Estimates: National Water Commission and Commonwealth Environmental Water Holder

Environment and Communications Legislation Committee

May 26, 2014

Estimates - ENVIRONMENT PORTFOLIO

National Water Commission

Senator RHIANNON: Ms Olsson, I noted that the commission's report-the 2011 assessment of the National Water Initiative-and then also in the 2010 statement on CSG, there was some interesting information. Can you outline the commission's current position statement on CSG, please.
Ms Olsson : The commission has not updated its position statement on CSG for some time in recognition that a lot of activity in this space is now undertaken by the Department of Environment. The figures that we used to create our original position statement were from our best source at the time. But I would be hopeful that much more accurate figures are now available through the mechanisms that the department has. We continue to be concerned that extractive industries, including CSG, are integrated into regional water-sharing frameworks and that they are dealt with in a transparent manner and not through shadow arrangements, which leads to a lack of confidence in water users or may lead to third-party impacts.
Senator RHIANNON: Have you had any communication, in the context of what you have just outlined, with state authorities in response to that position?
Ms Olsson : Yes, we have. I could not recall it off the top of my head. We have also gone through a process of updating our understanding of the state processes, which have evolved quite rapidly over the last couple of years. We will be including that in our triennial assessment report that is due out later this year. The states themselves have put in a number of policy and governance responses to the industry.
Senator RHIANNON: Will that be in the report or should we ask for that on notice?
Ms Olsson : The detail will be in the report.
Senator RHIANNON: In the report, you note:
Exemption mechanisms continue to operate in some jurisdictions, and further work is required to manage dewatering and the cumulative effects of mining activities.
Can you tell us whether this has been progressed and how it is going?
Ms Olsson : It has been progressed by a number of jurisdictions. The detail will be in the triennial assessment. I would risk making an error if I tried to outline the processes now. We could take that on notice and give you a response to the different processes. They vary quite substantially between jurisdictions.
Senator RHIANNON: It would be good if you could take that on notice. In the same report, recommendation 8 states:
The Commission urges states and territories to review their existing mining and petroleum regulatory arrangements to ensure that water resource impacts are addressed explicitly, and that those extractive activities are fully integrated into NWI-consistent planning and management regimes.
Can you also report on how progress is going with regard to this?
Ms Olsson : Yes. I will also take that on notice, because it varies between jurisdictions. A number of jurisdictions have made a lot of progress in this area since 2011.
Senator RHIANNON: In an earlier answer, you gave emphasis to the extractive industries and how that integrates. Do you see that as one of the most important issues with regard to water relations in the coming period?
Ms Olsson : Yes. We have made it one of the issues in the triennial assessments. It is obviously an issue if we start talking about new developments, such as in Northern Australia. Shale gas is an emerging industry as well as CSG. There are a number of developments in that area.
Senator RHIANNON: In your Waterlines report, No. 59 October 2011, it is suggested:
A streamlined, standardised national framework for assessing the cumulative effects of mining on groundwater and connected systems...
would be one way of dealing with the impacts of mining on groundwater. How are developments going with regard to that? Are there any other ideas that you have in mind, because you do say 'one way'?
Ms Olsson : Yes. I do not think I could say there would be much progress with regard to one streamlined system with regard to groundwater, but I will take that on notice and give you the full detail.
Senator RHIANNON: This might have been answered earlier, but I thought I would check, because I have been in and out. When will the commission deliver its 2014 assessment of the National Water Initiative?
Ms Olsson : We will be providing it to governments in September this year, and we hope to publicly release it in October.
