Chapter 7 – Case Study : Sydney’s Water System…

Chapter 7 : Case Study – Sydney’s Water System

7.1 Introduction The purpose of the case study is to consider and test three key propositions of this thesis in the context of a real problem situation. First is to demonstrate that the problem typology described in Chapter 3, regarding the Type 3 problem, can be identified and, importantly, that there is value in recognising this type of problem. Second is to demonstrate the benefit of using the problem-structuring approach developed in Chapter 6, through its practical application to a real Type 3 problem. In this case the problem is consideration of the planning process for the development of the water supply system in a large metropolis (the metropolis being Sydney, Australia). And third is to compare this novel approach with established methodologies used in major planning initiatives to determine whether the problem-structuring approach developed here provides any clearly identifiable advantages over existing approaches. If so, the aim is then to propose a more comprehensive, effective approach to the process of major infrastructure planning.

In order to achieve these three aims, the case study is presented in two distinct parts: first, is the application of the problem-structuring approach prospectively in order to guide the planning process; and second, is to use the problem-structuring approach retrospectively to critique alternative approaches.

7.2 Case Study structure Part A is a prospective application of the problem-structuring approach in its entirety. This part of the case study was based on a project managed by the Warren Centre for Advanced Engineering at the University of Sydney. The project focuses on options for developing the water system for the metropolis of Sydney, Australia. Both the system (the greater metropolis of Sydney) and the relevant subsystem (the metropolitan water system) were defined. The boundaries of the system were examined and tested using a boundary critique process. Once the system definition was completed, a comprehensive (but preliminary) narrative was prepared to give the reader the background to the problem situation and, importantly, to develop the argument that the problem in question is, indeed, a Type 3 problem. A qualitative, multidimensional system model was prepared, using the trilemma systems mapping approach developed in Chapter 6. Then,

251 Chapter 7 – Case Study : Sydney’s Water System… the response of the model to a plausible, hypothetical disturbance was explored. Critique of the system model was carried out by a large group of participants, representative of the entire domain of interests. A number of narratives was prepared, reflecting different perspectives and worldviews of the domain interests.

Part A is intended to address the first two propositions noted above: namely, to establish that the Type 3 problem typology exists and to demonstrate practical application of the problem-structuring approach by developing a system model for the Type 3 problem as a starting point for formalised (and accepted) decision analysis techniques.

Part B achieves the third aim of the case study in comparing this approach with established methodologies. In addition, it demonstrates a further important application of the approach. Having developed a robust system model of the problem, this was used retrospectively to critique other established approaches to strategic planning. In this case, the system model developed in Part A was used to critically examine a major planning exercise, which was undertaken by the New South Wales (NSW) State Government to plan urban and major infrastructure development. The outcome of this examination confirmed the extensive criticism in the media, in Parliamentary debate, and by the NSW Ombudsman of the approach taken by the government.

7.3 Case Study: Part A – The Sydney Metropolitan Water System Analysis 7.3.1 The Warren Centre “Metropolitan Water Options” project 7.3.1.1 Project Background In September 2004, a panel discussion was presented at the Engineering Leadership 2004 conference in Sydney, in which the author participated. The subject of this discussion was the leadership role of engineers in identifying good solutions to the very complex socio-economic-technical problems which confront modern society. The challenges relating to a sustainable water supply for metropolitan Sydney was used as an example. One conclusion reached from the case study and panel discussion was that it is no longer enough for engineers simply to practise their discipline; rather they need to engage with the problem in a broader sense: as citizens. This conclusion led the author to reflect upon whether a new set of philosophical principles for engineering practice would be required to enable such a change to be affected.

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After the conference, the author convened a meeting of representatives of three institutions, the Warren Centre for Advanced Engineering at the University of Sydney, Engineers Australia (EA), and the Australian Academy of Technological Sciences and Engineering (ATSE). The purpose of this meeting was to determine whether there was interest in establishing a project with two aims: first, to engage the broader community on the complexities of Sydney’s water system; and, second, to provide a white paper which might be used by various groups as a reference for policy-making. After several meetings, the Warren Centre agreed to manage the project within its portfolio, and EA, and ATSE agreed to provide in-kind support for the project. Later, the Nature Conservation Council of NSW also formally became a supporter of the project.

7.3.1.2 Project Vision The vision for the project was to engage a diverse, representative group of citizens from the Sydney community, with both interest and expertise in issues relating to Sydney’s water system, and a desire to communicate with a broader Sydney community. The main focus of the project would be to develop a methodology which would facilitate engagement of a very diverse group of interests and to prepare a comprehensive set of documents as a means of informing the broader community. It was envisioned that this would culminate in a forum, open to the general public, at which this material would be criticised and debated. More precisely, the project had three aims: 1. Using metropolitan Sydney as a detailed case study, make specific but wide- ranging recommendations to resolve the current problems with the water system; 2. Develop a methodology that can be applied to any metropolitan water system; and 3. Explore ways in which highly complex, infrastructure problems, such as water, energy, resource development, etc might be approached generally.

The outcome of the entire process would be summarised in a report which would be submitted the NSW State government, with the expectation that this would influence policy development.

The steering committee, co-chaired by a director of the Warren Centre and by the author, agreed that the project would be approached in two stages. The first stage would be to assemble a group of volunteers to work on the project and, concurrently, to seek

253 Chapter 7 – Case Study : Sydney’s Water System… funding from the Federal and State governments, corporations, industry associations, and not-for-profit organisations. This group would structure the problem in order to define the major issues, to engage with a wide representation from the domain of interests, and to prepare an initial system model to be used in wider community engagement. The second stage would be widespread community consultation, culminating in the public conference. The case study presented here covers the initial, problem-structuring stage of the project; that is up to the conclusion of Stage 1.

7.3.2 Using the problem-structuring approach as the basis for project engagement In this part of the case study, the problem-structuring approach will be demonstrated in its application as the basis for the Warren Centre project methodology. As noted above, this project tackled the challenge facing the metropolis of Sydney, Australia, in developing a sustainable water system. Considered here are the catchment (including technologies such as desalination), storage, distribution, demand management, sewerage, stormwater drainage, effluent management, recycling and water-borne waste disposal. The general problem-structuring approach is represented diagrammatically in Figure 7.1 and a step-by-step description of the process appears in Appendix 7.1.

7.3.3 Initial problem statement The problem is stated as follows:

“The challenge of providing a sustainable water system for the metropolis of Sydney”.

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Problem-Structuring Approach

Proposition of problem system

System/sub-system definition and boundary critique

Background narrative to establish/confirm problem typology

Trilemma analysis and multidimensional cognitive mapping of the “As Is” system Scope of Case "As-Is“ dimensional/system critique Study

Qualitative evaluation Disturbance system response

Dimensional/system critique of Dimensional/system critique of ”Most Likely” system response “Desirable Future” system response

Worldview narratives

Broad engagement with constituency of interests

Figure 7.1 – The problem-structuring approach

7.3.4 Proposition of problem system 7.3.4.1 System/subsystem definition The system is defined as being the metropolitan area of Sydney, including its current and future water sources. In geographic terms, the system is the metropolitan area, plus existing and proposed catchments. As will be shown in the next section, definition of the system boundary is an important step to identify and to consider a broad range of social, economic, and technological issues embodied in the problem definition.

Within the Sydney metropolitan system, the water subsystem is defined as being the infrastructure and institutional arrangements necessary to capture, store and distribute water (including demand management), to remove and treat effluent and stormwater (including recycling), and to dispose of water-borne waste. Definition of the physical system is straightforward and requires little more description than noted above. However, determining the boundaries of the greater, non-physical system, that is, to

255 Chapter 7 – Case Study : Sydney’s Water System… identify what other aspects should be included in the system model, such as, for example, societal, moral, and environmental issues requires further consideration. The process of boundary critique is used to facilitate this and is described in the next section. The system concept map is shown in Figure 7.2:

Outer boundary Area for system boundary critique

SystemSystem MetropolitanMetropolitan SystemSystem System Element Inner boundary System System System Element Element Element

System WaterWater Sub- Sub- Element SystemSystem System Element System Element

Sub-system outer boundary Sub-system inner Area for sub-system boundary boundary critique

Figure 7.2 – Concept map of metropolitan system and water subsystem

7.3.5 Boundary critique The boundary critique approach used here follows the thinking of Ulrich (1987). Generally, the concepts developed here of “As-Is” and “Desirable Future” system states align well with Ulrich’s critical approach. However, Ulrich’s Habermasian emancipatory stance was anthropocentric (presumably largely deriving from his interest in social systems). This is appropriate if one’s worldview leads to a sustainable development approach but, as discussed extensively in Chapter 2, in the sustainability discourse, the monist “sustainability” worldview must also be acknowledged. Consequently, Ulrich’s boundary critique methodology has been modified somewhat to accommodate this perspective.

The boundary critique process complements the definition of the boundaries of the metropolitan system and water subsystem, both in their physical and non-physical senses.

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The process transparently identifies what is to be included within the domain of interests and represented in the system model. The critique is undertaken twice: first, to determine the boundary of the metropolitan system; and second, to identify the boundary of the water subsystem. In both cases, the process is the same: the “As-Is” and “Desirable Future” system states are considered in the context of 12 questions (developed from Ulrich’s process). These questions are: 1. Who is the beneficiary of the system (S)? 2. What is the purpose of S, i.e., what goal states is S able to achieve so as to serve the beneficiary? 3. What is S’s measure of success (or improvement)? 4. Who is the decision-maker, i.e., has the power to change S’s measure of improvement? 5. What components (resources and constraints) of S are controlled by the decision- maker? 6. What aspects of the problem are part of S’s environment, i.e., are controlled by S’s decision-maker? 7. Who is involved as designer of S? 8. What kind of expertise does flow into the design of S, i.e., who is considered an expert and what is his/her role? 9. Who is the guarantor of S, i.e., where does the designer seek the guarantee that his/her design will be implemented and will prove successful, judged by S’s measure of success (or improvement)? 10. Who is the witness representing the moral interests that will or might be affected by the design of S? That is, who among the affected does get involved? 11. To what degree and in what way are those affected given the chance of emancipation from the premises and promises of those involved? 12. Upon what worldviews of either those involved or those affected is S’s design based?

These questions seek to understand sources of motivation, sources of control, sources of expertise, and sources of legitimation. As each question is considered twice, first in the context of the “As-Is” system state (denoted by italicised verbs in the questions above) and then considering the “Desirable Future” (denoted by changing the italicised verbs in the questions above express the notion of “ought”). The responses which emerge may be

257 Chapter 7 – Case Study : Sydney’s Water System… examined critically to determine what should be included and excluded, and what should be identified for consideration at the margins of the system and subsystem boundaries.

A concise statement of the boundary critique appears in the next two sections and the full detail appears in Appendix 7.2.

7.3.5.1 The metropolitan system boundary critique The physical metropolitan system boundary is defined as being the greater Sydney metropolitan area, plus current and future water catchments and resources89.

