Senator RHIANNON: Did somebody from the National Water Commission join a delegation of water managers from Australia to India in January of this year?
Mr McLoughlin : Yes. That was me.
Senator RHIANNON: That is wonderful. I understand that the official DFAT documents gave considerable coverage of the National Water Commission and its role in the water management success story in Australia. Is that how you would describe it?
Mr McLoughlin : There were three events in January in India. I attended all three. The broad focus was on Australian expertise in water management, particularly on basin-scale water management. Our real expertise there-literally on a world scale, in terms of significance-is the Murray-Darling Basin Plan. There were three events in Australian Business Week in India. It had a very strong focus on water skills and management and the commercial capacity of Australian companies to contribute to Indian development in the water space.
Senator SINGH: It was National Water Week actually, wasn't it?
Mr McLoughlin : Yes. There was a trade display from Australian companies and universities, which I also attended. The particular reason that I was there was actually standing in for Mr Parker as the joint chair of the joint working group under the MOU on water corporation in India. That was a very successful meeting over one day, in which-along with colleagues from MDBA, CSIRO and others-we proposed a substantial programme of work, an action plan as it was called, to assist Indian agencies with how they might approach the cleaning up of the Ganga basin in the Ganges River.
Senator RHIANNON: Were you representing Mr Parker or were you representing the National Water Commission? I understood that the DFAT documents really did promote the National Water Commission. They were really selling it as a positive body. Which was it?
Mr McLoughlin : I was essentially wearing the two hats that I wear as acting CEO of the National Water Commission and, more particularly, as assistant secretary in the water provision of the department. My view is that the DFAT documents did not particularly promote the National Water Commission; it was promoting Australian expertise in water management. As effectively the co-chair of the joint working group meeting for the period that I was there-in particular, a lot of the water activities discussed were associated with the MOU that was renewed with India in October last year-the fact that I wore that hat of the National Water Commission's acting CEO was just an additional string to the bow.
Senator RHIANNON: It just seems surprising considering that everybody knew that, as of May last year, the government's plan for the National Water Commission was for it to go. But then here is something on the world stage, quite literally, showing that-
Senator Birmingham: Maybe they did not get the memo on that.
Senator RHIANNON: Or you failed in the Senate. Is that the new interpretation?
Senator SINGH: It sounds like false advertising.
Senator RHIANNON: Could you see why it surprised people? We knew since May that it was supposed to be all over. That was the government's plan and here we have you down as representing the National Water Commission. However that is pitched, low level or high level, you are there in January 2015 when it is supposed to be all over on 31 December.
Senator Birmingham: I think Mr McLoughlin was scheduled to be there in his substantive capacity. It just happened that in the time in between that decision being made and his attendance he acquired an additional part-time role.
Mr McLoughlin : That is correct. The travel approvals take some time. As Senator Birmingham advised, the travel approval was provided late in 2014, while my NWC role took place from 1 January. A lot of what we talked about in India was about the National Water Initiative and the policy principles that arise. That is an area within the department that I have a role in, as well as my role in the National Water Commission.
Senator RHIANNON: That is excellent. That was my next question. What is the government's position on the National Water Initiative? Does the government plan to revise and expand the NWI for these future challenges: population growth, climate change, urban to rural trading of water and stormwater management? I am just interested in where you are going with this.
Mr McLoughlin : That question would have to go to the government.
Senator Birmingham: The government continues to support and believe that the NWI provides sound principles in terms of the good, sustainable and appropriate economic utilisation of water in Australia. We stand by it. There are no proposals at present to rewrite or expand the NWI. It certainly is the government's intention that the NWI continues to stand as the benchmark for water management in Australia, which is why the legislation to abolish the National Water Commission seeks to embed a continued audit of the states against compliance with NWI as a task that the Productivity Commission would be tasked undertaken in future.
Senator RHIANNON: You are confident that the Productivity Commission has the required culture, expertise and funding to do all this?
Senator Birmingham: I am 110 per cent sure.
Senator RHIANNON: Excellent. It is good to get it on the record. With the Productivity Commission, how will it focused its efforts on including the triple bottom line in the reviews of the National Water Initiative, given its expertise-as we know and we have debated many times-is not with regard to the environment?
