Programs under the Murray Darling Basin Plan face a funding cliff at the end of the next financial year exposing the Government’s approach to delivering the remainder of the Plan.
Communities throughout the Basin face an uncertain future and there appears to be no sense of urgency from the Government to resolve issues with the States according to Shadow Emergency Management Minister, Perin Davey.
“Despite both NSW and Victoria requesting extensions to ensure environmental projects, delayed by COVID and floods, can be finalised, the Labor Government have not committed any funding for water recovery or constraints projects post 1 July 2024,” she said.
“It just shows the Victorian Minister was right to cancel four infrastructure projects due to uncertainty around Federal funding.
“The State’s have already invested so much time and money into projects to offset the need for water recovery and the failure of this Government to even consider an extension is galling.
“The fear is, without the extension, there will be a mad rush to buy the gap prior to the legislated end to the Basin Plan – and that will come at a huge cost to Government, to communities and to the Australian economy.
“Water market experts have estimated the cost to purchase enough water licences to bridge the gap will be over $20 billion which is far more than the funding currently available in the budget.
“Then you need to factor in the loss in productive capacity, associated job losses, the list goes on.
“In the October budget there was a ‘not-for-publication’ line item for water purchase and there is currently a tender open to purchase 49GL,” Senator Davey said.
“The fine print in the tender documents make it clear the Government is using the process to sound out the market with a 12 month window for the Department to accept the offer.
“The funding cliff in the budget shows this Government doesn’t have a plan B,” Senator Davey said.
According to the Budget papers there is $165 million for 2023-24 in the Sustainable Rural Water Use and Infrastructure Program to complete State-led infrastructure projects but no funding beyond. The Water for the Environment Special account, set up to recover the 450GL additional water, has just over $845 million to the end of the year. Portfolio Budget Statements (dcceew.gov.au) (page 70)
ENDS: 09 May 2023