The South Australian government has announced a High Court challenge to Victorian rules that limit the extent to which trade in water rights can transfer water allocations from one catchment to another, and, in particular, from one state to another. Victoria’s rule limit the extent to which upstream irrigators can be bought out, with the water being allowed to flow downstream to South Australia for irrigation or urban use there, or as an environmental flow.
IANAL, but this would seem to fall under Section 92 of the Constitution which requires free trade between the states. In any case, I hope that the combination of political and legal pressure forces Victoria to drop this rule, which primarily benefits irrigation companies, while harming those Victorian farmers who would like to sell their rights and diversify into some other type of agriculture (those who simply want to get out of agriculture can sell their land and water rights as a package).
John Quiggin 
On a elated topic, the Age commentator Kenneth Davidson has suggested a number of times, the feasibility of piping water from Tasmania to Melbourne, obviating the need for further plunder of the Murray and Goulburn systems.
Do others agree with Davidson’s suggestion and what are the reasons the Victorian government seems reluctant to consider this (if feasible)as an alternative to piping water from MD agricultural areas and desal?
There may be a small problem as their is a moat between Tasmania and Melbourne.
Is it really sensible to irrigate farms in France by piping Thames water across the channel?
Maybe we could issue 457 visas for rowboat oarsmen and have water ferried across the Bass Strait in milkchurns.
This would probably be cheaper.
Vic water minister Tim Holding has made a real twit of himself by wrongly accusing SA of having an apalling record on water.
His accusations are –
FAILING to upgrade leaky old irrigation infrastructure. ;All SA irrigation is pipelined, unlike NSW,VIC and Qld where most irrigation is by open channels.
CONTINUING to rely on the Murray for almost all of Adelaide’s water supply. ;Adelaide simply hasn’t the rainfall or the catchment to be independant of the Murray and clearly leads the other states in rainwater tanks and waste/stormwater recycling.
BEING the last mainland state to commit to building a desalination plant. ;I think de-sal is a dumb idea anyway but the SA plant is ahead of Melbourne’s.
GIVING the state’s farmers a water allocation when Victoria’s farmers were on zero per cent allocation – water which could have gone to the Lower Lakes. ;SA farmers have high security licenses while the Vic farmers on zero were low security. Currently, Sunraysia irrigators have over 30% allocation while SA irrigators ae still on 18%.
Paul Walter #1 I will repeat what I have written before which is a little blunt.
The pipeline is an expensive and unnecessary fart in the brain. Stormwater and treated sewerage from all our cities are pollutants and need to be collected, cleaned and recycled, not allowed into the sea or other waterways.
The last thing any of our cities need is more people. Put sustainable before development.
John,
This restraint is not harming small farmers any more than they are currently being affected by drought and prices. Profiteering in the water industry is happening regardless of this rule. The existing restraints are principally to protect some areas where existing infrastructure is likely to be stranded by water migrating out of the region. The principle that trade would shift from “bad” farms to “good” farms improving efficiency is proving elusive, because the reasons for sale and the agents involved have a host of motivations. If the farm and water package is sold to a land agent or speculator, that agent is free to split the land and water. This is happening frequently. The water doesn’t get to SA, but it does shift out of the region. This is poor comfort for those in regions where income is shifting out.
With the size of irrigation farms and the drought there is nothing to diversify to. Farmers in Northern Victoria think that technocrats in big cities want to see them phased out. They are right to be paranoid.
I can see that there might be in principle reasons for wanting open trade, but it’s difficult to see practical reasons that will be good for the environment or socially with the situation as it is. The government is going to buy back drought-inflated licences – a bit of planning with foresight might have been better for both irrigators and the taxpayer.
Trade has improved industry efficiency, but it could have been carried out with much less harm and some would have happened in nay case. The efficiencies imagined were never gained.
Water markets should never have been implemented without scoping the risks faced by 1. adding sleepers and dozers to over-allocated catchments in the free release of rights and 2. declines in supply due to cuts in rainfall (it was a matter of time before the dry period of 1895-1946 came around again, even without climate change). Both in my book, were totally forseeable.
I’m in favour of water trading in principle, but not the way it has been done, and bloody nervous about carbon for these reasons.
It would probably be much much cheaper to buy back Cubby Station and the Condamines-Balonnes irrigators.
Roger#4, you bring up many points.
Restraints. Each irrigation area needs to have exit penalties to help maintain viability for those that remain.
