5.1
Due to the need to have six governments involved in managing the Murray‑Darling basin (basin), the compliance and enforcement arrangements in the basin are fairly complex. Broadly, basin states are responsible for enforcing water users' compliance with individual obligations, while the Murray-Darling Basin Authority (MDBA) and the newly legislated Inspector-General are responsible for enforcing states' compliance with their obligations under the Basin Plan.
5.2
This chapter explores key issues relating to compliance and enforcement which were raised during this committee's inquiry. This includes the nature and impact of inconsistencies in the compliance and enforcement regimes of basin states, such as metering, level of government compliance activities, water accounting, and penalties. The chapter outlines concerns regarding division of compliance roles, and responsibilities and barriers to improving compliance. The chapter concludes with initiatives to improve compliance and the committee's view and recommendations.
Metering and compliance across basin jurisdictions
5.3
Accurate, consistent, and comprehensive metering of water enables the tracking of water use, savings, and trends over time. Critically, metering also enables regulatory authorities to monitor compliance with licence restrictions and ensure that only permitted and sustainable levels of take are being extracted from particular water resources and the basin overall. More broadly, understanding how much water is being taken, and for what purpose, empowers governments to make informed decisions for communities, industry, and the environment.
5.4
Consistency in water metering between basin states has been on the national agenda for some time. The first national standards, agreed by basin governments in 2009, stipulated that all non-urban meters should comply with the national standards by 2020. In 2018, under the Basin Compliance Compact, basin states committed to ensuring that meters will comply with the national standards, and all forms of water take will be metered by 2025.
5.5
In its 2017 report, the Murray–Darling Basin Water Compliance Review (Compliance Review), the MDBA found that over the four years from 2012–13 to 2015–16, between 64 per cent and 73 per cent of basin surface water was metered. Among the states:
South Australia had the highest metering rate, with 96 per cent of surface take being metered, but it has an ageing fleet of meters. South Australia meters 88 per cent of groundwater take.
Victoria has the largest fleet of modern meters in Australia, with 91 per cent of groundwater and 83 per cent of surface water take in northern Victoria metered. As at 30 June 2019, approximately half of Victoria's 57 000 meters have telemetry that can provide data on water use in real-time or at least daily to water corporations and to water users.
It is unclear what percentage of surface water is metered in New South Wales [NSW] and Queensland. However, the MDBA Compliance Review found that, overall in the northern basin, between 25 per cent and 51 per cent of surface water take is metered. In terms of groundwater take, NSW meters 83 per cent and Queensland meters 28 per cent.
5.6
Basin states have been working to expand and strengthen their metering arrangements, but there are differences in the way they are approaching the task. For example:
In 2018, NSW introduced a non-urban water metering framework and began staging a five-year rollout which aims to have all its regions complying with new rules by December 2023.
Queensland released a non-urban water measuring policy in early 2021 and is expected to implement improved measurement of large-take, high risk water entitlements in the basin from 2021. Queensland has also indicated that it will begin to implement its strengthened metering policy from 2022.
Victoria's meters are being upgraded as they expire and where costs are not prohibitive.
In South Australia, all meters currently comply with local policy, and new or replacement meters must comply with the national standard.
In the Australian Capital Territory (ACT), meters are already required to comply with the national standard.
5.7
The MDBA's May 2021 Compliance Compact Review highlighted that the Basin Compliance Compact does not set a minimum standard for when a meter or telemetry is required, and contended this undermines community confidence and perpetuates views the system is unfair. The MDBA recommended that basin governments develop and observe minimum thresholds for when a meter is required.
5.8
Ms Helen Vaughan, representing Victoria's Department of Environment, Land, Water and Planning (Department of Environment VIC), told the committee that the Basin Plan reflects and accommodates the differences between states' frameworks, and simply aims to improve consistency, 'noting that consistent does not mean identical'. Ms Vaughan argued that:
[J]urisdictions are all at different points in developing their compliance and enforcement systems, and the different hydrologic systems have different needs. There are also issues like mobile blackspots making telemetry impossible—this is why a one-size-fits-all approach is not implementable.
5.9
Lack of consistency in how rules are being enforced in different parts of the basin was raised as a concern by several witnesses. For example, the Victorian Farmers Federation was critical of the differences in metering, arguing that all Victorian irrigation diversions are largely metered through telemetry and that 'Victorian farmers lack confidence in the Commonwealth and MDBA's ability to monitor the Basin Plan. You cannot monitor what you cannot measure.'
5.10
The Lifeblood Alliance was concerned that 26 per cent of water take nationally is estimated rather than measured. It argued that all jurisdictions should be placing a high priority on measuring all forms of water take in the basin.
5.11
Differences in metering have also bred mistrust between water users across the basin. Mr Chris Brooks, Chair, Southern Riverina Irrigators, summarised some of the key concerns of water users in parts of the southern basin:
[T]he difference between all of the states and the different rules that apply pertaining to water have been a complete disaster. You've got almost an uncontrolled take in Queensland—no metering, no monitoring and no concern for the environment—and you've got a fixed volume going to South Australia. Here in the middle, we are getting it both ways: it's not coming down, and yet it's going away.
5.12
Likewise, Ms Sophie Baldwin, Representative, Southern Connected Basin Communities, raised concerns about non-compliance in the north:
[T]he flaws in the Basin Plan are obvious, starting with the very premise that a connected river system is the key principle, and even that can't be achieved, when northern irrigators continue to take such vast volumes of water from the system that they have stopped the Darling River from flowing.
5.13
The then interim Inspector-General of Murray-Darling Basin Water Resources, Mr Mick Keelty AO, argued that there is inadequate floodplain harvesting regulation in the north which is undermining the confidence of southern communities:
…we don't know what amount of water was diverted there. And there has been absolutely no compliance in Queensland to measure the difference between what was prior to the introduction of the Water Act in Queensland to those capital works, because they don't do that type of compliance work. Their compliance work is based on vegetation clearance. So, in terms of diversion of water and compliance activity around diversion of water from flood plain harvesting and measuring it, it's just not being done…
5.14
Mr Keelty argued that improved monitoring is required to alleviate concerns:
[T]he first steps are that the Queensland and NSW governments have to implement the metering and telemetry. NSW introduced their legislation back in 2018 to be delivered by December 2019. They've delayed that now to December 2020…Queensland is yet to introduce their legislation and their metering and telemetry…I understand the problem in Queensland; the Murray-Darling Basin is only a small proportion of their state, and to deliver legislation that is applicable across the state is problematic. But it's not helping the suspicion from south of the border about what's going on north of the border.
