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2016
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
SENATE
WATER LEGISLATION AMENDMENT (SUSTAINABLE DIVERSION LIMIT
ADJUSTMENT) BILL 2016
EXPLANATORY MEMORANDUM
(Circulated by authority of the Deputy Prime Minister and Minister for Agriculture and
Water Resources, the Hon. Barnaby Joyce MP)
WATER LEGISLATION AMENDMENT (SUSTAINABLE DIVERSION LIMIT
ADJUSTMENT) BILL 2016
GENERAL OUTLINE
The Water Legislation Amendment (Sustainable Diversion Limit Adjustment) Bill 2016 (the
Bill) amends the Basin Plan 2012 (the Basin Plan) to allow for a second notification of supply
and efficiency measures by 30 June 2017. The Murray-Darling Basin Ministerial Council (the
Ministerial Council) requested these amendments on 22 April 2016.
A second notification would provide an additional opportunity for Basin jurisdictions to
develop and notify new projects up to 30 June 2017 to augment the first package of measures
notified on 5 May 2016 by the Basin Officials Committee (BOC) to the Murray-Darling
Basin Authority (the Authority). Augmenting the outcomes of the adjustment mechanism
would help maximise the social, economic and environmental outcomes of the Basin Plan.
The Bill provides for the Authority to propose a single determination on the adjustment of the
Sustainable Diversion Limit (SDL) by 15 December 2017. A single determination is
administratively and legislatively simpler than two separate determinations, which would
require two separate public consultation processes and the tabling of two separate
amendments in Parliament.
A determination deadline of 15 December 2017 will ensure a timely adjustment and provide
certainty for processes which depend on the outcome of the adjustment mechanism. Key
dependent processes include the development of water resource plans by Basin States and the
achievement of water recovery objectives.
The Bill also postpones the date after which additional efficiency measures can be notified
from 30 June 2016 to 30 June 2017. This is consistent with current Basin Plan processes
where additional efficiency measures can only be notified after the initial notification
deadline.
Background
The Basin Plan provides for coordinated and sustainable management of water resources in
the Basin. It sets new long-term average SDLs to provide for a healthy river system while
ensuring that the communities and industries that rely on Basin water resources remain
productive into the future.
The SDL adjustment mechanism enables the Basin-wide SDL for surface water
(10,873 gigalitres per year) to be changed up or down by up to five per cent, as long as
environmental, social and economic outcomes are not compromised. Adjustments can be
achieved through supply measures or efficiency measures. Supply measures are those that
achieve equivalent environmental outcomes as those set out under the Basin Plan with less
water. The greater the supply contribution from the SDL adjustment mechanism the smaller
the remaining water recovery task. Efficiency measures improve environmental outcomes
under the Basin Plan by recovering additional water with neutral or improved social and
economic outcomes.
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Consultation
All Basin jurisdictions (Queensland, New South Wales, the Australian Capital Territory,
Victoria and South Australia), key industry groups, environmental organisations, and Basin
Indigenous groups have been consulted on the details of the Bill.
Financial Impact Statement
There is no financial impact associated with this Bill.
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Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Water Legislation Amendment (Sustainable Diversion Limit Adjustment) Bill 2016
This Bill is compatible with the human rights and freedoms recognised or declared in the
international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny)
Act 2011.
Overview of the Bill
The Water Legislation Amendment (Sustainable Diversion Limit Adjustment) Bill 2016 (the
Bill) will amend the Basin Plan 2012 (the Basin Plan) to allow for a second notification of
supply measures and efficiency measures by 30 June 2017. The Murray-Darling Basin
Ministerial Council (the Ministerial Council) requested these amendments on 22 April 2016.
A second notification of supply and efficiency measures would provide an additional
opportunity for Basin jurisdictions to develop new projects to augment the first package of
measures notified on 5 May 2016 by the Basin Officials Committee (BOC) to the Murray-
Darling Basin Authority (the Authority). Providing additional time for the submission of
measures will improve the outcomes of the adjustment of the Basin-wide sustainable
diversion limit (SDL), which will help maximise the social, economic and environmental
outcomes of the Basin Plan.
Human rights implications
This Bill engages the right to an adequate standard of living, including food, water and
housing.
The right to an adequate standard of living is contained in article 11(1) of the International
Covenant on Economic, Social and Cultural Rights (ICESCR). The United Nations
Committee on Economic, Social and Cultural Rights has stated that the human right to water
entitles everyone to sufficient, safe, acceptable, physically accessible and affordable water for
personal and domestic uses. The Committee has noted the importance of ensuring sustainable
access to water resources for agriculture to realise the right to adequate food.
