FENNER CONFERENCE ON THE ENVIRONMENT
PANEL DISCUSSION: How does national policy impinge on local and regional water management?
Chair: Councillor Dick Gross
President, Municipal Association of Victoria
Panel:
Executive Director, Council of Mayors, South-East Queensland
Mayor Paddi Creevey
City of Mandurah, Western Australia
Councillor Robert Bell
Gosford City Council, Vice President Local Government Association of NSW
Mr David Butt
Director, Cabinet Office and Energy and Water Policy, ACT Chief Minister's Department
Dick Gross: I just want to say one thing about local government. Local government is absolutely obsessed with environmental and water issues. We only get 2 per cent or sometimes 2½ per cent of the total tax take in Australia. The federal government gets 70 per cent, the states get 28 per cent, and we get 2 per cent. Notwithstanding that minuscule level of taxation in Australia, local governments spent, in the 200304 financial year, more than a third of the dollars spent on environmental programs. So it is apposite that local government is involved in this discussion and this debate, because yes, we are the third sphere of government, but we are full of people who are utterly obsessed with their local environment, probably because we manage open space and some of us, but not all of us, manage water and in managing open space we have developed a love and affection for environment that absolutely dominates our expenditure patterns.
What we are discussing today is whether the national water reforms will help address water security issues in urban areas. We are talking about urban areas, we are talking about the national water reforms, and we are talking about the relationship between the two. So this is largely about security of water and use of water in an urban context.
If I could just make one other observation about Australians: we are urban and suburban creatures. Whilst our mythology is a rural mythology, our reality is that we do reside primarily in urban areas, and increasingly in coastal urban areas. So the backdrop for this discussion is that the demography of Australia, which drives a lot of what local councils have to do, is to cluster Australians in coastal urban situations where they are the group of people who have some of the most significant water challenges.
I will now ask each panel member to address the question, 'How does national policy impinge on local and regional water management?'
Jon Black: In terms of south-east Queensland, the population is just over 3 million in that geographic area described from the New South Wales border up to Noosa and west to Toowoomba, inclusive of Toowoomba. In terms of growth, I won't use percentages but it has just been revised to 1000 people a week. As indicated by an earlier speaker, it is the fastest growing region in Australia. That 3 million represents one in seven Australians, and that is the catchcry for the lobby that our organisation represents.
On the water supply side: we are in a drought, and the graphs that we saw in John Langford's presentation could be extrapolated across to the major Wivenhoe system of south-east Queensland, which represents 85 per cent of the water supply in south-east Queensland and is currently just on 20 per cent. As of 10 April the whole region will be 0n what we call Level 5 restrictions. I know they are all different around Australia, but essentially all outside watering is stopped. There are significant economic and social consequences, including, as you can imagine, from a local government point of view in terms of revenue for councils.
Moreover, on the drought, in regard to the supply, the state has legislated some emergency powers and directed the implementation of emergency response measures. So we have got councils and they are big councils, compared with other parts of Australia doing major water projects. For example, Caboolture Council, north of Brisbane, with a population of just over 100,000, is putting in some bore fields at the moment as part of this regional initiative. It is costing $63 million for that, for 5 ML of water.
I have mentioned the demand side, with the restrictions.
Regarding institutional arrangements, you might have caught some of the national media on this. Local governments in Queensland for historical reasons, really collectively own the water infrastructure, including the major dams, with a Corporations Act company. Under the Queensland Water Act the state government is responsible for the planning for future bulk supplies, so there has been, to use the vernacular, argy-bargy for the last 18 months. But if I may read out of Hansard for 12 March, a statement by the Premier: 'A new system can be established voluntarily if councils cooperate. If they do not, I will legislate.' So we are in quite a heated round at the moment on the terms of institutional arrangements, but from the local government point of view, you can do what you want with institutional arrangements, it won't create an extra drop of water.
Dick Gross: Is Toowoomba part of you?
Jon Black: Yes.
Dick Gross: So wouldn't it be said that perhaps the Toowoomba council dropped the ball, or the Toowoomba community dropped the ball, and the Premier is entitled to take a hard line and override local government?
Jon Black: I think we have got to get the story right there. For those of you who don't know, the Toowoomba community, through the council, decided to recycle water. It was a $30-odd million project, with federal funding. The minister, who is actually the local member there, intervened and decided that the community would have to make a decision and it went to a vote. The result was no. We were going to go to the polls this coming Saturday in south-east Queensland, to decide whether we were going to have recycled water in our drinking water supply or not. The Premier made the decision, supported by all the councils, that we don't need the vote. We have to do it anyway, so we will be having recycled water.
