is responsible for 22 per cent of the water that is utilised over and above what a developed pasture would use.

Much has been said about the Border Groundwater Agreement, which is an agreement between Victoria and South Australia 20 kilometres either side of the border. My opinion is that all this agreement has achieved is that we now have four management areas instead of two, all of which have differing rules regarding water management. Only 26 per cent of the water allocated in the South-East falls within this zone, and 35 per cent of the 165,000 hectares of plantation forests are also in this zone.

In the mid-1990s, it was recognised that we had to manage our water resources in a better way, thus prescription and licensing were introduced. In the first place, permissible annual volumes were determined by determining the recharge and assuming that there was no recharge under native and plantation forests. Once this recharge was determined, 90 per cent of it could be allocated for irrigation and the remaining 10 per cent set aside for the environment. Irrigation licences were then allocated as hectare equivalents, assuming about 4 megalitres per hectare to existing irrigators.

Applications for licences with irrigation management plans could be applied for by new irrigators. There may have been a few who did the wrong thing, but overall most people did the right thing. Once the area was fully allocated, that was it. It has been said that the vast majority of forest was planted to replace native vegetation. The truth of the matter is that, since 1982, 115,000 hectares out of the 165,000-hectare forestry estate was planted on existing grazing land and not on land under native forests. Most of the 50,000 hectares that were developed prior to 1982 were also planted on grazing land.

It must also be recognised that farmed forestry will have a much greater impact on water resources because of the introduced species of trees grown, the density that they are planted at, and the farming practices undertaken to ensure that these trees achieve maximum growth rates. Other introduced deep-rooted perennials, such as lucerne, have a similar effect on the water balance when compared with developed pastures because they are mostly dormant throughout the winter months, when the majority of rainfall occurs.

Some of those who are opposed to the bill would like us to go back to the beginning and allow every landowner to harvest or use all the rainfall that falls on their property. This philosophy is flawed in the aspect that, when water and land ownership were separated, property rights were given to water licence holders, and it would now be impossible and very costly to go back. This philosophy of water ownership being attached to the land would also have large implications for South Australia because it could mean that landowners in the catchment areas of the Murray River (Queensland, New South Wales and Victoria) could utilise all the water and we would see the river dry up in South Australia.

Much work, thought and consultation has occurred in the South-East on this matter. The Lower Limestone Coast Task Force was formed in early 2010. This task force was made up of all the government agencies that have an interest in water in the South-East, and they were given the task of reviewing all the science and research that is being done on this matter. They were also made responsible for developing an allocation plan policy issues discussion paper. Alongside this group a reference group was formed. This group's membership includes people from the South Australian Farmers' Federation, potato growers, vignerons, dairy farmers, dryland farmers, plantation foresters and environmentalists.

The State Liberal Party released its policy on this bill only a couple of days prior to the last state election—obviously they did not want any debate within our community leading up to the election. Their policy states that they will work with the federal and state governments to establish an overarching framework, enabling the states to introduce common legislation simultaneously.

This will guarantee the equal application of rules and maintain a level playing field for all states. One would have to be living in fairyland to believe that this will ever happen in the near future. It took over 90 years to reach agreement on management of the Great Artesian Basin, and the management of the Murray Darling system has been (and still is) debated by the state and federal governments ever since the time of federation.

When this bill was introduced to parliament in 2009 it was agreed to refer it to parliament's Natural Resources Committee, which I would have supported at that time. We have moved on since then, and the task force and the stakeholders' reference group have done all reviews necessary. I believe that referring this bill to the Natural Resources Committee is futile and only another time-stalling exercise.

If the water that forestry uses is licensed rather than permitted, it will give the forest growers much more surety into the future, and it will ensure that the water can be utilised to its maximum value. Forest growers must be able to develop long-term water management plans, and, if they are going to take any risks, they must also receive any benefits. Whilst allocations may be expressed in megalitres for all water users, these allocations must be a percentage of the permissible annual volume available for usage.

The member for MacKillop said in his address to this parliament that this bill has been driven by the vested interests of a greedy minority. This is far from the truth. I do not think that the vignerons, potato growers, horticulturalists, dairy farmers, irrigators, environmentalists, urban users and others who support this bill would appreciate being referred to as a 'greedy minority'.

This bill is not about picking winners and losers, or pitting different industries against each other. It is not about rainfall taxes and water levies. It is not about volumetric conversions. This bill gives the people of the South-East the tools required to enable them to develop water management plans that take into account all significant water-affecting activities and are in the best interests of all who are reliant on water, be they dryland farmers, forest growers, irrigators, urban users, businesses and the environment. I urge all who have any empathy with any of these groups to support this bill.

Mr WHETSTONE (Chaffey) (15:54): I, too, rise to speak on the Natural Resources Management (Commercial Forests) Amendment Bill. Yes, the opposition would like to allow the passage of this bill through the house; however, it will be the opposition's intention to refer the bill to the NRM committee in the Legislative Council. I note the minister's reference in the Hansard (24 November 2010) to reducing water allocations and use, ensuring that the sustainability of water resources through their prescription, and the development of water application plans, and this is entirely laudable and in many cases essential.

However, the flexibility being allowed commercial forestry to reduce water use is substantially at odds with the conduct of the NRM boards and developing water allocation plans for other uses. The minister cites important differences between the commercial forestry water use and other licensed water, but let us examine this flexibility. The minister states:

Under the forest water licensing system, the bill provides for the minister to approve schemes proposed by forest managers that set out how and when they will achieve reduced water use, or obtain extra water to offset any reductions to water allocation that are applied after clear-felling. For example, a forestry enterprise may seek the minister's approval for a scheme that proposes replanting an area that has been clear-felled, even though that clear-felling has triggered a reduction to the water allocation, and meeting the reduced water allocation by not replanting another area that will be clear-felled in future. Other schemes could involve changing plantation management practices, for example planting species that use less water, or increasing buffers between plantations and watercourses or wetlands. The minister will be open to a range of different schemes that may be proposed…

The bill provides a high level of flexibility to the commercial forestry sector to manage their plantations in ways that optimise forestry outcomes…

Isn't that generous of the minister, Madam Speaker? The real question is whether or not the NRM boards developing water allocation plans will be anywhere near as generous. This minister, whose water portfolio continually threatens to drown him, is just a little too reliant on his NRM boards, and it is their rigidly inflexible approach to reduce water use that has so many South Australian landholders up in arms these days.

There is a constituent in Chaffey who, despite investing substantially in efficient irrigation and supporting prescription on his water resource, is going to be left with practically nothing if his water allocation plan is approved by the minister. When I spoke to the NRM board about this constituent and the inequity he is suffering, I was extremely disappointed in their inflexibility and their refusal to consider any measure by which this landholder could receive treatment equal to that of the other landholders utilising the same water resource.