The Basin Plan provides for coordinated and sustainable management of water resources in
the Basin. It sets new long-term average SDLs to provide for a healthy river system while
ensuring that the communities and industries that rely on Basin water resources remain
productive into the future.
The Basin Plan includes a mechanism to provide flexibility in setting SDLs known as the
'SDL adjustment mechanism'. The mechanism allows the Basin-wide SDL for surface water
(10,873 gigalitres per year) to be changed up or down by up to five per cent, as long as
environmental, social and economic outcomes are not compromised.
Adjustments can be achieved through supply measures or efficiency measures. Supply
measures are those that achieve equivalent environmental outcomes as those set out under the
Basin Plan with less water. The greater the supply contribution from the SDL adjustment
mechanism the smaller the remaining water recovery task. Efficiency measures improve
environmental outcomes under the Basin Plan by recovering additional water neutral or
improved social and economic outcomes.
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The Bill will amend the Basin Plan to give effect to the Ministerial Council's request for a
second notification. The second notification will allow for the development and notification
of new measures that will contribute to the successful operation of the adjustment
mechanism, maximise its benefits, and further improve the outcomes of the Basin Plan.
Conclusion
This Bill is compatible with human rights because it promotes the protection of human rights,
specifically in relation to an adequate standard of living and the right to water. It does this by
contributing to the successful operation of the SDL adjustment mechanism, which advances
the outcomes of the Basin Plan and the sustainable management of water resources.
The Hon. Barnaby Joyce MP, Deputy Prime Minister and Minister for Agriculture and
Water Resources
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WATER LEGISLATION AMENDMENT (SUSTAINABLE DIVERSION LIMIT
ADJUSTMENT) BILL 2016
NOTES ON ITEMS
Clause 1 Short title
1. This Clause provides for the short title of the Act to be the Water Legislation Amendment
(Sustainable Diversion Limit Adjustment) Act 2016.
Clause 2 Commencement
2. This Clause provides for the commencement of the Act.
3. All items in this Act commence on the day after this Act receives the Royal Assent.
Clause 3 Schedules
4. This Clause provides that legislation that is specified in a Schedule to this Act is
amended or repealed as set out in the applicable items in the Schedule concerned, and
that any other item in a Schedule to this Act has effect according to its terms.
5. This Clause also provides that amendments to the Basin Plan arising from this Act do not
prevent the Authority from preparing other amendments of the Basin Plan under section
23B or 45 of the Water Act 2007.
Schedule 1 - Amendments
Basin Plan 2012
Item 1 Chapter 7 (note to Chapter heading)
6. This item omits part of the Chapter heading note and substitutes new text. This has the
effect of not limiting adjustments proposed by the Authority to measures notified by
30 June 2016. This supports the operation of Chapter 7, as amended by this Act, which
allows the Authority to propose adjustments to surface water sustainable diversion limits
(SDLs) taking into consideration measures that come into operation by 30 June 2024.
The measures are supply measures or efficiency measures.
Item 2 Section 7.02 (definition of notified measure)
7. This item expands the definition of "notified measure" to cover measures which are
notified under the new subsection 7.12(1A) (the second notification).
Item 3 Section 7.10 (heading)
8. This item repeals the heading of the section and substitutes it with "Initial adjustments to
be proposed in 2017". This reflects that measures notified on or before 30 June 2017 can
be incorporated in the initial adjustment.
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Item 4 Subsection 7.10(1)
9. This item amends the subsection so that a single determination can be made by the
Authority on the basis of proposed adjustments resulting from the first and second
notifications (subsections 7.12(1) and (1A), respectively).
10. A single determination is administratively and legislatively simpler than two separate
determinations which would require two separate public consultation processes and the
tabling of two separate amendments in Parliament.
11. This item also changes the date from which the Authority must commence a process to
determine the SDL adjustment from 30 June 2016 to 30 June 2017. This allows for
measures notified in the second notification (item 7 refers) to be incorporated into the
initial adjustment.
12. This item also requires that the Authority present its determination of proposed
adjustments to the Minister under section 23A of the Water Act 2007 by no later than
15 December 2017. This deadline would ensure a timely adjustment and provide
certainty for processes which depend on the outcome of the adjustment mechanism. Key
dependent processes include the development of water resource plans incorporating the
adjusted SDLs by Basin States and the achievement of the Commonwealth water
recovery objectives.
Item 5 Before subsection 7.12(1)
13. This item inserts a subheading to indicate that subsection 7.12(1) relates to the first
notification of supply measures or efficiency measures.
