Water management options for urban and rural Australia

The water dance

Tuesday 6 July 2010

Adjunct Professor Leith Boully
School of Integrative Systems
University of Queensland

Leith Boully is passionate about water resource management and has been involved in the great water dance at local, state and national levels for over 20 years. She and her family have an irrigation, dryland farming and grazing property at Dirranbandi in Queensland.

Leith served for two terms as chairman of the Community Advisory Committee to the Murray Darling Basin Ministerial Council and was a founding member of the Wentworth Group of Concerned Scientists. She is currently chairman of Wide Bay Water Corporation and the Lower Balonne Water Resources Ministerial Advisory Council, deputy chairman of the Cotton Research and Development Corporation and a board member of Seqwater, Murrumbidgee Irrigation Ltd, Agrifood Skills Australia Ltd, and is an adjunct professor with the School of Natural and Rural Systems Management at the University of Queensland.

There's nothing more important to Australians than water, because without it we can't survive. For the most part we treat water as a technical issue. Engineers have long dominated the water industry but in more recent times, as we face the real nature of our old dry continent, other disciplines have come to the fore. The truth is that, irrespective of whether you live in Adelaide, Griffith or Dirranbandi, water is not only technical it is also social.

How it is used and abused is about people, their values, needs and aspirations. It's easy for decision-makers to focus on the task at hand, but invariably as they try to dance around people and values, because they get in the way of objective and rational planning, conflict erupts.

The majority of the fantastic lectures in this series to date have focused on technical or policy elements in the water agenda. But tonight I want to focus on the people involved in the great water reform dance floor of the Murray-Darling Basin and how their lives and livelihoods are changing.

Water is personal – perhaps the most personal issue we have – and it's about us, the people. Before I go any further I need to make a confession. While I've always been passionate about the Murray-Darling Basin and water reform – which I see as a process for making things better for the environment and for people – I have to admit to feeling angry, frustrated and powerless in the current environment. I'm disappointed and frustrated that the National Water Initiative objectives, which were supported by most stakeholders, have not been reflected in the Commonwealth Water Act.

I'm angry that the Canberra machine does not seem to care about the impacts of water reform on real people in real communities.

As an irrigator, and member of a community in the Lower Balonne, I no longer feel that the contribution I make to society is valued. Rather, I'm intensely aware of the disdain that the city's chardonnay set treats us with. I'm powerless to do anything about that.

Sadly, I'm not on my own. These are the emotions that the majority of my peers in irrigation communities across the Basin feel. That said, water is personal and, therefore, many emotions will be generated through the reform process.

Now, I didn't come here tonight to bore you with my problems and seek a counselling session. I share these thoughts with you so that you might gain some insight into the very personal nature of water reform. And don't worry, now that they're declared I'll move on.

You'll note that I said that it is the water reform process that has evoked strong emotions. The technical objectives that were set out in the National Water Initiative of 2004 were largely agreed to and supported. However, they will only be achieved if they are embedded in legislation such as the Commonwealth Water Act, and if people are involved in and support the process of transition to the new arrangements.

I want to paint a picture for you of where we've come from, where we are now, and what we face, as people engaging on the dance floor of water reform. The idea of the dance analogy was inspired by two things. Firstly, as an executive coach I encourage people to look at their situation from both the dance floor as a participant and from the balcony, in order to objectively reflect on what is happening. The second thing that inspired me was a comment I once read by a dance professor. He said that when one looks at water in nature it is almost always in motion. When a human being is moving through space using the elements of time and energy, a dance is occurring. Dancing on water is quite hard, a feat that would invoke much discussion. Similarly, dancing through water reform is very hard and also causes much discussion.

Let me invite you to take three things away from my talk to reflect on. Firstly, water reform, like dancing, is all about people; secondly, badly designed policy instruments that disregard the needs and aspirations of people, like poorly performed dances, are likely to have angry audiences; and finally, consider how you would feel if your community was facing a tipping point with no support.

Let's move to the dance floor. Looking down from the balcony who do we see? We see the wallflowers, who are the most numerous; watching longingly from the outside they are the people who work and live in and are nurtured by Basin landscapes. Also prominent in this crowd now are the recently excluded state government officials.

The beginner dancers, those keen to dance but who have little knowledge, are the bright young things, well intentioned, who flock to places like the Murray-Darling Basin Authority. They are trying desperately to meet the vague demands of more experienced dancers.

The intermediate dancers think they know everything and they're too good to dance with beginners, but they will instruct them.

