Not confused enough in your life? Need a headache? Looking for something to send your eyes spinning in your head?
Then get into Australia’s water regulation framework — guaranteed to reduce even the toughest to tears of bewilderment.
The first national water markets report is a tough read. But it’s not the complexity of water trading that’s the problem — the differences between water allocations and water entitlements, between entitlements linked to properties and those not linked, between permanent and temporary transfers, between high security and low security entitlements, and so on and so forth. It’s that each state has its own entirely different system for administering water trading. The break-of-gauge lives on in water rights.
How’s this for a federation over a century after its establishment, in one of its most crucial industries:
- SA, NSW and Queensland all have registers of water licences, on which trades must be listed before they’re legal. But each records different information. Queensland’s is publicly searchable and there is also a database for works authorisations, development approvals, conditions for authorisations and management plans. But Victoria doesn’t have any equivalent. Oversight of water trading has been delegated to rural water authorities.
- Unlike everywhere else, SA currently “bundles” water licences so there’s no distinction between water allocations and water entitlements, and licences are “attached” to land. Legislation has been passed to convert to the same licensing structure as everywhere else, but it won’t commence until late next year and then only in the south-east of the state.
- The states can’t even agree on common terminology for water rights.
- The states don’t distinguish between actual water trades and the movement of entitlements and allocation between different parts of the same owner, meaning water trade data is hopelessly corrupted.
- Each state has entirely different governance structures for its water markets. In NSW, Victoria and SA, trade is directly governed by local water authorities or irrigation trusts, which can prevent trades based on criteria such as the volume of water already traded out of an area.
No surprise, then, that only 14% of water allocation trades in 2007-08 were interstate in nature, and that only one — one — interstate trade of water entitlements occurred.
This is straight-out obstruction of legitimate commerce. The states have no incentive to encourage interstate trade, because it might reduce the amount of water they control. Therefore, they continue to impose significant regulatory impediments that prevent irrigators and farmers from moving water to where it will be used most productively. In fact, there’s really no interstate water market to speak of — certainly not in water entitlements. And that’s during a period when drought made water trading critical to a number of industries.
And all of this is in addition to Victoria’s continuing, iniquitous anti-competitive 4% trading cap that artificially inflates the price of water and prevents environmental purchases.
We now have a Murray-Darling Basin Authority to manage — within very definite limits — our most crucial river system. But we still have nothing like a unitary regulatory framework for the system, meaning irrigators and farmers who want to buy water struggle to obtain it from owners further upriver who are willing to sell.
Media coverage of regulatory harmonisation is, unsurprisingly, patchy at the best of times. It’s hardly the most glamorous of topics. And the absurdities of the interstate water market are doubly out of view since the main victims are rural communities and industries, whose concerns rarely get picked up in the metropolitan-based media. But rarely has there been such a clear example of why we need a massive program of regulatory harmonisation between the States. Fortunately the Rudd Government is investing in one, but the dolts running these jurisdictions will only cooperate if bribed, and there’s little in the way of budget surpluses to keep them happy anymore.
You couldn’t have designed a worse federal structure if you tried.
Who wrote the crap headline?
Nah……only joking I’ve got a fair idea.
The country owes Brumby a debt of hatred…….well perhaps SA more than the rest
This reminds me of an old law subject at ANU called Land Registration to do with reconciling Old System and Torrens title but then double or triple it. Sad to say it was the only subject I got a HD for and a teachers note, that and first year statistics which was a total doddle.
But here’s the real point – there were no ecological imperatives in 1890 and the founding fathers could not conceive of a limited Earth anymore than this inter web thingo allowing my self referential musing. If ever we needed common law to ‘re-interpret’ the constitution with some (shock horror) ‘judge made law’ it would be just about now. Isn’t there a serious irrigator’s rights High Court of Australia constitutional case coming up soonish?
It’s kind of the season – I remember Mabo hit the deck in December 1992. What a ripper that was (my honours topic in 1989 was on native title actually, mediocre score – too radical or just badly written or both).
Well, then there’s Ross Gittins’ point that the environment has no “owner” under our governmental-commercial system and thus no one to aggressively push for its property rights to be protected. A similar point applies to emerging markets like water where interests are diffuse and often contradictory – there’s no peak water buyers’ group to lobby for deregulation and harmonisation.
Damn well reminds me of Admin Law which made me quit the Law part of my degree and stick with all that humanities nonsense, to the eternal detriment of my future earnings.