Item 6 Subsection 7.12(1)
14. This item omits "(notified measures)" from the end of 7.12(1). This corrects a previous
drafting error, as the definition of "notified measure" is already set out in subsection
7.02. This provision does not alter the definition of "notified measures" and does not
change the substantive effect of the subsection.
Item 7 After subsection 7.12(1)
15. This item inserts a subheading to indicate that new subsection 7.12(1A) relates to the
second notification of supply measures or efficiency measures.
16. This item also inserts a new subsection which allows for the Basin Officials Committee
(BOC) to notify the Authority of one or more supply measures or efficiency measures
after 30 June 2016 but on or before 30 June 2017. The purpose of this section is to allow
for a second notification of measures that, in the view of the BOC, should be taken into
account in proposing adjustments under section 7.10 or 7.11.
17. A second notification would provide an additional opportunity for Basin jurisdictions to
develop and notify new projects to augment the first package of measures notified on
5 May 2016 by the BOC to the Murray-Darling Basin Authority. Augmenting the
outcomes of the adjustment mechanism would help maximise the social, economic and
environmental outcomes of the Basin Plan.
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18. This new subsection gives effect to the request of the Ministerial Council to amend the
Basin Plan to provide for a second SDL adjustment step by 30 June 2017.
19. Item 7 also inserts a subheading to indicate that subsection 7.12(2) relates to the
notification of additional efficiency measures.
Item 8 Subsection 7.12(2)
20. This item omits the first occurrence of "additional" in the subsection. This corrects a
previous drafting error which created a circular definition of "additional efficiency
measures" by using the same term that is being defined (subsection 7.02 relies on 7.12(2)
as the definition of "additional efficiency measure"). This provision does not alter the
definition of "additional efficiency measure" and does not change the substantive effect
of the subsection.
Item 9 Subsection 7.12(2)
21. This item omits "2016" and substitutes "2017". This changes the date after which
efficiency measures can be notified from 30 June 2016 to 30 June 2017. This is
consequential to the amendment made by Item 7 of the Bill which allows efficiency
measures notified on or before 30 June 2017 to be incorporated in the initial adjustment.
Item 10 Subsection 7.12(2)
22. This item omits the second occurrence of "additional" in the subsection. This corrects a
previous drafting error which created a circular definition of "additional efficiency
measures" by using the same term that is being defined (subsection 7.02 relies on 7.12(2)
as the definition of "additional efficiency measure"). This provision does not alter the
definition of "additional efficiency measure" and does not change the substantive effect
of the subsection.
Item 11 Subsection 7.12(2)
23. This item omits "(additional efficiency measures)" from the end of 7.12(2). This corrects
a previous drafting error, as the definition of "additional efficiency measure" is already
set out in subsection 7.02. This provision does not alter the definition of "additional
efficiency measure" and does not change the substantive effect of the subsection.
Item 12 Before subsection 7.12(3)
24. This item inserts the subtitle "Requirements for all notifications" before subsection
7.12(3). This provision helps clarify the operation of section 7.12, specifically that
subsections 7.12(3) and (4) relate to both the first and second notification. The subtitle
does not change the substantive effect of the subsections.
Item 13 Before subsection 7.12(5)
25. This item inserts the subtitle "Amendments of notifications" before subsection 7.12(5).
This provision helps clarify the operation of section 7.12, specifically that subsections
7.12(5) (6) and (7) relate to the amendments of either the first and second notification.
The subtitle does not change the substantive effect of the subsections.
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Item 14 Subsection 7.15(1) (note)
26. This item amends the note to subsection 7.15(1) by omitting reference to 30 June 2016
and substituting "the time the measures are notified under section 7.12". This is
necessary to reflect that section 7.12 allows for the notification of supply measures after
30 June 2016 (see item 7).
Item 15 Subsection 7.16(1) (heading)
27. This item repeals the heading of the subsection and substitutes it with "Efficiency
contribution for 2017 determination". This removes reference to a determination of an
adjustment occurring in 2016. This is necessary to reflect that there will be a
determination of an initial SDL adjustment after 30 June 2017. This will allow measures
which may be notified on or before 30 June 2017 to be incorporated in to the
determination of the initial adjustment.
Item 16 Section 7.20 (heading)
28. This item repeals the heading of the section and substitutes it with "7.20 Final
determination of amounts in 2017". This reflects that there will be a single, initial
determination and SDL adjustment which will occur after the second notification of
measures on or before 30 June 2017.
Item 17 Subsection 7.20(2)
29. This item omits "2016" and substitutes "2017". This is necessary to allow for initial
measures which are notified on or before 30 June 2017 to be incorporated in the initial
adjustment.
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