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Compliance priorities

The MDBA sets compliance priorities for each water year (July – June) based on a horizon scan and a detailed risk assessment of Basin Plan non-compliance for each of the MDBA's key compliance areas, as set out in the MDBA's Compliance and Enforcement Policy.

Risk Assessment for 2019–20

The horizon scan undertaken as a part of the prioritisation process revealed the following important issues that could impact the implementation of the Basin Plan and Water Act:

  • Extended drought and dry conditions affect water use behaviours, continue to affect water markets, industries and communities, and place additional pressure on the environment of the Basin.
  • A lack of uniform confidence in the effectiveness of metering and measurement policies, and uncertainty as a consequence of varied implementation and reform of these policies. This uncertainty affects water user compliance with metering requirements and reporting accurate metering and measurement information.
  • Varying degrees of transparency, consistency and effectiveness in compliance and enforcement arrangements across the Basin states continue to fuel the lack of community trust.
  • Delay in the development and accreditation of most Basin state water resource plans, and the subsequent commencement of interim arrangements for implementing the Sustainable Diversion Limits (SDL) impacts confidence and clarity around regulatory requirements.
  • Ongoing concern about the transparency and fairness of the water markets.

Set out below are the priority areas and actions the MDBA is planning to take to address these issues. While the MDBA has identified these priorities, it retains the option to respond to changing circumstances and emerging issues, and pursue other matters as necessary.

Compliance PRIORITIES: 2019–20

Compliance priority

Why it's a priority

What will the MDBA do?

Unmeasured take

Unmeasured take refers to water extracted from the Basin that is not accounted for under current Basin state metering, licencing and works approvals, or monitoring arrangements. For example, where water can be extracted without a water access licence via overland flows (also known as floodplain harvesting).

Inaccurate management and accounting of unmeasured water take, and the infrastructure used to extract it, has the potential to adversely affect Basin Plan outcomes. It can impact on the ability to detect water theft and ensure compliance with SDLs; and reduce the protection of water for the environment and achievement of environmental outcomes. 

  • Review and audit floodplain harvesting infrastructure and policy implementation in the Northern Basin.
  • Monitor state government’s progress in developing and implementing floodplain harvesting reforms.
  • Undertake Murray–Darling Basin Compliance Compact reporting and assurance.

Metering

Water meters provide the clearest measure of how much water is being used across the Basin. Robust metering arrangements are essential for ensuring compliance with licence conditions and SDLs. Sound water usage data informs operation of the water market, as well as annual water planning by states, environmental water holders, water users and communities.  This is particularly important in times of drought.

Various reviews and investigations into compliance in 2017 and 2018, including the NSW Ken Matthews Review, the Australian Government Murray–Darling Basin Water Compliance Review and the Independent audit of Queensland’s non-urban water measurement and compliance identified issues with the accuracy and coverage of metered water take, which diminished community confidence in water regulation by Basin governments.

Under the Basin Compliance Compact, Basin states and the Australian Government have committed to improve metered water use and compliance in the Basin.

  • Undertake site inspections, reviews and audits of metering requirements, meter coverage, data collection and regulation in each Basin state.
  • Work with states to develop and implement the Metrological Assurance Framework (MAF) Modernisation Project.
  • Review state progress in implementing their Basin Compliance Compact commitments.

SDL accounting and the SDLAM 

Due to the delay of water resource plan completion and accreditation, interim arrangements have been established to implement SDLs across the Basin from July 2019.

Critical to implementing and enforcing the SDLs is a strong system of accounts that keep track of how much water is taken each year from the Basin water resources. The Water Act and Basin Plan therefore require Basin states to provide accurate and timely water accounts to the MDBA annually, and for the MDBA to maintain a public SDL register.

The Basin Plan also includes a mechanism to adjust SDLs (SDLAM). Under this mechanism, the Basin states have agreed to implement supply and efficiency measures in the form of projects which allow Basin Plan environmental outcomes to be achieved with less water and the SDL has been adjusted accordingly. If these projects are not implemented as committed the SDL may need to be readjusted in 2024 and the Australian Government may be required to buy back more water for the environment.

 

  • Complete and publish a SDL Health Check, to determine if the SDL accounting frameworks trialled by MDBA are conceptually sound and use best practice water accounting methods.
  • Report and implement recommendations in the SDL Health Check.
  • Check and audit the integrity of SDL data, including MDBA’s processes, and methods for addressing growth in use and interstate trade accounting arrangements.
  • Monitor and review the progress of SDLAM projects.

Improving Water Trade markets 

Water trading in the Basin is responsible for an estimated 95% (by volume) of Australia’s water market activity, with annual transactions in Basin water markets totalling over $2 billion. A fair, open and effective water market, informed by accurate information is crucial for water users, particularly in periods of water scarcity, as it provides a mechanism to manage variable seasonal conditions and allows water to move to its most productive use.

Basin States and Irrigation Infrastructure Operators (IIOs) are responsible for setting trading rules for their water resources and day to day trade operations. To ensure that they do not unfairly or unnecessarily restrict trade, Basin State and IIO trading rules must be consistent with the Basin Plan.

The MDBA has identified over 1500 surface water trade restrictions that may need to be reviewed to ensure they meet Basin Plan requirements and support the equitable and robust operation of the water market. 

  • Use the Water Trade Restriction Assessment Framework to review and assess Trade restrictions.
  • Review findings and management responses to the 2018/19 Trade Price Audit.
  • Educate water market users about the water trading rules, including the need to provide information around accurate trade price reporting.
  • Provide input to the ACCC led review of water markets in the southern basin.

Water for the Environment

Delivering and protecting water for the environment is the primary Basin Plan mechanism for improving river health and restoring water dependant ecosystems. Healthy rivers are crucial for communities and businesses, as well as for spiritual and cultural wellbeing (the Basin is home to more than 40 of Australia’s Aboriginal nations).

The Basin states are responsible for developing and implementing rules, regulations and other measures to protect water for the environment and ensure it is delivered according to plan. Some of these measures are being implemented under the SDLAM projects, Northern Basin Toolkit, or under Prerequisite Policy Measures in the southern Basin. These measures are being incorporated into water resource plans where possible.

It is important to ensure that the substantial amount water recovered by the Australian government for the environment is being used in accordance with the Basin Plan.

  • Conduct on-ground and satellite monitoring to review or audit compliance with state arrangements for protecting recovered water, delivering water for the environment, and regulating water take during environmental watering events. 
State Compliance and enforcement arrangements 

Consistent, effective and transparent compliance and enforcement arrangements are fundamental to public confidence in the management of the Murray–Darling Basin.

In 2017, the Murray–Darling Basin Water Compliance Review and the NSW Ken Matthews Review found that the Basin states had significant variations, and deficiencies in their compliance cultures, resourcing levels, transparency, and policy frameworks.

Through the Basin Compliance Compact, Basin states and the Australian Government have committed to reviewing their arrangements, identifying and addressing gaps or areas for improvement, and increasing transparency to improve the effectiveness of water regulation in the Basin.

Publically report on Basin state and Australian government progress in implementing the Basin Compliance Compact commitments to improving compliance.

Monitor and review Basin state compliance arrangements, including the transparency and effectiveness of their systems for responding to allegations of illegal conduct.

 

Updated: 26 Jun 2019