Impacts of 450GL Basin buyout “minimal“, says SA’s top water official

South Australia’s water boss Ben Bruce says the economic impact of the Commonwealth’s 450GL Murray Darling Basin buyout will be “minimal”.

South Australian Liberal water spokeswoman Nicola Centofanti has quizzed the state's top water bureaucrat on the impact of federal water buyouts.

South Australia’s top water bureaucrat says the economic impact of stripping 450 gigalitres out of Murray Darling Basin irrigation communities for the environment “should be minimal, if any” on water markets.

Department of Environment and Water Acting chief executive Ben Bruce also told South Australia’s Upper House Budget and Finance Committee this week that while it was difficult to determine the precise impact of buyouts, advice from the Commonwealth and “a range of economists is that it will have minimal impact on the market”.

“It will depend on how the Commonwealth decides to implement that approach,” Mr Bruce said. “The advice we have is it should be minimal, if any.”

Opposition MP and committee member Nicola Centofanti asked Mr Bruce if he had any idea of how much of the 450GL would be bought out of South Australia’s consumptive pool, to which he said “we would expect the majority to come from upstream, simply because that is where the volume is and there are more opportunities to do that”.

But Ms Centofanti, who is a Riverland Liberal MP, raised concerns South Australia could be disproportionably affected by buybacks, as distressed wine-grape growers sold off their water entitlements in the midst of a crippling wine glut.

“There has been some commentary from the wine industry that the current pressures on wine-grape growers would result in these areas giving up water,” Ms Centofanti said.Asked if he had discussed the impact of buying water out of South Australia’s Riverland winegrape regions with his colleagues in the Department of Primary Industries and Regions, Mr Bruce said “no”.

He also argued it made no difference whether water was sold to the federal government or to upstream irrigators, in terms of community and market impacts.

“If you take a particular industry, the wine industry — which is suffering, as you are well aware at the moment, particularly in the Riverland — those people are likely to sell their water regardless of whether they sell it to the environment or sell it to an upstream user.

“If you sell it to an upstream user, be it an almond grower or anyone else permanent, really in terms of the local economy it has the same impact as if you had sold it to the environment, so it’s not really any different.”

Ms Centofanti asked: “But isn’t one going out of the consumptive pool and the other one remaining in the consumptive pool?”

Mr Bruce said “effectively, whether you send it to an almond grower at Mildura or whether you send it to the environment, it is still not at, for argument’s sake, Renmark – it has the same effect. It’s permanent water that will be tied up and used permanently.”

However Ms Centofanti argued “do you not see that there would be some effect on the water market?

Mr Bruce responded by stating “if those people were going to be selling anyway, no, it’s no different.”

Asked if he would table the advice he had received from the Commonwealth on why buyouts would have a minimal impact on water markets and communities, Mr Bruce said he could not, as it was just “verbal”.

READ the full transcript of the Select Committee hearing HERE – relevant pages 590 to 593.