5.15
Mr Christopher McCosker, Executive Committee, Border Rivers Food & Fibre, argued that that there is general misunderstanding of compliance levels of the northern regions which are, in fact, highly compliant:
We've been very compliant for 40 years, and this is part of what we're a bit indignant about, all the noise that goes up and down the river. We've been compliant with telemetry and metering for 40 years, yet anyone would think we're cowboys and had never been anywhere near it. No-one has come to realise that we've been compliant, we've led the way, we've wanted to do it.
5.16
Likewise, NSW Irrigators' Council explained that 'many in the public do not know that the water used by irrigation farmers is licenced, subject to an allocation system, paid for, metered and capped at a sustainable level'.
5.17
However, Cotton Australia observed that there is still considerable work to do to ensure all significant water use is metered or measured to acceptable standards, and the data collected, processed and publicly available in a timely manner. Cotton Australia argued that while each state does not need to replicate the NSW Natural Resources Access Regulator (NSW NRAR):
…they do need to improve their compliance and transparency to a level that at least equals NRAR. All stakeholders have the right to expect that each jurisdiction has a clear set of rules, those rules are being enforced, and if they are not followed, appropriate action will occur.
5.18
Likewise, the Gwydir Valley Irrigators Association argued that 'consistency across all jurisdictions, in implementation of measurement and metering reforms is required'.
Standard of metering required
5.19
The practicality of the standard of metering being required in the basin was questioned by some inquiry contributors. For example, Mr Jim Cush, Chair, NSW Irrigators Council, argued that the agreed standard is impractical for agricultural water:
We've used an Australian standard, AS4747, which is a food-grade standard, and we're trying to utilise that on floodwater…Some meters can't read clean water, some meters can read dirty water. It is agricultural water; it's river water…up here it does get quite murky at times.
5.20
Cotton Australia also raised concerns about the blanket requirement for all meters to meet the AS4747 standards, arguing that accurate water measurement must also be cost-effective. Mr Michael Murray, General Manager, Cotton Australia, contended that the timeframes for basin states to meet metering requirements are unreasonable due to poor availability of compliant meters on the market:
I've got concerns about AS4747, because it is such a hard standard to meet. When we cross the line of having that standard with telemetry in NSW—and they'll be the first to have it across the whole jurisdiction—that information will be very timely. There are issues about it, and there have been issues about meeting those deadlines. The first deadline passed on 1 December last year, but the first approved telemetry device was only commercially available in August last year. There's been a market failure, so people need to have time to catch up…
5.21
Cotton Australia was of the view that there should be a general move towards telemetered, accurate meters and other suitable measuring devices where they are effective and economical. However, its support was contingent on jurisdictions resolving issues around security and governments having appropriate systems in place to manage the data transparently.
Reporting water use
5.22
There are also differences across jurisdictions in how regularly water users must report their water usage to the relevant regulatory authority. For example:
In NSW, reporting obligations differ depending on the type of water take, licence, meter used, whether telemetry has been installed, and if the new metering requirements have been rolled out in the region. However, broadly, it appears that water users in NSW are required to report their water take monthly or have it reported automatically every 24 hours where telemetry is installed.
In Victoria, many irrigation systems have automated control systems. These systems provide the state's regional water corporations with information about water deliveries and losses. This prevents people from ordering more water than they are allowed.
In Queensland, unless otherwise specified, the metered entitlement holder must provide up to two readings within a water year for each meter to the Department of Regional Development QLD.
In South Australia, some licences require individuals to provide either quarterly or yearly meter reading to the Department for Environment and Water (Department for Environment SA).
All licensed extraction in the ACT is metered and the licence holder must demonstrate to the ACT Environment Protection Authority (ACT EPA) how the metering measures water use, but it is unclear how regularly individuals must report meter results to the ACT EPA.
Burden of metering costs
5.23
The burden of metering costs also differs across basin states.
In NSW, due to the rollout of new metering arrangements, some license holders must purchase meters while some are owned by the state.
In Queensland, the cost of installation, maintenance, validation, meter replacement, removal and reading of meters is the responsibility of the water entitlement holder.
In Victoria, water corporations with rural customers own, maintain and read meters, and these corporations are responsible for making decisions about whether a meter is needed.
In South Australia, water licence holders are responsible for installing and maintaining water meters. Some meters are government-owned but as they reach the end of their functional life, the water entitlement holder will be required to purchase, install and maintain a new meter at their own cost.
In the ACT, each licence to take water requires the licensee to install and maintain water meters to measure the volume of water extracted.
5.24
According to the NSW Irrigators' Council submission, the Australian Government has a budget allocated for ensuring compliance with AS4747 but this has not yet been delegated to the NSW Government.
Number of agencies involved and differences in compliance activities undertaken
5.25
As canvassed in previous chapters, numerous concerns regarding the number of agencies involved in regulating the basin were raised with the committee. However, it is worthwhile outlining some of the differences between states in relation to compliance and enforcement.
5.26
In NSW, the Department of Planning created the state's metering policy while NSW NRAR enforces compliance with the state's water laws. The NSW Government only established its dedicated water compliance agency in 2018 following media reports of significant water theft in the NSW portion of the Murray-Darling basin. The NSW NRAR produces comprehensive annual and monthly reports of its activities, and focuses its resources based on a 'risk-based and outcome-focused approach to regulation'. The creation of the NSW NRAR has been accompanied by a significant increase in the number of compliance cases. When comparing 2018 to 2017, there were approximately 110 per cent more cases received for investigation, over 10 per cent more cases were finalised, and over 150 per cent more enforcement actions were determined in the NSW Murray-Darling Basin.
5.27
In Victoria, the Department of Environment created the state's metering policy while compliance with the rules and legislative requirements for the take and use of water and construction of works on a waterway is undertaken by regional water corporations. Meters are owned, read, and maintained by these water corporations and read remotely on a regular basis or at least yearly. The Department of Environment VIC has guidelines for water corporations to establish effective compliance strategies. Water corporations are expected to have compliance strategies in place that demonstrate how they will meet their obligations to effectively manage and prioritise compliance risks and enforce the Water Act 1989 (Vic). The guidelines stipulate that resources should focus on areas and entities where risks of compliance breaches are the greatest. The Department of Environment VIC reports annually on its state-wide non-urban water compliance and enforcement activities.
5.28
In Queensland, the Department for Natural Resources, Mines and Energy (Department for Natural Resources QLD) created the state's metering policy, but responsibility for water recently moved to the Department of Regional Development, Manufacturing and Water (Department of Regional Development QLD, which released an interim water meter standard for non-urban metering in February 2021. According to the Business Queensland website, the Department of Regional Development QLD monitors and evaluates water use through a range of methods, including field and desktop audits, metering, and notifications by third parties. According to that website, state monitoring activities 'increase in areas where pressure on water resources is greatest, for example in the Queensland Murray-Darling Basin'. Starting from 2019-20, the Department for Natural Resources QLD provided a one-page report on its compliance and enforcement activities in the basin. Queensland has been developing a framework that will enable it to report on its performance as a regulator. The framework is expected to be implemented in 2021. An update from the Queensland Rural Water Futures program, which aims to strengthen water compliance, measuring and reporting, advised that Queensland is exploring the best ways to capture meter data, establish practical transitional arrangements for existing meters, and apply a risk-based approach.