Senator RHIANNON: Who will be responsible for the commission's work on the National Water Initiative, when the commission is wound up?
Senator Birmingham: The committee has canvassed that. The government is considering an appropriate pathway forward. We are very mindful of the need for it to have the independence and the expertise of the commission for this task to be undertaken properly in future. We will have more to say about that in coming weeks and months.
Senator RHIANNON: You talked about a level of independence. What do you mean by that?
Senator Birmingham: People will perceive independence of any arm of government with varying degrees. The commission do good work. I think they do it relatively independent of government, notwithstanding the fact that they are a government agency with a government appointed board. We are mindful, though, that independence is important in the triennial assessment, so I would anticipate that a final landing point has due regard to that.
Senator RHIANNON: Who developed the terms of reference for the Water Act 2007 review, additional to the mandatory requirements of the act?
Senator Birmingham: I worked through those with the department, after consultation with the states.
Senator RHIANNON: There was consultation and then you signed off on them?
Senator Birmingham: Correct.
Senator RHIANNON: Who selected the independent review panel?
Senator Birmingham: That was approved through the processes of government.
Senator RHIANNON: What does that mean, please? What process was used to select the independent review panel? Can you set that out please.
Senator Birmingham: A number of names were considered through that process to ensure that an appropriately balanced panel was constructed. Suggestions came from a number of quarters, including the department.
Senator RHIANNON: When you are constructing that, my guess is that you have the terms of reference in mind and who would be able to do the best job around the terms of reference. Is that how you approach that when you are trying to get the job done?
Senator Birmingham: It is safe to say that the terms of reference were settled before the membership of the panel was settled.
Senator RHIANNON: One of the terms of reference-2(b):
Opportunities to reduce or simplify the regulatory and/or reporting burden while maintaining effective standards.
That is suggesting-it is pretty clear-that you want to simplify the regulatory regime. Was that something to the front of your mind when you were determining the review panel?
Senator Birmingham: Indeed. The government has given a very strong commitment across the whole of government to be able to reduce red tape and regulatory burden wherever possible. In this space I am very conscious that the Water Act has very important objectives. I do not want to undermine our ability to deliver on those objectives, but if there is a capacity to reduce some of the regulatory burden without undermining the delivery of those objectives then I would hope the panel will identify it.
Senator RHIANNON: You have been working in this area for a long time. You have come forward with those terms of reference. What are the regulatory burdens under the Water Act that could be reduced or simplified?
Senator Birmingham: There is an expert panel that has been appointed to review the act and I do not want to pre-empt their findings. I think it would be inappropriate for me to pre-empt their findings.
Senator RHIANNON: I was certainly not asking you to pre-empt their findings. I was just asking you to respond to the question, because it is something you have clearly given consideration to when you put it in as a term of reference and you have identified that was in your mind when you identified people to be on the review panel. I was just interested in you sharing your thoughts with the committee.
Senator Birmingham: I think for context, at least, it is important to appreciate that the Water Act does not just deal with how the Basin Plan is developed and implemented in relation to achieving a sustainable outcome for the Murray-Darling. It also touches on matters relevant to how water trading rules are developed and operate and how reporting requirements for certain entities in relation to water use occur. In those types of areas we might find that whether it is for consumptive water users or, indeed, potentially environmental water managers or others, perhaps there are some efficiencies. Maybe there are not. The review panel will reach its conclusions.