The disregard for these individual landholders by NRM boards is quite appalling. I can only hope that the minister will rein in that sort of mindset. I can only hope the minister will apply the flexibility he is proposing to commercial forestry to other water users. This brings me, inevitably, to the Basin Plan. It always comes down to the Basin Plan, because there is no more important issue facing the state and its water users.

We see the Wentworth Group is still complaining about scientific justification for what we already know. The Murray-Darling system requires more water for the environment flows. Perhaps they should have kept working with the Murray-Darling Basin Authority on how to achieve those savings instead of quibbling over the numbers. The South-East drainage water that flows out to sea: up 180 gigalitres has flowed out to the sea in any one year, and the minister's energy would be better used to implement diversions into the Coorong. It is not easy, but it will help what man has done to the natural aquifer and waterways.

I would also like to reflect a little on the Murray-Darling Basin Plan, which I think reflects what we are seeing happen here in the South-East. What I would like to see in policies as a reflection from the Basin Plan into the South-East is the minister's energy better spent on addressing starting points for South Australia, for instance, an equitable baseline start point for South Australia. What we are seeing is that South Australia has been handicapped at the starting point of a diversion cap from the mid-2000s. What we need is equity. What we need is for South Australia to have a starting point, like for instance in 1995, which we believe is an equitable starting point right across the Basin.

We would also like to see some quarantining of critical human needs and removal from these reductions. We look at what is happening in the ACT, in Canberra. They have been exempt from the SDLs in the plan. Why can't we have Adelaide's critical human needs removed from that process, again, being rewarded for responsible water policy and use? Over the last 40 years, South Australia has been an outstanding example of just what can be achieved. Today it appears that we are not being listened to. We have the minister here who needs to bat for South Australian water users. He needs to go in there and bat for us like never before. If he has to lose teeth, he has to lose teeth, but it is about fair and equitable treatment for all South Australian water users.

Within the Murray-Darling Basin, South Australia has held its head high. We have been responsible water users over the years because we have shown the rest of this nation exactly what efficiencies can be achieved. We look at delivery systems, the efficiencies that can be gained. We look at on-farm efficiencies, the water savings that can be achieved. It is not just about the water; it is about the sustainability of that water resource that will keep this precious commodity at bay. We do not want to see excessive water run out to sea at the expense of over-indulging the environment, at the expense of the economy, or at the expense of communities. There has to be a balance.

There need to be incentive programs to assist in investment. For instance, whether we are talking about the South-East, the Riverland or any irrigation district, we need incentive programs to assist investment in current vacant land. In particular, if we look at what has gone on with exiting in the Riverland, we see a significant patchwork effect up there where people have exited the industry. We have productive land that has the infrastructure in place, yet we are going to penalise the South Australian economy by leaving it almost as a ghost town. By leaving the patchwork effect, we still have the overheads, and we still have the costs of pumping. Those costs have to be met, yet we do not have the economic benefit coming our way from that productive land.

We have the infrastructure in place. The infrastructure is there. For instance, Loxton, one of the regions in my electorate, has the most modern infrastructure in Australia, yet we are seeing the patchwork effect in that area. We are seeing people exiting that area. We are seeing pipelines which were put in in the early 2000s now not being used. It beggars belief that we have invested in world's best practice, we are using technology, yet we are prepared to let it lie idle. The water minister has been briefed on this and is fully aware that we need him to show his hand, that he is there batting for every water user in this state, not just in the Riverland and not just in the South-East—every water user in this state.

We saw in the media yesterday some transportation of nuclear waste coming from New South Wales via South Australia to the Northern Territory. Are we prepared to put the watercourse of South Australia at risk to have nuclear waste travelling along it and crossing over it up to three times in my electorate? As I have said to the member for Mitchell, I am not opposed to the transportation of nuclear waste, but there have to be safe options. We have to have options that are not going to threaten the food bowl. There have to be options that are not going to threaten South Australia's water supply.

Again, I reiterate that we have to look at better and safer options and not look at using South Australia as a scapegoat. After all, we did hear that New South Wales was telling the federal government that they are not letting the waste go through their backyard, that is, 'Send it South Australia's way, but don't send it through the Blue Mountains.' It is outrageous that we will take the fall for New South Wales' waste.

I would like to display some formal recognition of the Murray Mouth. The Murray Mouth has been widely recognised right across the Murray-Darling Basin as South Australia's problem, 'When the Murray Mouth blocks up, that's your problem because you have inefficiencies in the Lower Lakes.' That is absolute rubbish. The Murray Mouth is part of the Murray-Darling Basin; the Murray Mouth is actually the Murray-Darling Basin's mouth.

I say that again because the Murray-Darling Basin's mouth is evidence that our river system is working; if we have water flowing out of that mouth, the river system is working. We do see drought. We do see times of shortage, but when we do see significant flows, we see the mouth working. We see the river system working.

We need to have a sustainable waterway, and whether it is water flowing through the forests in the South-East into the aquifers, out through the drainage systems and out to sea, whether it is the irrigators in the South-East wanting their share of the water through the aquifer, whether it is through their dams or their holding facilities, it has to be sustainable. Again, I just reflect that a lot of that water that does flow out to sea through the South-East, through the rehabilitated land, is flowing out to sea.

Why is that water flowing out to sea? Why can't we have the will? Why can't we have the means of going there and addressing the issue? It is about diverting freshwater flowing out to sea and putting it to environmental good use, and that is directing it to the Coorong, directing it to the lower end of the Murray-Darling Basin. It is about the South-East drainage scheme being able to assist, about being able to help with what the Murray-Darling Basin is sadly lacking, and that is water in times of drought.

Again, I would say to the minister that even though 20 October is coming along, and perhaps the current water and environment minister might not be there too much longer, he needs to set a legacy for the incoming (perhaps new) minister for those portfolios. The minister might look around and have a bit of a smile, but he has been there for a while; he has shown some worth; he has shown some ignorance; he has shown some good learning.

Mr Williams: When? Tell me the day.

Mr WHETSTONE: The member for MacKillop asks me when. Well, we are not all perfect but, having been very critical of the Minister for Water, I will continue to be critical while I do not see him batting for where I think he needs to be, but if he can show his worth or he can pass on a message to his successor then I will openly praise his worth.

It is all about the sustainability—again I come back to that word 'sustainability'—and it is about the balance. It is about whether we are going to allow water to flow out to sea to the detriment of other areas, whether we are going to have the South-East help the Murray-Darling Basin, whether we are going to have irrigators help the forest industry, whether we are going to have irrigators and the forest industry help the environment. I think there needs to be a working plan.

There needs to be a working relationship and today I see the states fighting between one another, and I see industries fighting for their share of what they consider theirs, all to the detriment of someone. Normally that someone is the person on the end of the chain, and whether it be the farmer, whether it be the state, whether it be the environment, there is an impact. Everywhere you look there is an impact. Someone is a loser; someone is a winner.