There are the zealots. These hotshot dancers are too good to dance with anyone. They are mostly Commonwealth public servants, academics, ministerial advisers and occasionally a minister.

The advanced dancer is someone who dances everything, especially with beginners. These are the people who can cross the river and inspire wallflowers to join in. But they are very rare. Professor Peter Cullen, one of the other founding members of the Wentworth Group, was one of these.

Now that you know who the dancers are, let's take a look at where the dancers come from and what the contemporary dance style might be. Back in the days when there was a Murray-Darling Basin Ministerial Council and Commission and the states were able to engage with the Commonwealth, most of the dances were group dances. They were generally, but not always, coordinated in such a way that all of the individuals in the group were dancing the same steps at the same time.

Sometimes, subsets of the larger group may have been dancing different but complementary parts of the larger dance. Sometimes there were groups of individuals dancing independently of each other, but for the purpose of finding complementary dance schools that worked for different venues and times.

One fine example of this was in 1995 when the Ministerial Council agreed to establish a cap on diversions. All of the states went about the implementation in slightly different ways. Same intentions, same dance floor, different steps, all agreed by the dancers.

Looking from the balcony this was a Basin-wide dance where everyone had to work together to choreograph the complex music of integrated land and water management. There was room for advanced dancers to inspire, for show-ponies to strut their stuff, and there was also a place for the wallflowers to feel safe enough to engage in the process.

The dancers reflected the style and pace of the dances: slow, steady and dedicated to making sure everyone understood the steps and had the skills and resources to carry them out – at a rural or country pace, perhaps. But embedded in this principled and high level dance sector there were many instances where the dance steps of water reform were being choreographed by those hotshot dancers and DJs with technical and policy skills, while the wallflowers at local venues were intimidated.

I asked a friend from the Namoi to describe her experience of the water dance in groundwater reform. This was an experience that lasted for 12 years. The following is what she had to say. The first official sign that the valley was over-allocated and over-used was from the aptly named paper 'The sleeping giant', released in 1994. This paper outlined how the valley was over-allocated by up to 400 per cent and that cutbacks were in order. So the dance began. The government went into denial and said that it was not a big deal and embarked on a community consultative process.

The committees were stacked with government officials, all with voting rights, and a predetermined outcome had been decided. Take the water, pay no compensation and to hell with the consequences. The community was a reluctant partner in this dance, but they had to stay because there was no other way to influence events.

The turning point came when the state government acknowledged that they had in fact changed their policy from knowingly mining the resource for over 30 years to one of sustainability. This meant that they were responsible for the mess. They wouldn't stand alone, however. They wanted the federal government to acknowledge their responsibilities through the Murray-Darling Basin Agreement and the Council of Australian Government Agreement on Sustainable Water Extractions.

Over that time there were two water sharing plans gazetted. The first was repealed because it did not take into account any social or economic impacts and, hence, did not satisfy the federal government's triple bottom line requirements.

Suddenly, the dance floor became a battlefield and people were taking cover. There were more people on the dance floor – the professionals, economic and scientific experts and the lawyers, of course. These respected independent players provided credibility to the farmers' argument for compensation in the interests of the resource and the wider economy.

The dance began again and it was frantic. The irrigators were exhausted. They'd been dancing for far too long. The public was bored with the issue and impatient for its resolution. The politicians just wanted to be wallflowers. They knew that if they got on to the dance floor it would be a world of pain. Both the state and federal governments knew they had to pay. However, they wanted to make sure it was the least amount possible. Settling this issue was a precedent.

Finally, after 12 years, the amount of compensation was agreed. Relief was felt momentarily. And then the tax man took to the dance floor and changed the music.

The question that my friend in the Namoi is now asking is: will the dance that will begin with the Basin plan be just as painful, slow and useless as the groundwater dance?

The lesson learnt from many case studies like this suggested that the water reform principles of the day were unable to assist dancers in the resolution of significant and complex environmental, social, and economic three-steps. A new dance score was required, and so the 2004 National Water Initiative was fiercely negotiated by stakeholders across the spectrum of interests.

A new era dawned in which it was recognised that the settling of trade-offs between competing outcomes for water systems will involve judgments that need to be informed by the best available science, socioeconomic analysis and community input. Water planning is to assist governments and the community to determine water management and allocation decisions that meet productive environmental and social objectives.