5.29
In South Australia, the Department for Environment SA created the metering policy and is responsible for carrying out compliance activities. The department uses a risk-based approach by targeting breaches that are most likely to stress water resources. During 2019-20, 18 per cent of the 13 971 water licences in the state received a site visit associated with a 'targeted' or 'business as usual' compliance activity. The Department for Environment SA provides an annual report on its compliance and enforcement activities.
5.30
In the ACT, the ACT EPA created metering policy and is responsible for carrying out enforcement activities. According to the MDBA's Compliance Review in 2017, ACT EPA staff can audit meters regularly, but it unclear how often this activity is undertaken. Public reporting on water compliance and enforcement is included in the ACT EPA's annual report.
5.31
In March 2021, in response to a question taken on notice, the MDBA advised that its Office of Compliance is 'currently working with basin governments on issues including a minimum threshold for metering across the basin to address the perception of double standards, and performance framework to benchmark water compliance agencies'.
5.32
The MDBA's May 2021 Compliance Compact Review identified that water compliance reporting by governments on the effectiveness of water regulators needs to be presented in a consistent way, and that governments should progressively provide more detailed information over time.
Differences in water accounting and related inconsistencies in 'compliant' use
5.33
Confidence in consistent compliance is being undermined in some quarters by differences in how rules are applied by jurisdictions (specifically, the water accounting rules). Some basin states use continual water accounting systems while others use annual accounting systems. This means that water users in some states are able to access water in a way that in a different state would be considered to be non-compliant.
5.34
For example, at the August 2020 public hearing, the Australian Competition and Consumer Commission explained to the committee that water accounting in NSW is different to that in South Australia. That is, water users in NSW cannot order water if they do not have any allocation in their account, whereas water users in South Australia can access water despite having a zero balance by placing their account into arrears:
…as you are probably aware, there are still a lot of arguments around issues like the timing of accounts having to be brought into balance. For example, there is an argument about the rules in South Australia. They allow a longer time period to bring an account into balance whereas in other states there is no water able to be supplied if the account is not in balance. So it's those sorts of jurisdictional issues that confound this issue [of compliance] as well. It's not a simple issue, and it's certainly one that has been much debated when it comes to the differences between the states.
5.35
The NSW Irrigators' Council pointed out that the South Australian approach of allowing water account balances to be overdrawn provided they are balanced by the end of the quarter, would be considered water theft in NSW if the water was not in the account prior to water pumping commencing. The NSW Irrigators' Council argued that states should have a consistent interpretation of what constitutes compliance.
5.36
Likewise, Mr Robert McGavin, Co-founder and Chief Executive Officer, Boundary Bend, argued that:
[I]rrigators should have to buy the water and have it in their account before they use it …I think it should be one rule for all and should have been for a long, long time, which is part of the problem that you guys are trying to resolve—different rules in different states having an unfair impact on others, when we're really one nation and one team.
Understanding compliance obligations
5.37
The committee heard there are varying levels of understanding of compliance obligations amongst water users in the basin. In some cases, this may be due to complexity within the requirements or poor communication from government regulators.
5.38
Mr Keelty, argued that the volume and complexity of policy, legislation and agencies involved in regulating the basin is counterintuitive to facilitating good compliance:
Even if I wanted to comply with the law, would I bother to go through all those hoops to comply or would I get on with the job of farming or irrigating or whatever it is that I'm engaged in? When I say 'we', the bureaucracy has created this. One of the problems is that, year on year, different policies have been introduced. We've had a foundation stone of different legislation, but we haven't rescinded anything of an historical nature. We haven't updated things. Every time we create an agency, it seems like the agency needs to develop its own website. Every time they develop their own website, they develop their own option. People could forum shop. They may be trying to do the right thing, but, honestly, why would you bother, when we have created such a bureaucratic process for them to go through?
5.39
Likewise, the Gwydir Valley Irrigators Association submission identified that it can be difficult for some water users to understand their obligations under their licence conditions 'given the changing nature of licence conditions under temporary restrictions and the myriad of new rules such as active management,' and suggested a 'clearer set of rules with clear communication' could address these issues.
5.40
Water Communities SA argued that there should be uniform arrangements across the basin, as currently 'compliance requirements are a mixture of four states with a variety of regulations that have various interpretations causing confusion and frustration with the consumptive user'.
5.41
Cotton Australia argued that poor communication from government agencies can be credited for poor compliance in some scenarios:
[A]s far as entitlement-holder stakeholders go, the critical understanding they must have is when they can extract, and how much can they extract. With this knowledge they will be able to comply with the Sustainable Diversion Limit requirements. The importance of this has been demonstrated recently in north-west NSW when embargos were applied (suspending the water sharing plans). The limitations on extractions were not clear and the information that was provided was not always provided in a timely or understandable manner.
5.42
A member of the Executive Committee of Border Rivers Food & Fibre,
Ms Kylie Craig, told the committee that floodplain harvesting rules are not well understood even by government officials working at some basin state water regulatory agencies:
NRAR had told landholders to seek their own legal counsel before floodplain harvesting, and they're the compliance people. So, if they can't understand it, how is a person trying to word it going to understand it?…If they're the regulator, we would hope we could trust that they would know what the rules are if they're going to be the ones prosecuting people.
5.43
Mr McCosker explained that the NSW NRAR advice was given in Moree on the Gwydir River:
[T]hat's something that needs to be taken up with NRAR and New South Wales. It happened in Moree. It happened on the Gwydir. They made the comment, 'If anyone wishes to access a supplementary flow,' on the first one that came along since the floodplain harvesting processes started, 'take it up with legal counsel before pumping.' That tells me that there was something amiss, whether it be within government, within the departments—that they didn't really know what to do.
5.44
Cotton Australia argued that it can be challenging for some water entitlement holders to find information about and understand their compliance obligations. While most entitlement holders know their basic legal requirements:
…in some cases, water licences/entitlements have more obscure clauses that might impact on the actual design of works that take water, the rate of take, trigger flow heights etc…Cotton Australia has heard from NRAR that it recognises that some conditions are either very difficult to interpret, impractical and or unenforceable. This suggests there might be a legitimate need for a review of licence conditions just to ensure they are fit-for-purpose…in at least some instances…they are either impractical, unenforceable or un-interruptible.
