Senate Environment and Communications Legislation Committee [Part 2], , 1:11:43 to 1:26:17
The committee examines progress toward the 450-gigalitre water recovery target and the socioeconomic impacts of voluntary water buybacks on regional communities.
Topics: Water management, Employment, Agricultural productivity
Speakers: Hon Murray Watt, Hon Matthew Canavan, Phil Coates, Malcolm Southwell, Christine MacRae, Mr. Tony Chappel
>> Senator M South Division head water infrastructure investment division. Um we're at uh 300 and the facts for you. Um we're at 380.7 gig liters recovered as of
>> 380
>> 380.7 as of 30 June. So that's from a combination of purchasing water efficiency and over recovery. So 85% senator
>> right. So there's roughly 70 gig liters to go.
>> Yeah. And we expect to be at about 400 by the end of the year. So around 50.
>> So that figure was 30th of June. There hasn't been much recovery between now and then.
>> Uh there's been a little bit Senator
>> between now uh
>> our numbers are published on our website and uh we've published them as 30th of
>> Sorry I'm struggling to just hear Mr.
Senator. Um the figures I've got are as at 30 June.
>> Do we know if there's been additional water recovery since then? Small amount.
>> We'll publish an update shortly.
>> Okay. Okay. But roughly 70 gig liters left. Uh how much was recovered this year to date or to 30th of June?
>> Uh this calendar year, this financial year. Sorry.
>> Yeah. As much as you've got. Sounds like you've only got to the 30th of June.
>> So that's in total. Um and I'll just ask my colleague to to come to the table out of that um in the last 12 months
Christine MacRae branch head water recovery I don't have to hand a breakdown for this financial year or calendar year water recovery is is usually occurs in in patches where water is registered and settled through the conveyance process, but I can take that on notice and provide that to you, Senator.
>> So, you can't tell me I mean, I don't mind how you've reported it, but you can't tell me how much was recovered for the last financial year.
>> I don't have that figure to date. I I I'd be I wouldn't I wouldn't be able to provide you reliable figures, unfortunately.
>> So, you don't report it on an annual basis anywhere?
>> Senator, we record on
>> the calendar or financial? I don't
>> Senator, the program's been operating for a couple of years and we are um recorded as as progress towards the 450.
Senator, I can give you a breakdown of the programs if you wish, if that is helpful.
>> Well, I'm more interested because uh there's just been 92 people lose their jobs in the River Arena region. How much water was recovered just before that loss of jobs.
>> So before the the recent Sunrise announcement, so from the different programs because the Sunrise announcement was uh after the 30th of June. So we did have 50 gig liters from our southern connected basin um open tender. We had around 12 giga liters from our EOI1 uh open tender that that was small holdings senator. So individual
>> was that at you saying that was open at the time of the announcement or before that was
>> that was operating at the time senator. We were actively purchasing water. That's correct.
>> How much did you do earlier this year?
This year we had a series of large portfolio purchases uh that would have that were contracted before 30th of June. There was about 216 gigal liters that was recovered.
>> 216 gig >> from large portfolically from rice growers that at a particularly dry time and well the water price temporary water prices very high. We had the Comwalth water and Comwalth government out there buying water. So, has there been any post assessment of the Sunrise decision to understand whether or not Comwalth Purchases contributed to this decision for 92 people to lose their jobs?
>> Sunrise. Yes. When Sunrise announced those job losses, they themselves recognized they were due to a range of factors that included voluntary water buybacks, but also >> but also other factors which you don't seem to mention including drier conditions which were a reflecting affecting planting levels. So to you is that Sunrise's own announcement did not solely mention water buybacks.
>> I never said that and I said it was dry.
>> You haven't.
>> Well, don't verb on me, Minister. You just admitted. You just admitted that Sunrise themselves did finger voluntary water buybacks as a contributing factor. Okay. And I didn't say it was a soul factor, but it was one of the factors. So given that has the government done some review of to what extent its voluntary water buybacks contributed to 92 people losing their jobs?
>> Uh the officials can obviously provide you with a direct answer but our government has recognized uh that voluntary water buybacks have some economic impacts on some industries in some communities. Of course, agriculture as a whole has grown in the Murray Darling Basin since voluntary water bikebacks commenced, but there are some impacts on some communities and that's of course why we have provided $300 million in structural adjustment
>> So, I'll just ask again, I I ask these questions and I I get uh diet tribes on other issues. has or is the government going to review whether or not its decisions contributed to and if so how much it contributed to 92 people losing their
>> Uh Senator Bell Coat's uh economics uh evidence and engagement branch um a specific assessment of that decision uh short answer would be no. Uh very difficult for us to to determine all the commercial factors that go into a decision like that. noting that um you know in 2019 and in uh 2007 to 2010 Sunrise also uh moth balled um processing facilities during dry periods uh of time and obviously the water availability and climate uh significant driving factors of those types of decisions. The most recent bit of government analysis uh about sunrise and rice process processing facilities was undertaken by Abears in I think 2024 that was commissioned by the New South Wales government uh in the context of its decision to end the uh rice vesting arrangements in New South Wales. So essentially to to deregulate uh that industry in New South Wales. Uh and uh that produced a report that as the minister said pointed to a number of contributing factors uh that were affecting the decline in the rice crop and subsequent um uh viability of the maintaining the processing footprint as it had in the past. Uh which included that vesting decision. Uh and also significant transfer of water use in the river arena. um which historically in you know back if you went back to the 90s would have been used growing rice crops which has shifted to other um other crops you know in that part of the southern basin now there's a significant um cotton growing there's several cotton gins have been built in the southern uh New South Wales river in the last 10 years so there is a structural adjustment that's occurred over a number of years in the rice industry which um as the minister said um while yes uh water recovery uh and anything that that reduces the availability of water a factor. Uh I I don't think you could um solely attribute the decision to the 450 or recent water purchasing activity.