Parties to the agreement clearly stated that governments are to engage water users and other stakeholders in the task of achieving the objectives. With the history of effective collaboration within the Murray-Darling Basin Agreement, and a clear articulation of the new objectives, the future for the Murray-Darling Basin was rosy – or was it?

Enter the prima donna. Not enough progress was being made. The states are unruly and disobedient. This Murray-Darling Basin problem must be fixed once and for all.

Rather than amend the choreography, the prima donna demanded a new deal. A specific new dance was to be developed to focus power and attention on water quantity and its marketing and accounting. The long-term dance partner, water quality, as represented by integrated catchment management, was banished.

The tango dancers sought to dazzle us with their brilliance. They said, 'We can make more progress if the Commonwealth orchestra dictates the music rather than seeking to develop the musical scores in parallel'. They convinced the elite city dance venues that utilising a single dance move, called the Ramsar, derived from an international movement, would be sufficient to force the naughty states and irrigators to reform their old-fashioned collaborative barn dances.

The minister of the day instructed the DJs to play 'Evacuate the dance floor' and 'Here's the greatest dancer' with occasional interludes of 'Dancing with myself' to facilitate the big dance design.

Some deals were cut and an awkward, clunky Water Act was delivered for John Howard to announce, along with the entry price for the next round of conflicted quick steps with the Basin community. The social and economic objectives of the National Water Initiative were left out there dancing alone.

As the last strains of 'I want to dance with somebody' fade away, the Murray-Darling Basin Authority debates the desirability of dancing with the states and the Basin community in the creation of this new Basin plan, the objective of which is to set new sustainable water diversion limits for each catchment.

So, the Canberra dance music plays on and on and on, the tempo increasing with the excitement of these new opportunities to fix the environment and exert power over troublesome gate-crashing states and irrigators.

Dances in Canberra are always preceded by a meeting to discuss and agree on what rules to impose on the dancers, and to decide who should dance with whom. These meetings can go on for quite some time with nothing to report. Weeks, months and even years pass, as the score for the ‘Basin plan big dance’ is written.

Finally it is agreed to go ahead with a small, telling dance led by the hotshot dancers. Just one small detail to resolve – the band and the play list.

'Dancing in the dark' and 'I don't want to dance' are on the play list. But 'Sins of emission' and 'Someone's trying to tell me something' by Midnight Oil are in dispute.

The dress code requires little argument. Proper attire, and no admittance without proper attire.

On the day of the dance it is drawn to the dance-master's attention that no-one has responded to their invitations, which were sent out only yesterday due to concerns about having the right people on the invitation list.

Advised that they were unlikely to be delivered to outlying stations before next week, there will be no-one for the hotshot dancers to ignore at the Basin plan big dance. The jitterbug, rarely seen in the capital, is danced with joy by all.

Speculation is now rife that when the excitement settles, the hotshots will take the Ramsar dance to the minister for approval. Concluding that the large numbers on the dance cards will appeal to the wallflowers, the first phase of the consultation program is approved, with strict guidelines around which Basin dance floor will be visited by which hotshots.

The rest is predictable. The irrigation council and local government association jointly fund an advertising program that runs in all the national papers. It says, 'We are on the dance floor, but the government won't dance'. The wallflowers have had enough. The tipping point has been reached. They turn vigilante and seek out the city elites, who presumed that they could rewrite the dance of the inland without their involvement.

There are likely to be some left in the Basin community hopeful that the new prime minister will burst out with the old Nat King Cole favourite 'Let's face the music and dance'. Unfortunately, they will be disappointed, as she's likely to be busy conducting the election.

I wonder if the hotshot dancers and the wallflowers will be able to work through what is shaping up to be a serious conflict – a conflict about the most personal of issues, our water, our livelihoods and our communities; in other words, our future.

While communities would like to see a sedate ballroom dance style emerge from the impending Basin plan, it is more likely to be a breakdance style. Breakdancing, for those of you who don't know, is associated with the streets of New York, and often when competing teams would dance a real fight would break out. The harsh and foolhardy nature of the dance is almost a game of chicken against an assailant.

So this long-awaited Basin plan is likely to represent a step-change for most Basin communities that are dependent on irrigation. We will see significantly reduced water availability and, along with that, reduced opportunity or ability to access capital to fund the ongoing nature of businesses.

We'll see total jobs, both directly and indirectly dependent on irrigation, declining. We'll see total populations decline and an accelerated rate of loss of community services such as schools and hospitals.