The boundary critique arrives at a consideration of the metropolitan system as being a human social system, which exists for the benefit of its constituents. The aim is for a sustainable metropolis having long-term prosperity, without compromising other moral interests. It is recognised that there is a substantial difficulty in identifying appropriate indicators that represent both the prosperity of the metropolis and the interests of other non-human constituents. This suggests that a range of both quantitative and qualitative indicators is required (for example, Palme and Tillman (2007)). Sydney is both socially stable and prosperous, but there is ongoing dissatisfaction with the way in which the growth of the metropolitan area and its impact on the environment are being handled both by NSW and Federal government authorities. Many members of the domain of interests are excluded from the decision-making process and lack influence in policy outcomes, particularly those relating to the development of social and service infrastructure. Thus, a substantial challenge for policymakers is to take into account the important perspectives representative of all interests in the problem, in order to arrive at an informed, responsible path to metropolitan development. There is a pervasive societal cynicism that political processes are unnecessarily secretive and exclusive, and that broader consultation with the community is desirable. This process of consultation should include a broad range of institutions and other representatives, bringing an informed position on the sustainability discourse, so that when policy is finally determined, it properly reflects the interests of the entire domain of interests. The current NSW government position is one of “sustainable development”, where human interests are placed above those of the others with moral status within the domain.

89 Note that this extends beyond the ocean shoreline to include discharge points for sewage and the areas affected by it, together with environmental impact of potential desalination options.

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7.3.5.2 The water subsystem boundary critique The physical water subsystem is bounded by the catchment, storage, distribution and logistics, demand management, recycling, sewage and stormwater removal and treatment, and waterborne disease disposal infrastructure, together with the resources and institutions required to construct, operate, and maintain them. The water subsystem exists to support the development of the metropolis of Sydney. However, there is a widely-held view that the subsystem should be developed in such a way that it does not compromise the interests or well being of other species or ecosystems. A range of both qualitative and quantitative indicators needs to be developed to fully represent the integral nature of both the metropolitan system and the water subsystem. This should take into account of the full spectrum of interests within the domain. Current governance arrangements regarding the water subsystem are heavily politicised and would benefit from greater independence. The politicisation of the water issue has constrained the planning and design process, and has largely excluded the involvement of the community and broader moral interests. There should be more rigorous consultation and engagement early in the planning process, in order to identify and engage the full domain of interests, which must be acknowledged and responded to within the water subsystem.

For the last 150 years, the predominant influence on design of the water subsystem has been the various disciplines of engineering. Reliance on the purely engineering approach has constrained the introduction of innovative solutions which could be more beneficial to the broad domain of interests. This suggests that the purely technical engineering paradigm should be modified to include non-engineering input. Responsibility for the water subsystem is with the State government of NSW, which should employ greater use of consultative processes to extend democratic participation and government accountability. This should include representation of all moral interests, including non- human interests, affected by the development and design of the water subsystem.

7.3.5.3 Integrating the boundary critique into project management structure The steering committee (under the co-leadership of the author) identified eight dimensions of similarity to be used to group interests and areas of information identified in the boundary critique. These were: Political; Regulatory; Institutional; Economic; Health; Environmental; Social/Community; and Technological. Six of these (the

259 Chapter 7 – Case Study : Sydney’s Water System… exception being “Health”) were drawn from well-established business strategic planning processes, familiar to a number of the steering committee members.

It was agreed that because the main focus of the project was on the water subsystem, the Technological aspects would be considered by developing a model of a water subsystem with four dimensions of its own: Sources; Demand/Usage; Reuse; and Disposal, as these covered the complete water cycle. Issues identified in the water subsystem would be mapped against the seven metropolitan systems dimensions, with this analysis being done by a total of eleven teams, each working on one of the system or subsystem dimensions, as shown in Figure 7.3.

Steering Committee

Management Team

Water Sub-System Elements

Storage/ Demand/ Treatment/ Sources Distribution Re-Use Disposal

Political

Regulatory

Institutional

Economic

Health

Environmental Metropolitan System Dimensions System Metropolitan

Social/ Community

Technological

Figure 7.3 - Metropolitan Water Options Project Structure

Ten teams (Regulatory and Institutional issues being considered by one team) were constituted, with diverse membership from local government, community groups, law, politics, economics, health services, environmental groups etc. Project participants were

260 Chapter 7 – Case Study : Sydney’s Water System… identified by steering committee members as having particular expertise in one or more of the problem dimensions, either due to their professional expertise or personal involvement in the issues. See Tables 7.1 (below) and 7.2 (overleaf).

TEAM LEADER TYPICAL EXPERIENCE OF TEAM MEMBERS

POLITICS TEAM Consultant (water industry) Politician; engineer/businessman

REGULATORY/INSTITUTIONAL TEAM Lawyer Academic; municipal council professional officer

ECONOMIC TEAM Economist (public sector) Commercial property management professional; economist; academic.

ENVIRONMENT TEAM Academic/professional Soil conservationist; academic/conservationist; environmentalist conservation NGO professional officer; catchment management authority board member; municipal council water management officer; academic environmentalist; community environmental representative; professional officer, water supply authority.

COMMUNITY TEAM Academic Environmental educationalist; municipal council; nature conservationist; catchment education official; municipal council environmental officer; academic; science teacher; social services professionals; and environmentalists; ecological engineer; public servant (public works department); public servant (energy and sustainability; environmental NGO professional officer.

HEALTH TEAM Public health medical officer

Table 7.1 – Metropolitan System Teams

The project teams met over a period of several months from December 2005 to May 2006. Each project team leader was a member of the steering committee and involved in developing the project methodology and facilitating use of the problem-structuring approach to guide the team’s consideration of the problem.

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TEAM LEADER TYPICAL EXPERIENCE OF TEAM MEMBERS

SOURCES TEAM Academic (water industry Professional engineer (energy/water expertise); senior expertise) public servant (engineer/dam management expertise); municipal council officer. LOGISTICS TEAM Environmental engineer Professional engineers (3) from firms consulting to the water industry. USES AND DEMAND TEAM Professional engineer (water Water industry association executive; consultant expertise) engineers (4); senior public servant (engineer/water background). TREATMENT AND DISPOSAL TEAM Environmental engineer Environmental engineer; academic (water system expertise); consultant engineer. Table 7.2 – Water Subsystem Teams

7.3.6 Confirmation of problem typology In order to establish the problem typology and to provide the participants in the project with a comprehensive background of the way in which Sydney’s water supply developed since European settlement in 1788, a historical narrative was developed by the author.

The narrative describes the development of the institutions responsible for the water supply, sewerage, and drainage of metropolitan Sydney from the first days of white settlement in the late 18th century through to the present day. From about 1875 until the 1980s, engineering practice was the predominant influence over the evolution and operation of these institutions. It is argued that the development of Sydney’s water system was largely successful and acceptable to society as long as the underlying philosophical principles of engineering practice, which formed in the second half of the 19th century, were broadly consistent with the worldview predominant in the community. Starting in the 1960s, these began to diverge: engineering continued to be based on an instrumentalist, positivist philosophy, whereas the influence of late modernist thinking, critical theory, and postmodernism became more pervasive in the general community90. At this time, reflective of this change in community values, there was a collapse in confidence in many of the technologically-focused disciplines.

90 This is not a phenomenon exclusive to the practice of engineering and its relationship with society as a whole. Indeed, as argued in Chapter 3, the area of operational research was one of the first to identify the sea-change in community worldviews.

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Concerns emerged regarding the long-term sustainability of the modern phenomenon, with particular emphasis on ecological impact and the social issues regarding the long- term consequences of technology, industry, and urbanisation. The narrative concludes that in the last 20 years or so, the situation has now come to be manifested as a Type 3 problem. There are widely differing stakeholder views and values, increasing political secrecy and coerciveness, ineffectual governance arrangements, and shifts in institutional power. In addition, the lack of community involvement, and the broadening of the domain of interests to include non-human species, riparian health and ecological impact have emerged as major concerns. (The complete narrative appears in Appendix 7.3.)

7.3.7 Development of the qualitative system model The model which was developed for the project was to consider the metropolis as being an open, dynamic, complex social system, with a water subsystem, which gathers, stores, distributes, recycles, and disposes of water and effluent.

The metropolitan system was described as a set of interacting system elements in which the water subsystem sits, both influencing and being influenced by interaction with other system elements, as shown in Figure 7.4 (overleaf).

The system elements were represented by seven trilemmas. Each of these trilemmas (and the relationships which exist between them) could be investigated over the eight system dimensions and the four subsystem dimensions identified in section 7.3.5.3.

A first draft of the trilemma analysis was developed by the author and reviewed and discussed by the project management team to arrive at a more comprehensive document for critique by the steering committee. The elapsed time for conducting the analysis was about three months, with four, informal three-hour working sessions by members of the project management team. In addition there were two three-hour workshops in which the entire steering committee participated. Six months after the formal commencement of the project, a forum was held at which representatives from each of the teams presented the results of their consideration91. A “straw proposal” narrative was prepared by the project management team as a starting point for the forum discussions. The

91 The elapsed time for this stage of the project could have been shortened if professional facilitation had been used. Progress was slower than might have been the case because project team members contributed voluntarily from their own personal time.

263 Chapter 7 – Case Study : Sydney’s Water System… results of this forum concluded Stage 1 of the project and formed the basis of the interim report back to the project sponsors.

MetropolitanMetropolitan SystemSystem Uncertainty Skeptic Health/ Quality of Life of Quality Influence Influence ce B n el Technological e ie ci f Lifestyle S Politics Modern E s co Industrial ic c lo m on gi C no c ca t o o e l al n m c rn ic e C m E Social lit m o u o h n n P is c ity bl er Contract a n st G E o l E ve a xp rn eg m e a L is c n iv ta ce ct tio A ns

WaterWater Sub- Sub- Media System Public System Interest C E om s ng m tic a u li g ni o em ty P e nt Vested Interests

Vested

Interests Capital Efficiency

cs M iti ed ol ia P Business Model

Fr t ee n C ig e a M B p a nm ita rk r li et e sm ov G

Figure 7.4 – The Sydney metropolitan system and water sub-system

7.3.7.1 Trilemma System Mapping The process of identifying and developing the trilemmas was as follows:

1. Issue Identification and Brainstorming – A brainstorming session was held with members of the project management team to identify as many of the influential issues as possible. This commenced with the consideration of the high-level situational issues influencing Sydney’s water system. These are the major issues of the problem environment or context (see Figure 7.5). Following this, significant forces at play in the system were identified (for an extract of these, see Figure 7.6). This process took place in a three-hour workshop. The author then analysed the output from the brainstorming session and constructed the seven trilemmas.

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Sydney’s water – situational issues – a starting point…

"Triple Bottom-Line" – economic/environmental/ Climate change social (is this a trilemma Free Market vs. and weather in itself?) monopoly – variability Health risk trade-off vs. market Enabling technologies to recycling participation permit reform of integration and energy Business models and water systems Single, simple, for water supply central system vs. decentralised, Retrofit vs. Government and local, small, Science vs. greenfield NGOs vs. complex system pseudo-science technology Belief vs. Acceptance of Science Science vs. change vs. Uncertainty Resistance to change

Figure 7.5 – Starting-point issues for trilemma analysis

Identify the dichotomies…

Vested Interests ↔ Community Engagement Legal Activism ↔ Politics

Health Risk ↔ Recycling Political Self-Interest ↔Technological Influence

Legal Activism ↔ Corporate Governance Change Acceptance ↔ Change Aversion

Opinion Leaders ↔ Politics Opinion Leaders ↔ Community Engagement

Public Ownership ↔ Private Ownership Media Influence ↔ Politics Greenfield ↔ Brownfield

Free Market ↔ Monopoly Free-market Capitalism ↔ Big Government

Political Self-Interest ↔ Community Concern Vested Interests ↔ Community Interests Economics ↔ Environmental Concern Centralised ↔ Decentralised

High Rainfall ↔ Low Rainfall Regulation ↔ Monopoly Enabling Technology ↔ Politics

High Energy Cost ↔ Low Energy Cost Community Concern ↔ Technological Influence Population Growth ↔ Population Decline

Figure 7.6 – Summary a brainstorming session output

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Trilemma Development – From the list of dichotomies which emerge from the brainstorming session (see Figure 7.6), the underlying forces responsible for the dichotomies were identified.

