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Chapter 1 Water Amendment (Long-term Average Sustainable Diversion Limit
Adjustment) Bill 2012
On 20 September 2012, the House of Representatives Selection Committee
referred the Water Amendment (Long-term Average Sustainable Diversion Limit
Adjustment) Bill 2012 (the Bill) to the Committee for inquiry and report.
The reason for referral/principal issues for consideration given were:
This bill gives the Murray-Darling Basin Authority authority
to make adjustments to the Basin Plan without ministerial or parliamentary
Intent of the bill
The Bill amends the Water Act 2007 (the Water Act) ‘to allow
the long-term average sustainable diversion limit (SDL) set by the Murray
Darling Basin Plan (Basin Plan) to be adjusted ... without invoking the formal
Basin Plan Amendment process.’
Section 23 of the Water Act sets out how the long-term average SDL will
be specified. The Explanatory Memorandum (EM) to the Bill states that this
section currently creates the legal possibility of an adjustment mechanism.
However, no adjustment mechanism is currently specified.
If s23 provides a legal possibility of an adjustment mechanism, this
means that the SDL can be adjusted without any formal notification to the
community or Parliament. The Bill proposes a mechanism whereby any adjustment
must undertake a formal notification process.
The proposed adjustment process provides that the Murray Darling Basin
Authority (MDBA) may propose an adjustment of the SDL by no more than plus or
minus five percent:
- with reference to the
Basin Officials Committee;
- without preparing an
amendment to the Basin Plan under Subdivision F of the Water Act;
- with notice to the
Minister, who must then adopt the adjustment and table the adjustment before
Parliament as a non-disallowable instrument under section 38 of the Legislative
Instruments Act 2003.
Adjustments will be determined through savings or offsets found through
environmental works and measures projects. The existing process for
selecting and implementing environmental works and measures will not be amended
as a result of this proposal. Proposed projects will still be required to
undergo stakeholder consultation processes as set out by Basin State water
resource planning processes prior to the MDBA’s consideration of their inclusion
in any SDL adjustment.
In addition, the Basin Ministerial Council has stated that it is their
expectation that the SDL adjustment mechanism will operate as follows:
To ensure stakeholders confidence and facilitate the
preparation of water resource plans, Council requests that the SDL adjustment
mechanism and associated provisions in the Basin Plan:
- simplify the operation of the mechanism such that the SDLs
determined by the operation of the mechanism in 2016 are adopted in the Basin
Plan at that time, to take effect from 2019;
- allow for the construction and implementation of
adjustment measures to be finalised in a specified timeframe and confirm the
Commonwealth’s responsibility to continue to bridge the gap over this period;
- account for situations where adjustment measures do not
proceed as planned;
- enable state water resource plans to account for the time
taken to complete adjustment measures, particularly through the use of
‘reasonable excuse’ or ‘permitted take’ provisions or the incorporation of
formula based SDLs in state water resource plans; and
- clarify how any formula-based SDLs in state water resource
plans should operate to reflect progress in SDL adjustment initiatives from
It is also worth noting that the Ministerial Council has agreed that
environmental works and measures should include any further modelling of works
under the Living Murray Program.
The Committee is satisfied that the processes already in place for
community and stakeholder consultation as specified in state water resources
plans should adequately address any concerns about adjustments being subject to
The Committee is further satisfied that consensus view of the Murray
Darling Basin Ministerial Council, as outlined above, outlines the clear intent
of the Basin States to ensure that all stakeholders will be involved in any
processes they put in place to determine projects to be considered in the
proposed SDL adjustment mechanism.
Reason for the proposed amendment
An SDL adjustment mechanism to respond to efficiencies gained in
environmental works and measures was recommended by this Committee in its July
2012 report on certain matters relating to the Murray-Darling Basin Plan.
In addition, the Murray-Darling Basin Ministerial Council, representing
the Commonwealth and all Basin State governments, recommended that an SDL
adjustment mechanism be included in the Basin Plan ‘through which environmental
works and measures could be counted as reductions against held water’.
Impact of the proposed amendment
The proposed amendment relates solely to parliamentary scrutiny of
amendments to SDLs.
Under the Water Act as it currently stands, if the SDL is expressed as a
quantity of water in the Basin Plan, to adjust the SDL the MDBA must comply
with Subdivision F. Section 47 of this subdivision sets out the consultation
process for an amendment to the Basin Plan which includes:
- a public consultation
period of at least eight weeks, followed by;
- a six week
consultation with the Murray-Darling Basin Ministerial Council, followed by;
- an allowance of 12
weeks for the Minister to consider the amendment and table it in Parliament,
consideration of the amendment for a period of 20 sitting days as a
This means that any amendment to the SDLs could potentially be delayed
for over six months.
Through both inquiries that this Committee has conducted into the
Murray-Darling Basin Plan it has been clear that the community wants the MDBA
to have more capacity to react in a timely and effective manner to changes in
environmental conditions and river management.
The Bill gives some extra responsibility to the MDBA, as unanimously
recommended by this Committee. Therefore the Committee considers that it will
give the MDBA the capacity to appropriately react to proposals in a timely
manner and on a valley-by-valley basis.
In addition, as SDL adjustments will be in response to environmental
works and measures put forward by Basin States, the Committee is confident that
due diligence will be adequately followed and all stakeholders appropriately
Finally, the MDBA will be limited in any SDL adjustment by a percentage
amount of plus or minus five percent and the Parliament must be informed through
a non-disallowable instrument. Proposed adjustments of greater than this amount
will invoke Subdivision F of the Water Act as outlined above. Therefore, the
Committee is confident that these safeguards are appropriate.
The Committee is confident that the proposed amendment strikes an
appropriate balance between allowing the MDBA the capacity to act in a timely
manner when making SDL adjustments and continued Parliamentary oversight.
Given that the scope and intent of this bill is limited to governance
issues and is in direct response to a House Committee report, the Committee
recommends that the Bill be passed.
||The Committee recommends that the House of Representatives
pass the Water Amendment (Long-term Average Sustainable Diversion Limit
Adjustment) Bill 2012.
Tony Windsor MP
4 October 2012