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Salinity Control, Water Reform and Structural Adjustment: the Tragowel Plains Irrigation District

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Salinity Control, Water Reform and Structural Adjustment: the Tragowel Plains Irrigation District Salinity control, water reform and structural adjustment: The Tragowel Plains Irrigation District by Neil Francis Barr A thesis submitted in partial fulfillment of the requirements for the degree of Doctor of Philosophy in the University of Melbourne. The research in this thesis was undertaken in Institute of Land and Food. University of Melbourne June 1999 Abstract The Tragowel Plains Irrigation District lies in the lower Loddon catchment of northern Victoria. Since the 1890s progressive development of the irrigation infrastructure of the Tragowel Plains has been accompanied by the development of irrigation induced soil salinity. In 1988 the State Government of Victoria supported the development of a community managed salinity management plan. At the same time, the water supply industry was significantly deregulated. Full cost recovery principles were applied to irrigation water pricing. Water entitlements were transformed into tradable commodities. The Tragowel Plains Salinity Plan was subsequently promoted by the Victorian government and the Loddon irrigation community as a model for encouraging structural change in a Commonwealth government facilitated regional development plan for the whole of the Loddon- Murray irrigation region. The process of developing this regional development plan revealed difference in the objectives of the various actors in this new planning process. The objective of community planners was the survival of the irrigation district. One of the objectives of Commonwealth was the transfer of water from low value use to high value use. These higher value uses were potentially elsewhere in the Murray Darling Basin. Further, these actors in the planning process used differing implicit models of the process of structural change in irrigation areas. The Commonwealth representatives had an implicit model of structural change in which farm consolidation was driven by the rate of exit from farming. They were also sceptical of the capacity of the Tragowel Plains salinity plan model to facilitate significant change in water use. The community proposal argued that farm consolidation was driven by the capacity of existing businesses to fund farm expansion, and that the Tragowel Plains model was capable of facilitating significant structural change and achieving real environmental benefits.. This thesis examines the outcomes of five years of Salinity Plan implementation and assesses these outcomes against the objectives of government, the community and the environmental movement, and assesses the implicit models of structural change used by the various actors. The study found that the accuracy of farmer appraisal of soil salinity has been greatly improved by the provision of soil salinity surveys. This supports one of the components of the implicit adjustment model used by the community planners – that without information from iii electro-magnetic surveying, farmers were often unable to accurately judge the salinity of farm soils. Greater certainty provided by soils salinity surveys has catalysed significant structural change on farms. Almost half of the saline land irrigated in 1989 has since been retired from irrigation. Two thirds of the water retired from saline soils had been reallocated to higher value perennial pastures. The adoption of professional whole farm planning has increased significantly since the implementation of the Salinity Plan. The rate of land relayout has not increased, but the participation rate has increased. The pattern of structural adjustment varied across the study area. Successful consolidation of enterprises was underway within dairy farm areas of the Tragowel Plains during the period of this study. The process was driven by the relative prosperity of dairy industry which enabled the operators of those businesses to fund farm expansion. The Salinity Plan had little direct impact upon decisions to purchase land. In contrast, in mixed farming areas in the north of the study area the number of small farm businesses increased during the period of study. This was counter to the objectives of the salinity management plan. The major processes causing this structural adjustment on the Tragowel Plains can be summarised as follows: • Low returns to existing mixed farming industries encouraged many farmers in these industries to exit. • A high exit rate due to financial pressure was being accelerated by non-financial issues such as the family and lifestyle dissatisfaction of women on farms. • A high concentration of mixed farms in the north created a geographic shortage of strong businesses able to fund expansion in that district • A high demand for small farms in the north from new entrants appeared to be based upon unrealistic expectations of the limitations of small farms and local off-farm work opportunities. • When the existing agricultural industries of a region are all in a weak financial position, they will be at a competitive disadvantage when bidding