My call is for every South Australian to work together, for every South Australian to work and draw a balance. As the member for Mount Gambier has said, we have been trying to get that balance and fighting over water reform for over a hundred years, but I just need to say to the member for Mount Gambier that we cannot be in denial that what we have not achieved in a hundred years we cannot achieve in the next hundred. It is about having a crack and putting up the argument that what we need is reform.

We need someone there with the will to actually stand up and make a difference. Those people who have actually stood up and made a difference over history are those people who have actually gone down and are still there recognised as the great leaders, the people who are in the history books for their will, their determination, to get out there and make a difference and fight the fight. Whether it happens today or it happens next year, in 10 years, in 50 years, the process must be started. We need people to continue to drive the reform that is much needed.

We have been fighting for over 100 years, but can anyone here today tell me that that fight has not made a difference? People today say that we have achieved nothing, but have we achieved nothing? I would really like to think that, over that century of attempted reform, there has been some kind of reform that has gone unrecognised, and that we are here today because of the hope of those people who wish to make a difference, whether it is in parliament or whether it is the people on the ground, the people at the grassroots level. They are the people who give good advice to the decision-makers.

Again, those people on the ground, those people with some knowledge, history and generations of knowledge that has been passed down are the people who need to have a bigger and much more significant impact on the decision-makers. We cannot rely only on the bureaucrats coming in and advising ministers and ministers going out and doing a small amount of consultation. Inevitably, it comes back to the bureaucrats in offices with glass windows looking out at the river, not knowing exactly what is going on and what reform will make a difference. It is all about using the theory of science, which gets blown out of the window regularly.

In relation to the last drought the Murray-Darling Basin has been through, the experts—the scientists, all the people sitting in glass houses—said that it would take 10, maybe 20 years to fix the Murray-Darling Basin. Yet we had significant rain, of biblical proportion, some might say; it took four months to restore the health of the lower end of the Murray-Darling Basin.

The catchments are over 90 per cent full, yet we still hear people argue that, because the catchments are full, we do not want to let any more water go down to the lower end of the river to continue to underpin the environment. I think it is just absurd that we continually have this fighting process which almost combats reform.

Reform is about good governance. It is about someone prepared to stand up and make a difference, someone who is actually prepared to put the bit between their teeth and say, 'This is what needs to happen and this is the path we are going to take.' As I said, it might have been 100 years of attempted reform that has many of us saying that nothing has happened, but I think we are here today because people have been prepared to stand up and initiate some form of reform, although we have not seen an outcome of completeness.

Again, whether we are addressing the South-East, whether we are addressing the Murray-Darling Basin, whether we are addressing history with the reform of our waterways, of our decision-makers, we need people to stand up and make a difference. We need people to implement good reform.

Mr VAN HOLST PELLEKAAN (Stuart) (16:13): The deputy leader has certainly put our perspective forward and commented on the amendments that we will propose. I do not believe that there is a better or more knowledgeable person in this house than the member for Chaffey when it comes to understanding water not only in the Riverland but certainly all over the state. He knows this issue inside out, as does our shadow minister for water. Living and working in the electorate of Chaffey, he has a particular knowledge and insight that the rest of us do not have.

The fact that water is a scarce resource is pretty obvious to everybody in this house and everybody outside as well. The fact that it needs to be managed is pretty obvious, as is the fact that there is probably never going to be enough to go around to meet everybody's wish list, whether it be people who would like everything to go to the environment or people who would like everything to go to commerce or, like most of us, people who think that there is going to have to be some sort of compromise, something in between. There will never be enough water to get to all the places that we would like it to go.

That then does lead us to looking at how we are going to deal with this scarce resource and dividing water use and the world as we know it up into various sectors. As we realise, at the moment we are talking about the forestry sector. There are two very important forests in the electorate of Stuart: Bundaleer and Wirrabara forests. I do not believe that either of them are draining the state of water. They are relatively small forests from a commercial perspective. They are both extremely important forests in other ways. In fact, part of their charter of existence has a strong heritage and community component, and they are both very important, but I do not think they are really the forests that people are concerned about over-using water.

Mr Whetstone: They are carbon farms.

Mr VAN HOLST PELLEKAAN: The member for Chaffey tells me that they are important carbon farms, supporting the universe as we know it. There are also other important categories of water use, and I think as time goes on we will realise that there are even more than we realise today. In the electorate of Stuart, different types of water users and different types of water supply are incredibly important. I would like to touch on those for a little while, because I think that a lot of the issues that are relevant to how water may or may not be used or how it may or may not be categorised, licensed, charged for, etc., primarily with regard to forests in the South-East, will apply to other areas, and particularly areas in the electorate of Stuart.

People have heard me talk about the water pricing for the six towns on the Barrier Highway and that if a household uses more than 328 litres per day of water, on average, then they get charged $11 a kilolitre for that water. I think that is a disgraceful situation. It is important to point out that those households do not get supply from the River Murray, but they still pay the River Murray levy, and that that $11-a-kilolitre water is non-potable water, so you cannot even drink it.

That brings me to an important point. I do suspect that a lot of the water that they receive you probably could drink but, in fairness, it is not possible for the government or SA Water to guarantee that it could always be drunk, so it has to be categorised as non-potable water and, if it is categorised that way, then you cannot take the chance. You cannot necessarily take a sample from your kitchen sink every time you want to have a drink and get it tested to see whether it is okay to drink, wash the vegetables in or potentially shower your kids in, and that sort of thing.

I would like to highlight that. Minister, I do not know this, but it has just come to me in the last few weeks—perhaps I am a little bit slow, but I suspect that the fact that the water is categorised as non-potable may well mean that it is excluded from what is called the 'postage stamping'. It may or may not be okay to drink, but if it is classified as not okay to drink then it does not have to have the same sort of common pricing.

If it is genuinely undrinkable water then it is outrageous to be getting charged that much money for it. If it is actually drinkable water, it is still outrageous to be getting charged that much money for it, but it is also possibly a bit sneaky to be putting it into the unpotable category so that the extra money can be charged. I do not know if that is the case or not. As I said, it has only occurred to me just lately that, if you look at the different ways water is supplied to some of those towns and the way the pricing is applied, that may or may not be the case.

There are also other towns off the Barrier Highway in the electorate of Stuart, like Melrose, Orroroo, Carrieton and others, and certainly plenty outside the electorate of Stuart, that are supplied water that I know you cannot drink, because I have seen it and it is cloudy, murky and just not appropriate. However, there are other categories of water use that I think may not have been considered yet. They are not directly part of this bill, so I am not saying that the minister or the government should have considered them, but I raise them to put on record the fact that I think they should be in future, as we all go further and further down the road of time looking at different types of categories of water.