Dick Gross: So, Jon, would you say that some of the political debate is actually a fake debate that state and local government agree on significant political issues, and that the disputes are only found at the edges?
Jon Black: That is correct. For both the local politicians and the state there is a water crisis. That is the consensus, so we have got to push aside the argy-bargy and concentrate on securing the water supply. South-east Queensland, if it doesn't rain and critical projects such as desalination plants are not completed on time, will run out of water in December next year.
Dick Gross: Just one other question. This interests me because I am an animal of local government, and local government operates in ways that are different from other tiers of government, in that it is more prone to consult, seek consensus, and sometimes listen to the loudest voices. Is water an issue that we shouldn't be consulting on but leading on?
Jon Black: Certainly when it comes to the expertise in local government, in terms of reticulating and treating water, absolutely. I think the issue is whether local government is the level to go out and secure bulk supplies. You can't expect Ipswich City Council to go and build a dam, for instance. And I think everyone would be aware of the Traveston dam issue.
Traveston dam has been proposed by the Beattie government for a major surface storage north of Brisbane, and it affects one of the major farming areas in south-east Queensland, so it is not a popular decision locally. But it is seen as a necessary storage from 2012 onwards. We just don't have the supply. And to extrapolate that, I would like to represent the rural community in south-east Queensland as well. They have been so efficient with water recently, because they haven't had any.
Dick Gross: Our next panellist is Mayor Paddi Creevey, from the City of Mandurah, Western Australia.
Paddi Creevey: Mandurah is 100 km south of Perth. It is not a planned city, but a bit like some of the places Jon was talking about. We tend to talk about rates of growth because our population is small, in 1970 we had 3000 people and we have 65,000 now not large by eastern state numbers, but when you are 50 km long and about 3 or 4 km wide, and you have got a major estuarine system involved in that and all that coastline, then there are some unique pressures.
There are also some differences in WA local government. The 144 local councils don't own the water infrastructure and don't provide the water supply; that is done through the state.
Dick Gross: So you don't even have a distribution?
Paddi Creevey: No. I guess the big issue for us in all this national reform is the fact that it has taken such a long time to come I think Brian Burdekin summed it up, that it is never a lack of money, it is always about political will. And I guess we've wanted something to happen for a long time. Hopefully, this can work.
The issue I'd like to focus on is that of capacity.
Dick Gross: Could I just rudely interrupt there, to make the point that local government is a very diverse beast. In Tasmania and Queensland they distribute water, in Victoria we used to but now do not and, just to make it clear, you don't?
Paddi Creevey: No, we don't.
Dick Gross: And New South Wales does?
Robert Bell: Yes.
Dick Gross: So this is one of the difficulties for local government in trying to have big national conversations, because we are so different. And that is why we have got a number of different people here in this conversation, but one of the things we have to take away is that for Western Australia and for Victoria, we only get a voice in the water debate, not because we are in the water industry, even though we might have been in the past.
Paddi Creevey: I'm glad you made that clarification because I think that's very important in understanding some of the challenges facing WA. The other thing I should say is that our Premier of the day, Dr Gallup probably, in my view, for the right reasons did not sign the agreement when he was in office, and it was only signed in April last year. I think the result of that is that WA really hasn't had a lot of influence in the national conversation and the national policy. Reading the document, I actually didn't find any reference to WA, but I think that's another thing that the state has to contend with.
In terms of local government, and particularly the local government I represent, one of the things we find interesting about the reform is this whole emphasis on capacity. You can't read the situation in isolation from the other things that are happening in the country, and particularly in WA, where there is such a strong resource market. That has led us to really quite incredible skill shortages. One of the things we are very concerned about is the lack of people who are trained in the sciences and also who have the capacity to implement a lot of these initiatives.
Given that in local government, as you rightly point out, we are very concerned about all the issues to do with the environment, then trying to recruit staff to even get the water sensitive design options up and running, to manage carefully what you have, to focus on the area I would like to talk a bit about during the discussion, about what we do about drainage and about recycling water trying to find the staff to do that is a challenge. That situation is probably not unique to Western Australia, but it really does have an implication for the training of people in those disciplines. As people move into the resource industry and often defer their training, I think that is actually going to have another impact on this whole water discussion.