From these, seven trilemmas were identified by the author and later subjected to critique by the steering committee. An example of the development of one of the trilemmas is presented here. The other six trilemmas are shown completely in Appendix 7.4.To construct the Vested Interests trilemma, three forces were identified from critical consideration of the brainstorming output. To identify these, it is important to recognise forces that are naturally in tension. In this case, vested interests (particularly business and community interests) were identified to be in tension both with established political processes and with media (particularly newspapers) seeking to influence political processes and exploit public concerns, regarding security of water supplies. The three forces were then represented as a triad and consideration was given to the response of the triad under the influence of dominant forces. Once the three forces constituting the trilemma have been identified, potential states of the system element are considered, with each force, taken in turn, being assumed to be dominant. For example, referring to Figure 7.7, when Politics is dominant over Vested Interests and Media Influence, the result (represented at the bottom left vertex of the triad) is Strong Government. But strong governments can be either utopic or dystopic. In liberal, Western, democratic societies, the utopic image of strong government is typically considered to be one where the government is motivated by public good. That is, it is free from the influence of vested interests, takes a bipartisan (or multi-partisan) approach to long-term strategic issues, and encourages a competent, largely independent bureaucracy, which both advises on and implements public policy. On the other hand, a dystopic image of strong government is one where sectional and vested interests remove objectivity from decision- making. “Pork-barrelling” becomes a major influence on policy determination, government is largely dismissive and insensitive towards community opinion and may be unduly influenced by an interfering media. (Both the utopic and dystopic characterisations are represented at the vertex labelled “Strong Government” in Figure 7.7.) The process is repeated to identify utopic and dystopic positions at the other two vertices.

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The Vested Interests trilemma…

FreeFree Market Market

Utopia Dystopia • Vested interests with strong • Weak government does not sense of civic responsibility adequately constrain interests • Guided and constrained by • Solution is expensive and inefficient intelligent regulation • Ineffective regulatory environment • Community concerns and perspectives sought and included in solution Vested Interests

Dystopia • Sectional and vested interests remove Vested objectivity from decision-making Utopia • “Pork-barrelling” a major influence in Interests • Responsible media coverage policy determination • Well-informed, balanced s M c e • Insensitive to community opinion iti d discussion ol ia • Public agenda driven by media P • Responds to the public interest

Informed StrongStrong Utopia Informed • Motivated by public good, not vested Public GovernmentGovernment Public interests Dystopia • Bipartisan approach to long-term • Influenced by sectional interests strategic issues • Politically biased • Competent, largely independent • Limited public debate bureaucracy

Figure 7.7 – Example of trilemma – first stage of development

The next step is to further develop the content of the trilemma by subjecting it to critique in order to determine the “As-Is” system state. This is done by holding each force constant in turn and exploring the influence on the system states represented at the vertices by varying the tension between the remaining two forces. For example, in Figure 7.7, assuming the vested interests force is constant and considering the effect of varying the influence of political processes in tension with media influence. The utopic and dystopic positions at the “Strong Government” and “Informed Public” vertices are thereby criticised and further developed. In this case, critical examination of the trilemma by project team members enabled the “As-Is” position to be identified within the triangle boundary (see Figure 7.8 overleaf). The location of the “As-Is” symbol on the diagram simply indicates the approximate equilibrium point of the three forces.

267 Chapter 7 – Case Study : Sydney’s Water System…

The Vested Interests trilemma…

FreeFree Market Market

Utopia Dystopia • Vested interests with strong • Weak government does not sense of civic responsibility adequately constrain interests • Guided and constrained by • Solution is expensive and inefficient intelligent regulation • Ineffective regulatory environment • Community concerns and perspectives sought and included in solution Vested Interests

Dystopia • Sectional and vested interests remove Vested” objectivity from decision-making s Utopia Interests I • “Pork-barrelling” a major influence in s • Responsible media coverage policy determination “A • Well-informed, balanced s M c e • Insensitive to community opinion iti d discussion ol ia • Public agenda driven by media P • Responds to the public interest

Informed StrongStrong Utopia Informed • Motivated by public good, not vested Public GovernmentGovernment Public interests Dystopia • Bipartisan approach to long-term • Influenced by sectional interests strategic issues • Politically biased • Competent, largely independent • Limited public debate bureaucracy Figure 7.8 – Example of trilemma – second stage of development – “As-Is” system element state A simplified diagram can then be prepared which summarises the characteristics of the “As-Is” state of the system element (see Figure 7.9).

The Vested Interests trilemma…

FreeFree Market Market Characteristics of the “As Is” situation • Insensitive to public opinion. • Public agenda heavily influenced by media. • Weak government struggling to constrain private interests. • Public suspicion of political processes. • Little well-informed, balanced discussion.

• Media coverage superficial. Vested • No bipartisan approach to long-term strategic Interests infrastructure issues. • Intimidated bureaucracy. Vested” • Secretive government decision-making. s Interests I s “A s M c e iti d ol ia P

Informed StrongStrong Informed Public GovernmentGovernment Public

Figure 7.9 – Example of trilemma – concise “As Is” system element characteristics A simplified map of the seven trilemmas, which characterise the metropolitan system and within which the water subsystem must be developed, is shown in Figure 7.10. Note that

268 Chapter 7 – Case Study : Sydney’s Water System… the lines on the diagram indicate relationships between trilemma vertices and other aspects of the problem system. The intention is to represent the interrelationships between system elements, indicating the holistic nature of the system, rather than just considering each system element in isolation.

GoodGood GovernmentGovernment QualityQuality of of LifeLife Politics Health/ Quality of Quality of Life “As Quality of Life Is” Social “As ContractIs” G Lifestyle ov l Ex e ga p rn e m e a L is c n iv ta ce ct tio E A ns s co Informed ic lo Informed m co g o n ic n ce al Precaution co rn E Precaution CorporateCorporate LegalLegal CitizenshipCitizenship Healthy DominanceDominance EfficientEfficient Healthy Ecology EconomyEconomy Ecology Uncertainty

Skeptic

e B nc e e “As Is” lie Monopoly ci f Monopoly S

TechnocraticTechnocratic ResponsibleResponsible RationalRational ScienceScience UnderstandingUnderstanding Capital Efficiency

” s I sBusiness A Influence “ Model Technological

Fr t e ” n C e ig e a M s B m p a I n ita rk Modern r li et ve s o m s G AIndustrial “ C l t o a n m ic e C m Informed lit m o u Informed o h n n Private P is ce ity Private bl r Public a n Public Public st Public OwnershipOwnership E OwnershipOwnership Engaged CoerciveCoercive Engaged Community PoliticsPolitics Community

FreeFree Market Market Media

Public Interest” Is C s E om s A ng m tic “ a u li g ni o em ty P e nt Vested Interests Interests

Involved Strong Involved Vested” Strong Community s Government Community Interests I Government s “A s M c e iti d ol ia P

Informed StrongStrong Informed Public GovernmentGovernment Public

Figure 7.10 – a concise map of the seven trilemmas facing Sydney. The initial trilemma system maps developed by the author were circulated to the steering committee for comments and criticism. Two four-hour working sessions, involving steering committee members and some project team members, were held to further review and criticise the trilemma system maps. In addition, there were a number of sessions, as part of the regular project management team meetings, in which the underlying assumptions and material represented in the trilemmas was discussed and refined. This process resulted in the diagrams which appear in Appendix 7.4.

There are several important observations to note relating to this process of developing the trilemma system map. The process is one of critical discourse. The intention is to identify issues of both intrinsic and extrinsic value in the problem structure and to examine critically preferences in relation to these values. (It should be noted that preferences can only be represented quantitatively relative to value scores. That is, how strongly one feels about

269 Chapter 7 – Case Study : Sydney’s Water System… some issue is mediated by how it scores in relation to the performance scores of other issues.) Because many of the issues derive from the beliefs and value positions of the participants, it is important to have a diverse group, which is representative of the domain of interests. For this reason, considerable effort was put into identifying people who would be interested in working on this project and who were not engineers and, importantly, who were not products of the institutions historically responsible for development of Sydney’s water system. That is not to say that engineers ought to be excluded from the process, but rather, that others should be included. Because of the diverse interests of the participants, there will be different viewpoints in relation to intrinsic value and preference – the aim is to identify these and to incorporate them in the problem structure. This is a fundamental difference to the traditional, reductionist, positivist engineering approach. The engineering approach typically seeks to focus on the technological problem and, because of the embedded reductionist methodology, often deliberately discards matters of intrinsic value and preference. These matters are seen as subjective influences on the problem which ought to be eliminated. In the approach utilised here, these issues are identified such that typically they can be grouped according to the problem dimensions (Political, Regulatory, Institutional, Environmental, Health, Economic, Social/ Community, and Technological) established at the outset. This process results in the multidimensional representation of the problem emerging, as a critique of the trilemmas proceeds.

7.3.7.2 Multi-Dimensional Mapping and “As Is” critique On completion of the trilemma maps, a small working group, consisting of members from the steering committee and some of the project teams, conducted a critique of the “As-Is” system. This used the multidimensional cognitive mapping technique, outlined in Appendix 6.6, to identify relationships both within and between system dimensions. An example of one of these maps is shown in Figure 7.11 and further examples are presented in Appendix 7.5.

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“As Is” – Social map Government insensitive to public opinion Media plays the wrong role; it mis-shapes the Influence of media in Competing interests – debate, is counter- “filtering” information no public meeting; no productive Media manipulated “Domain” anymore Media & public policy Erosion of the Disconnect between the instruments for public government and Over-estimation of the opinion influencing community – empowers capabilities of science government media manipulation “Token gesture” to community involvement

Decline in science and Shift in values and engineering Malconnect between public policy and public perceptions of “the good life” – what are the Corporate governance Value of science & opinion characteristics of “the is prudential and engineering good life” fiduciary, not moral Values & Gaps in knowledge of prosperity how life-style affects environment

Public retreat from long- We do not use right Constrain “prosperity” term perspective tools and indicators rather than “economic Where risk lies and how growth” to manage it Figure 7.11 – A conjugate cognitive mapping representing the “As-Is” system state for the “Social” dimension of the metropolitan system

The way in which this map was prepared was to use “visible thinking” techniques (for example, Bryson and Ackermann (2004)) to examine all problem information (from the brainstorm list and the trilemma system maps) in small group discussion. In this case, a 4-hour working session was held, involving the project management team members and other project participants. The tools used were a combination of overhead displays, whiteboard, flip-chart, and “Post-It” notes to consider and arrange information on each of the problem dimensions. In addition, notes of the discussion were kept for future reference. The benefit of this approach is that it visually represents the information, allowing it to be related to each dimension of the problem, highlighting relationships and major “conjugation points” (the yellow symbols in Figure 7.11). As participants consider the interrelationships, both within and between problem dimensions, indicators of both value and preference emerge.