Places like Roxby Downs, Woomera and Leigh Creek are, of course, all much smaller than Adelaide, but they are significant towns and significant water suppliers in their own right. Roxby Downs has its own system, and the whole town, in essence, is controlled by BHP Billiton. I believe that they receive desalinated water there. It is in the Speaker's electorate, of course, so she would know more about it than I do. However, I believe they receive desalinated water. Woomera gets River Murray water through a commonwealth supply.

There is a spur line from Port Augusta that goes up to Woomera and then on out into the rocket range, but not as far as Roxby Downs. It is the real deal: it is good River Murray water that goes down that pipeline and is supplied to the people of Woomera and some stations up there for stock use, and there is also a spur line from Woomera back down to Pimba. They receive water for commercial use, human consumption and stock use. The pastoralists there have the opportunity to get water from the pipeline if they choose.

Another interesting example is Leigh Creek, where the Aroona dam is the water supply. It is good water; nothing wrong with it whatsoever. As well as supplying into Leigh Creek, which is an Alinta owned and controlled town, they are good enough to pipe it on to the very small town of Copley, six kilometres away, where the Copley Progress Association (a volunteer not-for-profit organisation) then uses their own pipe network articulated system through Copley to supply their locals—and good on them for doing that. Members may remember that that was an important example for me when we were discussing the Safe Drinking Water Bill several months ago.

The member for Morialta tells me also that there is a water supply in the suburb of Skye, which I am not familiar with at all, and he may choose to comment on it. Apparently, that is certainly very much within metro barriers water that he says is poor quality—

Mrs Geraghty: I don't want to be rude, but what has this got to do with forests? Sorry, but out of curiosity.

Mr VAN HOLST PELLEKAAN: The member for Torrens asks what this has to do with forests and what this has to do with the bill, and I did actually address that at the beginning. This bill is very much about trying to deal with water as a scarce resource and, as we go down that path, we are going to start to categorise different types of water uses, different water uses and different destinations for water, licensing, metering, charging—potentially all these sorts of things will come into the spotlight as time goes on.

I would like to highlight this, so I am taking this opportunity to highlight that this house may well have to deal with some other very important different categories of water use, such as these others that occur a long way from Adelaide. However, I was just getting back to the one small one in Skye I was advised of by the member for Morialta.

I really want to make sure that these various uses—all the way through from South-Eastern forests potentially the Bundaleer Forest and potentially the Wirrabara Forest, and potentially these other categories of water use that I am talking about—are all treated fairly and squarely. That brings me back to the comments I made about the possibility that the water going out to the Barrier Highway is not getting treated fairly and squarely and the possibility that a technicality is being used to overcharge.

I would like to highlight the fact that non-potable water in small remote communities in outback South Australia is still a necessity because very much part of this argument is: what are the various necessary uses of water? Sure, if it comes straight to a tap, straight to a home in a suburb in Adelaide everyone considers that necessary. We move on, we have stock use, and people consider that necessary. We are now moving on to forestry use, and there is a debate about whether it is necessary and how it should be treated. I would like to highlight that, in coming months or years when that debate moves on further and further away from the city of Adelaide, the water use in those small, remote outback South Australian towns is necessary as well.

The Hon. P. CAICA (Colton—Minister for Environment and Conservation, Minister for the River Murray, Minister for Water) (16:25): I thank the members of this house for their contributions. In particular I acknowledge the member for Mount Gambier for his very thoughtful and astute contribution that relates to his understanding of the practicalities of the electorate that he represents. In regard to the contributions of the member for Chaffey and the member for Stuart, I will not bother to address all the issues that were raised there, only to say that quite a few of them, whilst very important issues, have precious little to do with this actual bill. But it appears that we all agree that the plantation forestry industry and forest product sector provide economic benefits to South Australia.

It appears also that we agree that plantation forests have been shown to impact on the availability of water resources, although we share differing views on the absolute extent of that impact. We also agree that the sustainability of water resources that support the environment, industries, communities and regional centres across South Australia are important, and that is why I have introduced this bill.

The government released the statewide policy framework 'Managing the Water Resources of Plantation Forests' in June 2009 to provide clear and consistent policy guidelines on how best to manage the issue across the state. This statewide policy framework recognises that, based on the scientific evidence, both forest water licences and permits are appropriate legislative tools to manage the water resource impacts of plantation forests.

This bill is required to fully implement the statewide policy framework and deliberately creates the two legislative tools. This is because the water resource impacts of plantation forests vary across the state. Put simply, a one-size-fits-all approach would not be appropriate. Their applicability to specific situations will vary depending upon the condition of, and pressure on, water resources and the current and future extent of plantation forests relative to other water users.

The community will have a say on how they want forest water impacts to be managed through regional natural resource management boards, and their consultation on water allocation plans. We must not allow ourselves to get confused here. We must remember that this bill is about providing the tools. It is the regional planning processes that will determine the most appropriate one to be used.

Both legislative tools have the capacity to manage forest water impacts on an ongoing basis to protect the integrity and security of access to water resources for all water users, including the environment. The main difference between the two legislative tools is that forest water licences allow for tradeable volumetric water allocations to be allocated to existing plantation forests and prescribed areas, while permits provide an option to manage the expansion of plantation forests to levels that are sustainable for water resources across all areas, regardless of prescription.

In response to the question on who will own the water, the bill defines the 'forest manager' as the person or company with 'effective control of the forest vegetation'. This means the entity with legal authority to control or direct the planting, growing and harvesting of trees and consequently the water impacts of the forest. As with most other property rights owned by large commercial enterprises, the business and investment structures of a particular company will determine the person or company with effective legal control of the plantation forest.

This bill is about moving towards a water planning and management system that treats all water users that have the potential to have a significant impact on water resources, in a consistent and equitable manner. It is clear from those members who have spoken on this bill that they will allow the passage of the bill through this house. However, the member for MacKillop and the member for Chaffey's preference is that the bill be referred to the Natural Resources Committee of parliament.

It is interesting to note that previous iterations of the Natural Resources Committee have investigated forest water impacts. In particular, the Natural Resources Committee inquiry into Deep Creek, which was tabled in this house on 19 June 2007. In this report, the committee recommended that:

The Minister for Environment and Conservation include commercial forestry activities within the Deep Creek catchment as a prescribed water affecting activity pursuant to section 127(3)(f) of the Natural Resources Management Act 2004.

In recommending that commercial forestry and the Deep Creek catchment could be regulated under the act, the Natural Resources Committee recognised the significant impacts of commercial forests on water flows. Prescribing commercial forestry as proposed by this bill will simplify and improve the management of forestry's impact on water flows.

The government has been communicating with the Natural Resources Committee every step of the way on the development of policy and legislation in relation to forest water impacts and water planning and management. When the statewide policy framework was released in June 2009, the then presiding member of the Natural Resources Committee was provided with a statewide policy framework, and all members were invited to attend a briefing on the policy initiative at Parliament House on 15 July 2009.