So my point is that we can have all the plans and I have just found this morning's session so helpful, because you really have laid out an amazing landscape, and it is important to have those plans but the other area I think we have to look to is training the people who can implement those plans, and that capacity, having that research and development application.
The other thing that I would like to link with that is making sure that our town planners are actually trained in understanding the implications for water. Traditionally they are not I don't know if it is featuring in their university education now, but one of the problems I think we face in WA, with a population growth that is above the national average, is that the planners are not really connecting with the water. I will give you an example.
In Mandurah our rate of growth has been 6 to 7 per cent over the last 15 years. When you go from a fishing village to a city, and you have got tremendous development pressures, then you really need staff with understanding across the disciplines. I think one of the problems that we are going to have to address in our state is that we still have a culture that developers have to make a profit, and the notion that you can develop any land, providing you put conditions on it. But then who monitors those conditions and who audits whether those conditions have actually been met? That is the impost that comes back to local government.
So, on top of all the major issues that you have put out today, I think there are some other issues that run with that. That is the capacity, that is the training of planners, and that is the development industry having to come to terms with the fact that you just can't keep developing land unless you've got a strong water policy to go with it.
Dick Gross: I have two questions for you Paddi.
Just a bit of background: local government is in a very financially insecure position. These big conversations require local government to be in a position where they can build infrastructure, contribute to debate, do research get involved as organisations with critical mass. Now, Pricewaterhouse did a review which showed that 30 per cent 30 per cent of local governments in Australia are not financially sustainable. We hide our poverty by under-repairing our assets, because that is less visible. So we don't repair roads. And the drought saves us from that, because water is the enemy of the road.
So we are very poor, but the poverty isn't spread evenly. It is no surprise that the smallest mainland state, Victoria, is in a much better position than the largest state, Western Australia, because this is all about length of roads often because that is the infrastructure that we are most often involved with.
The other thing that happened to Victoria is that there was a round of amalgamation. It was imposed on us, it was bitterly opposed. I was overseas at the time, so I missed all the fights, but it was bitterly opposed. But it has been a huge success, and it has made local government, in a very densely populated, small state, very much more viable.
So the question I would ask of Paddi, and also of all the others if they could remember to address it, is this. Is there an appetite for change, including the 'a' word?
Paddi Creevey: Well, as you know, in WA for the last couple of months we have been changing our ministers somewhat frequently the 'man in the Panama hat'. But now we are in a stable situation, and all's well with the world.
Just to address the first question, about the infrastructure: that goes to another federal discussion that needs to be had, about the federal grants. This, I think, does actually tie up with the whole water discussion.
Take our situation. We have a $200 million budget, just for the kind of infrastructure we need. (When I talk about infrastructure, I am talking about playing fields, libraries, sporting facilities, those kinds of grassroots facilities.) Because we grew as much in 10 years as it would have taken the normal population 40 years if you take the Australian average we did not have a chance to accumulate rates, loan borrowings or financial assistance grants or community capacity. But, for some reason, under the federal grants scheme we get $13 per head from the federal government, where some of our counterparts in the eastern states same population, far less population growth get $70 or $80 per head. Now, we don't want to take it away from them. We want the pot to be increased.
I guess you see those inequities that really don't help local government provide infrastructure. That of course comes down to the issue of sustainability, and you are right. The state government has done an inquiry...
Dick Gross: This is financial sustainability.
Paddi Creevey: Financial sustainability. And I guess there has been a concern about forced amalgamations, because of the 144 councils over such a large state. Especially in areas where there are dwindling populations, the local government is usually the last person standing. So there are issues in the rural areas of community decline, and it is, like most things, quite a complex argument.
However, there is now in our state's Local Government Association, a very determined effort to look at some of the issues that have been raised in the report that they have done, and I would suspect that, given that in 18 months' time WA will be the only state that hasn't done the amalgamations, if the government is re-elected it will not remain voluntary. They are working on it, you are right, but it goes much deeper than amalgamations. It goes to a lot of other federal formulas, it goes to a whole range of other things. So unfortunately there is no simple solution, but yes, the 'a' word is on our mind.
Dick Gross: I agree with everything you said, and I would say that the 'a' word is very traumatic, because it is like ripping up 150 years of history, in our case. It is not easy.