How real are those predictions? Let me give you an idea, based on some very recent work done by Judith Stubbs & Associates. Her report states that in the Murrumbidgee Valley the primary effect of the Basin plan will be a loss of employment, ranging from at least 440 jobs with a 10 per cent reduction in water availability to 2100 jobs with a 50 per cent reduction in water availability. The subsequent population lost is estimated at 1200 people with a 10 per cent reduction in water availability, and nearly 6000 people with a 50 per cent reduction in water availability.

Is the loss of 1200 people a tipping point? Is the loss of 6000 people a tipping point? We will just have to wait and see. How would you feel if you were a young person, or perhaps the newsagent, car dealer or school teacher living in Griffith and Leeton?

For individual irrigators, and their bankers, the uncertainty created by the very long period of time it will take from the release of a draft sustainable diversion limit to the finalisation of state water resource plans in 2014 is likely to be a little difficult. But within any change process there is going to be conflict. The extent of that conflict will be influenced as much by the context within which the change is occurring or, as in the case of the Basin plan, the nature of what is being imposed. Change doesn't happen in a vacuum.

It's my observation that there are five over-arching contextual matters that set the scene for, and will dictate the intensity of, the inherent conflicts over values, science, interest and relationships that the Basin plan will invariably face. I want to spend a little time talking about these. From the top they are: drought and the global financial crisis, the rural/urban divide; legislative constraints; geography and demography; and language barriers.

You won't be surprised to hear that trying to impose major change while people are grappling with a long and significant drought, declining terms of trade and the global financial crisis requires great sensitivity. Financiers are exerting pressure. The physical environment is unpleasant. Morale is low in many communities and people are vulnerable.

The additional pressure of a step-change Basin plan – delivered perhaps without respect and certainly without adequate recognition of the adjustment implications, together with a lack of committed resources – will result in anger, resistance and defensive behaviour rather than enthusiastic engagement in problem solving. Survival, rather than saving the Basin, is likely to be the priority.

What is the rural/urban divide? Surely we Australians are one. Unfortunately, if you live west of the Great Dividing Range in a very rural community it feels as though the people in the east have turned their backs. The debate that has raged around Australia with regard to the Murray-Darling Basin, particularly over the last half decade or so, I think has given us some insights into what this divide is.

To quote a Basin colleague: finally the disconnect between city and country is complete. My experience is that large numbers of people who work in the Canberra agencies are well-meaning, well-educated people who have done little but public policy and who believe they are on a crusade to save the environment. Very few contemplate the communities their advice will harm, even less have faced any of these communities.

Hugh Mackay and his discussion of the rural myth perpetuated in urban Australia suggests that this myth leads in turn to the rural fantasy – a favourite fantasy amongst contemporary urban and suburban Australians. This is the fantasy that says: 'Wouldn't it be wonderful to move to the country? Wouldn't it be wonderful to have our children educated at a quaint village school, grow our own veggies, breathe clean air and live as members of a true community?' But, of course, that never happens, does it?

The inexorable migration from country to city proceeds, and yet the more urbanised we become the more we indulge in the rural fantasy. So we settle for symbols of our commitment to the rural life. We drive four-wheel drive vehicles around the suburban bitumen, we wear elastic-sided boots to air-conditioned offices – not a horse in sight – and we install country kitchens in our inner city terrace houses.

And, I would add, that these mythologists are seduced by the technocrats who tell us that the end is nigh for the Murray-Darling Basin and demand that governments act to save 'their bush'. Why is this so? My theory is twofold. As our cities get larger and natural values are destroyed in the settlement process, the city is demanding that the people who live in the bush keep it just the way they imagine it should be, so that if they ever visit it will be as they imagined.

In the case of the Murray-Darling Basin, the technocrats have convinced them that it can be done. All we have to do is take water off those wicked irrigators. Secondly, it is a lot easier to export your environmental conscience than it is to change your own behaviour and demand that urban catchments be developed and managed sustainably.

And I know that this thought is heretical, but I wonder if South Australia would be so concerned about the Coorong and lower lakes if the city of Adelaide did not rely on an inter-valley transfer of water from the Murray to sustain it?

Whatever the truth, the rural/urban divide is real, particularly in relation to the management of the Murray-Darling Basin. People who live in the Basin feel it and react to it. I can't help wondering if some empathy and support would be more effective than the ridicule and criticism delivered through the media perpetually.