>> I mean, I just want to be clear. I'm not trying to be a Monday expert. I was in just a few months ago making this very point that buying back water while it was dry and the temporary water price was $400 was just insane. Uh what was the rush? Why did you have to make 216 gig lers of purchases earlier this year at a time that where the farmers were
already under stress? Well, because um many years ago um a target of 450 gigal liters was set well before our government was elected and of course only 2 gig liters of that amount was recovered under the former coalition government. And so we have committed to deliver on that target because we think that that's important for the long-term um health of the basin environment, industries, and communities. And we need to get there. Um we're not going to put our heads in the sand like we saw from the former government only recovering 2 gig liters. And we've got a legislated target uh to be met by the end of next year of 450 gig liters. And that does include that does involve ongoing recovery.
>> So the target's more important than people's jobs.
>> No, that that the target is important for people's jobs in the basin in the long term. If we know, let me finish. Sure. If we continue to see water overallocated from the Murray Darling Basin as we have seen for decades, we are going to see the demise of many more jobs in the basin than what we've seen over the last few years. And we don't want to condemn basin communities, the basin environment or basin industries uh to a certain death which would occur if we continue overallocating water. Only in January this year I accepted the expert advice that the lower Murray is critically endangered. Uh now of course the RD government listed the same area as critically endangered and of course that was overturned by the Abbott government. We are not going to stick our heads in the sand about the long-term impacts of overallocation and we will continue to support industries in the basin like we did at Sunrise only just recently in Leon.
>> But if if if the target is not more important than jobs, why didn't you factor in these job losses when deciding to push ahead with 216
>> G? We have factored in uh the fact that delivering the plan including voluntary water buybacks of I mean again I know the national party only ever focuses on the water buybacks part of the
>> focus on people's jobs and you refuse to
go on a political finish it's not a political diet tribe what
>> you just mentioned I didn't mention
>> it's not a political diet tribe I'm just actually inserting some facts >> I'm just inserting some facts you might like to, you know, meet a few facts every now and then. The facts are that in addition to water buybacks, this government has funded over $870 million in water infrastructure, water efficiency. So, it's not only about buybacks. Um, but we have acknowledged that in undertaking the plan, including buybacks, that will have impacts economically on some regions and some industries. And that's why we are providing $300 million in structural adjustment funding which includes the recent amount that we delivered uh via via a co-investment with Sunrise in
>> Um so you mentioned the original plan required this 450 gig liters. Did the original plan require a social and economic neutrality test?
>> My my understanding is it was and this has been well traversed. Yes. Last term our government amended the legislation to remove that test. So >> it is still economic status still.
>> Exactly. So originally because you were claiming that this target was you your hands were tied the uh target was what it was. It was enacted in law and as a minister you've got to apply the law and you got to deliver the 450 gig leaders. But you misled us there minister because the original 450 gig liters had explicitly a social and economic neutrality test which would have given you the power to avoid these job losses. And you just admitted your government made a specific decision to remove the test and allow you allow you to prioritize the target of a a water recovery amount over people's lives and jobs. That's explicitly what your government decided.
>> I don't accept that that's what we've
done. You just said it.
>> I don't accept uh last term, not this term. Last term we made that decision. We stand by that decision. uh whenever recommendations are made to me around voluntary water buybacks, one of the factors that is put forward for consideration is socioeconomic impacts. Um it is not binding on me. Um and as I say um you might like to say that undertaking voluntary water buybacks uh um loses jobs. What will really lose jobs in the Murray Darling Basin is continuing to ignore the reality uh of overallocation of water. We're not going
>> Okay, I'll just ask one more question. Did did you receive any specific advice about the Leon Mill uh before uh agreeing to water buybacks earlier this year?
>> Sorry, you're talking about the the lost jobs at Deniloquin as opposed to Leon. >> Leon and Deniloquin. Yes. So, um I don't recall receiving advice specifically on those um mills, but but as I say, we we acknowledge in a general sense um that the plan including voluntary water buybacks is going to have some job losses. What will have a hell of a lot more job losses is continuing to do what we've done for decades, which is
overall. very Lord Farquar. It's some of you will lose your jobs, but it's a sacrifice I'm willing to make. That's what you're sitting there. If you want
if you want if you want Labor Party, if you want to keep come back, I'd be I'd be very happy to have this conversation with you down the track if we continue down the path that your government did and all that will do is condemn those communities to a terrible future. >> Um, and we are providing >> financial assistance to encourage new industries. You just heard about developments in the cotton industry that are creating jobs. So yes, there are some jobs being lost. I've said, you know, when when those deniloquin um jobs were lost, I said no one wants to see any jobs lost. Um we've also seen jobs created and we will lose so many more jobs if we continue to ignore the fact that the Murray Darling Basin is drying as a result of climate change. something again I know you have trouble with um and I'm not going to do that. I'm going to make sure that those basin communities are alive for a long time to
>> Thank [clears throat] you chair. >> Thank you. Thank you Senator Can.