Disturbance Also using the trilemma approach, a plausible, hypothetical, qualitatively described disturbance was framed. Group discussion identified three “meta-issues” or forces which, potentially, could have serious impact on the development of Sydney’s water system. These were:

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• Demographic shift; • Climate/rainfall change; and • Energy/greenhouse gas issues.

Demographic Shift – Sydney’s population includes a large, post-World War II “baby boom” generation. The city is also the entry point for a large proportion of Australia’s immigrants. In the last 50 years, there has been significant urban sprawl, due to population preference for living in freestanding, residential accommodation. Demographers anticipate a significant shift as the baby boom population ages and the demographic mix changes. Although there are significant urban developments anticipated, it is also expected that there will be a tendency for the ageing population to move to medium-density housing. The demographic issues are highly complex and it would be a mistake to attempt to capture them in a couple of paragraphs. The point is that major demographic shifts, which could significantly affect the water subsystem requirements, are plausible potential developments over the next 50 years. It is possible to consider a number of scenarios as potential consequences to these demographic forces.

Climate/Rainfall Change – the period from 1999 to 2006 was unusually dry, being the second longest drought, since records began in the 1860s. There is considerable debate as to whether this is part of a regular long-term rainfall cycle or whether global warming is having a permanent impact on Sydney’s rainfall patterns. Once again, the issues are highly complex and there is simply not enough information to accurately predict how Sydney’s climate and rainfall patterns will behave in the next 50 years. However, a range of climate scenarios can be considered as potential disturbances to the system.

Energy – recent trends in global energy costs have been steeply upwards. Sydney is reliant largely on coal-fired power generation for its energy needs. Coal prices tend to be cyclical but economic cost is becoming secondary to consideration of greenhouse gas emissions. Renewable energy sources, such as wind generation, potential options to mitigate greenhouse gas emissions (through methods such as carbon capture and storage, as well as demand management), and nuclear energy have been included

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recently on the political agenda. Once again, a range of scenarios can be considered in relation to energy outcomes over the next 50 years.

These three meta-issues can also be arranged as a trilemma and the interrelationships between them explored. For example, a potential solution to a shortfall in rainwater supply is seawater desalination. However current desalination technology is relatively energy intensive and the lowest cost source of energy is electricity derived from coal. Hence, there is a natural tension between potential solutions for the water problem and others in relation to energy and greenhouse gas emissions and climate change. Similarly, the demographic shifts, considered above, also have potential impact upon, or are impacted by, energy use and climate. A “Scenario Triangle”, as shown in Figure 7.12 represents three potential scenario sets which can be used as a starting point to develop images of plausible, hypothetical disturbances with which to investigate system response.

Disturbance triangle…

Demographic Disturbance 1 Demographic Disturbance 2 • Economic growth remains strong • Sydney's infrastructure continues to • Population continues to grow strongly deteriorate • Sydney is the most popular home for new • Steadily increasing land and housing migrants costs forced many people to leave • North-Western and South-Western Growth Sydney, moving to other regional and Centres are developed capital cities • Ageing population continues • Population gradually declines, worsening redevelopment of medium density housing infrastructure deterioration

Climate Disturbance 2 Change • Global warming continues Demographic • Sydney's weather is less influenced by cyclonic weather Energy/Resource Disturbance 1 patterns Disturbance • Increasing global demand for energy, • Climate becomes hotter and Triangle particularly China and India causes oil, G R l drier, with rainfall about half the e ob gas prices to jump dramatically te so al a e u E long-term average im g rc n • Global demand for steel and energy l e er C an De gy • Summer becomes longer, with h m / sharply increases coal prices C a higher average maximum nd • Development of renewable energy temperatures technologies is slower than expected Climate Disturbance 1 • Global warming continues Energy/Resource Disturbance 2 • Tropical cyclonic weather patterns moved further • Softening of global slows the increase in energy south costs • Water-born and insect-borne diseases emerge • Improved conventional technologies substantially • Sydney experiences an increase in rainfall increases power generating efficiencies caused largely by major storms • Development of renewable technologies moves • Flooding becomes a serious issue, particularly in faster than expected low-lying areas of Western Sydney

Figure 7.12 – Using the trilemma approach to develop a base system “Disturbance Triangle”

Due to time and resource constraints, only one of these was developed for consideration in the case study and this is shown in Figure 7.13 (overleaf). More generally though, exploration of the disturbances represented in the disturbance trilemma (or trilemmas)

273 Chapter 7 – Case Study : Sydney’s Water System… can give substantial insight into the span of structural uncertainty in the problem. This can be explored through subsequent scenario analysis.

Disturbance: Hot, Dry, Ageing Sydney

•The global warming phenomenon continues unabated. Sydney's climate has very hot, dry periods and rainfall well below the long-term average. Year-round average temperatures increase, with particularly hot summers, with substantially more very hot days.

• Sydney remains the major metropolis of Australia, and continues to be the destination for many of Australia's immigrants. Population growth continues along the projected, long-term trend. The ageing population causes a significant change in domestic dwelling habits, with increasing numbers of home units and medium-density housing. The South-West and North-West Growth Centres are developed.

• Global demand for energy and resources continues to increase, driven by the rapidly industrialising economies of China and India. Energy prices increase steadily. Renewable energy technologies continue to be expensive both in capital and operating costs.

Figure 7.13 – Description of a plausible, hypothetical disturbance derived from the “Disturbance Triangle” 7.3.7.3 System response The next step in the problem-structuring process is to consider the system response to the hypothetical disturbance. The response of the “As-Is” system can follow two pathways as shown in Figure 7.14. If there is no change to the “As-Is” system, analysis of the impact of the disturbance on the system will lead to a “Likely Future” system state. However, it is likely that a more attractive “Desirable Future” can be imagined. By developing an image of a “Desirable Future” system state and reconsidering the structure of the “As-Is” system, the characteristics of the “As-Is” system which must be changed can be investigated. Thus, necessary changes can be developed regarding the structure of the “As-Is” system, so that it is capable of responding to the disturbance in such a way that it can deliver the “Desirable Future” system state.

The process by which this was undertaken was by having each group critically examine the likely response to the hypothetical disturbance of each trilemma in turn. (See Figure 7.15 overleaf.) Further consideration was then given to the issues which were identified in the “As-Is” system analysis and these were recorded in the multidimensional cognitive maps.

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System response: two possible pathways…

Disturbance If there is no change to the “As Is” system…

“Likely Future” The “As Is” system… • Determined by history Is there a more desirable and “Values” outcome?

Key question: What changes can be made to the system elements which would be likely “Desirable Future” to provide a pathway to the Desirable Future system state –the “Strategic Image”? These two system states might be thought of as the “Trajectory Images” of the system Figure 7.14 – Plausible system responses to the hypothetical disturbance identified in the “Disturbance Triangle”

As a starting point to imagine the “Likely Future” and “Desirable Future” system states, each group was asked to imagine how the “As Is” system would be likely to respond to the disturbance, considering questions such as: • How will each “As Is” element respond to the disturbance? • What will work well and what will not? • How might the system elements interact to create the overall system response? • How might the interrelationships between elements and subsystems interact to determine the total system response? • Specifically, how might the water subsystem respond? Consider the interrelationships between elements and subsystems to imagine the overall “Desirable Future” system response: • What might “Desirable Future” system elements look like? • What aspects of the “As Is” system could be changed to make the system better able to respond? • How might relationships between system elements be influenced to improve the overall system response?

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• How might relationships between system elements be changed to improve the total system response? • How might subsystems be changed to give a more desirable response?

System response: two possible pathways…

Disturbance If there is no change to the “As Is” system…

“Likely Future”

1. Characterise the “As Is” Is there a more desirable system… outcome? • Describe the history and Values which shaped the system • Identify the forces at work • Formulate and critique the Trilemmas • Characterise the sub-system 3. What Strategies do “Desirable Future” we need to change 2A. Describe the two the Trajectory? scenarios: • Describe in terms of • Words, diagrams, pictures the 8 problem etc dimensions 2B. Interpret the effect in terms of the Trilemmas Figure 7.15 – Problem structuring process steps in imagining plausible system responses To assist the project groups, a “straw proposal” narrative was prepared by the author, characterising the “As-Is” system state, the nature of the hypothetical disturbance, and the likely response of the “As-Is” system. The “Desirable Future” system state was also imagined and included in the narrative (see next section). This narrative was based on a three-hour working session by the project management team and some of the project team leaders.

7.3.7.4 “Straw proposal” narrative To provide background and contextualise the problem in preparation for the project forum, a brief “straw proposal” narrative was prepared and circulated prior to the forum. The intention was that this would be a starting point for further narratives to be developed which would reflecting different worldviews of project participants. This would then facilitate engagement of a broad representation in the domain of interests.

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The narrative was prepared by directly interrogating the trilemma system maps and the conjugate cognitive maps of each of the problem dimensions. That is, the various cognitive maps were simply “read”, taking various points and working them into appropriate parts of the narrative. The narrative was structured according to the problem dimensions, first identifying the major issues within each dimension (generally issues which have the most relationship lines or major conjugation points – refer to Figure 7.11 above). As each problem dimension was considered, reference was made to the trilemma system maps to identify important issues highlighted across trilemma representations. Because of the richness of information captured in the cognitive mapping processes (both the trilemma system maps and the conjugate cognitive maps) and their subsequent critique by a diverse representation from the domain of interests, it is a relatively simple task to develop a concise narrative which comprehensively represents the richness of the problem information across all dimensions. Using this approach to prepare the straw proposal narrative is not unlike a (cartographic) map- reading exercise – there is an immense amount of information which can be extracted from the cartographic depiction by a skilled reader, particularly one who is familiar with the terrain.

However, it is important to note that this narrative will always reflect the beliefs and worldviews of the narrative writer, no matter how much effort is put into remaining objective. This should be pointed out at the outset, when it is being used to stimulate subsequent consideration of the problem. Unless this is handled carefully by the facilitator, the risk is that it will be seen as an attempt by the narrative writer to influence the project outcome. Nonetheless, this should not be seen as a deficiency of the approach, rather it is a reflection of the new engineering paradigm proposed here, where the engineer is engaged fully within the problem, rather than simply attempting to be considered to be attached, independent observer.

The straw proposal narrative appears in Appendix 7.6.

7.3.7.5 Project forum A half-day forum was held to conclude Stage 1 of the project. In the first part of the forum, reports were received by each of the eight metropolitan system teams and the four water subsystem teams. Some teams had progressed further than others, with two

277 Chapter 7 – Case Study : Sydney’s Water System… in particular presenting very comprehensive analyses of the system response. In the second part of the forum, participants formed several small groups to critique the straw proposal narrative across each of the problem dimensions. These group critiques were facilitated by steering committee members. Also, teams were requested to critique the problem-structuring approach, comparing it with other approaches they had experienced.