So, to legislative constraints. The old Murray-Darling Basin arrangements got around the constitutional constraints on the management of land and water resources by having parallel legislation established in each of the jurisdictions. But, with the advent of the new Commonwealth Act, what we now see is a reliance on the very limited powers that the Constitution provided to the Commonwealth for intervening. It's arguable that the limits placed on the Commonwealth by the Constitution mean that the Water Act doesn't properly take into account the sound principles articulated by the National Water Initiative. Perhaps the Basin plan and the Water Act won't be compliant.

The principles that aren't taken into account effectively are the inextricable link between social, economic and environmental performance; the complex nature of integrated land and water management approaches that are required to deliver healthy river systems; and the importance of engaging communities in the development of plans to address trade-offs between those environmental, social and economic matters.

The Productivity Commission recently made the observation that sustainable diversion limits must be based on scientific assessments of the amount of water that is required to avoid compromising key environmental assets and processes. 'Good science', they said, 'is a necessary but not sufficient basis for the optimising of the use of Basin's resources. The value people place on environmental outcomes, the opportunity cost of foregone irrigation and the role of other inputs, such as land management, must also be considered.' They said that if the Water Act 2007 precludes this approach then it should be amended.

It is likely that this inadequate nature of the legislative framework will cause great hardship for communities and little gain for the environment.

When the Murray-Darling Basin Authority hides between the Water Act to defend the lack of attention they are paying to social and economic considerations one can't help but feel conflict is inevitable.

So to geography and demography, what's the context that this provides? The sheer scale of the Basin, together with the settlement patterns and cultural differences north to south, east to west, inevitably mean that it is expensive and difficult to engage effectively. Many individuals and communities are likely to feel disenfranchised by what is likely to be a paternalistic and traditional consultation model.

Conveying the implications of the Basin plan to people at the local level will be almost impossible for the Murray-Darling Basin Authority, and that will be seen as unforgivable.

The nature of the water resource planning process, which will be conducted by the states, is such that it will be years before local impacts can be determined accurately. Living in that uncertainty is excruciatingly painful.

Choosing the assets that will benefit from the water and the volumes required, though assisted by science, is a value judgment. Should communities have real input into identifying the assets that they want protected and some influence over the determination of management objectives? Obviously it's easier and more efficient to secure large quantities of water from catchments closest to where the water is needed, but is it socially acceptable?

My friends in the Wentworth Group contributed to this debate just recently. They highlighted this as an option and they incurred the wrath of those communities.

Is it better to take more water from poor communities or prosperous communities? How these questions of equity will be dealt with is unclear; social engineering by Commonwealth decree or negotiation? How would that negotiation be conducted? Given that the engagement process is likely to lack sophistication, it seems to me that the ensuing debate around these matters will either cause communities to join together to oppose a common enemy or to compete with each other to secure win/lose outcomes. The history of politics favours the latter.

One of the most important contextual issues from my perspective is around language. In order to participate in the water reform dance it is first necessary to have a common language that invites participation and facilitates dialogue. Because we don't yet have that language the likelihood of conflict is enhanced. The Commonwealth and Murray-Darling Basin Authority officials seem to have three languages. Firstly, there's the ducking and weaving language designed to tell you nothing and seeking nothing in return. It is typified by long non-answers to questions or referrals to other places to get your answers.

Then there's the language of boredom. In his book, Water Politics in the Murray-Darling Basin, Daniel Connell talks about the power of boredom to alienate people from important debates. It appears that in order to survive the system, public servants are forced to write and speak in a manner that conveys nothing of substance and lacks colour and movement.

Connell suggests that making the stories of water reform boring means that ordinary people are unwilling and unable to participate in dialogue and debate, even when those issues are of critical importance to them.

Having travelled long distances and sat through a number of public meetings hosted by Commonwealth agencies, I can attest that it is very difficult to keep fronting up just on the off-chance that you might learn something new.

And then there's the patronising language that carefully constructs arguments around why this is good for you and you should just do what we say because we know what's best.

Having been locked out of dialogue to date by virtue of the lack of opportunity and language barriers, it's my observation that Basin communities are in the process of developing new language in order to engage with a Basin plan. Whether it becomes a language of conflict or a language of collaboration depends on the degree to which the Basin plan takes into account its impact on jobs, access to services and the quality of life in individual communities.

As I've commented earlier, there's really broad agreement that in order to ensure Basin communities prosper into the future more water is required for our rivers, and land management practices must change. That's settled.

So it's not the 'what' that is under question, it's the 'how' that is under debate. Communities are angry and frustrated that a holistic approach is not being taken to the adjustment process. Whole communities will be affected. Some will be tipped over the edge.

