SUBJECTS: Murray-Darling Basin Plan; Australian economy.
MINISTER FOR THE ENVIRONMENT AND WATER, TANYA PLIBERSEK: After the millennium drought, governments came together across the Murray-Darling Basin and decided that it was just not on for the Murray-Darling Basin communities and environment to suffer once again like they had during that millennium drought. So after many years and much negotiation, they came up with the Murray-Darling Basin Plan. Now it's a complex Plan with a simple objective and that objective is to make sure that the Murray-Darling Basin communities and environment would be protected from the impacts of future droughts as well as they possibly could be. The objective was to set up the river system better for the future.
Of course, the plan has been off-track now for a number of years. The previous government deliberately delayed - and I would say even sabotaged - the Murray-Darling Basin Plan. When I asked the Murray-Darling Basin Authority recently for advice on whether the plan could be delivered on time, I was confirmed in my worst fears that, in fact, the plan wouldn't be delivered on time and that we needed to find a new way forward with the Basin states. So much of the work that has been done towards the Murray-Darling Basin Plan - and I acknowledge that a lot has been done over the years - almost all of it has been done during the time that Labor has been in government. In fact, well over 80% of water recovery has been done under Labor Governments. What we have seen under Coalition Governments is a deliberate go-slow, a deliberate sabotaging of the plan, and that means we're way behind where we should be. We're way off track for delivery.
Today I'm very pleased to announce that after many months of negotiations with the Basin states and territory, we have stuck - we have struck an historic agreement for a way forward. This way forward will deliver on the whole of the Murray-Darling Basin Plan, including the 450 gigalitres of additional water for the environment. What we're proposing is more time, more money, more options, and more accountability. I'll go through those in a moment. This is really about a return to common sense. The Murray-Darling Basin Plan is an incredible piece of cooperation between the Commonwealth and the Murray-Darling Basin states and the ACT. It came out of a period of environmental catastrophe and it's designed to avoid another environmental catastrophe. We know that south-east Australia, in particular, is getting hotter and dryer and although we have had a few wet years recently, we know that the next drought is just around the corner. We can't stand by and allow our threatened species, our rivers, our wetlands, and the three million people who rely on this river system for their drinking water to be unprepared for the next dry period. So that's exactly what we're doing today - we're making sure that we set the river system up for the future.
Specifically on more time - there's two very important elements to this. There are a number of infrastructure projects - water infrastructure projects, supply and constraint projects - that will be given additional time for their delivery. So they'll be able to be delivered in 2026 rather than 2024 when they were originally due. On the 450 gigalitres of additional environmental water, we're extending the time frame for the delivery of water to 2027. And importantly, instead of relying only on infrastructure projects for that 450 gigalitres, we'll be seeking voluntary water purchase towards that target as well.
It's very clear that the settings in the plan as they exist at the moment make it impossible for the plan to be delivered on time and that's what the Murray-Darling Basin Authority has told me. So any questions?
JOURNALIST: Minister how can you just tear up the 2018 agreement that had the terms for the 450 gigalitres?
MINISTER PLIBERSEK: Well, I'm certainly not tearing it up. The simple fact is, of that 450 gigalitres of additional environmental water, when I became the Water Minister, 2 gigalitres of that had been delivered. So in 11 years, they managed to get to 2 gigalitres of 450. It is obvious that what's happening at the moment isn't working. So what I'm proposing for that 450 gigalitres is that instead of relying on some mythical projects that haven't eventuated until now, and are unlikely to eventuate in the future, we'll also be open to water purchase in this area. I think it's also important to say that just recently we engaged in an extensive consultation with basin communities about the best common sense way to deliver on this 450 gigalitre target. And we actually got some terrific ideas about the best way forward including, of course, being able to purchase water towards the target, but looking at other infrastructure projects as well, looking at water use rules, and we're very open to all of those suggestions. I have consistently said that all options are on the table as far as I'm concerned. What I'm looking for are more options here, not fewer options.
JOURNALIST: Can you give us the scenario of how much of that 450 will need to come from buybacks? Will it come from the northern basin or the southern basin? Do you have - I mean, I'm sure it's up for negotiation. Can you give us an idea of the proportions?
MINISTER PLIBERSEK: Look, I'm not going to start to speculate about the proportions of the 450 gigalitres that will come from projects or water purchase or other means. I don't think that's productive for a number of reasons. The first is - we're still going through - we got more than 130 submissions through what we heard consultation that we did and we are of course, methodically going through those and wherever we can reduce the need for water purchase by using infrastructure or other methodologies, of course, we will do that. So it's not productive to begin to speculate. I also want to be quite careful about what I say about our water purchase program because as soon as the Government is in the market for water, there is the risk that water markets might be distorted.