7.3.8 Warren Centre project and outcomes 7.3.8.1 Project outcomes Stage 1 of the project was successful in formulating a model representing the metropolitan system and the water subsystem and engaging about 60 volunteers from a diverse cross-section of the community to participate in the project. A number of project participants observed that the problem-structuring methodology used in the project gave unexpected insights into the nature of the problem. They also suggested opportunities for its application in other areas where Type 3 problems have been identified. A comprehensive interim report was prepared for the project sponsors. However, funding commitments fell well short of the minimum target of $250,000 and the project steering committee could not endorse continuing the project into its second stage. The main impediment was that the project was not able to obtain full engagement of the water-related instrumentalities of either the State government of NSW or the Australian Federal government. Consequently, several large, commercial organizations which had given undertakings to support the project declined to become involved either financially or through commitment of other resource. The steering committee reviewed the situation as concerning: three very significant professional institutions that were able to engage 60 volunteers to work on potentially the most critical issue that faces the Australian community in the foreseeable future were not supported by either level of government. This had a significant impact on the progress that some teams could make. There were some instances where team members who were either employees or contracted by the NSW state government felt they should withdraw from the project. The consequence of this was that a number of the teams were unable to make the progress that they had intended by the time of the forum. Although this was an impediment for the progressing the Metropolitan Water Options project it provided fertile ground for conduct of this case study. The situation itself represents one of the challenges typically encountered in Type 3 problems: the effect of power imbalances and coercive use of power.

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Two teams made particular progress: the Environmental Team, and the Community Team. The Environmental team focused on three trilemmas (Lifestyle, Modern Industrial, and Public Interest) and were able to prepare and present scenarios which explored the response of a number of natural system elements in terms of their current state, impacting pressures and likely response. The Community Team did an excellent job of identifying the sorts of issues that the community needs to engage in for a metropolis the size of Sydney, with its enormous environmental footprint, to have a sustainable, long-term future.

In addition, the author made a formal submission to and testified before the General Purpose Standing Committee No. 5, of the Legislative Council of the Parliament of New South Wales in its Inquiry into a Sustainable Water Supply for Sydney.

7.3.9 Worldview narratives As noted in Chapter 6 (sections 6.3.5.4 and 6.3.5.5), the purpose of preparing a set of worldview narratives is to establish a range of interpretations, reflecting worldviews of the participants’ perspectives of the agreed problem information. This set of narratives is used in widespread community engagement, making reference to the differences in perspective in order to elicit the range of values and preferences within the domain interests. This helps to formulate values hierarchies in the established, formalised decision-making methodologies such as MCDM.

The aim of this part of the case study was to establish the framework for ensuring that narratives to be used in engagement with the domain of interests contained the agreed problem information, identified in the trilemma analysis and subsequent critique. One proposition, motivated by the author, which was tested, was whether narrative writers would be drawn naturally to constructing a narrative which contained all the agreed problem information. Or, alternatively, to determine whether they would be selective in order to emphasise those aspects reflective of their own worldview. It is important to note that such narratives can generally treat problem information in two ways. First, the problem information simply can be presented neutrally, without any deliberate interpretation, that is, merely presenting the information for the reader to interpret. Or second, the narrative writer can discuss problem information and bring their own perspective, which reflects their worldview. In the second instance, the narrative writer

279 Chapter 7 – Case Study : Sydney’s Water System… can present problem information, constructing a supportive argument for various interpretations of it. In this case, where the narrative writer sees problem information as contentious or wishes to place a negative construal on it, it is important that such an interpretation is made clear.

In order to investigate this, three project participants were requested to prepare relatively concise narratives (five to eight typewritten pages), using an extensive compilation of material developed during Stage 1 of the project. The narratives were examined to determine the extent to which narrative writers presented problem information covering the “As-Is” system characterisation and the “Most Likely” and “Desirable Future” system responses to the hypothetical disturbance. Two of the participants were team leaders and one was a team member. The three participants had fundamentally dissimilar backgrounds: one was a technical expert in one of the eight major problem dimensions; another was a professional officer working in the public sector; and the third was an academic whose area of expertise is in the humanities. Each of the narrative writers was given the same set of comprehensive background material prepared by the author, regarding the proposition. This included a set of the trilemma system maps, the multidimensional conjugate cognitive maps, and some further analysis and grouping of information which had been used to prepare the straw proposal narrative. Altogether, there were over 200 points of problem information the narrative writers were asked to consider, of which about 130 were considered to be essential for a comprehensive description of the problem. (In this instance, the set of agreed information was prepared by the author; however it is envisaged that, as the problem-structuring approach is refined, this agreed problem information would be arrived at by the project participants.) The three narrative writers were selected because of their enthusiasm shown in the Metropolitan Water Options project and their interest in seeking to identify a sustainable solution to the long-term development of Sydney’s water system.

When the narratives92 were received from the three writers, they were analysed by the author to determine how many of the 130 or so essential points of information could be identified clearly in the narrative text.

92 These three narratives are available for review upon request.

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Only one of the narratives contained virtually all of the objective problem information. The other two focused on specific aspects of the problem which were within the particular field of interest of the narrative writer. This refutes the proposition that carefully constructed narratives will naturally reflect all agreed problem information. It suggests that there needs to be an iterative process whereby narratives are revised until the agreed problem information is completely represented in the narrative text. This is an important issue because the problem-structuring approach utilises narratives as a key means of subsequent community engagement.

The conclusion from this work was that there needs to be a carefully defined process for ensuring that narratives completely represent the agreed problem information, before such narratives can be used to inform the domain of interests about the problem situation. Interpretation of problem information is to be encouraged, as the process recognises the importance of reflecting different worldviews and perspectives in description of the problem.

7.3.10 Critique of Part A of the Case Study In this section, the approaches taken by two of the participant teams will be compared. The background of these two teams differed: one team (the “Community” team) had some members with technical expertise relating to the water system but the majority were well-informed community members interested in engaging in the project. The other (the “Environment” team) consisted entirely of people with formal environmental expertise and experience in water system issues. It is informative to contrast the differing approaches of these two teams. This is followed by general observations made from feedback from the project team members, who participated at the forum, and subsequent interviews with selected members of the both teams.

7.3.10.1 Contrasting two approaches Both teams engaged deeply in the problem and recognised the broad, systemic impact of potential solutions. The implications which the Community team drew from this were that solutions which are applied generally to the system should preserve some form of local flexibility. In addition, the team observed that ideal specific solutions may not be able to be generalised across the entire system. This confirms that the systems theory upon which the problem-structuring approach is based was well understood and

281 Chapter 7 – Case Study : Sydney’s Water System… incorporated into the team’s analysis. The team was concerned that social justice and equity are important issues to consider, and that indicators generally do not take such issues adequately into account. The team also noted the importance of recognising different perspectives and approaches, learning from various successes in other areas and utilising education, surveys, and media to more comprehensively inform the public. Notably, the team recognised the importance of integrating the technological, economic, and ecological aspects of the problem. The team also noted the importance of taking into account the complexity of the technological issues and the need to have sound technical solutions identified to these aspects of the problem. From discussion with team members, the team adopted a “values-driven” approach to the problem. That is to say, the team was particularly concerned about the intrinsic value issues of the problem and to provide an intrinsic value framework within which the technological and economic solutions can be considered. Insights such as this would be expected to be most useful in developing values and objectives hierarchies in formalised decision-making techniques, such as MCDA.

The Environment team decided to focus on three trilemmas (Modernist, Lifestyle, and Public Interest), which they felt had most impact on the Environment dimension. They gave consideration to each of these, with particular emphasis on formulating the utopian state of each trilemma. This suggests that the approach of this team also recognised the intrinsic values represented in the system elements. The team also recognised the systemic nature of the problem and that the “natural environment” itself needs to be considered as a subsystem, within which the water subsystem exists. That is, consistent with systems theory, a hierarchy of subsystems exists within the main system. The team emphasised the importance of interpreting trilemma information. In some cases, they reworked the trilemmas to be more reflective of the values of the team. They also recognised the importance of defining a utopian state. The team gave particular emphasis to the dynamic nature of the system, again confirming the value of systems theory and the problem-structuring approach. They also considered the way in which both the natural (ecological) elements and the elements of the built environment impact upon both the water subsystem and the natural elements of the greater environmental subsystem. The team took a structured approach (organising information in a matrix), considering the natural environment system to be represented by a set of major elements, which respond to pressures, as a result of the disturbance. The team then identified a

282 Chapter 7 – Case Study : Sydney’s Water System… framework representing important intrinsic values of the system and developed this into a matrix of outcomes reflecting the response of the dynamic system to the disturbance. They then proposed a set of indicators to either directly or indirectly represent system response.

In comparing the approaches of the two teams, an important point that emerges is that they appear to focus on different levels of values and objectives. The Community team was more concerned with establishing a set of intrinsic values, that is, a set of high-level problem values. On the other hand, the Environment team considered intrinsic valuation initially and then moved down the hierarchy to concentrate on measurable indicators. A point which will be developed further in the next chapter is that the problem-structuring approach is useful both in distinguishing between intrinsic and extrinsic values and the qualitative elicitation of participants’ preferences. Not surprisingly, groups consisting of members with different backgrounds focused their attention on different levels of the hierarchy. This suggests that there is intrinsic merit in having greater diversity represented in group membership because of the greater richness of perspective and worldview that ultimately is included in the problem structure.

7.3.10.2 Critique by project participants The points noted below consolidate the observations of participants during the second half of the project forum, a debriefing session held with representatives from the two teams, which had made particular progress in the project, and observations by the author. • There was a general consensus that the problem-structuring approach presented a good way to attack this type of complex problem; • The approach should be iterative, with output from group meetings being circulated to the entire membership of the project; • A common question was how can issues around beliefs and values be represented without being judgemental; • Participants suggested that a useful development of the process would be for there to be a collective description of what the ultimate outcome should look like and that this should be reflected in the content of narratives. This should be considered by the entire project membership;

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• A concise manual, explaining the methodology, would be useful for team members to refer to, rather than having to rely entirely on team leaders for guidance; • Although the trilemma process is intended to simplify a highly complex issue, there was a perception among some team members that the approach is too complex and might distract the members from the task. However, they acknowledged that this was the first time that the problem-structuring approach had been utilised. They noted that if the issues identified in the critique were addressed adequately, that this should not present an ongoing difficulty; • Teams generally felt that to consider all trilemmas would be too complex and focused on two or three, which they considered to be most relevant for their analysis; • One difficulty faced was that the steering committee initially had quite diverse views as to the best way to approach the project. After the trilemma system mapping approach had been discussed during several planning sessions, a consensus emerged that a new approach was worth trying; • The project teams started at different times. Had all teams started at about the same time, there may have been an opportunity to use the trilemma system mapping approach to engage team leaders and to create a set of common concepts and a common language for the project. (Towards the final stages of the project, there were clear signs of such a common language emerging.) • The approach of structuring a problem around a number of different dimensions, representing similarities, appears to have been successful and gave clarity to the issues to be focused on by the individual teams; • Progress in the project appears to be largely a function of the commitment of volunteers, which in turn appears to be related to the passion individuals have for the issue. This suggests that beliefs and values strongly influence initial engagement in the problem; • Consideration needs to be given to the way in which teams are constituted. In this project, team leaders were given freedom to invite team members whom they thought would be a strong contributors. This appears to have added bias. (For example, the Community team largely consisted of interested lay-people, who were well-informed on the issue but had limited formal technical knowledge. They became engaged in the project because of their interest and passion about

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wanting to contribute to a solution. On the other hand, the Environment team members were selected due to their experience and technical knowledge regarding environmental issues, albeit with considerable diversity in their backgrounds. The Community team focused its activities on understanding community attitudes and the way in which behaviours might be influenced; whereas the Environment team sought to understand and identify values and how these influence outcomes.)