The public investment to support this is currently directed towards the purchase of water entitlements from irrigators and some dubious water-use efficiency projects that are supposed to provide for adjustment. There is no whole-of-government approach to identifying and investing in adjustment measures to assist communities to adjust to fewer jobs and people, while maintaining a reasonable quality of life for those who remain.

The fear of what a significant reduction in water availability might mean for communities is causing a clash of values. Where environmental values clash with personal survival or family and community values, invariably it is the human dimension that takes priority.

Peter Senge observes that most leaders instigating change are like gardeners standing over their plants, imploring them, ‘Grow. Try harder. You can do it.’ If leaders don't understand the forces that keep significant change from taking root and growing, then all their entreaties, strategies and change programs will produce more frustration than real results.

The change process was well underway within the old collaborative Murray-Darling Basin Agreement model. It was enhanced by the National Water Initiative, and the support for the task of change was there. There was a high level of awareness and there was a broad commitment to change. Unfortunately, we've lost a great deal of momentum through having to build new relationships with new people in new institutions. Those institutions, as yet, have limited capacity or willingness to provide key enablers for the next part of the change process.

If the future dance through water reform within Basin communities is to avoid resorting to that breakdance style, the Basin plan to be announced in the next month or so must, at a minimum, set the sustainable diversion limits in a way that balances environmental, social and economic trade-offs. If that can't be done then the release of the plan should be delayed until the legislation is amended.

It needs to ensure that the engagement process will provide sufficient information for stakeholders and communities to assess the range and extent of the impact and risks that have to be managed in the transition to new arrangements. It needs to commit significant resources, firstly, to pay irrigators for water that they lose; and secondly, to facilitate adjustment in communities. Surely that's not too much to ask.

As I said at the start of my talk, I would like to invite you to reflect on three things: firstly, water reform is just like dancing, it's all about people; secondly, badly designed policy instruments that disregard the needs and aspirations of people, like poorly performed dances, are likely to have angry audiences; thirdly, consider how you would feel if your community was facing a tipping point with no support.

Finally, I want to leave you on a light-hearted note with a poem that I found when I was writing this talk. It's called: 'Ode, on the general subject of water' by Kenneth Boulding:

Discussion

Question: You talk about various towns in the Murray-Darling Basin depopulating. But all the statements that are coming now from the new minister for sustainable population suggest that there's going to be masses of people that are going to be moved into regional areas, some of which will no doubt be in the Murray-Darling Basin. So what are these people to do? I ask from a personal basis because one of my sons bought a house in Boorowa, which is an hour-and-a-half from Canberra, but he was unable to find employment in Boorowa. Unless you're on the land then there is no employment; plenty of housing, but no employment. So are you coordinating with Tony Burke, the minister, at all on the question of population in the Basin?

Leith Boully: I saw some correspondence between the minister and a couple of peak body groups the other day asking that very question, will the Minister be considering rural towns in places like the Murray-Darling Basin within his population strategy. It also asked whether he would be considering the allocation of resources like water and other natural resources to support perhaps growing populations.

There was a non-response, I guess is the kindest way to describe it. But I think the real issue is, unless you have investment to create different and new opportunities in rural communities, people aren't going to want to move there, whether they come from somewhere else to this country or whether they already live in Australia. Unemployment is very low in most of the prosperous rural towns. There aren't many jobs in those places that aren't directly related to agriculture at the moment, and irrigation is the most productive agriculture that we have. So if we lose a big proportion of that, we will lose jobs and people to go with it.

I'm an optimist, so I'm sure people will be creative and find new ways to create jobs and employment in communities. But this will be a significant step-change within many Basin communities that will require very creative thinking.

Question: What would your reaction be to the statement from the previous prime minister, how he was welcoming population to grow to 30 million, and what would your peers' reaction be to that?

Leith Boully: Well, just for a minute I'll put on one of my urban water hats – You've got to be joking! Now I'll put a rural hat back on. They're not going to live in rural Australia. They're going to want to live up and down the east coast. Our settlement patterns are trashing the natural environment around our larger cities, particularly on the east coast. Will anyone want to live on the east coast if we have 35-40 million people or more living in Australia?

Question: I was struck recently, when driving to Adelaide, by the huge increase in the number of irrigators down there. Do you think that they were just too optimistic or they didn't see what was happening? In hindsight, it seems to be a bit over-optimistic as to what has happened around the Hay Plains and so on.