In late 2009, the Natural Resources Committee was provided with a copy of the 2009 version of the bill and the 10 proposed government amendments. The then minister for environment and conservation requested that the Natural Resources Committee consider holding in inquiry into the bill. The committee postponed its decision until after the 2010 state election and, subsequently, after the elections decided not to hold an inquiry.

With respect to the South-East, the Natural Resources Committee was invited to attend a briefing on and make a submission to the draft Lower Limestone Coast Water Allocation Plan Policy Issues Discussion Paper. The Natural Resources Committee will also be provided with a copy of the draft Lower Limestone Coast Water Allocation Plan when drafted and ready for statutory consultation.

While on the South-East, it is clear that many of the environmental, economic and social implications in relation to the bill relate to its application, not the actual mechanism that is created by this bill. While this should not affect the passage of the bill, I would like to elaborate on this just briefly for the benefit of members. An interagency government task force has been working since early 2010 to support the development of the Lower Limestone Coast Water Allocation Plan through a review of the science, development of policy principles and consultation with key stakeholders.

In association with the task force, an industry stakeholder reference group has been established to engage key stakeholders on science and policy matters. The stakeholder reference group includes representatives from the potato growing, viticulture, dairy, forestry and dryland farming industries, as well as the South Australian Farmers Federation and the Conservation Council of South Australia.

The government task force, with the support of the stakeholder reference group, released the draft Lower Limestone Coast Water Allocation Plan Policy Issues Discussion Paper on 24 March 2010 for four weeks of public consultation. The feedback received from the community and stakeholders in the South-East on the discussion paper is currently being reviewed by the task force with input from the stakeholder reference group, and will help shape the policies to be applied within the Lower Limestone Coast Water Allocation Plan. The South-East Natural Resources Management Board will subsequently prepare a draft Lower Limestone Coast Water Allocation Plan for statutory consultation that is consistent with the final policy principles adopted.

In closing, it is important that any new tools to manage forest water impacts are designed to operate alongside existing tools for managing other water uses under the Natural Resources Management Act 2004. By creating both legislative tools—forest water licences and permits—the best and most appropriate mechanism to manage water resources in a particular region can be adopted in consultation with the local community. I thank members for their contribution and indicated support of this bill and acknowledge the member for MacKillop's comments that we should not take too long with this bill in the committee stage.

Bill read a second time.

Committee Stage

In committee.

Clause 1.

Mr WILLIAMS: The bill has been presented to the parliament, as the minister said a few moments ago in his closing remarks and also in his opening remarks, to provide several tools to the government for the government to then develop policy. To be quite frank, we have been debating this issue well in excess of 10 years. We have been seriously debating it in the South-East; and I think that the minister said that the task force was set up sometime in early 2009. We have had very serious work done on this for at least a couple of years.

Is the minister any closer to informing the parliament which of those tools is going to be needed? Are we going to be moving to a permit system or are we going to be moving to a licence system? I know that the minister in his summing up comments just now tried to make the case that it is not necessary to take this to the Natural Resources Committee of the parliament, but unless the parliament can be given an indication—after all this time and all this work—which one of these tools is the preferred option, which one of these tools is going to be used, I am going to have to say to my colleagues in the other place, 'Yes, we do need some further parliamentary scrutiny,' because, as I said in my second reading contribution, I am not of a mind to give the minister a set of powers when the minister is not prepared to say which of those powers he needs—which ones he prefers to use.

The Hon. P. CAICA: I am assuming by answering this question that, with clause 1, we may be able to facilitate a speedy passage of the remainder of the bill. What I would say is that there are two tools, not several tools. The two tools are the tools that are in the toolbox to allow for forestry to be regarded as a water interception activity and then to be able, with those tools, either to license it or to extend the enhanced permit system.

I have said previously that part of the water allocation planning regime in this state is actually getting to a position where the community and the stakeholders themselves determine what is the best way by which the water allocation plan can be not only developed but also implemented and based on (as much as anything else, but most importantly) the sustainable use of that particular resource. For example, I met today with national representatives of the forestry industry. They met with me in my office today and, of course, they have an acute interest in this particular bill.

They are very pleased. I will not say what it was about, but they are not opposed to what is occurring at this stage. They are expressing some concerns, but not concerns about the tools that this bill will provide to the toolbox, but about what will be the implementation of the water allocation plan. I want to say, in a not too longwinded way, that it is not up to me and it is not up to this parliament to determine what is the most appropriate tool to use with respect to the water allocation plan that will be developed in the South-East and developed in consultation with the broader community and stakeholders.

It will be, I think, a matter for determination of that group after that consultation has occurred through the Natural Resources Management Board, and then the appropriate tool will be used and will be agreed to by, if you like, the majority of the people. Now, I have a preference, and I have told you, I think, what that preference is. I think that the most appropriate tool is a licence, but, again, it is going to be at the determination of the people through the consultation process.

People turn around and say that we do not consult. You said yourself that it is 10 years in the making. It has almost been a consultation by death for some of us who have been involved with it. Most certainly what I concluded when I became the Minister for Water after the 2010 election was that we needed to do a little bit more work to go through the establishment of the reference group to make sure that we got to the position today where there is, if not universal support, certainly significant support for the passage of a bill that allows the tools to be in the toolbox for the Natural Resources Management Board, in consultation with stakeholders in the broader community, to implement what tool it is in the context of the water allocation plan that will be developed.

Mr WILLIAMS: Minister, you have not allayed my fears in the least. I will tell you why: I have had a lot of experience with the NRM board in the South-East and none of that experience could be referred to as being happy experience. By and large they have been unhappy experiences. You talked a few minutes ago in your summation of the second reading about the industry stakeholder group and you named some of the members of the industry stakeholder group. This has always been the problem, because these stakeholder groups—and this is not the first time—have always been set up and each of the irrigation activities has had a separate seat. So we have had the potato growers; they are irrigators. We have had the vignerons; they are irrigators. We have had the dairy farmers; they are irrigators.

We have had all these separate irrigation bodies get a seat on the stakeholder boards. In some of the early iterations we had two seats from the forestry sector, one from the hardwood and one from the softwood, because they could not get on together, could not get their act together at that stage. I think they have probably got their act together a little bit better now. Then one seat represented the rest of the stakeholders in the South-East, which is the rest of South-East community, the rest of the farming community in the South-East.

Minister, the reason we keep not getting this right is that the vast majority of the water in the South-East is used in what we call dryland farming. The vast majority of the water is used in dryland farming. It is much, much more than is used by the forestry industry, and it is much, much more than is used by the irrigation sector. Yet, those irrigators—and there are not a lot of them by number—get all of these seats around the table at stakeholder meetings, and the dryland farmers, who to be quite honest have been screwed over for years, get one seat if they're lucky.

