OPINION: Australia’s rivers traded into trouble

By Mike Young 9 May 2012
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Flawed water-trading systems are choking our formerly mighty river systems to death, says Mike Young.

IF YOU LIVE IN PERTH you’re still in the midst of one of the longest dry periods in recorded history. If, on the other hand, you live in Brisbane you may have already forgotten about the long dry that characterised most of the first decade of this century.

Indeed, when you’re seated around a dining room table in Brisbane you’re  more likely to hear grumbling that perhaps if the Wivenhoe Dam operators had let more water go earlier, the recent flooding that inundated the city would have been much less severe. The water-security value of south-east Queensland’s desalination plant and the new treatment plant, pumping and pipes that make it possible to recycle water from sewage have been all but forgotten by many.

Australia is a land of droughts and flooding rains. We love the rain and we routinely forget to plan for dry periods. We can see evidence of this in Australia’s attempts to negotiate a new plan for the Murray-Darling Basin. With the return of rain, the sense of urgency has passed and complacency is back. Once again people are starting to think that nothing is really wrong with the Basin’s water-allocation regime and that short-term personal interests should be put ahead of the future health of the river system.

River problems

In the case of the Murray-Darling, perhaps the first question to ask is: “Why did this river system get into such a deplorable state?”

The answer is pretty simple. Back in 1994, the states agreed to stop issuing more licences and cap the total amount of water that could be taken from the system. They forgot, however, to fix the water-accounting system used to decide how much water can be diverted. To make matters worse, they then embraced water trading. Every irrigator was given an allocation and told that if they didn’t want to use it they could sell it to someone else.

Water soon became valuable and it didn’t take long for irrigators to decide to become more efficient, to start using groundwater instead of river water, and capture overland flows as they passed by their farms. Soon, such serious water-accounting problems emerged that the river stopped flowing. In fact, in November 2002 – before the recent long drought came – governments put not one, but two and then three dredges in the mouth of the River Murray to keep it open! People had pinched all of the river’s water.

Murray-Darling dry period

With the wisdom of hindsight it is obvious that the Murray-Darling Basin had been traded into serious trouble. Yes, there was a long dry period from 2003 until 2008 but the river was in trouble before then.

If you are an irrigator and you become more efficient in collecting water that falls on or passes by your property, then less of it drains back to the river. The more efficient you become, the less the river flows. When trading is used to reveal the real value of water, irrigators use the water allocated to them or they sell it to someone else who will.

It gets worse than this, though. If you are a flood irrigator and you start investing in recycling systems, the first thing you do is to decide that none of ‘your’ water should drain or flow back to the river. The next step is to make sure that none of the rain that falls onto your property runs into the river, either. Once that is done, you then make sure that no water flowing across your property reaches the river – it’s just too valuable. Bad luck if you’re a bird waiting for a wetland to be flooded again.

Bad news for the river

The next bit of bad news for the rivers is the fate of the Murray-Darling Basin’s groundwater systems. After heavy rain, water seeps underground and ends up in an aquifer where it flows ultimately into the river and then out to the sea. In many river systems, the groundwater in these aquifers is the source of the flow, but as this groundwater tends to enter the river from the side, you can’t see it.

When the Murray-Darling Basin’s administrators introduced a cap on surface-water diversions, they didn’t put a cap on groundwater. As soon as surface water became valuable, irrigators started to use more groundwater, levels dropped, and eventually it stopped flowing into the river. Oops! In 2007 the last 50 individuals of a species of fish, the southern purple-spotted gudgeon, had to be rescued from a dying wetland until enough water could be found to put them back.

In short, the introduction of water trading in Australia has meant that in NSW and Victoria – in addition to the Murray – the Murrumbidgee, the Goulburn and the Broken rivers have all been traded into serious trouble. Those responsible for managing these resources got the design of our water allocation and water accounting systems seriously wrong.

Installing irrigation systems

Many irrigators used the money they received from selling water entitlements to install very expensive and efficient irrigation systems for collecting water. These irrigators and the local townspeople who sold equipment to them liked all this new investment. They thought that this new business opportunity would be sustainable. The problem is that no-one told them that the water-trading and -allocation systems they were relying upon were seriously flawed.

In fact, the majority of the growth was being achieved unsustainably by taking water needed to keep the river flowing and keep its ecosystems thriving.

If the health of this system is to be maintained, the water that was taken away will have to be returned. If these accounting mistakes are not fixed, then river flows will continue to decrease and, periodically, will become so saline that their water-dependent ecosystems will die one by one. This process will start at The Coorong, which sits at the mouth of the once-mighty Murray, and gradually move upstream.

Ecosystem health

At this stage, I doubt the proposed Basin Plan, which was announced by the Murray-Darling Basin Authority (MDBA) in November 2011, will fix the water-accounting problems. Good models of interaction between the Basin’s surface and groundwater systems are lacking and the politics of rapidly reducing allocations are ugly. Irrigators hate it when water is taken away.

The best available science suggests about 4000 gigalitres (4000 billion litres) of water need to be returned to the Murray-Darling System to provide sufficient flow to keep The Coorong healthy. But the MDBA has indicated that it only intends to require the Commonwealth Government to secure 2750GL. Given this, it is not surprising that the government of South Australia announced in November that it now intends to challenge the authority in the High Court. 

Professor Mike Young is executive director of the Environment Institute and professor of  water economics and management at the University of Adelaide.

Source: Australian Geographic, Jan – Feb 2012