I think the drought is distorting what should happen in respect to water flowing from ‘good’ to ‘bad’. There is definitely a ‘flow’ happening because highvalue SA plantings are buying temp licences but we are a very small market. The big effect needs to be seen in NSW and VIC and both are basket cases as far as changes in water use goes.
2nd para, yes some farmers have to go so they may as well fight tooth and nail to get the best exit deal possible.
The rest I pretty much agree with.
Alice#5, do you mean cheaper than a high court challenge? Regardless, Cubby needs to be dissolved because it is the example of what should not be happening in the MDBasin.
Cubby came into existence by questionable circumstances and although there are many far worse examples of government corruption and water wastage, Cubby is the focus.
It’s a pity Cubby isn’t in NSW because that is the state which truly wastes the most MDBasin water and has the greatest area of ‘bad’ crops like cotton and rice.
I would’nt have thought that someone like Davidson would have conjured a “fart on the brain” to the point of taking the idea to print?
Could it be pssible that theidea is poo-pooed because it might interfere with logging, woodchipping and pollution of catchments in Tasmania for the benefite of a motley constellation of vested interests not dissimilar to those operating out Queensland.
And whither all the infrastructure rorts involving Desal plants and the decimation of the Goulbourn Valley in Victoria, let alone consequences for South Australia for similar reasons. Why else did we have introduced, a “compretion” regime between states?
But Isympathise mightily with the comments re water harvesting,etc. And we only have to imagine what contents reside within the contracts guarded by FOI and comercial-in confidence, that could explain why these alternatives are not considered.
I wouldn’t have thought that someone like Davidson would have conjured a “fart on the brain” to the point of taking the idea to print, without a little reseach prior?
Could it be possible that the idea is poo-pooed because it might interfere with logging, woodchipping and pollution of catchments in Tasmania for the benefit of a motley constellation of vested interests not dissimilar to those operating out Queensland.
And whither all the infrastructure rorts involving Desal plants and the decimation of the Goulbourn Valley and rainforests of Victoria, let alone dire consequences for South Australia involving similar reasons. Why else did we have introduced, a “competition” regime between states?
But I sympathise mightily with the comments re water harvesting, etc. And we only have to imagine what contents reside within the contracts guarded by FOI and comercial-in confidence, that could explain why these alternatives are not considered.
Salient #7 says “Alice, do you mean cheaper than a high court challenge?”
Well, I know lawyers are masters of the universe when it comes to charging but I would still suggest cheaper than the idea of piping water from Tasmnania (althought it is possible I could be wrong on that).
Paul, the only reason Melbourne wants more water is to support a higher population and therefore more development.
The cheaper it can obtain this water the better except in the case of water recycling because this needs a lot of land which they would rather fill with people.
A pipeline from the Murray catchment is more expensive than water recycling but cheaper than a pipeline from Tassie, which could also be fraught with other issues such as you mention and more.
Clearly, being sustainable is not a priority of the Vic govt.
Alice,lol, now that I know what you were refering to, buying water from any irrigator to sell to city consumers is from a purely price oriented view making better use of that water.
However, our cities need feeding and they need to make better use of the water they use and waste anyway.
“The water doesn’t get to SA, but it does shift out of the region. This is poor comfort for those in regions where income is shifting out.” – roger@4
But roger, in that case the water is shifting out to where it is more valuable, but the income is shifting in in return.
I really can’t see why farmers in areas that could sell water are so opposed to having the option of making easy money when circumstances suit (and when they don’t, they won’t sell). Don’t forget that in the case you posit of a real estate agent unbundling the water rights from the land, the price said agent paid the exiting farmer will include the value of those tradeable rights.
Roger, you’re absolutely right about sleepers and dozers and pretty much right (the NWI made some attempt to address this) about climate change. I wrote a lot of criticism of the simple-minded way in which water rights were introduced.
But that horse has bolted, and there’s no option now but to expand the scope of trading and for governments to repurchase the rights they gave away 15 years ago.
JQ: can you recommend some reading on the state of water laws in Australia?
I’m looking for something akin to:
serious discusion OR
one-page, somewhat humorous version.
I’m trying to compare Australia vs the US West to understand similarities and differences.
Why don’t we as a nation do something positive about getting more water into the Murray instead off shutting down agriculture.
How about a nuclear power station/desal unit built on the coast directly east of Eucumbene dam, and the water pumped into Eucumbene and some of the power recovered on the run down to the Murray/Murrumbidgee, farming can continue, jobs retained, small towns need not die.