These observations might be consolidated into specific conclusions regarding the case study as follows: • The trilemma system mapping approach provided a useful framework to represent the system. It provided the means to synthesise contributions from individual groups and to elicit values and preferences regarding problem information; • The systems approach, in particular the dynamic response to the hypothetical disturbance, was recognised as an effective device for considering future system responses; • A useful precursor to team deliberations would be some form of “visioning” to identify and distinguish between intrinsic values, extrinsic values and preferences, rather than attempting to elicit these purely from team discussion. This would ensure that consideration of the problem would extend beyond the purely technical from the outset. An area of future work proposed is to consider whether the process could be used in constructing values or objectives hierarchies, during the MCDM process. That is, to determine whether there would be benefit in specifically distinguishing between intrinsic value (perhaps further differentiating between object intrinsic value and moral intrinsic value, as noted in Chapter 2 (section 2.4.2.2), and Chapter 6 (section 6.2) and extrinsic value in constructing the values hierarchy. And further, investigating whether this would assist in the elicitation and representation of preference and valuation information, through the construction of value functions or similar intra-criterion preference relationships; • The trilemmas established a common language to use across project teams; • The trilemmas satisfactorily represented the breadth of the problem. The water subsystem was considered to be of such complexity that it needed to be

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represented by a further set of trilemmas and, in the case of the Environment team’s consideration, a further subsystem was identified within the metropolitan system (of which the water subsystem was itself a subsystem). This enabled clear project boundaries to be established, thus giving greater focus to project teams, regarding the issues they were requested to examine; • The approach enabled the steering committee and project management team to determine those areas which needed greatest resource; • It informed the steering committee and project management team as to the most likely barriers to project progress; • In preparation for, and following, the first forum of project teams, the approach enabled construction of a rich, comprehensive narrative of the problem and the way in which the problem system evolved in response to the hypothetical disturbances; • The approach requires further development to make it more robust. In particular, it needs to be adopted at the outset as a means to structure problem information, so that key organisational requirements are considered. Also, the project steering committee (which must include team leaders for each problem dimension) must have a clear understanding of the approach and its underlying basis. This would enable team leaders to identify issues of values and preference, which emerge from team discussions; • One of the most valuable outcomes of the case study was the emergence of the set of rich, comprehensive narratives of the metropolitan social system and the water subsystem. Reflecting on the value of these narratives, it became clear that they can be the thread, which links various stages of problem resolution. This can be achieved in two ways: first, the narratives can provide a chronological contextualisation of how the problem arises, and how various parts of the solution can be developed and placed into the problem context. Second, they can indicate opportunities where potential solutions might lie, by identifying gaps in knowledge, by complementing areas where information is incomplete, or by identifying where inconsistencies exist and how these might be resolved.

Furthermore, experience in the case study suggests that if ownership of the narratives is vested in the participants, the narratives can become a useful means for ongoing engagement and for the development of a deeper understanding of

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the problem. This appears to be due to the narratives drawing upon a common language which develops within the project team to describe issues under consideration. Perhaps, even a “culture” develops within the group of people working on the problem and the narratives assume their widely acknowledged cultural role in communicating between community members.

There are some further aspects of the problem-structuring approach which this part of the case study confirms (or rather, does not refute): • This approach is unlike other qualitative systems approaches (for example, total systems intervention, critical systems heuristics, soft systems methodology), which generally only identify and consider relationships between system elements. The trilemma systems mapping approach examines dynamic system responses to a hypothetical disturbance; • The three issues which form each trilemma are effectively “self-bounded” and facilitate the determination and critique of the inner boundary (viz. Midgley (1992) boundary critique model). This is because the description of any situation in relation to the three trilemma forces will be contained within the triangle; • The response of the system to disturbances can be linked back to the stakeholder belief system used to define the trilemmas, because of their “self-bounding” nature. Hence, scenario outcomes directly reflect stakeholder belief systems; • The approach allows representation of a large amount of information using relatively simple schema – this meets the challenge of having only five to eight units of concentration, so the mind can keep focused. Representing problem information across a range of dimensions allows information to be stored and quickly recalled, so that richness of problem information is not lost; • The use of the trilemma device forces the formation of mental representations (that is, personal constructs) of the problem. It uses a device which, deliberately, is analogous with the theoretical cognitive processes described in established psychological theory. This does not necessarily happen with other cognitive mapping approaches – success is largely determined by the skill, knowledge, and experience of the facilitator; • It is relatively straightforward to identify utopia/dystopia positions, by holding one force constant and exploring the effect of varying the other two;

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• By engaging a wide range of stakeholder perspectives in identifying the forces and creating the trilemmas, there is both engagement of stakeholders and the creation of a common language to describe the problem; • Rigorous use of the approach results in an extremely rich representation of the problem which can readily form the basis of a comprehensive problem narrative. A set of such narratives created by different authors representative of the entire domain interests can be developed, so that ultimately they contain all agreed problem information. These also reflect the perspectives and worldviews of the individual narrative writers thereby retaining the richness of problem information relating to values, interests, beliefs, and preferences.

One question, which might be developed into a criticism of the approach, is how can the practitioner be confident that some key force (which potentially might destabilise the system) is not overlooked in developing the trilemmas. The solution to this lies in critique of the system once the initial trilemma mapping has been done; and again, later, during the critique of the scenarios. This emphasises the importance of critique in the process – its function is not merely to explore values-laden aspects of the problem and other areas of uncertainty, but is also to provide rigorous testing of the model as it is developed.

It might appear that the problem-structuring approach by its nature is reductionist and hence is inconsistent with its own philosophical principles. First, it is not “structurally” reductionist. Two groups working independently (perhaps with different belief systems) using the approach to consider an issue would almost certainly not arrive at the same set of force-pairs or the same sets of trilemmas to characterise the system. And second, the critical reviews of both the initial problem structure (prior to consideration of the disturbance), and the critique of the scenario analysis are intended to examine critically the extent to which the assumptions made might compromise representation of the uncertainty and complexity of the problem. The second application of the problem-structuring approach is to use the objective information identified in characterisation and critique of the problem system, as a framework for critically examining planning approaches derived by other means. In Part B of the case study, the material developed in Part A forms the framework for such a critique. The metropolitan water planning approach developed by the NSW State

288 Chapter 7 – Case Study : Sydney’s Water System… government in the period 2004 to 2006 for the Sydney metropolitan area is considered. This was developed at much the same time as a 25-year urban plan was prepared for the Sydney metropolitan area. The Metropolitan Strategy and the Metropolitan Water Plan, developed by the NSW government, effectively provide an alternative approach to considering the metropolitan system and the water subsystem and these are critically examined, using the problem-structuring methodology developed here.

7.4 Case Study: Part B – Critique of the Metropolitan Strategy and Metropolitan Water Plan The second application of the problem-structuring methodology is to provide a framework by which various problem-solving approaches can be examined to assess their comprehensiveness. Here, a framework containing a large amount of relevant problem information has been developed. This was then used to critique three pieces of work published in the period from 2004 to 2006, by the NSW State government. These three documents form the basis upon which the NSW State government planned the water infrastructure development for Sydney, in the context of its major planning, both for metropolitan Sydney and for the whole State looking out to 2031.

The first of these is the “Metropolitan Strategy”, a long-term urban plan, which was prepared as a result of a Ministerial Directions Paper, published in 2004. This drew together planning material for the development of the greater Sydney metropolitan area, and outlined strategies across a broad range of economic, social, environmental areas. It was published in December 2005. The second was the development of the “Metropolitan Water Plan”, the strategic plan for the development of Sydney’s water infrastructure. The initial draft of this was released in 2004, subsequently was subjected to expert review, was revised, and was republished in May 2006. The third document, published in June 2006, is the “State Infrastructure Strategy”, which outlines infrastructure development and associated capital requirements, with most emphasis being on the next 10 years.

7.4.1 Introduction The way in which this critique will be undertaken is to first briefly describe the current state of affairs regarding metropolitan planning in NSW, in order to place planning for the water system in the context of state and urban planning. Although some consideration will be given to the NSW Plan and the State Infrastructure Strategy, the

289 Chapter 7 – Case Study : Sydney’s Water System… main focus will be on the 25-year Metropolitan Strategy, “City of Cities: a Plan to Sydney’s Future”, (NSW Department of Planning (2005)), and the way in which the Metropolitan Water Plan (NSW Government (2006)) was developed and how it was integrated into the Metropolitan Strategy.

7.4.2 Planning in New South Wales 7.4.2.1 NSW State planning The three major documents in the public domain relating to state and metropolitan planning in NSW, noted above, are the NSW State Plan (NSW Premier's Department (2006)), the State Infrastructure Strategy (NSW Treasury (2006)), and the Metropolitan Strategy (NSW Dept. of Planning (2005)). The NSW State Plan comprises a number of other relevant documents, such as the Metropolitan Water Plan (NSW Government (2006)), the Urban Transport Statement, the State Health Plan, the NSW Greenhouse Plan, the Aboriginal Affairs Plan, and several others. Generally, these documents were prepared within the last five years or so and were integrated to form the NSW State Plan. This was published several months prior to the state elections in March 2007. This came after a series of articles in the media, which criticised the State government for a lack of infrastructure planning around a number of important activities. These were transport, health, crime, education, the economy, and water (SMH (2006b), SMH (2006d)). Two of the documents referred to above, the Metropolitan Strategy and Metropolitan Water Plan, are of particular relevance to this case study. The State Infrastructure Strategy also contains information relevant to capital expenditure on water-related infrastructure.

7.4.2.2 Metropolitan planning Work on the Metropolitan Strategy commenced in 2004. It was the first total urban planning exercise done for over 15 years and only the fourth in Sydney’s history. Formal urban planning did not start in NSW until the late 1940s and two plans, the “County of Cumberland Planning Scheme” (1947), and the Sydney Region Outline Plan (1968), were particularly influential (Spearritt (2000)). A further metropolitan strategy was prepared in 1988 and revised in 199393. Of course, in the intervening period, there were many plans prepared for specific issues and regions within the metropolitan area, but there was nothing which considered the Sydney metropolitan area holistically. In 2004, the NSW

93 The 1947 and 1968 plans are regarded to have been to be substantially more influential on the way in which Sydney has developed than the 1988 plan, “Sydney Into Its Third Century”. This document is not regarded as having been particularly influential in metropolitan planning (Spearritt (2000).

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Minister for Planning initiated a process to develop a strategic plan for metropolitan Sydney out to 2031. This was to include a community consultation process. This plan, the Metropolitan Strategy (NSW Dept. of Planning (2005)), was published in December 2005, at much the same time as other infrastructure planning was also undertaken for the entire state of NSW.

The planning documents themselves suggest that there was a formal, high-level, process which planned, coordinated, and collated input from various government departments and agencies and which also undertook widespread community consultation. However, as discussed further below, when publication dates of the various documents referred to in the plan, media reports, parliamentary discussion, and other discussion in the public domain are examined, it seems more likely that much of the planning material was developed by government departments and agencies, in isolation, as part of their normal long-term planning, with the Cabinet Office and Treasury collating information into the final metropolitan strategy.

