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Prime Minister, we have a water problem

By Bernard Eddy - posted Wednesday, 2 September 2009

“The shutters around the important people are impenetrable. Shock and awe will not work. Knowledge will not work. Only a threat to their existence will work." Steve Posselt, author of Cry Me a River, after recently completing another kayak trip down the Murray.

When the Australian public gets a chance to assess the present state of water, the lack of effective water stewardship by past and present governments and the alarming implications of recent decisions on the future of our water, there will be hell to pay.

Recent developments confirm fears that Australia leads the world towards water mayhem: a world in which two thirds of the population will face water shortages by 2025. (Stockholm Statement from recent World Water Week Conference (PDF 24KB).)


The Federal government refuses to allow the public to assess the problem because it consistently refuses to collate and share a national water registry, which would provide a starting point for the long overdue public debate at the epicentre of climate change concerns: water.

Anders Berntell, Executive Director of the Stockholm International Water Institute said: "Water is a fundamental element in economies, communities, and public health. We know that it is the medium through which climate change manifests its most serious effects. To be effective, climate negotiations must factor in the impact and importance of water for the world and, indeed, human well-being."

How can we begin to solve our most urgent concern if we have no idea who owns how much water and where?

Every state has crucial water management issues exacerbated by ten years of drought. Inside every state border, an unworkable number of water utilities are run by career-focused public servants bent on maintaining an outdated pre-climate change regime. No effort is made to accommodate the urgent need for reform of water management on every level. Political control of the public service ensures short term fixes are the dominant pre-occupation. Consequently, any effort to reform the system from within is met with instant dismissal.

Any outside input on water stewardship is strictly controlled. Experts called upon to produce reports are chosen because they can be relied upon to produce “independent reports” which support the “free market will fix it” doctrine.

Public consultation has been reduced to a window dressing exercise overseen by public relations companies’ expert at “drilling down” at meetings to provide the people who pay the pipers with skilfully laundered tunes.


Along state borders chaos reigns. The devastation of the Murray Darling Basin exemplifies everything that’s wrong with allowing the states to veto any effort to save the nation’s largest food bowl.

The offer for sale “at market price” ($450 million) for Cubbie Station deliberately buries the fact that the Cubbie Group - a Queensland government connected business which underwent it’s greatest expansion under the Goss government - pays a paltry $3,700 per annum to divert 70,000 Ml of water. Worse still, it has built massive earthworks which divert more than half of the water from the floodplain which should have flowed into the Balonne/Culgoa river system. The massive amount of water “captured” by the Cubbie Group in fact cost current Cubbie Chair and former treasurer in the Goss government, next to nothing. Changing the entire hydrology of the delta was exempted from environmental scrutiny by Premier Goss.

The madness is, if the government made a reasonable offer to buy Cubbie’s water - assuming it is possible to sell the water separately: an issue currently before the court - and the water was allowed to flow down the system, it would not get past the next property because it has reserved water rights sufficient to soak up every drop. Such is the way of water trading.

When you think about it, most politicians were brought up in the suburbs. Water and farming are things you see learn about on television.

Instead of bringing in a new order for co-operative federalism, the Rudd Government has been working overtime to screen this daylight robbery. The long awaited Land Water Australia Report 2002-2009 was gutted and the LWA was disbanded.

Our Prime Minister, chief of staff in the Goss government during this time, has done nothing to help his besieged Minister for Water solve this profligate lunacy.

Then there’s Coliban Water a corporatised company with a Veolia representative on the board supplying water to an area a quarter the size of Victoria. Coliban is taking water from the Goulburn River and offering unlimited amounts of it to the highest bidders around Bendigo. To hell with the dying river system and to hell with any environmental concerns, let’s make money while the sun shines.

Another iconic river system, the Snowy, is being allowed to die a slow death at the mercy of two state governments and Canberra. The Environmental Defender’s Office has notified the Snowy River Alliance that the formal agreement made between the New South Wales, Victorian and federal governments to increase environmental flows is virtually meaningless because it is not binding on the signatories.

The Snowy River is also the centrepiece for a major, hidden threat to our water future: Australia’s obligations under two major international agreements, Goods and Trade in Services (GATS) and the Australian American Free Trade Agreement (AUSFTA).

The Howard government decided to put the Snowy Scheme on the market.

Dr Patricia Ranald explains:

A very broad community campaign developed against the sale, on the grounds that private and possibly transnational foreign ownership would reduce the ability of governments to regulate both water flows and electricity supply for public interest and environmental reasons.