The other question I had is this. I loved what you said about the developers, and my perception is that the state and federal government are less likely to take on developers and get them to pay for their externalities, or the costs that we all bear, rather than local government, which in my situation is quite rabid about it. I wanted to ask you the question about sustainable design in Western Australia. In Victoria, councils have grown sick of waiting for the state government to impose requirements for sustainable design of new dwellings and even significantly renovated dwellings, and so they have put in their own rules about sustainable design. That is, of course, ridiculous. It is completely unfair that in one suburb you have to have 5-star rating for environmental design and in the next suburb you don't. But it is our way, in local government, of pushing state governments towards environmental design, because local governments do land-use planning. What is the situation about environmental design in your neck of the woods?
Paddi Creevey: It is still pretty mixed. I think the problem is that the subdivisions come under the province of the state government the local government makes recommendations but the planning laws have not kept pace with what is needed on the ground today. And, unfortunately, if the planning law says you don't have to do something, and you try to impose it, the developer can take you to the state Appeals Tribunal and then you can't impose it.
Our environmental and planning laws need to get up to speed very rapidly. A lot of local governments, including our own, are trying to work cooperatively with developers, because they in the end get a better situation, particularly in the area of water sensitive design. They can see that if they wind the roads round the trees instead of knocking them over, if they do the boring under the trees instead of trenching around them the tree will live. And in a landscape like ours, if you'd taken out shares in limestone blocks that are now the favoured way of doing mass subdivisions the benching then you'd be a millionaire.
Someone used a term earlier today that I think sums it up: the 'institutional clumsiness' of trying to respond. So a lot of local governments are trying to take that lead.
I think we are the only state that doesn't have developer contributions, and so the impost again comes back onto local government, particularly in areas of trying to make sure that we get recharge into the aquifer through proper drainage, that it doesn't just all go out into the ocean, and that you do get the water sensitive design, particularly in our very sandy soils and very parched landscape.
Dick Gross: We will now cross back across the continent to New South Wales and Councillor Robert Bell.
Robert Bell: Just to address the question before us this afternoon. I have looked at it in terms of the pros and cons of the National Water Initiative and how it impinges on local government. But before I do that, by way of background I just want to give you a little bit of an idea, in terms that in New South Wales we have 106 water utilities and sewerage facilities which are owned totally by the councils, either in isolation or in collaboration. In other words, they are authorities where there is more than one council, or they are individual councils.
You had an example that was brought up by Kim Russell earlier today, in relation to Dubbo. Dubbo is one of those 106 councils that fit into the regional body, and I chair the state water management committee which picks up those councils. The population that that covers is about 1.4 million, and is fundamentally regional New South Wales.
The other thing that I think is interesting is similar to what Paddi was saying I would concur totally in terms of the financial stretched-ness, for want of a better word, that local government is facing. The Local Government and Shires Associations commissioned a report which cost half a million dollars. It was done by former Treasury people, and it revealed a startling lack of resources that are provided to local government, and a huge amount of cost shifting from federal government and state government over the last 25 years. In the state of New South Wales, 4.5 per cent of all public money is local government, and yet they are expected to do one heck of a lot in a myriad of different types of facilities to be provided to their local communities. In other words, 95.5 per cent is money that is raised from the people of New South Wales and goes into the state coffers. Therefore, we have a fundamental problem in addressing a lot of the issues.
However, in relation to the question at hand, we think in New South Wales that the national guidelines will lead to a much better and more consistent planning direction in the longer term. We think that a national approach is the only way to go forward, that the individual states, as exemplified by the MurrayDarling, are not the way to go. And a lot of people seem to agree with that. For the first time, we have got a national agenda in terms of water it's right up there at the top and all the interactions with water that occur, such as what has been one of the focuses of the discussion so far: population and water, that nexus or lack of it.
The other thing that is really important is the restoration of the over-allocation. 115 per cent overallocated in New South Wales. It is absolutely scandalous, and at any given point in time you could see quite clearly, when it got to 60 per cent, 70 per cent, 80 per cent, 90 per cent, 100 per cent, how long does it go? if we didn't have the National Water Initiative, if we didn't have that come on board, would it be 130 per cent in two years' time? As some of the speakers were saying in terms of the politics, unfortunately it has got totally out of hand in New South Wales. The NWI, in a positive sense, will definitely address that, and as has been indicated, about $3 billion has been allocated to address that, not only in New South Wales but in the other states as well.
