Australian farmers to lose water to restore rivers

CANBERRA (Reuters) - Farmers would lose more than a third of irrigation water in Australia’s major food bowl, the Murray-Darling, under a plan released on Friday to restore ailing rivers, posing a new headache for the Labor minority government.

Farmer Ian Shippen walks past a mobile irrigation boom on a dying oat crop on his farm in the heart of Australia's Murray-Darling river basin outside Moulamein, about 600km (373miles) west of Canberra, August 24, 2007. REUTERS/Tim Wimborne

The move could see the value of cotton production cut by 25 percent, and farmers and irrigators have warned of farm closures, massive job losses and higher food prices if the plan by the Murray-Darling Basin Authority is adopted by the government.

Environmentalists welcome the cuts, saying they will help Australia’s major river system survive future droughts brought on by climate change in the world’s driest inhabited continent.

Prime Minister Julia Gillard’s fragile one-seat majority government is dependent on support from both rural independents and the Green party and will have to balance both interests in deciding whether to adopt the plan by the end of 2011.

Under the new plan, irrigation rights would be cut by between 3,000 to 4,000 gigalitres a year, cutting water supplies to farmers by between 27 to 37 percent, with the government to buy back water licenses to compensate farmers.

“Cutting water use ... will reduce the supply of food and fiber and increase the number of farmers leaving the land, resulting in the destruction of farm and rural communities,” said Victorian Farmers’ Federation President Andrew Broad.

But the authority said the cuts were needed to guarantee the long-term health of the nation’s major rivers, which have suffered a century of neglect and over-allocation for irrigation.

“The real possibility of environmental failure now threatens the long-term economic and social viability of many industries and the economic, social and cultural strength of many communities,” the 200-page report into the river system said.

The Greens party, which will control the Senate from July 2011, called for the government to stand by the plan.

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“We’ve known for years that the (irrigation) system has been over-allocated, now it’s time to get the balance right,” said Greens Senator Sarah Hanson-Young.

“We need a sustainable river system -- it’s the only way to keep communities around the river sustainable as well.”


The Murray-Darling basin is Australia’s food bowl, accounting for 40 percent of agricultural production and 93 percent of domestic food production.

The basin supports food and cotton producers and covers 1.06 million sq km, 14 percent of Australia’s landmass and an area the size of France and Spain combined.

The basin covers four states and contains Australia’s three biggest rivers, the 2,500-km (1,550 miles) Murray, the 2,700-km Darling and the 1,690-km (1,050 miles) Murrumbidgee.

But too much irrigation, lack of inflows and rising salinity are so bad that for eight years, no fresh water has flowed into the sea at the mouth of the Murray River.

The authority’s findings set up a major fight for Gillard, who secured Green party and rural MP support for her minority government by committing to be more sympathetic toward their, at times conflicting, concerns.

Irrigators have warned that a 27 percent cut in irrigation water would lead to 14,000 job losses and cost the economy A$1.4 billion a year.

“An unbalanced basin plan will hurt Australians. It will cost jobs, force up food prices and threaten farms that have been in families for generations,” National Irrigators council chief executive Danny O’Brien said.

Gillard’s government has already committed A$3.1 billion to buy water back from irrigators over 10 years through the existing national water market, and has committed a further A$5.8 billion to improve water efficiency in the basin.

The cuts proposed on Friday would cost the government around A$4 billion to buy back irrigation rights.


Editing by Michael Perry; Editing by Sugita Katyal