I would also say obviously that we need to do legislative amendments in the Parliament in coming weeks. One of the things that we'll be doing at the same time as we'll be, for example, changing the deadlines of elements of the plan and removing the cap of 1,500 gigalitres of water that can be purchased, making sure that the water for the environment special account can be used to do voluntary water purchases, a number of things we need to do in our own legislation. We also will be introducing measures to make sure that our water markets are better run and better protected. There's been a lot of good work done to make sure that we get the cowboys out of the water markets to make sure there's more transparency, more accountability, and fewer cowboys.
JOURNALIST: I understand you don't want to tell us how much money you have got for buybacks in the future. Have we spent all of the $13 billion, I note there was something in a couple of budgets ago about an undisclosed amount of money allocated. Has it already been allocated? And have you spent the $13 billion?
MINISTER PLIBERSEK: Well, there is still money in the water for the environment special account that is unspent, and just looking at the figures here, off farm efficiency measures, $1.5 billion was available for those off-farm efficiency measures. Only $350 million of that was spent. There was $60 million set aside for on farm efficiency measures. None of that was spent. So you had a government that actually - with the previous government, the Coalition Government, happy to say they supported the Murray-Darling Basin Plan, but were not prepared to do the hard work to actually deliver the Plan. I can't stress enough well over 80% of all of the water that's been recovered towards the Murray-Darling Basin Plan was done when Labor was in government. When I came to be the Minister for Water, only 2 gigalitres out of 450 had been recovered in that additional environmental water part of the plan.
JOURNALIST: Why hasn't Victoria agreed to sign up?
MINISTER PLIBERSEK: Well, it's a matter for Victoria, but what I will say is that the states that have agreed will get more time to deliver the water-saving projects that they're engaged in. They'll get more money to deliver those projects and also if there are social and economic impacts in their communities, those state governments will have funding to support those communities. They'll get more options. So, of course, my door will be open if they got other projects that they want to bring forward, if they got other ways of delivering on the objectives of the Murray-Darling Basin Plan. I think that it's very clear that with more time and potentially very substantial additional funding that this is an excellent deal for states. What I would say is that Victorian officials have continued to work cooperatively with Commonwealth government officials and my door will always be open to Victoria joining on with this Plan. It's certainly in the interests of Victoria to do so, more time, more funding, but also better environmental outcomes and when it comes to delivering these projects, one of the reasons that we're doing the water supply and constraints program is, of course, because we want to reduce the amount of water that we need to buy through voluntary water purchases, the more we can invest in water-saving projects, the less need there is to buy water in the marketplace.
JOURNALIST: So can I just clarify with you - does that mean that Victoria has to meet the earlier deadlines? Does it mean that they are going to get buybacks automatically if they don't sign up for the new plan?
MINISTER PLIBERSEK: Well, just to be clear - voluntary water purchase is something that the Commonwealth government will do subject to these changes passing through the Parliament, subject to the legislative changes we need. It will be the Commonwealth government doing voluntary water purchase. We don't need the agreement of the states to do that. We'd like the cooperation of the states where that's possible, but New South Wales has also made clear that they're not supporters of buybacks. They understand that this is something that is a matter for the Commonwealth Government and we'll of course be working as cooperatively as we can with state governments like New South Wales to say if there are any social and economic impacts, we'll work with you. We'll fund adjustment policies and programs for those areas that might be impacted.
When it comes to the time frames, we can't single out states under the legislation, but what we need to do to extend the time frames is come up with new funding agreements for New South Wales. So we will enter into a new contract with them that says we'll continue to fund these projects, the deadline has changed from 2024 to 2026. We often have to execute updates to these sorts of funding agreements. If Victoria is not interested in updating its funding agreements, then that's a matter for them.
JOURNALIST: Ask you a question on another matter. What are the implications for Australia considering the economic downturn we're seeing in China?
MINISTER PLIBERSEK: Sorry, do you mean the impacts on water and agriculture or do you mean broadly you're asking me a question about the economy?
JOURNALIST: Broadly, yeah.
MINISTER PLIBERSEK: Well, look, the Australian economy is always impacted by the economic upswings and downturns of our major trading partners. Of course, it has a potential impact on our economy, but I know that the Treasurer will have this well in hand and I know that our Trade Minister is working very hard to make sure that we are re-establishing Australian markets in China and hopefully that will take the edge off of any impact that you see from a downturn in the Chinese economy.
JOURNALIST: Have you spoken to Dan Andrews about this water agreement? What was his attitude?
MINISTER PLIBERSEK: I have spoken to the Victorian Water Minister many, many times about this agreement, and I believe the Prime Minister and the Premier have spoken as well.
JOURNALIST: Do you have the support to get this through the Parliament? And do you think the Greens will support it?
MINISTER PLIBERSEK: Let's see. This is a great opportunity for our Parliament. It has something for everyone. The Liberals and the Nationals have called for an extension to the timelines for these projects. So they have already said that they want to see longer for the Murray-Darling Basin Plan to be delivered. So our proposal will meet their request that the time frames be extended. The Greens have said that they want to see the whole of the 450 gigalitres of water for the environment delivered. This will do that. So I very much hope we'll get support from the Liberals and the Nationals and the Greens and the crossbench to deliver this, but we'll see.