5.45
However, other inquiry participants advised the committee that irrigators generally have a good working knowledge of compliance requirements and the material consequences of non-compliance. The Border Rivers Food & Fibre submission, for example, argued that water users generally are aware of technologies that monitor compliance and understand the repercussions for non-compliance:
Water-users understand that state agencies and now federal agencies have multiple technology capabilities to monitor their activities and to enforce compliance. There have been significant changes [which have] occurred over the last two decades and farmers are terrified of losing their access to water. There has been a lot of dangerous rhetoric about compliance which has been found to be empty and unwarranted. Water-users are desperate to remain compliant and have demonstrated their willingness to work with state regulators to achieve this. We have always supported robust sanction and penalty regimes and continue to do so.
5.46
The NSW Irrigators' Council made a similar argument that irrigation farmers generally have 'a high-level of understanding about their obligations,' while recommending that clear communication from governments on changes to conditions is essential to facilitating good compliance in the community.
5.47
Gwydir Valley Irrigators Association highlighted that the NSW NRAR had identified that:
…almost 70 per cent (67%) of water licence holders reported feeling fairly confident in their knowledge of water laws. However, less than half of the general public (49%) understood the consequences of breaching those laws.
Proving illegal water take
5.48
The 2017 MDBA Compliance Review identified that enforcement regimes can be constrained by the difficulty with proving water offences.
5.49
The International Association of Hydrogeologists Australia submission argued that it can also be even more difficult for state water agencies to determine non-compliance with groundwater licence conditions, due to the spatial extent of groundwater resources and the varying depth of aquifers. The Association argued that the nature and extent of non-compliance is largely unknown and unreported by states but that anecdotal evidence from members indicated it is a significant issue especially during drought. The Association explained that groundwater is extremely important in the basin, particularly during drought, when additional bores are often drilled.
5.50
The Association also expressed concern that there are low numbers of compliance inspectors across governments and, in its view, insufficient disincentives for water theft in some states:
[S]uccessful operation of the Basin Plan depends on compliance with licence conditions, yet state agencies have generally been reducing the number of licencing inspectors. Disincentives for non-compliance are generally low: when the few cases of blatantly illegal use are prosecuted in court, the size of the fine has historically been far less than the market value of the water.
Penalising illegal water take
5.51
Basin state legislative schemes provide a range of enforcement options against non-compliant individuals, such as civil and criminal measures. Basin state water regulators can also use administrative orders to ensure compliance with legislation (for example, by prohibiting water use or unlawful construction of water works). In some states, it is an offence to fail to comply with an administrative order (NSW, South Australia, and the ACT). State regulators can also apply to the relevant court or tribunal to have administrative orders enforced and for a range of other orders to be made.
5.52
The South Australian Royal Commission report observed a high degree of inconsistency between basin states regarding the range of offence and penalty provisions and the use of administrative orders. It further noted that basin states' monitoring capacity and compliance cultures are highly variable. The report suggested legislative reform to increase uniformity across the different enforcement schemes, and to better reflect community expectations and the integrated nature of basin water resources. The Royal Commission pointed out that greater consistency between offences and penalties would also assist courts when considering the treatment of comparable conduct.
5.53
Likewise, the 2017 MDBA Compliance Review found differences in the range of penalties and sanctions for enforcing illegal water take under state laws. The review noted there is a strong argument for consistency of penalties and sanctions, and to make penalties a decisive deterrent. At the end of 2018, the Senate Rural, Regional Affairs and Transport Committee also recommended greater consistency in how basin states determine and penalise breaches of water legislation. A government response to the recommendations had not been provided as at September 2021. An interim response advised that the 'report was being considered'.
5.54
States have been working towards commitments to improve their compliance regimes, but they have not made commitments to make consistent their compliance regimes. For example, there are inconsistencies in the penalties for illegal water take, some of which have been outlined in the table below.
Table 5.1: Penalties for illegal water take, by state and territory
|
|
|
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NSW
|
Tier 1 offences (the most serious offences that deal with intentional, negligent and reckless conduct) attract a maximum penalty for individuals of $1.1 million and/or prison terms of two years. In the case of a continuing offence, there can be a further penalty of $132 000 for each day that the offence continues. The maximum penalty for corporations is $5.005 million and, in the case of a continuing offence, a further penalty of $264 000 for each day the offence continues.
|
|
Victoria
|
The maximum fine for intentional water theft and related offences if they cause substantial harm is $198 000 for individuals and $990 000 for companies.
|
|
Queensland
|
Taking water without entitlement or taking water in excess of entitlement attracts a maximum number of 1665 penalty units. The maximum fine that a court could impose for the offence would be $222 194.25. A penalty infringement notice issued by an authorized officer for this offence could be 20 penalty units, with a fine of $2 669.
|
|
South Australia
|
Penalty rates vary and are calculated with consideration for the level of risk that water theft poses to a particular resource and the value of water. Penalties are categorized into overuse that is under 10 per cent ($0.34/kL), greater than 10 per cent ($1.02/kL}, and greater than 25 percent ($1.87/kL). The penalty for illegal water use is being charged at $2.72/kL.
|
|
ACT
|
It is an offence for a person to take water without a licence. Penalties can range from $1000 on-the-spot fines to court fines of up to $27 500 and six-months imprisonment.
|
5.55
In the Compliance Review, the MDBA argued that it is important to have a full suite of administrative, civil and criminal penalties and sanctions so that the punishment can match the crime, and the compliance resources required to pursue a breach are proportionate to the offence. Victoria was found to be the only state to explicitly include in its water legislation increased fines for repeat offenders. However, Victoria was also found to have very few administrative and civil penalties and sanctions available to it, which means having to choose between low-level warnings and criminal prosecutions.
5.56
In their article, 'The Murray-Darling Basin in Court: Administering Water Policy in the Eastern States of Australia - Administrative and Other Challenges', Justice Nicola Pain and Ms Georgia Pick identified that while basin states similarly make it an offence to take water without authorisation or conduct meter tampering and the like, criminal enforcement varies across basin states. For example, the extent to which open standing provisions enable citizen enforcement of environmental laws varies from state to state. According to Pain and Pick, only some basin states (NSW and Queensland) enable citizen enforcement, allowing members of the community to bring proceedings against non-compliant companies and individuals to the relevant court or tribunal.
5.57
In its May 2021 review of whether the Basin Compliance Compact was meeting intended objectives, the MDBA identified that there is variation across jurisdictions in when and how penalties are pursued and in states' mandatory responses to non-compliance. The 2017 MDBA Compliance Review also found that offenders are often given an option to take remedial action first.
5.58
The 2017 Compliance Review also identified differences in the statute of limitations between basin states. For example, in Victoria there are some limitation periods of one year and in NSW the limitation period for water offences is three years. The MDBA pointed out that this means that the timeliness with which offences are dealt with by state regulators is important.
5.59
The MDBA's 2017 review further identified that the option to refer matters to specialised courts can also influence the penalties imposed. For example, in NSW and SA, breaches can be referred to environmental courts with specialist knowledge and the ability to give 'creative and bespoke orders' to wrongdoers.