The Federal Government sought to diffuse the campaign by announcing it would amend the sale legislation to limit transnational investment to 35 per cent of total shares, and require the management of the scheme to be located in Australia. However, the Federal Government then reportedly received legal advice that such regulation could be directly contrary to AUSFTA investment chapter, which did not exclude water or energy services and forbids any limits on foreign ownership of assets worth less than $800 million. The Federal Government share of the scheme fell below this threshold.

The Government was reportedly highly embarrassed by the prospect of any public discussion of the possibility of its own proposed nationalist safeguards being in conflict with AUSFTA (Myer 2006). The Prime Minister hurriedly withdrew the sale legislation altogether, announcing that he was responding to community concerns about privatisation, and the sale did not proceed (Howard, 2006). This was clearly a victory for the community campaign. However, it also showed that some government departments were unaware of the restrictions placed on government policy by AUSFTA, and were not willing to defend these restrictions publicly.

Confronted by internal problems and external threats, how are we going to solve our water mess? Well, we could be decisive and follow the “governator”. Arnie has just declared a state of emergency in California prompted by a three-year drought. He wants to set up an all powerful water management organisation to guarantee the state’s water future.

Just what we need: decisive action, accountability and an iron hand to overrule parochial interests.

Ensuring water remains in public hands and the introduction of an independent water authority similar in structure to the Reserve Bank would make sense. But Canberra isn’t interested.

A recent report by Allen Consulting, Urban Water: A Vision and Road map for National Progress, has recommended the privatisation or our urban water supplies “after discussions with a group of water industry and policy experts”.

Public private partnerships have already seen more than a quarter of Australia’s water supply and services pass into private hands. The Howard and Rudd governments have passed a raft of legislation paving the way towards full privatisation of water.

The separation of land and water titles and the unregulated growth of water trading have made a critical water shortage much worse. It is probably fair to say, ungoverned water traders are doing for water what unruly financial advisers did for the global economy early this year.

Australian’s have already had an opportunity to assess just what our future might be if we hand over control of water to large corporations.

Every single country that has opted for water privatisation has the same story to tell. The price of supply goes through the roof and the end user is treated with contempt. Saying the corporate solution will protect the environment is akin to convincing people the “free market” will support the poor.

The Big Pong in Adelaide (February 2003) and the Crypto Scare in Sydney (also in February 2003) were both caused by cost cutting measures to boost corporate profits. Subsequent inquiries revealed a total lack of due diligence and concern for end consumers.

The Big Pong revealed the approach of overseas water barons to the money making bonanza on offer down under. In response to a request to reveal financial details of the agreement United Water had made with the South Australian government the CEO quipped. “We’re not here because we love the state and we’ve got bleeding hearts, for Christ’s sake, we’re here to make money. We’re here to do business.”

A classic own goal for the private water trade if ever there was one.

Allen Consulting and their Global Access Partners state their vision for urban water privatisation promises “a secure level of water to meet society’s essential needs, society can have confidence in the quality of water, and that consumers (particularly the vulnerable) and the environment are appropriately protected.”

Australia already boasts a number of unenviable characteristics in relation to its present water governance. We are the driest continent on earth, we use more water per captia than most, and we are the place most susceptible to climate change. We have more federal and state utilities and departments with a say in water management than anywhere else on earth and we contribute more to climate change per capita than any other country. Alas, none of these go close to guaranteeing immunity from the disastrous consequences of water privatisation: which in every other part of the world have proven to be the precise reverse of providing for the vulnerable and the environment.

No corporation can hope to remain competitive by putting welfare of the vulnerable and the environment before its shareholders. It doesn’t require rocket science to conclude the stakes are way too high to allow the private sector to mess with a vital resource as precious as water.

It’s one thing for the banks to withhold interest rate cuts during a recession, but where will we stand when the corporations decide that the supply and demand rules applied to water in a drought: the less there is, the higher the cost to you and me?

What will happen to our sunburnt country then?

The executive summary of the report actually says: “Similar network industries including rural water, electricity and gas and others such as telecommunications, rail, port and airports have undergone successful market and regulatory reform over recent decades. Why not urban water?”

In other words, “clap if you believe in faeries”.

Let’s simply place the facts of global water privatisation before the Australian people and ask them to decide in a referendum.

Its time to inform the public and bring them into the debate: privatising our water supply is akin to selling our sovereignty. Australians need to know now the move to sell the country's water has been going on behind their backs for more than ten years. They don’t have a clue what’s going on or, what has happened when water has been turned over to privateers in many other countries.

In another five years time, it will be too late and our children will curse us into an early grave.

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About the Author

Bernard Eddy is the co-convenor of the Australian Water Network.

Other articles by this Author

All articles by Bernard Eddy

Creative Commons LicenseThis work is licensed under a Creative Commons License.

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