In fact, there have been a number of meetings held in the South-East where they have no seats. This is why I have little faith in the process, Minister, and this is why I question this parliament giving you a range of powers. You hadn't mentioned before that you have a favouritism for a licensing regime, and can I tell you that that is my least favourite way forward, because once we start issuing a licence for what, for all intents and purposes, is dryland activity—and I know there is some debate about trees using water from the groundwater system. I am still yet to hear, minister, you and your departmental officers acknowledge that lucerne has the same impact.

If you had an understanding of why we had to start the whole Upper South-East drainage scheme, minister, you would understand the role of lucerne in the landscape in that area, and the change to the whole nature of the water balance if you have lucerne there, or if you haven't got lucerne there. It acts in a way not dissimilar to a plantation forest.

There is a whole range of plants growing in the South-East currently, and will be in the future, which have different impacts on the water balance, different impacts on the amount of water used, and yet we are picking on one small part of the industry base for the South-East. I don't accept that I should trust the NRM board in the South-East through its processes which to date, I have argued, have been flawed. I cannot trust that they will get it right, because they have a long record of getting it wrong.

Minister, can I mention one other thing at this juncture, which will save me getting up and asking another question. You have said that you have set up an interagency task force, and that you have set up an industry stakeholder reference group: what discussions have you had with your interstate colleagues—because this is the other problem.

Every time we put a barrier in front of somebody planting a tree in a plantation forest in South Australia and every time a tree does not get planted in South Australia it is very likely that that tree will be planted in Victoria. It is also very likely that that tree will be planted within the same water system, and it is absolute fact that it will be planted upstream of where you are purporting to solve the problem. What discussions have you had to ensure that, if we go down this path, whether it be the permitting system or the licensing system, it will be done in a bilateral way and that South Australia will not be disadvantaging itself with Victoria?

I cite the case with regard to the River Murray. We have done the right thing with regard to the River Murray in South Australia. Since the late 1960s and early 1970s we have capped our water use. We have done the right thing. We have increased our efficiencies and we have done everything right whilst we have watched the people in Victoria and New South Wales keep doing what we regard as the wrong thing about the River Murray.

Yet, now that there is a move to have some national rules, the stepping-off point is the year 2008, so all the good work that we have been patting ourselves on the back for, for all of those years—the last 40 years—counts for nothing. Why would we poke ourselves in the eye again and move unilaterally to disadvantage our forestry industry, which is a significant industry in the context of the South Australian economy? Why would we do that without an agreement that we are going to have a similar impost on that very same industry just across the border?

Minister, you and I both know that the chief problems we face in the South-East are within the border zone, within that 20-kilometre zone, which are influenced by what happens across the other side of the border; yet we seem intent on imposing restrictions which are going to affect the timber industry and the working mums and dads and family members in the South-East who rely on that timber industry in South Australia and which will have no impact on the same industry in Victoria. As a consequence we are going to do little to solve the problem in that 20-kilometre border zone. What have you done to try to drive a bilateral approach to this issue?

The Hon. P. CAICA: That was a very long question. I will try to get this right. I will leave the specific question amongst the 10 minutes of talk to last. I disagree with quite a few of the assertions made by the member for MacKillop in posing this question to me. I do not share his view about the Natural Resources Management Board. I am confident that the support and expertise that is provided by the department for water, and the advice that it can provide and bring in, will augur well for the Natural Resources Management Board doing a very good job. Of course, the role of the Natural Resources Management Board, amongst other things, is the interface with the broader community. That is why they are such a valuable resource in the context of natural resources management.

I also do not subscribe to the view that we are not getting this right. I believe we are getting this right by having this bill that provides the tools. Certainly, the National Water Commission's biennial report to the National Water Initiative highlights the leadership role being played by South Australia in relation to the development of this policy and the subsequent implementation of that policy that is contingent upon the passage of this bill.

In regard to dryland farming, with the establishment of the reference group we have had dryland farmers around the table in an interchangeable role. We have also had representatives of SAFF there, and certainly they were part of the group that recommended that the paper that was developed by the reference group (and in consultation with that group) be promulgated for broader discussion, and that is what has happened.

In relation to dryland farming, of course forestry will only be licensed for what they would use above what was and is a dryland farming activity but, notwithstanding that, in the context of another question that you asked about lucerne, for example, or other activities, there is the ability to regulate those activities if through expansion and intensity they become an activity that is further affecting the resource from which it is being drawn. Those powers, and a range of powers, already exist.

In relation to the member for MacKillop saying that for the first time he has heard me say that I support the licensing, I am not quite sure and I will check the record, but I will correct it here if I did say it incorrectly previously. I said that if I had a view to express on this and I was sitting down there in the South-East, and I happened to be a forestry person or indeed any other person who is a water user down there, I would support the use of a licence but, I will reinforce this point: it is not for me to decide and it is not for the member for MacKillop to decide.

It is about the tool in the toolbox and the people who are going to be impacted upon or be beneficiaries of a water allocation plan, because this is about actually providing security for forestry and the future and, again, I do not subscribe to the view expressed by the member for MacKillop that we are putting a barrier in front of the planting of trees. I do not subscribe to that view at all. This is about the security of all water users within the South-East, forestry being a very significant and important economic resource to the state and the nation. I do not subscribe to that view either.

In relation to the specific question about the dialogue that has occurred with interstate colleagues, what I would again reinforce is the work and the report that was done by the National Water Commission. Also the member for MacKillop knows that the departmental officers are in dialogue with their counterparts in Victoria as part of a process to review the Border Groundwater Agreement. It is also safe to say that it is not as easy a process as just demanding that aspects of it be reviewed, because it needs the agreement of both Victoria and South Australia.

I have certainly been in contact with my counterpart, who I am sure you are aware of—Mr Walsh—about speeding up that process of review of the groundwater agreement. I hope that that satisfies the concerns of the member for MacKillop.

Clause passed.

Clauses 2 and 3 passed.

Clause 4.

Mr WILLIAMS: Minister, again, this gets to the crux of the problem. We are singling out commercial forestry, and the definition is:

…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)

As I said earlier, the vast majority of the water used in the South-East is used by dryland farmers.

We are moving into a carbon-constrained world. We are not quite sure what we are going to be faced with in that carbon-constrained world in the not too distant future, but I think it is fair to guess that obligations are going to be put on all of us to lessen our carbon footprint. The farming community is recognised as having a relatively large carbon footprint, particularly livestock, and the vast majority of the land in the South-East of the state is used for livestock production.

It is envisaged by my constituents to whom I talk regularly on these matters that, at some time in the future, and probably in the not too distant future, they will be obliged to offset their carbon footprint in some way. One of the options open to them will be to plant trees on their farms. The fantastic thing about this is that it provides a win-win situation; it provides a whole host of other environmental benefits, so long as they do it properly. However, I would argue that, if they plant trees on their farms to offset their carbon footprint, they would do it in a way to enhance their farms, particularly by providing shelter breaks principally for livestock, but they are also very effective when cropping land.