5.60
In terms of public access to information, Pain and Pick pointed out that while prosecutions have occurred in basin states, comprehensive research is difficult as most cases are heard in local or magistrates courts which do not publish judgments and/or the regulator does not provide public information on its enforcement activities.
Support for increasing uniformity
5.61
The Gwydir Valley Irrigators Association argued that basin-wide confidence in the regulatory framework should be a focus, as inconsistencies in the compliance regimes of states raises questions about the overall fairness of the regulatory systems. The Gwydir Valley Irrigators Association argued that developing a uniform sanctions and penalties regime would potentially make it easier to understand regulatory actions being taken. Likewise, Australian Grape & Wine expressed its support for greater consistency of regulations, penalties and sanctions between states where possible.
5.62
Other inquiry participants, however, questioned the need or value of having sanctions and penalties identical across jurisdictions. Cotton Australia argued that while uniform sanctions and penalties would make it easier to understand the penalties in each jurisdiction, it is not important for the penalties to be uniform, 'as long as there is agreement among the states of what constitutes a breach, and the penalties are high enough to disincentivise breaches'.
5.63
The Victorian Government argued that the framework for managing water resources in the basin reflects and accommodates the differences between state and territory frameworks. The Victorian Government noted that:
[J]urisdictions are…all at different points in developing their compliance and enforcement systems, and practical or geographic limitations: such as lack of mobile network coverage making telemetry read metering impossible—mean that a one-size-fits-all approach is not implementable.
5.64
The Victorian Government also pointed out some of challenges of increasing uniformity of compliance regimes across the basin:
[W]hile some reviews have recommended that jurisdictions make their compliance systems more uniform, Victoria's view is that this is impractical, and inconsistent with the COAG Principles of Best Practice Regulation. For example, penalties for water related offences are part of Victoria's broader state penalty framework. Any changes to bring about greater uniformity in water-related compliance would result in either these penalties being out of step with the rest of the state based penalty regime, or require a complete overhaul of those regimes.
5.65
The Victorian Government argued that, given the strength of its existing systems, a wholesale review and amendment of its compliance framework is not required.
Financial incentivisation to ensure states meet their obligations
5.66
As discussed in the committee's Issues Paper, the Commonwealth Government makes payments to basin states under a number of partnerships for different programs. National Partnership Agreements (NPAs) between the Commonwealth and the states set out milestones that states are required to achieve to meet their Basin Plan commitments. The NPAs specify the Commonwealth payments that are to be made to the states in return for meeting these requirements. Basin states are required to submit an annual Statement of Assurance that reports on their progress against their milestones. The Commonwealth Department of Agriculture, Water and the Environment (Department of Agriculture) conducts an annual assessment against milestones and the Commonwealth Minister for Water decides whether milestone payments are to be made to the state.
5.67
In its five-year review of the plan, the Productivity Commission recommended that milestone payments to states should provide a genuine incentive for implementation, and that the advice used to inform assessments of progress against milestones should be published in full.
5.68
A February 2021 review commissioned by the Department of Agriculture into the NPAs also identified that future NPAs should (among other things):
clearly define all milestones and Key Performance Indicators;
align more closely with strategic objectives;
clearly specify the roles of parties;
design graduated milestones that alleviate the pressure of judging partial completion; and
define early milestones as prerequisites for achievement and payment of later milestones.
5.69
During the inquiry, Professor Jeff Connor, Professor Sarah Wheeler, Professor Quentin Grafton, Professor John Quiggin, Dr Adam Loch and Dr John Williams raised concerns that, unlike the National Water Initiative, the Basin Plan does not give states guidelines or link funding to progress on objectives. Professor Connor et al credited this lack of accountability as being partially responsible for the failure of some states to finalise their Water Resource Plans (WRPs) by the agreed timeframe. Likewise, Dr Anne Jensen argued that state compliance requires effective penalties to be in place for non-delivery and failure to meet deadlines.
5.70
For context, at 31 May 2021, 13 WRPs were accredited and operational, including all WRPs from the Queensland, Victorian, ACT, and South Australian Governments. NSW is well behind schedule, having submitted its 20 WRPs to the MDBA in mid-2020 approximately a year after than the initial deadline. The MDBA's completed is assessment of nine NSW WRPs and identified these plans contain potential inconsistencies with Basin Plan requirements. NSW advised they will be amended and resubmitted. Based on the MDBA's preliminary assessment of the remaining WRPs, these also all appear inconsistent with Basin Plan requirements and will likely be withdrawn, amended, and resubmitted for assessment. It is important to note that all basin states had inconsistencies identified in their WRPs and were required to be amended before accreditation by the MDBA.
5.71
In its first report assessing Sustainable Diversion Limit (SDL) compliance which was released in August 2021, the MDBA examined water use across the basin catchments for the 2019–20 water year and found that 97 per cent of catchments were within plan limits.
5.72
The NSW Government reported use above allowed limits in three water resources. The MDBA accepted there had been non-compliance with 'reasonable excuse' for two resources. The MDBA found the claim for the Barwon-Darling was invalid as 'NSW did not operate in a manner fully consistent with the submitted WRP'. NSW has committed to re-double efforts to improve regulation, and outlined it's 'make good' steps in a work plan.
5.73
The submission from Professor Connor et al argued that there is a fundamental flaw in the design and implementation of the Basin Plan in that there are 'not really sanctions or penalties for states' overdraw of water in ways that are inconsistent with their commitments to reduce extraction'. This is discussed further below.
Compliance roles and responsibilities
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Responsibility for compliance and enforcement in the basin is shared between the MDBA and basin states. Broadly, the MDBA works to ensure that states adhere to their obligations regarding sustainable diversion limits, WRPs, water trading rules, planning and protection of environmental water, and water quality and salinity objectives. Basin states are responsible for ensuring that water users do not exceed permitted levels of water take. The MDBA provides assurance of the compliance and enforcement frameworks within each state. The Productivity Commission also has a role in reviewing the effectiveness of WRP compliance in its five-yearly reviews of the Basin Plan. The role of the Inspector-General is discussed in the following section.
5.75
The MDBA supplementary submission explained that 'its working understanding is that…in applying state water management law, basin states will ensure their operations are consistent with the requirements of WRPs'. However, the MDBA noted that the situation is a little different in Victoria, in that Victoria's WRPs do not incorporate state law.
5.76
The MDBA has the power to conduct monitoring and audits and can step in to address individual non-compliance where action taken by a state is inadequate. Once WRPs are accredited, the MDBA also reviews data provided by basin states to determine whether SDLs have been breached. While the MDBA can investigate alleged non-compliance, concerns about the adequacy of the MBDA's audit approach and the level of overuse permitted before investigation occurs have been raised.