The other thing that we think is good is the increased water trading capacity, which is a whole new dimension in terms of getting better outcomes. You can't turn to local government, because we are cash strapped; the states and the feds themselves seem to be prepared to give only a certain amount of money, and some states are even cash strapped.
There is also a really important thing, the connectivity between groundwater and surface water. And that's really recognised in the NWI. We think that is long overdue, because this country fundamentally has based its water supply system on surface water, and yet we are the driest continent. And we also use it for single use, as we all know, and we have done that for decades.
There is also that other aspect in the NWI, in terms of not only the big funding that you can get access to, but also the $50,000 grants for communities. We know councils in New South Wales that, through partnerships with the local communities, have got multiple grants that way. And that is another education process in terms of the demand side of water management.
In terms of the cons, there are a few problems. Someone came up with the question of whether national water policy impinges on local and regional water management the question I actually had was also 'in urban areas' but it is very focused on inland rivers and the agricultural sector, and the question of environmental capacity. That is, sustainable water yield and nexus with population are not even mentioned. That's unfortunate.
The funding criteria are very strict and unlikely to address drought situations as adequately as they could particularly emergency drought situations, but then you could say there are other buckets of money and other funds that could address that.
The other thing that we have found through personal experience, having been the recipients of some of the NWI funding, is the time delays the time delays between the decisions that are made at local level, by either a single council or a group of councils, and the receipt of the funds. This is a major thing, because with the water crisis you've got huge issues, as Paddi referred to, in terms of skills and training. There is a chronic shortage in this country of lots of different professions, but there is a chronic shortage of people in water management, or anything to do with water. And when you've got 106 water utilities out there that are wanting staff, it's a matter of who is the highest bidder. In fact, I could give you examples where you put on a person for $80,000 and the general manager's salary goes up $20,000. Why? Because of the hierarchy. You can't have someone that you have to pay $80,000 to do a job for you, without that impacting on the rest of the structure of the council.
Also, during the time that you wait, between when you put the application in and you get the nod, and then you finally actually get the money, the cost escalations are quite significant. We have got a number of cases in New South Wales where in a 12- to 15-month time frame in the last three years there has been about a 40 to 60 per cent increase in many of the component costs associated with the project. I can give you an example in terms of the water loss program that I chair for New South Wales, which is through an NWI program, where councils have identified leakages up to 20 per cent. They don't know how to deal with those leakages. Just because you can see something gushing up in a street doesn't mean that that is actually the real source of your percentage leakage of 20 per cent. It's probably 0.0001 per cent in reality, or less.
With that situation you need to have the technical expertise in order to address your leakage problem. That leakage problem requires, therefore, people to be able to come on board. And those cost structures are increasing, as well as problems with the actual equipment itself. To try and source the equipment my mate on this panel, from SEQ, has 'stolen' virtually 75 per cent of all the best people who are involved in water management, the people who have got the technical expertise. They pay a lot more money than a lot of the rest of us can afford, and so there is a great magnet into SEQ to solve SEQ's problems before those of the rest of Australia. We can't do anything about that, because we live in a democracy, but I wish sometimes we could stop some of the 'Mexicans' going up north. That would be good!
In conclusion, we need to have a very holistic approach to this and we need to look at all the facets if we are really going to address and meet the challenges of climate change in terms of meeting the expectations of our communities, and also be able to go forward in a sustainable fashion to whatever is our final population in 2050.
Dick Gross: Our final panellist is David Butt. Even though we are all representatives of local government, there are going to be regional differences of opinion.
David Butt: I think you are very right about differences of regional opinion, and that really comes down to differences of regional geography and what areas are facing. The Australian Capital Territory is part of the MurrayDarling Basin, so we are particularly concerned about where we sit in that which happens to be at the top end of one of the major 22 rivers that form that area and what our requirements are, what our place is in that system.
To quickly answer the question of whether national reforms will help water security in urban areas, I think the answer is yes. The subsequent question might be: will urban areas be the same in 20 years? And I think the answer is going to be no. The question is how you deal with that change. It is going to impact on the ACT, it is going to impact on everyone else. I used to work in the federal government, so I feel somewhat confident in making sweeping statements, but I think every regional, urban centre in Australia is going to be impacted over the next 20 years, through water. The only thing that will stop that happening is if it rains.