This is why I lament the fact that dryland farmers have had such a small say in the stakeholder groups. I was not convinced by your answer, and this is why I have a mistrust, because of the long history of this. I saw some figures just recently which suggest that dryland farmers collectively would use well over half the water—I will not say any more than that, but it was considerably more than half of the total water in the South-East—but they have had very little say.

However, there will be an obligation on them in the very near future, I believe, to offset their carbon footprint. Will they be caught up in this definition of commercial forests if they choose to do that by planting trees around their farm, not to harvest at some stage but to offset their carbon footprint, and if they do not sell those carbon credits but use them as an on-farm offset?

[Sitting extended beyond 17:00 on motion of Hon. P. Caica]

The Hon. P. CAICA: The member for MacKillop spoke about the carbon footprint. The carbon footprint is not necessarily a matter that is being dealt with with respect to this particular bill which, of course, is providing the toolbox for forestry to be part of the Water Allocation Plan. However, I agree with his view. This was a matter I discussed with our agricultural sector when I was the agriculture minister, about the role that all aspects of primary production will play in the context of carbon offsets and reducing the carbon footprint.

I think there are some great advantages that might accrue to primary industries with respect to the money that is available through the commonwealth government for promoting offsets. There is a relationship to the farming sector in relation to the $960 million, for example, that is allowable for biodiversity, and that is its relationship with the land, not the 71 per cent of which is used for commercial purposes.

So, I think there are going to be some good things that will arise from that. People certainly know, in the context of primary production, that there is a significant role to be played by that sector and some advantage to accrue to that sector if the carbon tax is as I expect and a sophisticated carbon tax is developed by the federal government. That is not something that we can deal with in the context of this particular bill today.

In the example that was used by the member for MacKillop, if a farmer wanted to plant 10 per cent of his property or 20 hectares, or whatever it might be, as forestry or farm forestry in the context of what might be the ability to offset against a price on carbon, the exclusion of that activity would still be determined in the context of the water allocation plan. You would know, because I know you would, that the discussion paper that went out there provided for, in the context of dryland farming and farming forestry, 10 per cent of property or 20 hectares without it being regarded as part of a water allocation plan.

That was a discussion paper that was promoted before the development of the water allocation plan, and I expect that issue to be a matter of further discussion in the context of the water allocation plan. Of course, the discussion paper that went out there gave two scenarios: a 10 per cent or 20 hectares. I know that you are at one with your constituents down there and they know this is an issue, so I expect that there will be full stakeholder consultation that will include dryland farmers and others, through this process of developing a water allocation plan, and that that matter will be discussed. If it is not only discussed but agreed that the concept of exclusion for farming forestry should be part of the water allocation plan, that is what will happen.

Mr WILLIAMS: I will be very specific with the question because I am still not satisfied with the answer. If I need to get a carbon offset on my farm and I plant some trees to achieve that carbon offset, will that be captured by the definition of 'commercial exploitation of the carbon absorption capacity of the forest vegetation'?

The Hon. P. CAICA: I will try to make it very clear so that you do understand, and I am not in any way saying that to be disrespectful. The idea of the 10 per cent and 20 hectares in the context of what was the discussion paper that went out was about whether or not it is water affecting—

Mr WILLIAMS: It said 'a commercial farm'.

The Hon. P. CAICA: And then whether that commercial farming forest is a water intercepting activity and has an impact upon the water resource. That is when it will be determined in the context of the water allocation plan. Other than that, it will not have any impact at all in this process. This process is about forestry and the size and intensity of forestry in the context of whether or not it is a water-using activity. How big is your property; your vast tracts of land?

Mr WILLIAMS: It's big enough. It's not large.

The Hon. P. CAICA: There are probably several of them and, even when you put them all together, there are several of them. For example, say there is 1,000 hectares.

Mr Williams interjecting:

The Hon. P. CAICA: It doesn't matter. Say it is 500 hectares and you decide that you are going to plant that whole 500 hectares with forestry, not for commercial purposes but for the purpose of offsetting, if you like, carbon, and what you are actually doing is doing that as a financial incentive, because people from around the world might want to come and have trees planted there to offset their carbon footprint. Okay, are you with me?

Mr Williams interjecting:

The Hon. P. CAICA: All right. My view would be that, in the context of the water allocation plan in the South-East and your 500 hectares of forest, the size and intensity of that would certainly then be regarded as a water interception activity in the context of the water allocation plan. It depends on the scale and the intensity, and certainly the discussion paper talks about 10 per cent and 20 per cent, but if we drill down even further it is about whether or not that activity is going to have an impact on the water use within that particular region.

Mr WILLIAMS: I think, minister, you fail to understand the implications that we might be imposing. I have talked about the dairy farmers. We know that the dairy industry may well be under the pump under a carbon-constrained future, because dairy cows expel quite a bit of methane, which is a much worse greenhouse gas than carbon dioxide. The vast portion of the dairy country in the South-East does not have a lot of trees on it currently.

However, if those farmers are obliged to offset their carbon footprint in the future and they do that by planting trees on their farms—and it may well be more than 10 per cent—if they plant trees on their farms to offset the carbon footprint on that same farm (not sell the carbon credits to somebody else, just to offset their own carbon footprint), will that be considered as a commercial exploitation of the carbon absorption capacity of the forest vegetation? That is the crux of it. We might have the absurd situation in the South-East where a dairy farmer, to offset his own carbon footprint on his own farm, is prevented from planting enough trees to do that and has to go and buy some trees being planted in India, for God's sake!

The Hon. P. CAICA: I do not want to sound like a broken record but, in the context of the discussion paper, it was 10 per cent or 20 hectares. You are quite right to say that the majority of land down there (as you would know better than I) that is involved with dairy does not have a lot of trees. Indeed, cows do produce methane, and I applaud the work being done by Adelaide University at Waite to look at ways by which they can reduce that enzyme (or whatever it is) that does that in their munching processes.

Mr Pisoni: Alka-Seltzer.

The Hon. P. CAICA: Beg your pardon?

Mr Pisoni: Alka-Seltzer.

The Hon. P. CAICA: Yes. I hope that advance in technology, research and science comes in quicker rather than later. In a pure sense, offsetting is alleviating a cost that would otherwise be imposed on them, and the argument is that it is a commercial decision to do that—and I know that you accept that. However, the answer—again, going back to the 10 per cent or 20 hectares that was part of the discussion paper and will be a matter of ongoing discussion and it still needs to be in the context of a water allocation plan for that water allocation plan to set exclusions—is that it has not been determined yet.