5.77
According to the Department of Agriculture, the MDBA's enforcement function is enlivened where there is an accredited WRP. As all WRPs have been accredited for all jurisdictions except NSW, the MDBA has a bilateral agreement with NSW which allows SDL compliance to commence from the 2019-20 water year using the framework articulated in the WRPs submitted for assessment. As outlined in the committee's Issues Paper, the MDBA may enter into enforceable undertakings with a state to make good an area of non-compliance. The MDBA may also apply to a court for a declaration that the state has not complied or an injunction to prevent further non-compliant behaviour.
5.78
During its inquiry, and before the introduction and passage of the Inspector‑General legislation mid-2021, the committee heard concerns that compliance roles and responsibilities are not clearly articulated. For example, Cotton Australia argued there is insufficient transparency regarding the division of roles and responsibilities between agencies, arguing that:
[C]ompliance is a classic example – what is the role of the Office of the Interim Inspector-General? What is the role of the MDBA? What is the role of the state jurisdictions and their agencies?'
5.79
Similarly, the Gwydir Valley Irrigators Association argued that, 'clarity about roles and responsibilities and who to turn to when there is an issue, is needed. The Victorian Farmers' Federation submission argued that introducing an Inspector-General further 'duplicated and confused accountabilities for enforcement'.
5.80
Conversely, the National Irrigators' Council submission argued that division of responsibility is clear in that 'primary responsibility for compliance rests with state authorities, the federal oversight of compliance is not intended to take over that primary responsibility'.
5.81
Although, the National Irrigators' Council argued that 'it is hard to see how these differences [between states' compliance regimes] would increase potential for compliance breaches', some stakeholders were concerned that differences in the way that basin states are creating WRPs will make it difficult for the MDBA to assess compliance and for the public to understand the level of compliance across states.
5.82
Indeed, the MDBA's May 2021 review of whether the Basin Compliance Compact is achieving its intended outcomes identified that its own review was hindered by inconsistencies across states:
[T]he review was unable to determine the effectiveness of compliance arrangements across the basin due to differences between jurisdictions in both the compliance arrangements and how they are communicated and reported…the differences in regulatory approaches and reporting between basin governments prevent a holistic comparison of compliance outcomes…in many cases, the underlying definitions of compliance components and activities are significantly different and therefore the data is not comparable.
5.83
The MDBA recommended adjusting the Basin Compliance Compact as consistent benchmarks and standards are now necessary for progress to be assessed and evaluated.
5.84
The MDBA's supplementary submission to this inquiry also identified that public and government regulators still 'have limited access to information that provides confidence that arrangements are appropriate, fair, and in effect'. The MDBA explained that:
[I]ncreased information on actual water take and water licence details is still lacking. This includes information to enable users to understand what rules or conditions are in effect in different areas, levels of water extraction and quantity, and environmental flows occurring…a significant factor influencing this challenge is the separate water registers of each basin state, which hold information about allocations, use and licences. The varying levels of accessibility and security of each register means that while entitlement holders generally understand the rules and are familiar with their license conditions, it is difficult for the public to access information on how much water can and has been taken, and the rules of take.'
5.85
At its February 2021 hearing, the committee heard that the MDBA had conducted several audits of accredited WRPs and that the findings of the first audit would be released when finalised:
We've done a number of audits, for example, in Queensland, that are part of us exercising that ongoing compliance role, which, as you discussed earlier, will transfer to the Inspector-General of Water Compliance when the legislation is passed…At the moment, we're just finalising the first of those WRP audits, but we've got more than one audit underway, and our audit work program is published. I think we published that in July last year for the 12 months that we're currently in…We're yet to finalise that first WRP audit. That's in the Warrego-Paroo-Nebine water resource plan area. We're in the final stages of writing up our findings and recommendations in that audit and, as soon as those have been finalised by the authority, we will be publishing those findings.
5.86
In August 2021, the MDBA released its Warrego–Paroo–Nebine (WPN) WRP findings. The WPN WRP had been in operation for three years and had not previously been audited. The audit focused on the mechanisms used by the Department of Regional Development QLD to regulate water take and protect environmental water in the Warrego River, consistent with WPN WRP requirements. The audit used the flow event that took place in the Warrego from February to April 2020 to assess whether:
Department of Regional Development QLD processes for determining announced periods for water harvesting were made in accordance with the rules governing the calculation of announced periods; and
Department of Regional Development QLD monitoring and compliance procedures were sufficient to ensure that water users are compliant with their water allocation conditions.
5.87
While the audit confirmed that announced periods of water harvesting were determined in accordance with the rules, it identified instances where water allocation holders had not complied with their obligations.
5.88
One particular instance of noncompliance highlighted that the Department of Regional Development QLD 'had no effective mechanism in place to monitor and enforce compliance with daily extraction limits, or more generally, to monitor extraction during a flow event'.
5.89
In addition, there were instances identified where water holders reported faulty meters following the cessation of their water extraction. Whilst these occurrences do not represent a breach of the WPN WRP or QLD legislation (water allocation holders are permitted to continue water extraction for up to 60 days after a meter fault is identified), it showed that the data collected from water allocation holders when meters break down is not sufficient to accurately estimate water extracted while the meter is not operating.
5.90
The audit made recommendations to achieve more effective monitoring of water allocation holder compliance, as well as improve the accuracy of water take data collected, including when extraction occurs through a faulty meter.
Role of the Inspector-General
Background to establishing the role
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In 2018, in its five-year review of the plan, the Productivity Commission recommended that the MDBA be divided into two separate agencies to avoid potential conflict of interest between its delivery and regulatory roles. The Productivity Commission recommended that an independent statutory regulator should be established and that the MDBA should separate its functions as far as possible in the interim.
5.92
In response, the MDBA established a dedicated Office of Compliance and an Independent Assurance Committee to ensure it meets its compliance objectives and receives external assurance on its work. Basin governments also agreed to legislate to establish an Inspector-General of Murray-Darling Basin Water Resources to provide independent assurance that the MDBA is fulfilling its compliance role.
5.93
At that time, the Northern Basin Commissioner, had been overseeing implementation of the Northern Basin Review outcomes as well as monitoring, auditing, and reporting on northern basin compliance matters since October 2018. However, the position had no statutory powers and relied solely upon the cooperation of basin governments to carry out its work.
5.94
Mr Keelty explained to the committee that this became problematic on occasions where people were not forthcoming with information and that he had provided advice to the Australian Government that the role required power to compel witnesses and documents.
5.95
In August 2019, the government announced a new position of Inspector‑General of Murray-Darling Basin Water Resources to improve transparency and accountability in the basin. This role subsumed the Northern Basin Commissioner role. Mr Keelty was announced as the Interim Inspector-General in October 2019 for 12 months—the estimated time it would take to create a permanent statutory position. Amendments to the Water Act 2007 (Water Act) to create the Inspector-General role were expected to be considered by Parliament in 2020; however, as explained further below, the legislation was ultimately considered and passed in mid-2021 instead.