We are looking at some situations here in the ACT where we are down to less than 8 per cent of our normal inflow into our storage areas. It is not sustainable. We have to look at what we can do to ensure a capacity to supply 350,000 people 320,000 of whom are in the ACT, 30,000 of whom are across the border. So this is something that isn't just territory or jurisdictional based. What happens in Queensland is going to impact on New South Wales, even given New South Wales' extraordinary ability to over-allocate. So how we deal with that is the question.
I also happen to have studied economics at university. (I am always averse to describing myself as an economist.) I will say one thing here, and that is, 'You're going to pay for it.' When I hear people say that we can't afford to do things now, I think, 'Well, is it that you can't afford to do them, or are you not allocating out the costs properly and attributing them to where they fall, and making sure that they are covered?' It goes back to Paddi's comment about developers and whether there are developer contributions, and all the rest of it. They are not small town issues; they are issues for urban development. They affect Canberra, they affect Queanbeyan, they affect Sydney, they affect Wagga, they affect Mandurah.
How we use water I think is an issue that is being forced on us. In the ACT we are now looking at very serious stormwater harvesting, with the objective of replacing potable water use. We used to just catch it up in the dams in the mountains, bring it down here, and gaily sprinkle it around all of our playing fields and everything about Canberra that you've ever believed. We're not doing that any more. We don't have the water to do it, so it's forcing us to look at other options.
So we come to water sensitive urban design. Our new design areas, our new suburbs that we're still throwing up with fairly gay abandon, are being built to use 40 per cent less water than older parts of urban Canberra do. So the expertise is out there, and it is possible to do developments along those lines. Water sensitive urban design is a fascinating area, and it is really quite incredible how it's not new. Talking to our planners at the ACT Planning Authority and they're pretty good, despite some differences of opinion we might have over planning and how development goes ahead I find that a lot of this stuff is not new and it is possible for the town people to get up to speed on this and do it. (Or I believe it is, anyway.)
The ACT sits in an area at the top of the Murrumbidgee. We generate in the ACT about 490 GL of water in a normal year. We have another 360 GL flow through the ACT from the Murrumbidgee, which effectively we don't touch. So recognising where we sit in the system, that water is going down to users down below; it is going all the way down to Adelaide.
We have to think about what we do with effluent. At the moment we are treating it to tertiary stage and it is released into the system. And if you analyse what we are doing on a system-wide basis, we are only using roughly 50 per cent of the gross water that we take out of the system. Notwithstanding that, we are still facing problems.
I was talking to one of the Commonwealth officials yesterday and I said, 'Well, we are looking at a recycling proposal. We are looking at between 10 and 20 GL capacity to recycle wastewater from our Lower Molonglo works and eventually bring it back in and reticulate it for potable water.' And he said, 'Why? Why don't you just catch it up in the mountains and bring it down?' The answer is that it's not up there. There is a drought on. And when we talk about markets and going and buying water, if the water's not there you can't buy it. Tantangara Dam sits at the headwaters of the Murrumbidgee and is basically the main feeder dam going into Eucumbene and the Snowy hydro area, where the water gets used for hydro and then eventually gets used for release into the Murrumbidgee Irrigation Area. So it's taken out of the Murrumbidgee River and diverted down through the Murray. That dam is at 2 per cent. They don't have the water there for the ACT to go and buy, to provide water for us. So we have to look at solutions such as recycling.
If we lived on the coast we would probably be looking at desalination. One hesitates to wonder about icebergs, but I am sure it is an idea that will come up again.
In inland Australia we are going to have to look at how we use water, we are going to have to look at how we price water, which will influence how it is used, we are going to have to look at the various users. The market for water is urban, industrial and rural, and environmental. We are going to have to work out what quality of water may get used from various sources or what potential rights the parties have.
It was fascinating listening to my colleague from Western Australia about the mining boom over there. That is creating a skills shortage for everyone. This is supply and demand stuff. The potential dam builders, the engineering companies, are making a motza over there. Do they want to come over to the east and build a $150 million dam as a one-off project? No. You've got to have projects of sufficient size to attract them back, or you have to pay them more money. That's the economic reality that we are facing.
The industrial demand for water I don't think is going to decrease, and we have to look at how we allocate water out across that.
