Spending Your Money Like Water
By Sharona CouttsJuly 26, 2012
Senator Bill Heffernan attacks a deal The Global Mail investigated, which could see the government pay $83 million to just 11 landholders in New South Wales, calling it a fraud on the taxpayers.
A proposal to buy up vast amounts of land and water in central New South Wales would be "perpetrating a fraud on the Australian taxpayers", according to Senator Bill Heffernan, who is calling those involved to appear before a parliamentary committee inquiry into the deal before it is approved.
The particular deal Heffernan wants to investigate was reported in The Global Mail in late May. It involves the water and land from a group of owners in an area of the Lower Murrumbidgee River, known as Nimmie-Caira.
(Click play to listen to Senator Bill Heffernan speak with The Global Mail's Sharona Coutts. Plus, read the story explaining how the owners could get up to $83 million for their water, though they have only paid a combined annual fee of $260,000 to access it in the past.)
The Nimmie-Caira water buyback is part of the federal government's multi-billion-dollar plan to buy up water rights from irrigators and other water users throughout the Murray-Darling Basin, to ensure that water is available for the environment. That plan is slated to be finalised later this year.
The arrangements regarding Nimmie-Caira are unusual in many respects. Most notably, the landowners don't currently own formal entitlements to the enormous quantities of water they are hoping to sell. For the deal to proceed, they would receive those rights from the New South Wales government, with the specific intention of then selling them to the Commonwealth.
"I've been told by the government officials that they have approval to pay two-and-a-quarter times the market value for the water, as an incentive," says Heffernan. "This is what I'd call cooking the water acquisition books."
Heffernan says that's a ploy to facilitate a sale that would appear to deliver big wins to the environment, but is in fact a political deal.
He told The Global Mail that the water at issue only flows onto the Nimmie-Caira properties in times of floods or other events that mean water is abundant. In other words, it would only be available when there is already ample water covering the environment.
"We need water when water's short, not when it's in flood," he says.
Heffernan is sceptical of the deal because it includes paying for — in addition to the water — the land, and also the channels, levees and other "infrastructure" it contains. In total, Heffernan says taxpayers could pay four times the market rate for this water.
"That's perpetrating a fraud on the Australian taxpayer," he says.
Heffernan chairs the Senate Committee on Rural and Regional Affairs and Transport, which has a current inquiry into the management of the Murray-Darling Basin. The committee will call stakeholders in the Nimmie-Caira deal — including the bureaucrats involved — to come before the inquiry, Heffernan says.
According to news reports, the federal and state bureaucrats involved in the deal were set to meet on Thursday. Calls to the federal department and environment minister Tony Burke's office were not immediately returned.