Functions of the role
5.96
According to terms of reference tabled by Mr Keelty at the committee's hearing in October 2019, the role was expected to monitor Basin Plan implementation; compliance with obligations in the Water Act and WRPs; progress of water recovery; delivery of water efficiency, supply, and constraints projects; and completion and submission of WRPs. All of these functions are the responsibility of either the MDBA or the Department of Agriculture. Indeed, at the public hearing, Mr Keelty stated that the Northern Basin Commissioner's role duplicated the work of other entities.
5.97
Mr Keelty argued that the role should be similar to a standing commission of inquiry by having oversight over expenditure and delivery of infrastructure and the integrity of the plan and the ability to refer matters to existing crime and corruption commissions where needed.
5.98
In December 2019, basin governments agreed to work together to negotiate an in-principle agreement to ensure that the Inspector-General had appropriate support from basin states to carry out functions. The Commonwealth's proposal was that the Inspector-General's role would be expanded to monitor the management of Basin water resources under both state and Commonwealth legislation. The Commonwealth indicated it would continue to seek basin jurisdictions' support for referral of relevant state powers necessary to provide the community with confidence in the management of Basin water resources.
5.99
At its hearing in May 2020, Mr Keelty advised the committee that he had entered into an informal agreement to be on stand-by for the department while a small core of people continued the work of the Inspector-General's office.
Initial referrals and issues arising
5.100
During the 2019–20 year, the Inspector-General's office had received 30 referrals, one of which was from the NSW Water Minister, with most relating to the conduct of a government agency or official, the conduct of an irrigation infrastructure operator, or water markets and trade (rather than illegal water take). Most were referred to the appropriate agency for investigation while four inquiries were undertaken by Mr Keelty's office in the period.
5.101
With regards to referrals from state water ministers, the committee heard that the Inspector-General had been working with the Commonwealth Water Minister's office to establish protocols for dealing with these types of referrals. Mr Keelty explained that some complaints fell outside of state legislation or policy or crossed state boundaries:
The referral from Minister Pavey from NSW doesn't fall within the current NSW legislation and so it has been forwarded to our office. I imagine…on one or two occasions we may recommend legislative amendment. I want to be careful that I don't talk about actual incidents, but there are some occasions where some allegations fall outside the remit of some of the state agencies. That's either a deficit of legislation or policy within the state or it crosses jurisdictional borders. I can imagine that there would be occasions when state ministers want to have a separate independent source look at it.
5.102
At the public hearing in May 2020, Mr Keelty explained that his office is not qualified or resourced to monitor quantities of water; the office is monitoring how the basin is governed and engaging with departments when anomalies arise:
You may recall we did an inquiry into a release on some of that material from the MDBA website on the satellite tracking. So we're monitoring how it's governed, but we're not actually monitoring the quantums. We're not really qualified to do that, nor are we resourced to do that…We're engaging with the departments and we're looking for, if you like, anomalies, when anomalies arise—and they become very public very quickly. And that's when we would engage our oversight. We're not in a position to know what quantum should have reached Menindee. I think NSW and Victoria were asking us to look at flood plain harvesting in Queensland. We're being very careful not to be used as a political football by one government over another to prove a point or disprove a point. We're aware of what's happening and we're engaged with the departments, but when anomalies arise we'll take that up with the individual parties…We wouldn't do the investigation ourselves; we'd ensure that the investigators were investigating it.
5.103
In December 2020, the Hon Troy Grant replaced Mr Keelty as the newly named Interim Inspector-General of Water Compliance. At the committee's February 2021 public hearing, Mr Grant explained that although details of responsibilities had not been finalised at that time, his understanding was that his office would not be taking over Basin Plan compliance reports and reporting on the implementation of the Basin Plan. However, his office would be reviewing and auditing those reports. Mr Grant explained that his role would be a hybrid of 'regulator at last resort, compliance auditor, and some types of functions which may be similar to Ombudsmen'.
Legislation for the Inspector-General role
5.104
In June 2021, legislation for the Inspector-General role was successfully passed. Broadly, the legislation conferred the existing compliance functions and powers of the MDBA, and those of the interim role, to the Inspector-General who will monitor and provide oversight of both Commonwealth agencies and basin states. According to the legislation, the role will have new inquiry powers, as well as the power to issue guidelines and standards and undertake audits. The legislation also introduced new offences and penalties for unlawful conduct relating to the taking of water and trading of water rights.
5.105
According to the Minister for Water, the Hon Keith Pitt MP, the Inspector‑General (and supporting Office of Water Compliance) sits within the Department of Agriculture and is divided by 'ethical walls'. The movement of compliance functions out of the MDBA was also flagged to commence in July 2021.
5.106
The Inspector-General is expected to be able to refer issues to the proposed Commonwealth Integrity Commission, if and when the Commission, is established. An independent panel is also expected to provide the Inspector-General with advice.
5.107
In his second reading speech, the Minister for Water explained that the legislation would:
[E]nable the Commonwealth to step in and take enforcement action on water theft if a basin state is unwilling or unable to do so…the Inspector-General will seek to improve consistency across the basin. The guidelines and standards will clearly articulate to basin state regulators, communities and other stakeholders what constitutes best practice for basin water management. The standards and guidelines will provide the Inspector-General with a framework to evaluate the performance of basin jurisdictions, including the Commonwealth, in delivering the Basin Plan.
5.108
However, in her second reading speech, Ms Alicia Payne MP, argued that:
[U]unfortunately this bill won't commence immediately after the parliament passes it; the act will only commence after all basin states have approved its provisions.
5.109
At its May 2020 public hearing, the former Inspector-General, Mr Keelty, advised that without referral of power from states there are limitations to what an Inspector-General can achieve:
[W]e've done everything to date through cooperation…I've struggled to get the Queensland Department of Natural Resources, Mines and Energy to give me the number of compliance officers they have looking at water resource management. I've had figures from 132 to three, and I think the figure is much closer to three. Minister Lynham wrote to former Minister Littleproud and complained about the northern basin report and said it contained inaccuracies. So, while ever I get different people in different departments telling me different things—and I might add that people in the Department of Natural Resources, Mines and Energy in Queensland were instructed not to talk to me without a senior person present. So when you get that sort of officialdom riding over the earnest efforts of individual officers, I think you need to be able to come in and have some sort of sanction or powers to be able to say, 'That's nonsense; let me talk to the individual.'
5.110
Additionally, the Shadow Minister for Environment and Water, Ms Terri Butler MP, highlighted that the Inspector-General would have to ensure that a basin state was not already pursuing a compliance matter before taking action:
[B]ecause conduct relating to taking water would also be the subject of the basin states' laws, this bill would actually require the new inspector-general to notify the appropriate agency of the state before taking certain compliance action, and, if a state says that they're dealing with the matter, provide them with an opportunity to do so before this new agency itself takes enforcement action. The intention is obviously for the Commonwealth to have the ability to take action but only after giving the basin state the opportunity to do so first, as the primary, frontline compliance body.