Leith Boully: I assume you mean the explosion of rice paddies on the Hay Plain. It's not the number of irrigators or the number of irrigation farms that we have that is the challenge. It is the way in which water resources have been allocated over time. Governments for a very long time in Australia saw that building dams and developing irrigation areas was a way to bring wealth to the inland. That was government policy for a very long time.

Even up to 20 years ago there were governments in Australia who were still developing irrigation deliberately to bring population to the inland. When we understood, particularly in the Murray-Darling Basin, that we'd over-allocated the resources, that we were in fact destroying the systems that we need to sustain irrigation and the environment, that policy started to shift. So we've had a conversation now for 20-odd years around the need to change. I think that need to change is settled. What's not settled is how we do that.

Most farmers are optimists and they are also gamblers. So those who developed irrigation in the Hay Plains, I'd suggest, had a reasonably high gambling streak in them and they were prepared to take the risk and have a go. Rice is a very profitable crop, and in those years when you can access water you can make a lot of money out of it.

Question: My question is related to a statement you made about environmental health overriding the human issues. I'm wondering then why the Murray-Darling Basin is in such a degraded state. It links with the last issue about the new irrigation farms out on the Hay Plains. I too have seen those and wondered why on earth they were being built in a time of drought. The businesses going into them will gain some profits over time but do we, as taxpayers, have to pay them compensation when they fail?

Leith Boully: Let me start with the last question first. I don't think anyone's suggesting that taxpayers would pay compensation – except that the new Water Act uses the word 'compensation'. What the National Water Initiative Agreement in 2004 did was require the states to establish property rights around water. You may or may not agree with that. We all have a property right for the piece of land that we hold. People who own water now have a property right for that water.

The argument is that those property rights have a value and that if society decides that they no longer accept the state that the Basin is in and they want to buy some water to remediate that, then that water can be purchased from those irrigators in the same way that you would resume land if you want to build a bridge or a road in other circumstances.

So that's where we sit in terms of adjusting those businesses from where they are now to create the water that's required to repair our rivers and system within the Murray-Darling Basin.

I can't put my finger on the day or the year when environment actually became important for people in the Murray-Darling Basin and people in government. But it was at that time we realised that continuing to grow water diversions was having a negative impact not just on the environment, which it certainly was, but the environmental decline was also impacting on people's ability to irrigate effectively.

If you haven't got good water quality you can't irrigate. If you've over-allocated the system and your dams run dry, you can't irrigate. If you're not proud to live in the environment that you farm in, then you're probably not going to stay there. Environmental values have taken precedence in the last five to ten years.

In the adjustment process, if it comes down to being able to feed and educate your kids versus putting water back into the river for the environment, it's human nature, the kids win.

Question: One thing that strikes me is that we pay a very tiny proportion of our income in urban areas for food, and I assume that the problem must be that you can't just raise prices for your products because of competition from elsewhere within the country – or is it imports, or what?

Leith Boully: I think it's called Woolworths and Coles. We enjoy a very high standard of living and we don't like paying much for the food that we eat. Calculations I did a few years ago for our farm business – if I fully costed the production of our beef or our wheat or our cotton – the price I received for it was something like 30 per cent of the full cost of that production, if I properly valued the environment. I don't think you're going to pay another 70 per cent for your loaf of bread, your milk, the cotton t-shirt that you wear. So that's a fundamental problem that farmers face.

Woolworths and Coles have got it all over us, because they can import food that we enjoy from overseas at least as cheaply as we produce it here, if not more cheaply. Some of it's pretty good.

Question: I wonder if I could pick up two things. Firstly, your comment about if it is a choice between the environment and the kids, then the kids win. On the face of it that's self-evidently true, but the reality seems to be that there simply isn't the water to support both, or even to support the kids that are there. So we're still left with the need to make change. You said that that's accepted. So if we then go on to the comment – which I rather enjoyed – about communication, and in particular the languages and the colourful or the non colourful language of public servants. These bright, young, idealistic, well-meaning, well intentioned policy wonks that you have identified, I think probably wouldn't all be keen to be seen as duckers and weavers because at about that age they're trying. So I'm guessing some of the duckers and weavers that you are encountering aren't these young, well intentioned would do the right thing if they could, if they knew what it was.

So somewhere in there we've got a bit of a tangle between the young and the enthusiastic and the perhaps more experienced duckers and weavers. But if we get any of them out into the Basin area you seem very pessimistic about the prospects of communication.