Senator Birmingham: As we have discussed here before in relation to this very matter, the PC has traditionally had a commissioner who comes from an environmental background. The PC has done reviews on water matters before. Even during the life of the National Water Commission, the PC has looked at matters such as urban water management. The PC has also looked at other environmental matters. We were discussing earlier today the Productivity Commission's work in relation to carbon abatement activities. I think one of the officials around the table at the time described it as being one of the more comprehensive analyses of what is happening around the world in terms of different carbon abatement activities. I think to suggest that the Productivity Commission does not have the skills to undertake reviews that require consideration of an environmental element is quite incorrect.
In addition to that, it is important to note that there are requirements placed within the proposed amendments to the Water Act that will ensure that the PC has to consult appropriately and have due regard to these matters. As I said before, I am quite confident that they can balance the sustainability arguments versus the optimisation of the economic utility of water arguments.
Senator RHIANNON: You have just mentioned community consultation there with regard to the PC. Can you outline the form that the community consultation will take and provide some details?
Senator Birmingham: If we could get the bill into the committee stage in the Senate, I could happily outline it there.
Senator RHIANNON: Maybe you could help your case now.
Senator Birmingham: What I will say is that my recollection of the bill, the amendments that are before it and so on-I do not have it in front of me at present-is that we are highly likely to end up with legislation that is more prescriptive about how consultation is undertaken in relation to the review of the National Water Initiative than necessarily the current undertakings of the National Water Commission are.
Senator RHIANNON: But isn't it the case that it only has to occur every three years?
Senator Birmingham: That is why it is called a triannual review, as it currently is.
Senator RHIANNON: Yes, precisely. But you are trying to make out that there is wonderful community consultation. When you get down to the detail, it is once every three years.
Senator Birmingham: So why do we need a stand-alone statutory authority to undertake a once in every three years review?
Senator RHIANNON: No, you are the one who is answering the questions. I am asking you about community consultation. It is your opportunity to set it out. The best that you have got is it is once in every three years.
Senator Birmingham: There should be community consultation on the once in every three years review of compliance against the National Water Initiative. That is absolutely the case. Whether it is done by the National Water Commission or the Productivity Commission, it is still only a once in every three years review. That is why it is called a triannual review. It happens once every three years. Whoever is doing it should go out and consult. But we do not need to have a stand-alone statutory body with a standing board there to undertake a once in every three years exercise.
Senator RHIANNON: This question is with regard to a project to reduce evaporation. I understand that there is such a project at the Hume Dam and it is being considered as a supply measure. I just trying to understand why that is the case.
Mr Slatyer : There is a proposal under development concerning the operation of Hume Dam. It would qualify as a supply measure if the project was able to deliver equivalent environmental outcomes but with the use of less water than would otherwise be the case. Whether or not that project can in fact do that and the extent of the potential offset benefit is currently being evaluated.
Senator RHIANNON: What I am trying to understand is why you are defining it as a supply measure rather than as a water-recovery project. Is it in terms of the quantity of water? What is the change over?
Mr Slatyer : A conventional water-recovery project, if it is an infrastructure project, would create either an evaporation saving or an efficiency saving on or off farm, which allows you to free up some water that can then be passed to the environmental water holder and dedicated for the environment. That is a conventional water-recovery project. A supply measure project is one that, through the design of structures and through various clever engineering and so forth, allows you to direct water towards your environmental sites in a smarter way and therefore get the same environmental outcome but with the use of less water. Typically, for example, to get water into a river runner or a flood plain, you could either use masses of water to achieve that result with some kind of over-the-bank flow into the river runner or you could achieve the same environmental result in that river runner by installing some kind of regulating structure that would allow you channel water into the environment. That is an example of the type of supply measure that is contemplated by the Basin Plan.
The Hume Dam one would be in the nature of a rule change, which allows the water to be controlled in a different way. Again, whether or not it achieves an equivalent environmental result with less water and the extent of that benefit is still to be tested. It is the responsibility of the MDBA to evaluate the effect of these projects at the moment. That project is being developed for submission in the form of the business case to the MDBA.
CHAIR: We are just going to have a break for ten minutes. We will then return with this portfolio.