against new entrants for whom the housing and other farm infrastructure is not a sunk cost. iv These results call into question the implicit model of “exit-driven” structural change which has been the basis of agricultural structural adjustment policy for the past 30 years. This thesis concludes that policy tools to enhance structural change in agriculture need to be targeted to entry to agriculture and the competition between farm build-up and farm entry, rather than focussing upon changing the rate of exit from agriculture. v Preface As I reflect upon my professional career, it is clear that structural adjustment of agricultural communities and salinity control have been the consistent themes of my research. My first research position, which I entered soon after graduating, was set in the midst of a period of aggressive restructuring of the Australian dairy industry during the late 1970s. This theme continued in studies of part time farming, adjustment decision making and changes in the composition of the farm workforce. With hindsight borne of a career based upon the changing priorities of research funding bodies, I can see now that a change in research career was inevitable. In 1983 I commenced a new research direction . a study of farmers’ perceptions of the extent of irrigation salinity and the barriers to salinity control. The intention was to assess the accuracy of farmers’ appraisal of hazard using remote sensed estimates of the extent of soil salinity. As the project developed it became apparent that the utility of remote sensed salinity detection had been over marketed by those developing the technology. The objective of measuring accuracy of salinity appraisal was abandoned. Now, fifteen years late, this thesis represents the belated delivery of research which fulfils my 1983 intention. Despite the methodological limitations of my first study of salinity, it was still the first significant Australian study of the social issues which are enmeshed in the salinity control. It lead to my decade long involvement in social research within the Victorian Salinity Program and positioned my career firmly in the commencement of the ongoing infatuation of research organisations with the goal of a sustainable agriculture. And for many years I believed that the ‘structural adjustment’ chapter of my research career had closed. This was not the case. By the mid 1990s there was a growing realisation by research funds that the objective of sustaining agriculture was closely liked with the direction of structural adjustment within agricultural industries. And thus, with the research described in this thesis, the two main strands of my research career are finally entwined in a single thread. Clearly, this thesis represents both the outcome of research undertaken during the period of my formal enrolment for the degree of Doctor of Philosophy and research undertaken prior to this period. Parts of chapter 1 have been previously published as chapter 12 of Greening a vi Brown Land (Barr and Cary, 1992). Some sections of chapter 2 were previously published in Community Involvement in Catchment Management (Wilkinson and Barr, 1993). I certify that this thesis comprises my original work and that due acknowledgement has been made in the text of the thesis to all other material used. This thesis is less than 100,000 words in length, exclusive of tables, bibliography and appendices. vii Acknowledgements A number of people have played a pivotal role at key points in my life, shifting the points and sending my carriage on the journey to this study of structural adjustment in the rural sector. My parents experienced their share of the pressure for adjustment within the rural sector, and from this I learnt a little of the personal struggle behind the words. Glenn Ronan, an early advocate of the need for rural counselling, first set me on this research path in 1977. John Cary inducted me into the world of salinity research in 1984. I believe it will indeed be many years before another researcher is placed in the fortunate position of having available such a rich and extensive longitudinal data set for study. To be given the opportunity to explore such a data set is an honour of fortune for which I must express my gratitude to the Murray Darling Basin Commission and the Department of Natural Resources and Environment, who shared funding of this research. I have benefited from wise council and advice during the preparation of this thesis. Ken McDougall shared similar experiences to my parents. His local knowledge of the Tragowel Plains was a valuable assistance, as was that of Drew English, Lester Haw and Craig Dyson. I am indebted to a number of colleagues whose ideas and insights have been of enormous assistance. Foremost is my supervisor, Professor John Cary. Likewise, Roger Wilkinson of Landcare Research, New Zealand and Ian Reeve of the University of New England. The completion of this research would not have been possible without the assistance of Sally McInnes who undertook more than her share of the 1995 interview load, George Wyatt who organised the 1987 interviews, the officers of the Pyramid Hill office of Goulburn Murray Water and Andy McAllister of Tatura.
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