Murray-Darling Basin Authority

I seek leave to make a brief explanation before asking the Minister for Sustainability, Environment and Conservation a question on the subject of state government's funding for the Murray-Darling Basin Authority.

The Hon. J.M.A. LENSINK: In the Mid-Year Budget Review the government announced its shocking decision to strip funding from the MDBA from to $26.4 million to $12.1 million a year. Tony Burke was quoted at the time in The Australian as saying:

I don't think there has been a decision in this portfolio that has shocked me more. I have no way of explaining this.

Since then the MDBA has written to the state government outlining the impact the cuts in funding will have in rendering unviable works to reduce salinity, improve environmental outcomes and monitor river health. The chairman, Craig Knowles, delivered a speech stating that the cuts would place Victoria in a position where it would be cross-subsidising other states and should be expected to:

...follow this race to the bottom leading to the end of the Living Murray salt interception schemes and joint natural resource management programmes.

Mr Knowles also stated that the cuts:

...foreshadow a need to radically alter the way in which the basin is managed and its water assets are funded. The scale of the state government cuts dictates that there will be consequences.

The government's own response to the altered proposed basin plan of 27 August 2012 states the following on page 22:

Under no circumstances should the MDBA weaken or reduce the water quality and salinity objectives, targets and management frameworks in the Basin Plan. The Basin Plan must include non-discretionary requirements for water resource plans to manage water quality and salinity.

My questions for the minister are:

1.How does he reconcile that statement in his own government submission with its cut to the MDBA?

2.Does he acknowledge that Victoria will be subsidising South Australia if this cut proceeds?

The Hon. I.K. HUNTER (Minister for Sustainability, Environment and Conservation, Minister for Water and the River Murray, Minister for Aboriginal Affairs and Reconciliation) (14:35): I thank the honourable member for her most important question because it allows me to put on the record, once again, the outrageous behaviour of New South Wales in this matter.

The decision to reduce funding from 2014-15 was not made lightly by this government. Our state takes only 7 per cent of the extractions of water from the River Murray but has been contributing more than 24 per cent of the funding for the Murray-Darling Basin Authority. That was before New South Wales cut its contribution by 60 per cent in July 2012.

I am not sure that I actually heard the honourable member or, indeed, her party raise their voices when New South Wales took that unilateral decision to cut that funding. They, of course, were all the way with New South Wales and the Liberal government then. That reduction from the New South Wales funding is to be followed by a further cut with a contribution from New South Wales capped at $8.9 million in 2013-14 and 2014-15. Our reduction in funding is to take place from the 2014-15 financial year and our contribution during 2013-14 will be maintained at $26.4 million.

Prior to making this decision, the South Australian government expressed concern in response to the New South Wales decision to reduce its funding. Unfortunately, New South Wales has continued with its proposed action and has refused to consider increasing its contribution over the next three years to back to where it should be. With New South Wales reducing its contribution, South Australia, was, in effect, subsidising New South Wales at the expense of other programs in our state for the environment, for the health and education of those communities. The New South Wales' Liberal government is refusing to pull its weight.

Maintaining our contribution in 2014 will allow time for us to negotiate with the other basin states and the Murray-Darling Basin Authority to ensure an equitable and efficient way of managing the River Murray as an entire system. The reduction in funding is for joint projects only. The implementation of the Murray-Darling Basin Plan is funded by the federal government and that is not affected by these announcements. South Australia has fought hard to ensure the Murray-Darling Basin Plan provides for a healthy river. We will work to ensure that New South Wales comes back to the table.

The PRESIDENT: A supplementary, the Hon. Ms Lensink.

The Hon. J.M.A. LENSINK (14:38): Does the minister expect Victoria to continue to subsidise South Australia through its own contribution?

The Hon. I.K. HUNTER (Minister for Sustainability, Environment and Conservation, Minister for Water and the River Murray, Minister for Aboriginal Affairs and Reconciliation) (14:38): I expect Victoria would do its utmost to help us drag New South Wales back to the negotiating table.