Consideration will now be given to two plans in particular, “City of Cities: a Plan for Sydney’s Future – Metropolitan Strategy” (that is, the Metropolitan Strategy) and the Metropolitan Water Plan.

7.4.3 The current metropolitan plans and their development 7.4.3.1 “City of Cities: a Plan for Sydney’s Future – Metropolitan Strategy” This plan is developed around a concept which sees metropolitan Sydney continue to develop as the major “global city” and economic centre in Australia, with strong economic and employment growth. Emphasis is on development of “city centres” within the metropolitan area. These are to become employment, services (retailing, health, and education) and residential hubs, linked by a well-developed transportation system. Emphasis is also placed on protecting local character, access to parks and spaces, and containing the environmental footprint of the metropolis. The plan takes a sustainable development approach, identifying the triple bottom-line objectives of economic growth, while balancing social and environmental impact. The stated aims of the plan are to improve liveability, strengthen economic competitiveness, ensure fairness, protect the environment, and to improve governance. To achieve this, the plan identifies seven so-called “strategies”: Economy and Employment; Centres and

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Corridors; Housing; Transport; Environment and Resources; Parks and Public Places; and Governance and Implementation.

Within the Metropolitan Strategy (which runs to over 200 pages) there is limited reference to the water subsystem, briefly discussing the challenges regarding water supply, the need for recycling, and the importance of maintaining environmental flows, particularly within the Hawkesbury-Nepean system. Reference is made to the 2004 Metropolitan Water Plan, suggesting that this document contains the substance of dealing with water issues for the metropolis within the 25-year planning horizon. The development of the Metropolitan Water Plan itself will now be considered.

7.4.3.2 Metropolitan Water Plan Before looking at the current Metropolitan Water Plan in detail, is important to understand some background. In 1998, Sydney’s water catchments were full (Cohen (2006) 23 March 2006, p2) and, despite somewhat erratic rainfall in the decade of the 1990s, there had been no stress placed on water infrastructure since the completion of Warragamba Dam in 1960. This was as a result of two factors: first, the capacity of the dam itself (Warragamba Dam is one of the biggest metropolitan water reservoirs in the world); and second, the Sydney catchments experienced an unusually wet period in the forty years or so up to the mid-1990s. This led to complacency in infrastructure planning, there effectively being a 25-year gap in water infrastructure planning, which had not accommodated significant changes in population of the Sydney metropolitan area and the emergence of a water intensive lifestyle (Australian (2004)). But 1998 was the start of the second longest dry period since records began. By 2002, storage levels in the Sydney catchments were less than 60% and dropping at alarming rates. The summers of 2002, 2003, and 2004 were all unusually dry and hot and by the end of the 2004 summer, storage levels of the Sydney system had dropped below 40%. Comparisons were drawn between the longest drought on record, which lasted nine years – if the current drought were to be of similar length, Sydney faced the real possibility of running out of water. The government response to increasing public concern was the publication of the Metropolitan Water Plan in October 2004 (DIPNR (2004)). The plan is brief and was widely regarded as being more of a public relations exercise to convince the community that work was underway, rather than being a substantive strategic plan (SMH (2004)). In the plan, few commitments are made for infrastructure development, and associated

292 Chapter 7 – Case Study : Sydney’s Water System… capital expenditure. Most of what the plan commits to is to investigate options for developing new supply alternatives, reducing demand, investigating recycling, and resource allocation between environmental, residential, farming and commercial requirements.

After the Plan was published in 2004, an expert panel was appointed by the Cabinet Office to review it. The panel made two reports back to the government, an interim report in February 2006 (White (2006b)) and its final report in April 2006 (White (2006a)). The specific Terms of Reference given to the expert review panel have not been made public94. The panel makes only brief reference to the 2004 plan, focussing on a quantitative analysis of the supply-demand balance and developing a set of recommendations as to how this balance could be maintained in the medium term (2006- 2015), and in the longer term (2015-2030). In May 2006, a new Metropolitan Water Plan was published, only based loosely on the 2004 document but making extensive reference to the recommendations of the expert panel’s review.

A reasonable way of considering the 2004 plan, the expert review, and the 2006 plan is to see them as one piece of work. The 2004 plan was an outline of the problem and identification of a range of options to be examined; the expert review was the means of giving substance to these while giving impression of independent, impartial ratification of government policy; and the 2006 plan provided the means to draw together material from the expert review, together with a substantive body of work undoubtedly completed by various government agencies and departments such as Sydney Water Corporation, the Sydney Catchment Authority, the Department of Energy, Utilities and Sustainability, the Department of Planning, the Department of Environment and Conservation, and the Department of Natural Resources. This work appears to have been coordinated by the Cabinet Office.

7.4.3.3 The State Infrastructure Strategy The State Infrastructure Strategy was published in June 2006 by the NSW Treasury, and was tabled in Parliament just prior to the State budget. It is primarily a capital planning document. The strategy covers five main areas of infrastructure: human services

94 The author made an unsuccessful attempt was made to access the Terms of Reference.

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(particularly health and education); justice (particularly correctional services and police); transport; electricity; and water.

Total capital expenditure planned for the metropolitan water system for the period 2007- 2016 is about $7.5 billion95. Despite the emphasis on water supply and recycling in both the Metropolitan Strategy and the Metropolitan Water Plan, the State Infrastructure Strategy only identifies about 21% of total planned capital expenditure on water supply, whereas sewerage (41%), and distribution infrastructure (37%) spending account for nearly 80% of the total. Less than 1% of expenditure is identified for environmental flows in the Hawkesbury-Nepean system (NSW Treasury (2006), pp46-47).

7.4.4 Critique of the water planning approach The intention of this critique is not to criticise the detail or specific commitments made as the planning process took place in the period from 2004 to 2006. Rather, the aim is to identify the planning paradigm underlying the development of the “City of Cities” Metropolitan Strategy and its relationship with Metropolitan Water Plan. This will then be contrasted against the problem-structuring approach developed in this dissertation, in order to determine whether it might offer any advantage over current practice.

7.4.4.1 Metropolitan Water Plan (2004) As noted above, this document is not really a plan at all – rather it outlines a number of major challenges regarding water supply and the need to investigate options, such as groundwater utilisation, recycling, desalination, demand reduction, and environmental protection. Virtually all commitments in this plan are to undertake investigation or state intentions to undertake detailed planning into previously identified options. The only firm capital commitments are $106 million for deep water access at two of Sydney’s dams, and $31 million to allow environmental releases to be made at four dams and two weirs on Hawkesbury-Nepean system. The work of the Hawkesbury-Nepean River Management Forum, in relation to management of the Hawkesbury-Nepean catchment, appears to have been largely ignored96. There are a several preliminary capital estimates

95 The amount planned for recycling was not released as it was identified by the government as commercially sensitive. The government stated that this is due to the project being identified as a potential public-private participation project. 96 The Hawkesbury-Nepean River Management Forum was an extensive community engagement project, which sought to include and take into account the needs and views of a wide range of stakeholders directly involved with the Hawkesbury-Nepean river system. The health of this river has been

294 Chapter 7 – Case Study : Sydney’s Water System… in relation to further work (for example, a desalination feasibility study, and facilities to make water transfers from the Shoalhaven River system to the Hawkesbury-Nepean system). There is virtually no reference to sewerage or stormwater drainage, other than further evaluation of a recycled water programme for western Sydney. A commitment was made to develop the “Sydney Metropolitan Water Sharing Plan” under the Water Management Act (2000), to identify and allocate water resources for environmental flows, residential and commercial consumption, and irrigators, however a literature search suggests that this plan was not prepared.

7.4.4.2 Expert Review of the Metropolitan Water Plan (2004) Although commissioned as a review of the 2004 plan, the two reports done by the independent experts made little reference to the 2004 document. Rather the panel developed a number of strategic alternatives which would allow maintenance of the supply-demand balance until 2015, using rain-fed water supply, with additional contingency planning required to guard against the risk of severe drought97. The panel recommended adoption of three strategic themes98.

First was large-scale implementation of demand management and recycling measures, with attention given to modelling baseline demand and potential savings available through demand management and recycling programs. Second, was to understand constraints, such as environmental flow requirements for catchment rivers, system reliability criteria, and trigger points for investment decisions during extended periods of drought. This would include decision points to commence the tapping of groundwater and the construction of seawater desalination capacity99. And third was the adoption of an “adaptive management” approach, which would include scarcity-based pricing considerations, modifying reliability criteria, and substantive institutional reform, with a high level coordinating body responsible for implementation of the plan. The panel

deteriorating for many years and the forum was welcomed as a means by which community views could be considered. 97 At the time this review was commissioned at the end of 2004 the total catchment was that its low point of 38% but by the publication date (April 2006), the drought was beginning to break and the total catchment level had risen to 45%, with a panel noting that there was a 80% likelihood that the catchment level would continue to increase. 98 It is not possible to determine the origin of these themes. It was not made clear whether they were part of the terms of reference given to the panel, all whether they were derived as a result of the panel’s deliberations. 99 The conclusion was that groundwater supplies could be utilised for periods of up to three years during deep drought, and, should the total storage capacity drop below 30%, construction of a desalination plant would commence, on the basis that the lead-time for plant construction would be covered by remaining water supplies.

295 Chapter 7 – Case Study : Sydney’s Water System… noted that estimates from 2015 to 2030 were less certain and would depend on a number of issues, such as demographic trends, environmental flow requirements, and the extent to which additional supply capacity might be constructed.

It is interesting to note that the expert panel review of the 2004 Metropolitan Water Plan (with the exception of some reference to water recycling programs in western Sydney) focuses almost exclusively on water supply. There is no extensive deliberation given to stormwater management or sewerage management. Nor is there consideration given to the interrelationships between these and the current water supply paradigm (much of the water requirement is for the wet carriage of sewage), even though sewage and stormwater management are expected to be the biggest capital expenditure items undertaken by the government in the near to medium future.

7.4.4.3 2006 Metropolitan Water Plan This plan is far more comprehensive than the 2004 document and makes a number of capital commitments to infrastructure development. In the plan, it is noted that the recommendations of the expert review panel have been influential in preparation of the revised version of the plan. (This supports the view noted earlier that the expert review was, in fact, part of the planning process, rather than a true review.)

The 2006 plan again focuses on Sydney’s water supply, largely accepting the recommendations of the expert panel review. The plan adopts a supply-demand balance approach and recognises the potential and impact of both long-term drought and of climate change. It places significant emphasis on grey water recycling (particularly for western Sydney) and makes mention of the potential for stormwater recycling. A number of government initiatives introduced in the previous two years, relating to water saving and demand management schemes for residential, agricultural, commercial, and government enterprises, are outlined. Commitments are made to increase water transfers from the Shoalhaven system and developing groundwater access when storage capacity drops below 40%. There is a commitment to the design of a desalination plant with an ultimate capacity of 500 megalitres per day100. Also, there is discussion of improving catchment and river health but no commitment to increasing environmental flows, during times of low rainfall. Commitments are made regarding environmental flows in

100 500 megalitres per day would meet about 40% of the 2015 projected demand.

296 Chapter 7 – Case Study : Sydney’s Water System… the Shoalhaven River. But no pledge is made to increased environmental flows in the lower Hawkesbury-Nepean system – these would improve the environmental condition of the river. The adaptive management approach recommended by the expert panel is adopted and commitments are made to regulatory reform to allow private enterprise access to some parts of the water system. Commitments are also made to greater community engagement and the involvement of experts to advise on determining water policy.

