Report finds water fraud risk

By Country News

A new report has uncovered evidence of South Australia manipulating environmental flows to get more Murray River water than it would have otherwise been entitled to.

The Ernst & Young report, released just before Christmas, also found there was a risk of fraud by state governments in delivering environmental flows.

The report is a new twist in the debate over management of flows in the Murray-Darling Basin, as governments have previously been pointing towards the likelihood that private diverters were not being metered well enough to prevent water theft.

The report raises the prospect that states or their agencies could rort the system to achieve preferential flows.

‘‘There is significant risk that the existing controls are not sufficient to ensure the Commonwealth Environmental Water Holder’s statutory obligations are met,’’ the Ernst & Young report found.

‘‘This ... arises because delivery of Commonwealth environmental water relies on relationships developed at the officer level rather than agreed processes ...’’

While the CEWH is responsible for environmental water, it must rely on state governments and their agencies to deliver its water.

It also relies on Commonwealth water agencies — the Murray-Darling Basin Authority and the Department of Agriculture and Water Resources — to act in a way that maximises outcomes for CEWH.

The CEWH has no statutory power over them if they choose to act in a way contrary to CEWH’s decisions.

The Ernst & Young report found three fraud risks that appear to be particularly relevant for the CEWH:

■State agencies intentionally providing false information to the CEWH to obtain resources. State agencies intentionally misusing CEWH resources in order to achieve their own objectives.

■Individual water officers intentionally providing false information and/or misusing CEWH resources in order to achieve their own private objectives, which may include commercial gain for themselves and/or their family or associates.

■Unauthorised access or misuse of environmental water by private landholders.

The report found the highest risks were in South Australia due to a lack of reporting requirements from that state.

A second report, published by the independent Australia Institute, found that South Australia had substituted environmental flows for the flows it was normally provided through the MDBA agreement between the states.

In 2015-16, the South Australian Government was advised that the CEWH was going to provide an environmental flow to increase water into the Coorong lakes.

The SA Government then deferred part of its regular entitlement, thus relying on the environmental flow.

At the Murray River barrages, Commonwealth environmental water contributed 100 per cent of the total stream flow volume.

The Australia Institute report found:

‘‘In the absence of Commonwealth environmental water, flows over the barrages would have been negligible in 2015-16.

‘‘This suggests that river operations may have adapted to the availability of Commonwealth environmental water.

‘‘Possibly, water that would have previously passed through to the Coorong and Murray Mouth (ie prior to the Commonwealth environmental water program) is no longer being prioritised below the Lower Lakes, with the possibility that Commonwealth environmental water is substituting previously provided environmental water rather than augmenting it.’’

Call for action after damning allegations 

Speak Up campaign spokesperson Doug Fehring said the release of the Ernst & Young report, as well as the Australia Institute paper, should be ringing alarm bells at the highest level of government.

‘‘We have a $13billion basin plan which is riddled with flaws; the more evidence that is compiled through its implementation, the more we learn about its inconsistencies and inadequacies,’’ Mr Fehring said.

‘‘Our concern is that the political risk to governments of admitting they have another pink batts on their hands is too great, so the issues are ignored.’’

He said these latest revelations indicated that water, which was supposed to be sent to the Coorong as environmental flows, had been held back to keep the Lower Lakes at a prime recreation height.

Additionally, in 2015-16 the South Australian Government deferred its entitlements, replacing them with environmental water, but failed to deliver this water to the Coorong.

It has also failed to use its desalination plant to provide Adelaide with water, instead using Murray River flows, despite these coming at substantial cost to communities further upstream.

‘‘While water is keeping the Lower Lakes at optimum level for boating, it is not being used to help the environment, and at the same time is significantly impacting the amount of water available for food production, especially in areas like the NSW Murray and northern Victoria,’’ Mr Fehring said.

‘‘This is reducing the amount of food available for Australian consumption, as well as what we can export to starving people throughout the world.

‘‘Should we really be putting recreation for a minority above growing food and protecting the environment?

‘‘There should also be huge concern about the lack of transparency and accountability in water management, which is an issue that Speak Up has raised continuously for three years.

‘‘Why were reports which questioned the South Australian use of water not made public?

‘‘Why were they not available for the vital meeting of water ministers in December, or other inquiries including a royal commission?

‘‘How much more damaging information is being withheld from the public, probably to protect politicians and bureaucracies?’’