5.111
At the time the legislation was passed, the Senate agreed to refer the legislation to the Rural and Regional Affairs and Transport References Committee for inquiry upon Royal Assent to examine any potential further amendments to improve the operation of the Act. That committee is required to table an interim report on 30 September 2021 and a final report three months after.
What powers should the Inspector-General have?
5.112
Prior to the introduction of the legislation, the committee explored what powers the Inspector-General should have and to what extent the office should be empowered to access information in order to carry out the functions of the role. The committee discussed the importance of having an independent body that could not only refer compliance matters back to the states for investigation but also have power to investigate cases where state investigations are unsatisfactory.
5.113
Additionally, the committee canvassed the importance of the Inspector‑General being granted legislative power to access information from basin states where required to conduct an investigation or audit. This type of power would require agreement from basin states as Commonwealth power alone would be insufficient. Potentially, the role would require referral of powers from the states in order to provide the Inspector-General the legislative framework to coerce information from jurisdictions. However, as mentioned by Ms Alicia Payne MP, gaining referral of powers from the states would likely delay the process further.
5.114
According to Mr Keelty, the draft proposal included power to compel documents, but the jurisdictions had not agreed to this:
We have it in our draft proposal, to compel people to bring documents forward. We haven't worked through the mechanics of the jurisdictional differences, because basically the jurisdictions, to this point in time, haven't agreed to that. So we're working on a model that encourages the jurisdictions to allow us to have access to materials, whether by compelling that access or whether we get it through cooperation. But I think compelling it will require a referral of power and the referral of power will be a stumbling block...unless [a matter] falls within the remit or jurisdiction of an existing body, such as an ICAC or a similar body. It will depend also, I guess, on the advance of the National Integrity Commission in terms of Commonwealth agencies.
5.115
The passage of the Water Legislation Amendment (Inspector-General of Water Compliance and Other Measures) Act 2021 in June 2021 provided the Inspector-General with the power to require persons to give specified compellable information and created offences and civil penalties if persons fail to comply. It is unclear whether the states have agreed the provisions.
5.116
Prior to the introduction of the Inspector-General legislation, the committee received evidence which emphasised that the Inspector-General would need to be properly empowered to carry out the role.
5.117
The National Farmers' Federation argued that the Inspector-General should be able to perform his role without obstruction and with full cooperation from the states. The Border Rivers Food and Fibre submission observed that the work of the Inspector-General will be complex, and they would need 'to understand the different approaches of all the different state jurisdictions in terms of planning, accounting, compliance, etc'.
5.118
Ms Juliet Le Feuvre, Member, Lifeblood Alliance, appearing before the committee in April 2021, argued that the problem with the role of the Inspector-General:
…is that it has no teeth to actually do anything. Anything that they find out then has to go back to the MDBA to be acted upon. What we need is something with actual teeth that can enforce water resource bans, make sure that they are put into practice and are worth enforcing once they get through, and also deal with any noncompliance issues by individual users.
5.119
Mr Bret Walker SC pointed out that the Inspector-General's office would need adequate independence, resourcing, and scope to carry out its role:
[T]he devil's in the detail. Unless there is true independence, unless there is proper resourcing and unless there is a susceptibility of administrators and not merely being delegated to questions of compliance, it will be a most incomplete job.
Initiatives to improve compliance
5.120
During the time of the inquiry, the Australian Government made a series of investments to support the states in their compliance activities. This included $35 million to expand metering and satellite remote sensing technology in the northern basin; $25 million to encourage installation of metres by irrigators in the northern basin; and $5 million for cameras to capture live stream river flows to provide transparency to the public. Approximately $38 million was set aside to establish the office of the Inspector-General.
Committee view and recommendations
5.121
The committee heard evidence from a range of stakeholders that the complexity of compliance arrangements and inconsistencies between the compliance regimes of basin states are causing some frustration.
5.122
The committee acknowledges the significant progress made to date by governments to strengthen their metering, monitoring and penalty regimes, but recognises that differences between states can cause confusion, and perpetuate the perception that arrangements are unfair and that compliance obligations are not always being met. The committee agrees there should be greater uniformity between schemes but acknowledges the practical limitations of reforming entire regimes across states where a one-size-fits-all approach is simply not appropriate.
5.123
The committee considers there is merit in the MDBA and the Office of the Inspector-General for Water Compliance working with basin states to develop best-practice principles to better align, where practical and appropriate, the compliance and enforcement approaches of governments, for example, in terminology, reporting requirements of regulators, and penalties.
5.124
The committee recommends that the Murray-Darling Basin Authority and the Office of the Inspector-General for Water Compliance, work with Murray-Darling basin states to develop best-practice principles to better align, where practical and appropriate, the compliance and enforcement approaches of governments, such as terminology, reporting requirements of regulators, and penalties.
5.125
As discussed in Chapter 2 – Governance, the committee considers that the Commonwealth and basin states should also clarify how existing state water sharing plans and operations interact with those items introduced by the Basin Plan, that is, Water Resource Plans and their related processes, such as compliance.
5.126
Better quality and timely communication from governments would likely assist stakeholders to understand their obligations and governance arrangements and improve community confidence across the basin.
5.127
The committee acknowledges the significant steps that have been taken by the Australian Government in recent years to improve transparency and compliance in the basin. These include improving hydrometric networks and remote sensing technology in the northern basin by 2023, providing support to the NSW and Queensland Governments to encourage installation of metres by irrigators in the northern basin, and enhancing real time monitoring at key sites in the northern basin.
5.128
The committee also welcomes the establishment of the Inspector-General of Water Compliance, and notes that the legislation is currently being examined by the Senate Rural and Regional Affairs and Transport Committee.
5.129
While efforts to date are pleasing, the division of compliance roles and responsibilities between the Commonwealth and the states could be more clearly articulated. Stakeholders are confused who to turn to when there is an issue. It is important that the roles and responsibilities of the Inspector-General be clearly articulated. Clarity on the division of roles and responsibilities between government agencies and the Inspector-General will assist in resolving multijurisdictional issues.
5.130
The committee recommends that the Murray-Darling Basin Authority and the Inspector-General of Water Compliance, work with basin states to clarify the division of compliance roles and responsibilities between Commonwealth and state governments and their agencies, and the Inspector-General’s role in resolving multijurisdictional issues. Where there is duplication, uncertainty, or absence of compliance responsibility between governments, the Murray-Darling Basin Authority and the Inspector-General should work with states to address this.
Next chapter
5.131
The following chapter explores issues relating to environmental watering.