Commonwealth Environmental Water Holder
Senator RHIANNON: Why did the CEWH not meet the priority of the MDBA to deliver water to the Gwydir Wetlands in this water year? I understand you did it for two years but not the third year. Is that correct?
Mr Papps : No, that is not correct.
Senator RHIANNON: So what did you do in the third year?
Mr Papps : In this water year, 2013-14, in fact, I approved a record amount of water to go into the Gwydir Wetlands, somewhere around 27 to 30 gigalitres with the potential for a little bit more to go in.
Senator RHIANNON: What do you base that change on? What made you determine to make that change?
Mr Papps : What do you mean 'change'?
Senator RHIANNON: You just said that you allocated more, so I am assuming something had changed. Have I made an incorrect assumption? I am just trying to understand your process.
Mr Papps : The process is that, even though I take the advice of state partners-the MDBA and other stakeholders involved through the environmental watering advisory group-the decision is mine alone in terms of allocation of Commonwealth environmental water. We saw some opportunities in the Gwydir to undertake watering in areas that we had not previously watered. Those opportunities presented themselves, and we took them. For example, we undertook some watering in the Carole Creek and Mehi River areas that had not been, to my knowledge, undertaken before, or certainly not to the extent that we undertook them.
Senator RHIANNON: How do you intend to align the use of environmental water holdings with the priorities of the MDBA and the Basin-wide Environmental Watering Strategy?
Mr Papps : The Basin-wide annual environmental watering priorities, which the authority prepares each year-this is the second year that they will prepare them-are incorporated into our normal planning cycles. We are obliged under the Environmental Watering Plan in the Basin Plan to have regard to those instruments and to the environmental watering strategy. The environmental watering strategy is yet to be developed and it will not be available until later this year. They are important inputs into our normal water-use planning cycle.
Senator RHIANNON: So the CEWH and the MDBA are quite separate in all their decision making?
Mr Papps : The use of the Commonwealth environmental water holding is my responsibility as the CEWH. The authority is intimately involved, if you like, in the process. It constructed chapter 8 of the Basin Plan, which is the environmental watering plan with which my decisions have to be consistent. It is involved, as you have already referred to, in constructing the annual watering priorities and the environmental watering strategy. Clearly, it is intimately involved in the process and it has a different role and responsibility to the one that I hold. In practical terms, we work very closely with the authority.
Senator RHIANNON: Going back to a previous answer-this is going back to the specifics-if I understood correctly, you said that you had released more water in this third year. Is it correct that you watered all the small creeks but not the Ramsar-listed wetlands? It was claimed that they had enough water over the previous three years.
Mr Papps : No. My understanding in the Gwydir is that we watered those areas where there was a need for them to be watered. Secondly-and this is very important to understand our watering in the Gwydir and indeed in many parts of the basin-where we would not cause any third-party impacts. The Gwydir in particular is subject to potential third-party impacts involving the inundation of private property. In many places within the Gwydir valley you have cropping right up to the boundaries of wetlands and rivers. All of our watering is undertaken within that constraint.
As I said before, a record volume of 32.3 gigalitres of Commonwealth environmental water was used this year in the Gwydir system. Twenty gigs were used in the Mallawa wetlands. I have mentioned the Mehi River and Carole Creek. I approved a further 20 gigalitres for use in the Gwydir Wetlands that has not been delivered because there was a lack of a suitable trigger. In other words, in terms of those wetlands, the Commonwealth environmental water follows a natural trigger, which is a natural inflow. If that does not occur, the watering does not occur. That is perfectly consistent with the ecological requirements of those wetlands.
Senator RHIANNON: I think there are at least two issues that arise from that response. You talked at the beginning about the need to be watered. When I was asking for a comparison between the small creeks and the Ramsar-listed wetlands you said 'my understanding'. Do you need to take that on notice to check that?
Mr Papps : No. I think I have worked out what you were referring to and I think I have dealt with it in the last question. We watered the Mallawa wetlands. You are referring to the Gwydir Wetlands, where I allocated water but it was not delivered because of the lack of a natural trigger.
Senator RHIANNON: In the second part of your response you went on to talk about the constraints. From what I understood you were talking about the pressure to trade some water.
Mr Papps : No, that is not correct.
Senator RHIANNON: That is not correct?
Mr Papps : No. The constraints I am talking about are the physical constraints that operate across the basin. In the Gwydir it is not only but principally related to the potential inundation of private property. I have not been under any real pressure to trade water in the Gwydir. The decision to trade flowed from a consideration of the environmental matters related to the Gwydir. We had met the environmental targets that we could meet. We had sufficient water in our reserves and even more water in the New South Wales government's reserves to meet environmental flows in the Gwydir both now and for the foreseeable future. The decision to trade was one that I was not pressured into; it flowed from the set of circumstances that were prevailing in the Gwydir at the time.
Senator RHIANNON: I will ask another question on this because I have heard and read that there was a difference in how they were treated. Why was the internationally-significant wetland treated differently in this water year when watering would have improved, I understand, its resilience going into a dry period?
Mr Papps : Let me just go back for a moment, because you have been talking about the three years and the four years. My understanding-and I have been advised on this-is that the three years have been completed, so 2013-14 was in fact a fourth year where we were able to provide a great deal of water. There is no evidence that I have seen where we have missed a watering opportunity that was available. There is no evidence that I have seen that suggests that the ecological condition or resilience of any of these wetlands has suffered or will suffer as a result of those decisions.
That is something that we keep under observance, if you like, throughout the season, and, if circumstances change in the Gwydir and if we come into another series of very dry years, our watering decisions will change.
Senator RHIANNON: Thank you.