You point to some of the physical aspects and, I agree, it's a big area. But that, on the face of it, oughtn't to be an insuperable difficulty. We've got lots of modern means. So I wonder whether you could help us a bit more on what are these areas of the difficulties of communication – leaving aside the language bit and knocking the policy-people – how do we overcome those difficulties of communications and then how do we get around the issue that at the end there still has to be lots of painful adjustments?

And I'm sorry, I'm still not clear – after our discussion perhaps I need to reflect a bit more after your talk – about the adjustments that are there and how you would see these being apportioned where the pain has to be endured by a whole pile of people all through the region.

Leith Boully: Some of the most effective water resource planning processes that I've been engaged in are at the state level. What makes them really work is that you can build a relationship with the people in the state agency. You can sit around a table and you can argue about how to solve the problem for the time it takes to solve the problem. That's where eventually, after the release of the Basin plan, those conversations are going to have to happen.

The challenge we have is that with the Commonwealth playing a much more significant role, it is not used to going out and engaging with communities. You get a fly in/fly out consultation of two hours, which means someone stands up and talks to you for an hour or an hour-and-a-half, and you might, if you're lucky, get a chance to ask a couple of questions after we've had afternoon tea.

At the heart of all of that is the ability to build a relationship, because there are fantastic people in the public service – I've taken the mickey out of them tonight. But I’m not taking it out of the individuals, it's the systems that we have put in place. If you can't build relationships with people you can't solve problems.

Yes, there are some big adjustments to come. You need to have trusting relationships and some social support from people, who you might see as your enemy, for what you're going through, just understanding how difficult it is to feed the kids. Because while the kids will win in the short-term in terms of what you might do, most people know that the longer-term interest for their kids is in solving these problems.

At the end of the day it is going to boil down to investing enough money to solve this problem. The $10-12 billion dollars sitting on the table at the moment is more than enough to buy the water we need for the Murray-Darling Basin, and to provide adequate adjustment for most of the communities that will be impacted. It's just not being invested in any way that would accord with what people out there know that they need. So if we can come back and build a relationship and be serious about solving this problem in a genuine way, it shouldn't be that difficult.

Question: I'm not a public servant. I live in Canberra and I'm an irrigator in Canberra – one of only a small number that we have here in the Territory. As you may know, we in the Territory only represent about 5 per cent of the whole water in the Murray-Darling system, so the amount that we drank here tonight just about represents what we have in Canberra in relation to the whole system.

Three things though: one, you raised the point about the fact that the states gave all the irrigators a property right. That doesn't exist in the Territory. That was taken off us. It was stolen from us when they first introduced the Act in 1998. It's never been rectified and I don't think they are ever going to rectify it, which means that if they wish to, they can just withdraw my rights to extract water and pay me no compensation.

The second point is: in the Wentworth Group paper you talked about the fact that there should be a 60 per cent reduction in the Murrumbidgee system. If you did that to me, as an irrigator, it would make certain that I was not an irrigator in the ACT, because it would remove me out of the system completely.

The third point is: if you look back in history and go back a hundred years, how many times did the Murray River, before the weirs went in, run into water-holes? How many times did the Murrumbidgee go into water-holes, and also the Darling? Therefore, when we are talking about keeping water for the environment, what water are we talking about when we hit a drought, because it really doesn't make sense to me?

Leith Boully: I'll start with the last first. I mentioned a couple of times in my talk that it's not just water quantity that's important. If we are going to have a healthy river system, the way we manage the land and the way we manage flows in the river is important. If we were to do what we should do and return to a system that mimicked natural flows, the Murray would dry up. The Murrumbidgee would dry up. And, unfortunately, or fortunately, as a reflection of the values that we now hold, society would not accept that happening in either of these systems, because we are dependent on them for a whole range of things, other than just irrigation.

So we will miss an opportunity in there with a potential management tool to restore other levels of ecological function that come from being dry rather than being wet all of the time.

With the Wentworth Group and that recent report, my name's not on it. Whilst I'm a founding member of the Wentworth Group, I'm no longer an active member of the Wentworth Group. I was personally horrified to think that anyone would dare to pick winners – or in this case losers – in terms of how the pain should be shared across the Basin when the sustainable diversion limits are determined.

I sit on the board of Murrumbidgee Irrigation, so you can imagine how I felt talking to our shareholders when the Wentworth Group report was released.

I didn't realise that ACT water entitlements weren't entitlements, so you have my empathy. I hope you can fix it.