The contest and I do describe it as a contest of urban versus rural water use is something that we are going to have to face. It's not only whether we build a dam and lose agricultural area; it's whether we have a rice farm or give a town or an urban centre capacity to supply water to the population. That will come down to price or it will come down to government intervention, and decisions that impact on market allocation of water.
Discussion
Question: I would like to deal with the demands question. There is enormous growth, particularly in Mandurah and south-east Queensland, and you have talked about reducing demand through water restrictions and so on. But demand is a function of per capita use and total number of people or industry or whatever, but in the urban situation it is per capita use multiplied by the number of people. Have you addressed at all any ways in which your population growth might be slowed, for instance by putting pressure on the federal government to reduce its annual immigration rate of what is now 180,000 people, as we heard this morning?
Robert Bell: In our case it is definitely zoning. We had a grand plan in 1975 and then 1982 to have a certain number of people natural growth. The state government forced us to change zonings not only to create natural growth but to provide for a lot more, extra growth, which wasn't in our plan. So I think it is more complex than immigration. I think it has got a lot to do with what kind of place you want to have and what sorts of zonings, and therefore what uses of the land you want to make. You can get somebody from on high coming in and saying, 'No, you've got to have an extra 30,000 or whatever.' In our case, where I come from, we are supposed to have an extra 35,000 people and we are supposed to change the zonings yet again. (This is as of six months ago.) In the case immediately to the north, in Wyong Shire I come from Gosford they are expected to have another 70,000. In the Hunter they are expected to have another 145,000. In Wollongong they are supposed to have 135,000, and Sydney will have an extra 900,000. The only way those can come into effect is if you make the plans to accommodate for the extra population at the expense of some of the very characteristics that people actually moved there for originally.
I think it is unfortunate that we can't allow natural growth to occur, because you have the capacity to plan much, much more effectively and not make mistakes in the planning.
Jon Black: From south-east Queensland's point of view, we are fortunate to have a statutory plan for growth. When I say fortunate I mean that it is a plan to accommodate an additional million people over the next 20 years. But the local government level has indicated, the same as in New South Wales, the need for planning control mechanisms. And that is the democratic process, as well. You see in south-east Queensland this pro-development type focus, because of the economic prosperity and dividend that provides, as against the ones that wish to protect habitat and lifestyle. And that's the local government process.
In Queensland those local governments control that process. There is one of our 18 councils, for the Shire of Noosa, that has a population cap. I think we could also add that south-east Queensland was terribly popular with the southerners; it was inexpensive relative to Melbourne and Sydney. But if you have been there recently you would know that it is almost as expensive. So I should think there is a natural levelling off there as well, notwithstanding the $66 billion being spent on infrastructure in south-east Queensland at the moment, which attracts a lot of people, especially water engineers from New South Wales.
Question: I am from Rous Water, which is headquartered in Lismore, in north-eastern New South Wales. This question might go to a number of people, but especially the representative from south-east Queensland. You mentioned just now that south-east Queensland had what is called the 2020 plan, if I recall it right, though I am not really familiar with that at all. You mentioned Noosa and their policies, but as far as I am aware it seems the only one, perhaps, that has a particular emphasis on population. I don't know the plan so this is a multiple-part question.
First, are there population constraints? Have they been considered in the 2020 plan? Then, combined with that: the federal Environment Minister has suggested that water can be readily accessed from south of the border which just happens to be where I live. At the moment we have got a $15 million plan that we are working on to increase our water supply, and about an $80 million dam to do so in the future. We have our previous infrastructure, which was paid for, and the public policy of having loans so that future populations share in the cost of providing that big dam and user infrastructure is an issue.
So when it comes down to what would happen if the federal government were to charge or to allow south-east Queensland to take water this is hypothetical but it has been proposed at the top level. Would you think that there would be an honest payment of what it is worth? In other words, regarding the infrastructure costs, why should the southerners pay for your infrastructure if you didn't plan correctly? At least, that is what my constituents tell me. And, basically, could you afford the water?
Jon Black : I am glad you asked the question, in the sense of my thoughts around the National Water Initiative. One of the principles in there probably needs to be raised. It is about full cost recovery. It doesn't say, in my interpretation, anyway, 'full cost recovery from the customer'.