There are other ways by which it could be managed; that is, there is a water licence as well, is there not? The dairy farmers who irrigate (which they do, as I understand it) have a water licence. They can offset that water licence in the context of growing trees. There are ways by which it might be able to be done. It is hypothetical and speculative, and all I am saying is that, in the main, as a principle and a rule of thumb, if the size and intensity of the operations create a situation where they have an impact upon the existing water allocation plan or any activity in the extraction of water within that particular resource, it obviously would need to be considered by the Natural Resources Management Board.

In particular, the advice that I have received—or whoever my successor might be—is in the context of not just review but further measures that might be put into place. Really we could go around in circles on this, but I reinforce the point that the majority of these matters are going to be further developed in the context of the consultation that needs to be undertaken on the development of the water allocation plan.

Clause passed.

Clause 5.

Mr PEDERICK: Clause 5 relates to the preparation of water allocation plans. I note that the draft Lower Limestone Coast Water Allocation Plan has almost been in limbo for five or six years, and what concerns me is whether you and your department have it in limbo on a supposition that forestry is going to be noted as a water user under this legislation before that moves forward. It has been so long now, and I think it is quite out of order if that is the supposition that the department has been making, that is, of legislation passing through both houses in this place.

The Hon. P. CAICA: I thank the honourable member for his question and, of course, it does seems like it has been in limbo for a period of time and, quite simply, there is a water allocation plan in place. That water allocation plan has been, quite rightly, subject to review, and that is what happens to water allocation plans. The information that I have received, and that my predecessors have received—and it is something that has been on the boil, as the member for MacKillop said, for over 10 years—is what activity in the form of forestry should be in place to account for its water use?

In answer to your question, it is quite simple—that we were not going to implement another water allocation plan without forestry or, more importantly, without the tools being available for the NRM Board to include forestry as a water intercepting activity. I presume you would recall that when I was the forestry minister this was being discussed back in the previous term of this government. Now I have the role of water minister and we are progressing it to include, at least on this occasion, the tools for forestry to be regarded as a water interception activity and for its activity to be allocated in the context of the water allocation plan—so, yes.

Mr PEDERICK: In the light of that answer, minister, is it not a little arrogant of your department to think that this bill will pass and become an act when it is not even in legislation, yet they are holding up the relevant water allocation plan thinking that this legislation will proceed when it may well not?

The Hon. P. CAICA: I am not going to be rude to the member for Hammond, but you would realise, because I am sure you are not stupid, that there is an interim water allocation plan in place. Quite simply, it does include forestry, and the information that I have received from many within the South-East was that a tool to allow forestry to be included in a water allocation plan should be an objective.

It has been an objective of this government since 2002 when we were elected, and we are fulfilling that policy position and the commitment that I believe we have made to many people within the South-East in regard to forestry as an activity. In my view, and I know that the member for MacKillop and others might not agree with it, but I think this provides a greater security through all water users in the South-East by including forestry as a water intercepting activity and allocating it as such.

Mr PEDERICK: Thank you, minister, for that answer. In my mind, if the legislation gets chucked out of the parliament, so to speak, and does not proceed, we could be here for another five years rolling over past more and more times of the five-yearly review times because of this policy, this supposition. I think it is absurd, and I think it is arrogant to believe that this is already part of the plan when it is not. It is obviously what the department is planning for, and it has not even passed legislation. You have answered that question; I am just making the point.

The Hon. P. CAICA: I will respond to that if you give me the opportunity. There is a regulation in place, with respect to the existing water allocation plan, that allows for expansion. This is about making sure that all users of water have the ability to be included in the next water allocation plan. I will finish off by saying that I do not believe in any way that I am arrogant, but there is a difference between arrogance and ignorance.

Mr WILLIAMS: Minister, my colleague, the member for Hammond, has raised what is a very important point. I am not going to hold the house much longer, because I am now convinced that the best thing we can do with this legislation is to send it off to the parliamentary committee to have a good look at it. Let me make a point, minister, and expand on the point that the member for Hammond just made.

The water allocation plan in the South-East was due to be reviewed, with the new allocation plan to be put in place by 1 July 2006. I know we just changed the legislation to extend the review period from five years to 10 years but, under the legislation on which the NRM Board operates, it was duty-bound under the law to review its plan every five years. That five years of the existing plan that you are talking about expired on 30 June 2006.

In the meantime, in preparation for the new plan, which was going to be handed down and operational by 1 July 2006, there was an expectation that that plan would move the whole water licensing system in the South-East to a volumetric-based system, as opposed to an area-based system, and every irrigator in the South-East, including myself, was obliged to put a meter on every bore in the South-East. Minister, you might question why I make the statement that I do not trust these people.

This is a red hot reason why I do not trust these people. We have been waiting for five years, whilst this board has been acting outside the law as made by this parliament. It has been sitting around navel-gazing for in excess of five years and drawing up plans which have been outside the law. In the meantime, it has imposed millions of dollars of expense on the irrigators in the South-East in the expectation that it would act within the law and have a new water plan available to begin operation on 1 July 2006.

Minister, that is why I say I do not trust these people; I just do not trust them. I am not enthused, minister, by your suggestion that with further input from your department they will get better at it. I suspect that that has been a fair bit of the problem in the past: the interference by the department here in Adelaide in the way that the NRM Board should operate, and that has been the conduit between the local community and policy decisions.

I know, just as you know, minister, that that is not the way that it operates in practice. I am not going to take any more of the time of the house today. I am convinced that this needs a lot more scrutiny by the parliament, and that is the recommendation I will be making to my colleagues in the other place.

The Hon. P. CAICA: To finish off, I thank the honourable member for his comment that he will not keep the house any longer. Of course, he is aware that there is a review period of five years for the water allocation plan. The plan was the subject of a review, but he knows that the plan does not expire until it is rewritten. Of course, there has been a process undertaken. This is not the culmination: this is the bill where the tools for the toolbox will be provided ad nauseam. Look, I do not think that this bill needs to be referred or, indeed, should be referred. I would say that it would be ludicrous to send this bill through to the committee but, again, that would be a matter for determination in another place.

I would say, though, that I am certainly receptive, because I think that you could probably join the consultation process that has been going on, because you are at one with your constituency down there. Anyone who has a bad word to say about the representative in here and the department that has been undertaking this consultation process would be hard pressed to say that there has not been a level of engagement there.

I disagree and dispute the word 'interference'. What the department and what government agencies should be doing is providing access to sound advice for the best consideration of the Natural Resources Management Board and subsequent communication of that information to the broader community that the NRM Board represents. I thank the opposition for its support of this bill, and I look forward to its quick passage through the remainder of the clauses.

Clause passed.

Remaining clauses (6 to 24) and title passed.

Bill reported without amendment.

Third Reading

The Hon. P. CAICA (Colton—Minister for Environment and Conservation, Minister for the River Murray, Minister for Water) (17:22): I move:

That this bill be now read a third time.

Bill read a third time and passed.