Murray-Darling Basin Plan revisited: Same mistakes over and over again.

Just last week I wrote about how the Government is making the same mistakes in allocating funding to the Great Barrier Reef (GBR), as it did with the Murray-Darling Basin (MDB) over the period 1997-2009.
It turns out that they are repeating the same errors again with the MDB. The Senate is set to vote tomorrow (8th May, 2018) to amend the MDB Plan. This involves scrapping the requirement for some additional 600 gigalitres (GL) of water to be kept for environmental purposes in the Basin, which was a commitment of the original MDB plan.
Instead, the government is proposing to spend $1.3 billion on variety of programs, mostly to be implemented in Victoria and NSW, which are supposedly going to save some 600 GL of water, thus somehow offsetting the equivalent back-down on environmental water commitment.The big problem with this is that the projects to be funded are going to be hugely cost-ineffective, just like all the environmental projects that were implemented in the MDB in the past.
Public funds are going to be spend, and special interests in Victoria and NSW are going to be served, with very little positive environmental outcomes, and at enormous costs per unit of environmental outcome (i.e $/ML of water saved). This is all something that we have already seen, analysed, and showed that it is a poor way to go about securing environmental water in the MDB. But, the government doesn’t seem to care. Elections are coming, and pork-barreling is the name of the game! Sad, really!

Author: Tiho Ancev

Tiho Ancev is a Professor of Agricultural and Resource Economics in the School of Economics, University of Sydney. His main research areas are agricultural, environmental, natural resource and energy economics. Tiho’s main contributions have been in water economics and policy, economics of energy, economics of air pollution and climate change policies, and economics of precision agriculture and agricultural input use. He has published widely on these topics in top international peer reviewed journals. Tiho has led and contributed to national and international research projects in these research areas. He is currently the Managing Editor-in-Chief of the Australian Journal of Agricultural and Resource Economics.