Murray-Darling Basin Plan

The Hon. J.M.A. LENSINK (14:24): I seek leave to make a brief explanation before directing a question to the Minister for Water and the River Murray on the subject of the desalination plant and the River Murray.

Leave granted.

The Hon. J.M.A. LENSINK: The return of environmental water is a commitment made by the state government in exchange for the $328 million to build the Adelaide Desalination Plant, and the rhetoric behind that was that the state would reduce its reliance on the River Murray. It is my understanding that under the Adelaide Desalination Plant Implementation Plan South Australia is responsible for the management of this water. Under this plan the state minister is required to notify the commonwealth minister of the government's actions rather than make an offer. However, on 30 October, minister Hunter stated in this place:

The offer of environmental water from SA Water up to the commonwealth was made, as I understand it, well over 12 months ago and that offer has not, as far as I am aware, been taken up by the commonwealth. The offer still stands, of course.

My questions to the minister are:

1. Has the minister since communicated with the commonwealth on this issue regarding its intentions of where the environmental water will come from?

2. Are there targets in relation to dates and annual volumes?

3. Can the minister ensure that South Australia's food producers will not once again be sacrificed to meet these targets?

The Hon. I.K. HUNTER (Minister for Sustainability, Environment and Conservation, Minister for Water and the River Murray, Minister for Aboriginal Affairs and Reconciliation) (14:26): I thank the honourable member for her most important questions in terms of the River Murray and also the state's contribution to those outcomes. As is well known in this place, through the leadership of our Premier Jay Weatherill, this state stood up to the federal governments of both political persuasions to make sure that we got the best outcomes we could as a state to provide for the health of our river into the future.

The basin plan came into effect on 24 November 2012 as a result—a large part of the result—of our activity and our agitation in this area. The state government is now working with the Murray-Darling Basin Authority and other basin jurisdictions to progress those implementation arrangements. To underpin the implementation of the basin plan, the South Australian government has entered into an intergovernmental agreement with other basin jurisdictions which outlines how we will work together.

The intergovernmental agreement includes commitments to work collaboratively to plan for the use and management of environmental water, to establish joint governance arrangements to support the effective operation of adjustments to the sustainable diversion limit (SDL) as well as commitments for commonwealth government funding. This includes arrangements for investing in projects that address physical or operational river constraints and sustainable diversion limits adjustment projects which can offset the water recovery requirements under the basin plan. It is important to understand that all states—all parties really—have to agree to those SDL adjustment processes.

If SDL adjustments are proposed by one jurisdiction but not supported by another, then they cannot go forward. That is a big driving force in making sure we get the outcomes that have been guaranteed under the plan. For example, if New South Wales puts forward a program that South Australia does not believe has adequate water flowing from it, then we will not be supporting that program. New South Wales, of course, knows that and so presumably would not be putting forward such a program that we would not ordinarily support. It is a very powerful instrument.

Under the agreement, the commonwealth government has committed to make over $13 million in funding available over eight years to the South Australian government. This is in recognition of the additional costs associated with the basin plan and to support the development of business cases for SDL adjustment projects.

To guide the state's implementation of the basin plan and the related programs, the government has released the South Australian Murray-Darling Basin Plan Implementation Strategy. This implementation strategy outlines the key actions being pursued to ensure the basin plan is fully integrated into South Australia's ongoing water management arrangements.

Work to execute the strategy is progressing well, I am advised. We have been progressing arrangements for the $440 million suite of environmental and industry diversification projects that were secured by Premier Weatherill and the state government during negotiations to develop the plan. The government is also investing effort in reviewing and adapting the state's existing Murray-Darling Basin water management arrangements, including water resource planning and allocation, water quality and salinity management, environmental water management and water trading. A central plank of that successful implementation will be the introduction of a new sustainable diversion limit in each of the state's three water resource plans by 2019.

The introduction of new sustainable diversion limits will require about 183 gigalitres of water recovery from the South Australian Murray system, and I am advised that over half of that has already been recovered. The commonwealth, of course, released its water recovery strategy on 2 June this year. The strategy largely reflects current actions underway by the commonwealth and other jurisdictions to recover water, or offset water recovery requirements, for sustainable diversion limits.

The commonwealth strategy confirms that there is a cap on water purchases at 1,500 gigalitres, but indicates that the projected total water purchase may only need to be 1,300 gigalitres. I have said in this place before, the commonwealth's projections take into account estimated water savings of 543 gigalitres from contracted infrastructure projects—and that is all well and good—and assumes that offsets from the SDL adjustment measures could be 650 gigalitres. But what if they are not? It remains to be seen what happens in practice. For example, the actual level of water recovery offsets will only be known following the operation of the SDL adjustment process in 2016, and 2016 is awfully close to 2019, when the plan is supposed to be implemented.

The commonwealth intends to update the strategy annually to reflect latest information, and we encourage them to do that—that is good policy—with a major review to follow in 2016. The state government will also continue to participate in good faith in the water recovery and the SDL adjustment process. The state government will also continue to explore a range of projects for water recovery or offsets, and we will ensure we are well prepared in the event that not all the outcomes predicted in the commonwealth strategy are realised; for example, the final SDL adjustment falls short of the projected maximum of 650 gigalitres.

This is why it is so very important that we work to change the commonwealth's mind about water buyback. Water buyback is the cheapest, most efficient way of ensuring environmental water is in the Murray River for the benefit of the environmental processes that happen all up and down the river. The commonwealth has, as I said, capped their buyback. They have even tried to screw it down by another 200 gigalitres, all on supposition; the science has not been there. We have not seen that information and, as I intimated, we will not see it, probably, until 2016.

If the commonwealth hitches its wagon to engineering solutions—which is what they are saying to us they want to do, and which I said in this place I think yesterday, ends up being on average about seven times more expensive than the most efficient process, which is buying back water—and if those engineering solutions do not get us those SDL adjustments, then come 2019 the commonwealth is going to be short—short of the water that has been promised be implemented by the basin plan.

That can be fixed now by them reneging on their promise made in the lead-up to the last election about capping water buybacks. We all know why they did that; that was to pander to communities in New South Wales which have been overextracting from the river system for decades and decades and decades. It is not efficient, it is not effective, it is not good policy, and we would like to see the Liberal Party in this state join with us to campaign against the federal government's water buyback programs and actively encourage them to do what is efficient and in the interests of this state.