Water broker licences: Time to tighten the rules

SHOULD we care about water brokers using their own water licences and accounts to trade irrigator clients’ water?

SHOULD we care about water brokers using their own water licences and accounts to trade irrigator clients’ water?

As Australian Water Brokers Association president Tom Wilks states, clients trust him.

But it only takes one unscrupulous broker to start speculating and it’s more than trust that is lost.

An average $2 billion a year of water is traded across the Murrumbidgee, Murray and Goulburn systems.

Yet there are no regulations to ensure water brokers act in their clients’ best interests, that they don’t collect commission from both buyer and seller and that they don’t buy and sell water in their own right.

Anyone can put up a shingle on their office door and call themselves a water broker.

READ MORE: WATER TRADES RAISE TRANSPARENCY CONCERNS

Compare that to the highly regulated real estate sector where legislation states: “It is an offence for an estate agent or agent’s representative to obtain a beneficial interest in a property that they have been commissioned to sell.”

Why are water brokers any different to property agents?

Why did three major water brokers trade $7 million of water on to and off their own NSW licences in 2016-17?

And why can some brokers operate without a water licence, while others insist it’s critical?

Then there’s the issue of transparency. Surely a seller should be able to verify who bought their water and for what price, and vice versa.

But once an irrigator’s water is shifted on to a water broker’s licence, that direct link between buyer and seller is lost.

Brokers should be legally obligated to supply buyers and sellers with each other’s details to confirm the traded price.

We can’t just rely on trust when trading in our nation’s most precious resource: water.