This comes back, I think, to the $10 billion plan. To make a personal comment, I am a big supporter of it for the MurrayDarling and the obvious environmental benefits, but Malcolm Turnbull in his comments has made it quite clear I can't give you the exact words but it's along these lines that urban people can have as much water as they are willing to pay for. You have to question the equity around that, in terms of the population. We all pay tax, although it has been pointed out that local government can't tax. Are we getting the fair dinkum benefit back from that taxation? Should customers pay the full cost recovery? Should it be the ratepayers of south-east Queensland funding the current program of $10 billion worth of new water infrastructure? With respect to moving water across borders, I suggest there is no plan, it's a desktop study to see if it's economical to move water. But we should note that we are only looking at a bank-type economic examination rather than, perhaps, the social aspects of water.
Certainly I think you've got to break down the borders. I found it interesting earlier today to hear about the Federation decisions around water and boundaries, because it took so long to get there and I can see why. Water is perhaps more important than oil.
Question: I just wondered if I could ask the councillors about their thinking: when you are talking about planning, what are you planning for? And in that 'planning-for', what place do you give the environmental assets?
Paddi Creevey: I am glad you raised that question. What we are planning for is community. Obviously, you are creating a place where people are going to live, and to live they have to have certain things that we need as human beings, they have to have the ability to participate, and they have to have wellbeing. And I guess the United Nations has raised a whole lot of issues for that.
The City of Mandurah had an interesting experience last year: we were finalists in the international liveable communities awards. 200 cities from all round the world entered, and we ended up presenting in Hangzhou. It was interesting that what they were looking at was community wellbeing, environmentally sensitive practices, the kind of public health, the kinds of notions of living in community, and also the notion of community development and participation. So that mixture of environmental sustainability with a community sense of participation and sense of place is basically what you are planning for.
When you talk about rates of growth and things like that, you are basically talking about people choosing to live in an area, to make it their home and their community.
I think it was rightly pointed out at the beginning that local governments place a very high emphasis on what you plan for, because basically when you do your community surveying, that's what the community tells you they want. And I note the notion that, for example with us as a sea-change community, you have to look at how not to kill the goose that's laying the golden eggs. That is a very difficult message to get through to the clumsy institutions, who do not respond quickly enough to the rapid changes that take place in a community.
I think that you can't lose sight of the fact that it is about community, it is about where people live. And that is what the planning aims to achieve.
Dick Gross: I might just add, being an incorrigible boaster, that my council won that world championship a few years ago.
Paddi Creevey: We got third most liveable community in the world.
Question 4: I have just a couple of comments. There was the comment about water and the capacity to pay. There is no question, not an irrigator in the country would question it, that water is going to shift to the people with the capacity to pay. And that will be for urban and, increasingly, industrial uses. When you look at the value of that water in a sale to a farmer versus those competing users, you've got to look at the value add. For example, I grew popcorn for something like 10 years. I got around $350 to $400 a tonne. When you go into Hoyts and pay for it in one of those boxes, you are paying $17,000 a tonne, just for having a bit of hot air blown on it. When you start talking about the value add and communities, you have to recognise, although it is not very tangible or known, the real value of that water. Every community with rainfall less than 500 mm a year in the southern MurrayDarling Basin is dependent on one of two things, and that is minerals or water. If they haven't got one of those two things they are struggling to survive.
Just blithely shifting water around raises some issues that are not very well understood, and perhaps we could have a comment about the value of their communities, what they see in those resources close to them.
Robert Bell: I think that what was said earlier today was fantastic, about virtual water. I think we have got to make a linkage between this country and the nature of this country, and whether it is going to get dry or drier. The fact is that over the last few hundred years it has been getting bouts of dryness and then wetness, but from the stuff I have read from Professor Warner and Pitman, it appears that the wetter times, which are about 45 or 50 years, are actually getting drier, and the drier ones are actually getting drier. Everybody is entitled to different points of view, but what I found was really interesting with that was the fact that when those histograms went up they showed that, whether it was in Western Australia or whether it was in the Mallee in Victoria, whether it is the central coast or whether it is Sydney, it is the same in Albury, it is the same in Moree. It is amazing how that sort of trend is almost replicated.
What I am trying to say is that we need to be tailoring the sorts of crops and the sorts of things in this country which have some relationship to the actual country we live in. It's about time that governments actually factored in virtual water and somehow put some sort of a cost on that, and we need to be producing those things that don't generate a requirement for so much virtual water to actually get that product to market.
That's notwithstanding what you're talking about, which is to do with the middle man factor. But virtual water is like the elephant in the room, in my opinion. It really should seriously be taken on board by somebody.
