Jan Beer. Photo by Ash Long

In 2011 the Murray Darling Basin Authority stated that there had been considerable investment in water storage and delivery infrastructure for more than 100 years in the Murray Darling Basin, thus creating “one of Australia’s most efficient and productive food growing regions”
They go on to say this “development is increasingly recognised as having had unintended consequences” as the “construction of dams, locks and weirs to control water flow has altered the natural flow regimes, changed river temperature and changed sediment and nutrient loads.”
Ironically the so-called solution, the Murray Darling Basin Plan is resulting in unintended consequences of massive proportions which is seeing the collapse of irrigation districts in the southern basin, huge economic and social impacts on regional communities, increased financial debt for farmers, reduction in dairy production in particular, vast increase in water prices due to opening up of the water trade and detrimental environmental consequences that are being ignored by governments and authorities alike.
“No irrigators would be worse off” was the cry of bureaucrats and politicians when the Basin Plan and irrigation modernisation was instigated.
The Goulburn Murray Irrigation District which has always been Australia’s largest irrigation district, as with all irrigation districts in the southern connected system are struggling to survive.
Over 83 per cent of water recovered for environmental purposes in the Murray Darling Basin has been taken from these districts.
Some regions have seen 20- 38 per cent of their most precious resource, water, taken through buy-backs and, “water savings” gained by replacement of low cost, gravity designed Dethridge wheels with high-tech, high cost computer operated gates and on-farm efficiency measures.
The majority of irrigators were never “willing sellers” of their water, but were under extreme financial duress after 10 years of drought, followed by two successive years of major flooding, capped by high fixed fees for irrigation water that they were left with, even after they had sold or given up their water.
The Commonwealth Environmental Water Holder took the water recovered, but did not have to take over all of the associated fees, hence many irrigators were left with delivery share fees of thousands of dollars each and every year despite no longer owning the water.
Many farmers could not shoulder the debt burden, sold the remainder of their water and left the industry.
In 2011 in a socio-economic analysis the MDBA stated-” At the Basin level, the costs are expected to be relatively small.”
The social and economic cost of the recovery of water has had an extremely serious consequence for towns, schools, the social fabric of communities with the loss of sporting teams and the domino effect of loss of business services.
The MDBA Basin Evaluation analysis figures up to 2016, show how severely communities have been affected:
• Pyramid-Boort community lost 17.8 per centof its total surface water entitlements and saw a reduction of its agricultural workforce of 47 per cent.
• Swan Hill – a reduction of 20.4 per cent available water and decrease in agricultural workforce of 42.6 per cent
• Wakool community- a reduction of 38 per cent of available water and 61.5 per cent decrease in agricultural workforce.
Many irrigation communities have experienced a decrease in their agricultural workforce well in excess of 20 per cent and in some communities up to 50-60 per cent (Deniboota and Denimein).
The MDBA modelled decision making on a broad basin scale rather than at a community level, with devastating outcomes.
Modernisation was expected to generate substantial growth in economic output from the Goulburn-Murray Region.
Instead dairy farmers are now heavily reliant on a fickle and increasingly expensive temporary water market with GMID irrigators paying $20 million more for temporary water now than without the Plan
The dairy industry is the largest water user in the GMID and has been the hardest hit, losing $200 million at the farmgate with a 26 per cent drop in milk and total regional production down $550 million.
With the increased reduction in the irrigation consumptive pool, dairy farmers are now less able to withstand drought, higher water prices and a volatile commodity market.
Irrigated agriculture, to remain profitable must be able to access secure, reliable and affordable water.
“Irrigation businesses and communities will benefit from increased certainty about the availability of water, and the rules governing its availability.
“They will be able to make planning and investment decisions with more confidence that governments are managing and allocating water on a sustainable basis.” (Regulation Impact Statement)
It is purely government policies under the Murray Darling Basin Plan that have reduced the security of tenure of irrigators entitlement rights by continually diminishing the irrigators’ consumptive pool.
Conditions have changed and entitlements certainly made less secure with the introduction of the Commonwealth Environmental Water
Holder as the largest entitlement owner. Extra volumes of CEWH carryover water has reduced the storage capacity in dams and meant an increased likelihood of spill of irrigator’s water.
The shrinking consumptive irrigation pool means that ultimately communities and irrigators alike
are far more vulnerable to extended dry periods such as we are now experiencing.
Even a two-three-year drought, which we frequently experience in Australia, would cripple corporate irrigators and destroy 50 per cent of the dairying industry in northern Victoria.
The opening up of the water trade to speculators and loss of available water for productive use has resulted in higher water prices and higher costs.
An overheated water market has rapidly pushed water prices to unsustainable levels, with High Reliability Water Shares increasing to approximately $5,000/ML with temporary water in the vicinity of $420/ML.
The intended purpose of the Basin Plan was to provide for the integrated management of water resources in a way that improves water security for all uses of Basin water resources, and promotes productive and resilient water-dependent industries, and communities with confidence in their long-term future
In reality irrigators face an increasingly uncertain and vulnerable future, particularly for farmers who are the backbone of Australia- the family farms.
In a drought-driven market our dairy farmers must attempt to forsee the future by deciding how much of their water allocation to sell in order to purchase fodder and grain.
