Australasian Science: Australia's authority on science since 1938

Water Reform Needs to Be Back on the National Agenda

By Ken Matthews

Our national water research effort is fragmented, non-strategic and lacks leadership.

Stimulated by the millennium drought, Australia made great progress over the early years of this century in reforming and improving the way we manage our precious national water resources. That reform progress has now ground to a halt. Because the seasons in most areas of Australia have been much better, the attention of governments has shifted to other policy problems.

But in Australia, the next drought is never far away and much remains to be done to manage our water resources better. The governments of Australia need to work together to develop a new decadal strategy to tackle the next generation of water reforms. The Commonwealth and state governments need to rebuild national collaborative processes, institutions and incentives to restore momentum to the water reform process.

Changes to government policies, programs and legislation are central to the necessary changes to water management in Australia, but the Council of Australian Governments no longer pays serious attention to water reform issues. Key institutions driving reform have been abolished or had their budgets cut. Incentives for the state governments to resume progress in reforms no longer exist.

New reform processes therefore need to be built. One possibility would be for the Commonwealth Government to define specific state-by-state water reforms it would like to see undertaken by specific state governments and provide an incentive payment, tailored to the degree of difficulty of the particular reform, to encourage that state to tackle the task.

However it is done, water reform needs to be put back on the national agenda. There is a rich menu of possible reforms.

There is a clear and pressing need for the northern states of Australia to develop national principles to guide new water developments, and future water management, in northern Australia.

There is a need also to build community confidence that the growing volumes of water reserved for environmental purposes are being well used. Greater transparency and better forms of public participation in decisions about the use of environmental water are needed. Reserving water for the environment is the right thing to do. It is vital to demonstrate its value and benefits to enthusiasts and sceptics alike.

There is an obvious public policy need to reform and improve the way Australian governments go about decisions on mining and coal seam gas developments and their interaction with groundwater and surface water resources. There is strong community dissatisfaction with the current processes.

We need better ways of taking decisions about cumulative, long-term potential impacts of mining and energy developments. We need processes that are based on evidence, logic and respectful community participation, if decisions are to be accepted by those affected.

There is a major reform challenge to develop a truly national water-trading exchange to enable truly free trade, subject only to externality impact assessments. Water trading should be as smooth, speedy and low cost as share trading.

Water regulation is also ripe for further reform. Water managers need to deal with economic regulators, health regulators and environmental regulators – each of these areas of regulation have many opportunities for improvement.

Regulations slowing the (inevitable) introduction in Australia of recycled water for potable purposes, in particular, need review.

We need policy and legal reforms to facilitate the coming transition from large centralised urban water supply systems to wholly or partly decentralised systems. There is no intrinsic reason why water supply to urban communities should be largely run by the public sector rather than the private sector.

As a natural resource, water management should be driven by good science. Current water science management arrangements are letting us down. Currently we have no strategic national R&D priorities. Our national water research effort is fragmented, non-strategic and lacks leadership.

Finally, many Australians ask why the nation has been unable to capitalise in export markets on its past water reform successes. We need to reform processes and institutions in Australia to facilitate the success overseas of Australian water management companies.

We need at least another decade of progress before we can be confident that our water resources are being managed as well as they could be. There is much to be done but the economic, environmental and social returns are potentially enormous.

Mr Ken Matthews AO FTSE is Chair of the ATSE Water Forum. He is a former Chair and Chief Executive Officer of the National Water Commission and was previously the Secretary of the Federal Department of Transport and Regional Services, and the Secretary of the Department of Agriculture, Fisheries and Forestry.