Morrison government considers abandoning $1 billion water projects


But federal Water Resources Minister David Littleproud told the Herald that withdrawing from the plan would “not return one drop of water to NSW farmers”.

Instead, the federal government would have to divert money allocated for projects to capture more water and make its use more efficient and buy back water rights from irrigators.

Water Resources Minister David Littleproud says NSW will not get one extra drop of water to farmers it quits the Murray Darling Basin Plan.Credit:Alex Ellinghausen

“It would mean the Commonwealth would need to recover the final 20 per cent rather than investing in water infrastructure to recover it,” Mr Littleproud said.

“Building infrastructure to recover water means local people will be employed as part of an economic stimulus back into their communities,” he said.

Advice prepared for the Commonwealth puts the value of that buyback at more than $1 billion, two sources with knowledge of the discussions said.

The government has been reluctant to embark on water buybacks, purchasing only $312 million since September 2013 but spent $2.25 billion on efficiency improvements in the same period.

Mr Littleproud’s rebuke followed criticism of Mr Barilaro’s threat from the National Irrigators’ Council, a body traditionally close to the National Party.

“[Withdrawing from the plan] would create massive uncertainty and it could result in (at least) another 287 [gigalitres] of buyback in the NSW Murray and Murrumbidgee,” the NIC’s chief executive, Steve Whan, wrote to Mr Barilaro on November 15.

“I estimate that water is worth more than $363 million in crops.

“With even a modest multiplier, that becomes close to a billion dollar economic hit for communities like Griffith and Hay on the Murrumbidgee, and Murray communities like Deniliquin.

“While there may be some appeal in backing a very short-term agenda to ditch the Basin Plan, in the longer term that will certainly end up costing irrigation communities even more.”

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The Murray-Darling Basin has been put under significant pressure by a prolonged drought, leaving one part of the river system — the Barwon-Darling — at risk of collapse.

The Natural Resources Commission earlier this year found the Barwon-Darling, the site of widespread fish kills and water shortages, was “an ecosystem in crisis”.

Mr Barilaro declined to comment.

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