These are high risk decisions based on a volatile market which will see their survival or demise.
The GMID dairy industry, which produces a quarter of Australia’s milk and is home to 16 processing factories, is especially vulnerable to any further reduction in water available for production in the southern Basin.
In the NSW Murray Irrigation areas despite starting the season with Dartmouth Dam at 90 per cent and Hume Reservoir at 54 per cent is on zero allocation, even though only two years ago (2016) the system was awash with floodwaters when dams exceeded capacity in much of the southern connected system, saturating the environment and causing enormous flood damage.
“The Basin Plan will ensure security and reliability of water rights. Irrigation businesses and communities will benefit from increased certainty about the availability of water, and the rules governing its availability. They will be able to make planning and investment decisions with more confidence that governments are managing and allocating water on a sustainable basis.”
The unbundling of water in 2009 so that the water trade became an open market, followed by the rapid implementation of the basin plan, has seen the inability of the majority of farmers in the southern irrigation districts to compete in purchasing water
These farmers cannot compete with the large corporate plantations, which have purchased large volumes of high security water from where it is most readily available, the southern basin irrigation districts.
The Goulburn Murray Irrigation District has seen a continual loss of water from its productive pool and has lost up to 5,000ML per month from its irrigation district with 43 per cent of high security shares having left the district since 2008.
GMW has said it is not sustainable to continue to operate the channel system when deliverable water falls to below 800GL. It is currently below 900GL.
The more water that leaves the GMID, even with farm upgrades, the more water prices rise. In short, many farmers already no longer own enough water to run upgraded irrigation systems, no matter how efficient the system, and they can’t afford to buy more water on the open market, particularly in dry seasons, especially when they have to compete with corporate farmers and speculators for the rapidly dwindling temporary water available to the productive pool.
The fixed costs fees are falling on the shoulders of fewer and fewer irrigators and cannot be sustained. The holder of all environmental water, did not extinguish these fees or take the costs with it when they acquired the environmental Water, thereby decreasing the sustainability of irrigators.
“With all the savings achieved irrigators will have greater water security.”
The combination of increasing allocation prices and a greater percentage of irrigators sourcing water through allocations means there is a far greater risk for irrigated agricul-
tural operations. It is forecast that horticulture plantations and cotton farms in the southern Murray downstream of Swan Hill will demand in excess of 400GL/year till at least 2020-2021, and this water will come out of the irrigation districts with high security water shares, such as the GMID and southern Murray Irrigation districts. This is the equivalent water used by in excess of 630 dairy or rice farms.
With less water being available, higher water prices and increased competition from downstream industries such as nuts and cotton, irrigation farmers lose the ability to cope with seasonal and market volatility and continue to make a profit. The majority of irrigators no longer have reliability and security of water availability to enable them to operate a profitable business.
“The Basin Plan will optimise environmental outcomes”
With increased frequency of high environmental flows, local landowners are seeing an explosion of the
carp population, increased incidence of bank collapse, for example at the Barmah Choke, where Murray channel capacity has reduced by about 1000ML/day, loss of large , mature river gums falling in as river banks collapse not only in the Murray but also the Edward and Goulburn Rivers, as they are all run at or above capacity, sedimentation build up in river channels throughout the basin and more frequent incidence of hypoxic blackwater events.
Continuing environmental flows based on outdated historical and flood flows data is setting the environment up for a disastrous crash when the next prolonged drought occurs.
The intended outcome for the Basin Plan was to achieve a healthy Murray Darling Basin incorporating communities with sufficient and reliable water supplies, “productive and resilient water-dependent industries, and communities with confidence in their long-term future”
The Basin Plan will optimise environmental outcomes
The reality is, with increased frequency of high environmental flows, local landowners are seeing an explosion of the carp population and increased incidence of bank collapse. For example, at the Barmah Choke, the Murray channel capacity has reduced by about 1,000ML/day. There is an ongoing loss of large , mature river gums falling in, as river banks collapse not only in the Murray but also the Edward and Goulburn Rivers, as they are all run at, or above capacity. Landowners and scientists alike have reported sedimentation build up in river channels throughout the basin, the Lower Lakes and the Coorong and the more frequent incidence of hypoxic blackwater events.
The Basin Plan has resulted in a plethora of severe detrimental, unintended consequences due to government policies enacted by bureaucrats and politicians ignorant of the realities of river systems, agriculture and the irrigation industry.
The implications for regional basin communities and agriculture means farmers are now confronted with falling production, higher water prices, less water security and reliability which means farmers and consequently communities and their regions are now less resilient and less able to cope with volatile commodity markets and climate change.
The “unintended consequences” of six years of the Basin Plan has devastated large swathes of regional areas in the southern connected communities.
Unless there is a pause to review and revise the Basin Plan direction, State and Federal Governments will have spent in excess of $3.3 billion dollars of taxpayers money on modernisation of irrigation systems, only to have the foodbowl of the Murray Darling Basin destroyed by inept and inappropriate government policies.
These policies, such as opening up the water market trade, will by 2024 have destroyed the dairy and rice industry in the southern connected basin and with it many rural communities.
– Jan Beer