Concession brings water plan closer

VICTORIA has moved closer to signing the Howard Government's $10 billion plan for the national management of the Murray-Darling basin after forcing a key concession from the commonwealth on water security.

VICTORIA has moved closer to signing the Howard Government's $10 billion plan for the national management of the Murray-Darling basin after forcing a key concession from the commonwealth on water security.

Victorian Premier Steve Bracks emerged from "very constructive" talks with the Prime Minister in Sydney yesterday confident that he had brokered a favourable deal for Victorian farmers, whose water rights would be protected until 2019 under legislation set to be redrafted by the commonwealth.

Mr Bracks said Victoria and Canberra had finally achieved common ground on the critical point of referral of powers in management of the Murray-Darling basin after weeks of deadlock.

Under the "in-principle" agreement brokered yesterday, the commonwealth would be handed power over basin-wide caps, the enforcement of caps, water metering and regulation of the market through the Australian Competition and Consumer Commission.

In turn, Victorian farmers' water rights would be protected until 2019, and the state would retain control of water pricing and land management.

"I think it will be a better deal for Victorian farmers," Mr Bracks said after the talks.

"Water rights will be kept. There will be more water from the Murray. There'll be more certainty given in the future under state water plans, which means that (farmers) have a bankable position on their existing water rights and entitlements."

Victoria is the only state yet to sign up to the $10 billion plan for federal management of the Murray-Darling basin, announced by John Howard in January.

Mr Bracks demanded talks with Mr Howard 10 days ago after receiving draft legislation which he said gave the commonwealth unprecedented legislative power. Mr Bracks declared the national water plan "dead in the water" unless the legislation was redrafted.

The federal Government denied yesterday it had been forced into a backdown. Mr Howard made no comment after emerging from the talks, which also included federal Water Minister Malcolm Turnbull and his Victorian counterpart John Thwaites.

Mr Bracks would not guarantee yesterday that Victoria would sign up to the Murray-Darling plan and said negotiations were still ongoing.

"It has to be enshrined, the principles we discussed today, in legislation, and that is the detail that we'll be scrutinising closely," Mr Bracks said.

But the Premier said he was confident the new legislation would be "much more limited".

The Victorian Farmers Federation - which has consistently argued that Victorian irrigators would be worse off under the national plan - said it was pleased that their water rights would be protected.

"In Victoria farm businesses have been built on the basis that water rights would be protected until 2019 under the entitlement," said VFF president Simon Ramsay.

"We don't disagree with the Prime Minister that the Murray-Darling basin needs federal Government oversight.

"We certainly would support the state signing up to the plan if these areas of concern that we have raised are addressed in legislation."

Victorian Nationals leader Peter Ryan said the stand-off would have been resolved much more quickly if Victoria had been prepared to negotiate in good faith with the commonwealth.