JOURNALIST: We are at a stage now where we have got this 450, we have only got a small portion of it delivered. Are you saying you're going to give states until 2027. At what point do you reach for the big guns and start water buybacks? Because this is what has happened, we're getting to the deadline of 2024, we're less than a year way and we haven’t got anything near like what we need?
MINISTER PLIBERSEK: So we need to change legislation, so we'll be going into the Parliament with our legislative changes well before the end of the year. They should be introduced in very shortly, in coming weeks, and what that will enable me to do is to remove the 1,500 gigalitre cap on the amount of water that can be purchased. It’ll mean the water for the environment special account funding can be used for voluntary water purchase. We haven't been sitting on our hands when we it comes to water purchase. We actually are in the middle of a tender right now to complete the Bridging the Gap part of the Murray-Darling Basin Plan. So we need to get 49 gigalitres of water to complete that part of the plan and we'll be purchasing a substantial portion of that and the tender for that will be finalised in coming weeks. What I would say about this is it's not as easy as it sounds. We definitely need willing sellers and the water that we have purchased towards the Bridging the Gap target, that whole process has taken several months now - about nine months in total - because we need to find those willing sellers and we need to make sure that we're getting good value for money for taxpayers, and that the water that has been purchased - has the environmental utility we're after. We do see an enhanced role for water purchase in the future. We have got a long way to go. That 450 gigalitres of additional environmental water, if we just wanted to buy that, just to give you an idea of the volume, you're talking about 180,000 Olympic-sized swimming pools. I know most people don't really think in gigalitres, but this is a big task ahead of us. We are a very long way from achieving the objectives of the plan because we had a government for almost a decade that deliberately sabotaged it.
JOURNALIST: How much will you compensate communities where you buy back water?
MINISTER PLIBERSEK: Well, that very much depends. Our first objective is to minimise any social or economic impacts. Of course, we'll be looking for water purchases that minimise effects on communities. Secondly - it will depend on where the water has been purchased, what kind of industry existed there in the future. So I'm not going to speculate about the sort of amounts we're talking about other than to say we have more funding available than has been provided by any previous government, should it be necessary.
JOURNALIST: And how much will the Government - the Commonwealth spend on buybacks?
MINISTER PLIBERSEK: Well, again, we're simply not going to start speculating even about the number of gigalitres of water we're going to buy because to do that risks distorting the water market. What we'll say to you is we're determined to deliver the Murray-Darling Basin Plan in full. We said we would before the election. We're going to do it. What we know for certain is just as we have had a few years that have been too wet in many parts of Australia, the next drought is around the corner. We're already seeing the first signs of El Nino coming back. We're seeing some areas that have got substantially less than average rainfall already. We need to prepare for the future, that's what we're doing.
JOURNALIST: Can I ask you about the sustainable diversion limit adjustment mechanism.
MINISTER PLIBERSEK: You can, you can ask me!
JOURNALIST: What a mouthful. We had states put forward proposals and then nothing has happened over a fairly long period of time, I think they were all meant to start in 2019?
MINISTER PLIBERSEK: Yep.
JOURNALIST: So how - how will you ensure that it happens by 2026? What have you got in mind in a practical sense to get states to put them on the table and actually deliver them?
MINISTER PLIBERSEK: So with the sustainable diversion limit adjustment mechanism projects, you're talking about 36 projects, 14 of them are working, six of them are likely to be delivered on time. So that's about 20 of the 34. The other 16 are in trouble. Some of them are unlikely to be delivered, some of them just flat out won't be, given what we know now. We do want to give additional time for the projects that can be completed, to be completed. It makes no sense to have identified a pathway forward to save water and then not to use that pathway. But, of course, that requires, first of all, legislation to pass through our Parliament and then it requires states and territories, in particular, in this case we're talking largely about New South Wales, to be prepared to sign up to the extended time frames and the extended accountabilities that go with the extra time and the extra money, come with extra accountabilities. So that's what we're working through with New South Wales in coming months and, of course, if Victoria do want to change their mind and sign up to this agreement and get the extra time, the extra money, then we'll have to do the same process with them to work out what the realistic pathway is to delivering the remaining projects.
JOURNALIST: Just on Indigenous cultural water, how is that going, allocating that - that money to communities?
MINISTER PLIBERSEK: Great. It is proceeding. We came into Government with very little work done about how this might happen. There's a number that the previous government had, but no mechanism for allocating that water. So we have been having extensive talks with - there's about 40 First Nations across the Murray-Darling Basin. We have been working with peak groups in the north and in the south to design the right mechanism to make sure that this $40 million of water is used for the benefit of First Nations people across the Murray-Darling Basin. People have different views, people from different communities have different views about how best that might happen and so we're just patiently working through those different views at the moment. OK, thank you all.
