Progress has been made with National Water Initiative but more needs to be done

June 19, 2009 - PRLog -- According to the National Water Commission, the NWI is “Australia’s enduring blueprint for water reform…[and] represents a shared commitment by governments to increase the efficiency of Australia's water use, leading to greater certainty for investment and productivity, for rural and urban communities, and for the environment.”

The agreement was signed in 2004 by the Australian government and all the state and territory governments.

Chairman and CEO of the National Water Commission, Ken Matthews said Australia’s water supply would be in a more adverse state without the NWI.

“It has initiated a whole lot of things that just would not be happening otherwise,” he said. “A whole lot of reforms processes, management improvements that were overdue and actually have started and in some cases, are finished.”  

Demonstrable progress has been made in areas such as groundwater, water accounting, water trading, and urban water security.
 
However, Mr Matthews admitted there had been delays in implementation in almost every area of water reform which was affecting the progress of other reforms.

A number of urgent problems had also arisen including over-allocation, environmental degradation, the 4 per cent and 10 per cent rule in Victoria, cost recovery commitments by the Government, suspension of water plans and rural adjustment pressures.

“There have been developments since 2004 which are not being properly accommodated and the best example is climate change,” he said. “It now needs to be built more effectively into reforms.”

The NWI also had “forgotten areas” such as risks assignment & compliance and enforcement which had not been developed at all.

Mr Matthews said there were new risks emerging, particularly rural adjustment pressures which was the biggest risk to continuing water reform.  

Other issues that needed to be addressed were the mining industry, adjustment arrangements and urban water institutional reforms.

Mr Matthews said there were grounds for reform optimism: the NCI had a plan, unprecedented resources being devoted to water, high levels of political attention and the loyalty of stakeholders.

“It could be different. We could be in a position where governments and important stakeholder groups were resigning from the NWI and we wouldn’t have a plan,” he said. “There are still big opportunities for further reform and big opportunities for improving water management.”

Water shortages, lack of water security, environmental degradation, the increasing impacts on communities and the lack of government agreements were still issues of concern.  

Mr Matthew said he was very worried as a citizen that water reform in Australia was not happening fast enough.

“I worry that if it slows down even more, it will grind to a halt altogether,” he said. “[However], I think it’s important to communicate to people that there has been progress. Had there not been a NWC, a lot of things which are happening wouldn’t be happening.”
Managing Director of Yarra Valley Water and Chairman of WaterAid Australia, Tony Kelly said the National Water Commission needed to focus more on rural areas and the way water is managed in those areas.

He said the National Water Commission had been successful in its performance reporting in urban water as there were now national comparisons which act as a stimulus for further improvements.

“In the next three or four years, I think most of the capital cities in Australia will be in a much more secure position after investing 50 billion dollars in new sources.”

However, Mr Kelly said the imbalance between rural and urban areas needed to be addressed.

"On the national level… urban [areas] are only using 10 per cent of Australia’s fresh water and a majority of the balance is used in rural areas,” he said. “The emphasis now needs to be on rural areas and particularly on irrigation usage.”

Older irrigation systems needed to be upgraded as they could not longer meet the needs of modern farming.

Mr Kelly said the biggest national water issue in the next year and a half was the way water was managed in rural areas.

"Improving the efficiency of rural irrigation systems has been a major element in Victoria's Reform Agenda but much less so in other states," he said. “What’s happened down here in Victoria is that we have had the urban water users funding improvement in irrigation infrastructure in exchange for a share of the water savings.

The Victorian experience would provide cheap water for urban areas, increased security for farmers and benefit the environment as savings would go back into stress rivers.

In his address, Mr Kelly spoke about the progress of water reform in Victoria and the establishment of a state wide water grid which would link various regions together.

”These linkages really do need to be managed if we are going to exploit the potential of this grid,” he said. “Allying that with the introduction of more competition and third party access in the whole sale end of the system in particular holds great promise for further improvements in Victoria.  

The water grid would allow Victoria to optimise their supplies across the state for the benefit of farmers, urban consumers and the environment. In the past this has been compromised by a lack of coordination across utility boundaries and a lack of a state wide perspective experiencing the same water restrictions, he said.

“We will be able to even out the pain a little bit but also when things return back to normal hopefully we will have access to cheaper whole-sale water. That’s got to be good for urban users and farmers because it’s going to keep pressure off the prices.”

NB
Readers may also be interested in a follow-up conference being hosted by IIR Conferences:
Water Pricing & Trading Conference
24–26 August 2009 | Rendezvous Hotel, Melbourne
Analysing pricing mechanics of the Australian water market
www.iir.com.au/waterpricing

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