There are a number of observations regarding the strategy for development of the metropolitan water system over the period from 2004 to 2006, concurrent with development of the Metropolitan Strategy and the State Infrastructure Strategy. These are: • The date of publication of each of the documents suggests that integration of the strategic plans relating to water, infrastructure, urban planning, and state planning was done after the planning process, rather than before it; • The structure of the plans and a lack of relationships identified between issues both within and between the various planning documents suggest a “jigsaw puzzle” planning approach – various government departments appear to have undertaken much of the analysis more or less in isolation, with the government selectively releasing material into the public domain as independent pieces of work, rather than as an integrated plan. It appears that the NSW Cabinet Office undertook some form of oversight, rather than the Department of Planning, as might be expected; • Individual planning documents do not contain explicit references and linkages to other documents, again suggesting little integration in the planning process. For example, the State Infrastructure Strategy, published in June 2007, makes reference to capital amounts identified in the 2004 Metropolitan Water Plan (DIPNR (2004)), even though no such amounts were ever quantified – presumably these were estimated after publication of initial version of the plan. On the other hand, the 2006 Metropolitan Water Plan (NSW Government (2006)), published about one month prior to the State Infrastructure Strategy, makes no reference at all to the infrastructure strategy document. The infrastructure strategy refers to nearly $3 billion – 48% of Sydney Water Corporation’s 2006-7 to 2009-10 capital budget – in investment for sewerage and

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stormwater infrastructure development (NSW Treasury (2006), p 46), yet no mention is made of this in the 2006 Metropolitan Water Plan (NSW Government (2006)); • The 2006 Metropolitan Water Plan (NSW Government (2006)) focuses almost entirely on supply of water and recycling, using the well-established wet carriage model of sewage treatment and disposal. As Beder (1989a) points out, very significant amounts of potable water are used for the wet carriage of sewage, without consideration of alternative technologies, which might be investigated. This reflects the established, conservative, instrumentalist engineering paradigm, which has dominated the design of water system infrastructure in Sydney over the last 140 years. As Beder also points out, preference is given to pre-existing technologies and investment, rather than investigating the potential of new technologies to resolve some of the challenges of sustainability; • Despite the original Ministerial Directions Paper placing considerable emphasis on water, sewerage, and drainage, there is scant reference to the water system in the final 25-year urban development plan; • The impact on water-borne disease and poor sanitation received only passing attention in the planning process. Although major water-borne disease outbreaks, such as typhoid, cholera, and dysentery are considered to be unlikely, climate change is expected to increase the threat of insect-borne disease, due to habitat extensions for insects such as mosquitoes. Options identified and discussed in the Metropolitan Water Plan regarding rainwater reuse, grey-water use, and neighbourhood stormwater detention do not appear to have been evaluated for potential health impacts; • Despite government publicity stating that the various plans were developed with widespread community consultation, much of the planning was done under a cloak of secrecy. The opposition parties, the NSW Ombudsman, and the media criticised the government for its “obsessive secrecy” in refusing freedom of information applications and requiring consulting experts to enter into “cabinet- in-confidence” secrecy agreements Australian (2005), Telegraph (2005), SMH (2006a), Telegraph (2007)); • Despite the advice of the expert review panel, the commitment in the 2006 Metropolitan Water Plan (NSW Government (2006)) that construction of a desalination plant would not commence unless levels in Sydney’s catchments

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drop below 30%, the government announced commencement of the plant (at a cost of $1.9 billion) in February 2007. This was despite the catchment water levels were still above 35%, and that there was no capital amount included in the State Infrastructure Strategy. This decision attracted widespread criticism, being interpreted as a political move to avoid increased water restrictions immediately prior to the State election, held in March 2007 (SMH (2006c), SMH (2007c), SMH (2007d), SMH (2007a), SMH (2007b)).

All of this suggests that the approach taken by those who prepared the Metropolitan Strategy and the 2006 Metropolitan Water Plan appears to have attempted to combine a reductionist, analytical approach to come to terms with the technical (the economic, technological, ecological) aspects of the problem, combined with a “soft” methodology to engage in an extensive but not particularly effective community consultation program. This indicates that the planning authorities are taking an approach which may be appropriate for a “Type 2” problem (as described in Chapter 3) but not for one of Type 3. Although there is a shared commitment to seeing a sustainable water system developed to meet Sydney’s needs, there are substantial differences between parties, both within the decision-making group (in this instance, the various government departments and agencies) and the broader community. Progress is made coercively through secretive decision-making processes and by the government driving through decisions which appear to be solutions to one part of the problem but instead merely manifest themselves as symptoms of another.

This approach does not recognise sharp differences in beliefs and values amongst the domain of interests and does not recognise the complex, systemic characteristics of the problem. As demonstrated in the first part of this case study, the problem is not a Type 2 problem, rather it has a uniqueness and a holistic complexity, which clearly characterises it as being of Type 3. Because the problem is not clearly identified as a Type 3 problem, the problem-solving approach is at best only partially effective. Precisely the same approach flaw exists in the Expert Panel review of the 2004 Metropolitan Water Plan (DIPNR (2004)). Rather than recognising the holistic, interconnected nature of all the elements of the water subsystem, the expert panel focused on balancing supply and demand, without giving anything more than a mention to important water subsystem elements, such as the sewerage, stormwater,

299 Chapter 7 – Case Study : Sydney’s Water System… environmental, and social aspects of the problem. The 2006 Metropolitan Water Plan, although far more substantive than the initial 2004 document, misses both the systemic nature of the water subsystem and the interrelationships which need to be identified between the water subsystem and the greater metropolitan system. These would be expected to be included in the Metropolitan Strategy. Because the impact of differing beliefs and values of the domain of interests are seen as being outside the problem – this probably gives rise to the secrecy surrounding planning of the water system – rather than within it, large parts of the community see themselves as marginalised or entirely excluded from the process. This is seized upon by the media as yet another reason for criticising the government’s management of the situation in the face of a looming crisis.

Because of this disengagement or marginalisation of a significant part of the domain of interests, due to their only partly sharing values represented in the problem definition, the political processes tend to be poll-driven. Sectional interests dominate the decision- making and the bureaucracy appears to be incapable of having political influence, because it is unable to come to terms with the complexity of the problem.

Similarly, technologists – particularly engineers, in this instance – are limited by their positivist, instrumentalist paradigm and unable to engage adequately with the breadth and complexity of the problem. The consequence is that their influence in the decision- making process, rather than being respected is seen more as a liability. The fragmented approach to analysing the system results in suboptimal solutions being selected. This further undermines the credibility of the technologists, which is tested both in terms of their ability to identify rigorous solutions to the problem and their influence in the political processes. Because technologists are seen to be ineffectual, an increased scepticism emerges around the effectiveness of science and technology. This often has the consequence that misinformation, even pseudoscience, receives significant community and media attention.

Although lifestyle and quality of life are important to most residents of Sydney, most do not believe in causing irreparable damage to the ecology. The Metropolitan Water Plan does not seem to have given particular weight to a large body of work done on catchment health and riparian well-being, in particular, in relation to the Hawkesbury- Nepean river system. The underlying philosophical approach of both the Metropolitan

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Strategy and the Metropolitan Water Plan is one of “sustainable development” – reference is implicitly made to a triple bottom-line approach. This paradigm is reflected in a strategy which only allows for environmental flows in times of normal to high rainfall. Although the alternative philosophical “sustainability” belief system is well represented within the community and has had considerable influence in preventing infrastructure development in the Shoalhaven Valley, this approach is seen by government as being an impediment to progress. But both positions are represented in the community, and, in a democratic society, the two should be acknowledged and represented in the eventual outcome. The current planning approach appears to see this issue as being outside the problem: an unfortunate, unwanted complication which needs to be dealt with.

One of the major initiatives proposed in both Metropolitan Strategy and the Metropolitan Water Plan is the development of a significant recycling capability in western Sydney. The capital cost of developing this infrastructure has been kept confidential and does not appear in the State Infrastructure Strategy. As noted above, the government has been harshly criticised for undue secrecy in its decision-making. In particular, this is the case where there is public suspicion regarding the efficient use of government resources or that public/private participation (PPP) projects are being utilised at substantially higher cost of capital than if the infrastructure investment was carried out by government enterprise. Once again, this is reflective of a Type 2 problem- structuring approach, rather than recognition that a satisfactory resolution of these sorts of issues ought to be included within the system boundaries. Concern regarding the business model proposed is not confined to PPP projects. As discussed earlier, there is considerable unease regarding government enterprises, such as Sydney Water Corporation, being required to contribute significant dividends to the State Treasury, rather than limiting the operating surplus to providing for future capital expenditure requirements.

As noted above, the media and the NSW Ombudsman expressed concern regarding undue government secrecy in decision-making. The public is cynical about government manipulation of the media and the media is critical of the government for denying it access to information. This combines to produce an ill-informed discussion of the major issues and limits public debate. The government becomes less sensitive to popular

301 Chapter 7 – Case Study : Sydney’s Water System… opinion, with undue attention given to opinion polls, while a countervailing force develops, which makes the public agenda heavily influenced by the media.

A further deficiency of this planning approach is that there does not appear to be any consideration given to how the metropolis and its various subsystems might respond to plausible, hypothetical events. In the case of the Metropolitan Water Plan, the strategy is framed almost entirely around a climate change scenario which would cause Sydney’s climate to remain hot, with the city being able to cope with extended drought. No consideration appears to have been given to alternative futures such as Sydney’s climate remaining hot but with a much higher annual rainfall101. For a strategic plan to be effective, it needs to be able to respond to many plausible disturbances.

This brief critique of the Metropolitan Strategy and the Metropolitan Water Plan invites the question as to whether the problem-structuring approach developed in this dissertation might contribute to a more satisfactory outcome. That is, whether, first of all, employing a problem-structuring approach, which recognises the holistic complexity of the problem, would add significant value. This would require development of a model to represent the metropolitan system and the water subsystem of the type developed in Part A of the case study. And second, whether such an approach could be usefully employed in informing established decision-making techniques (such as MCDM) to guide policy determination and the final decision-making processes. This question will now be explored.

7.4.5 An Alternative Approach The problem-structuring methodology developed in this dissertation suggests that there is an opportunity to take an alternative approach to problems, such as urban planning for large metropolitan areas and associated major infrastructure investment. In recognising the Type 3 nature of the problem and taking a holistic planning approach, many of the issues identified above become incorporated into the problem structure itself, rather than being seen as peripheral to it. An important first step is to recognise the Type 3 nature of the problem prior to commencement of the formal planning process (although

101 When Sydney experiences unusually high rainfall (which seems to occur with much the same frequency or perhaps more often than unusually low rainfall), the cause is normally due to the influence of rain depressions resulting from cyclonic activity in tropical waters hundreds of kilometres north of Sydney. It is not out of the question that climate change could increase the frequency of cyclonic activity and cause resultant rain depressions to move further south.

302 Chapter 7 – Case Study : Sydney’s Water System… acknowledging that in complex systems, such as these, the characteristics of the system continue to evolve and must be accommodated).

For a systems approach to work effectively, particularly in social systems such as metropolitan areas, boundary critique is especially important. This must include identification of the domain of interests, which are represented both directly and indirectly in the problem. It may be that different aspects of the problem might require different boundary conditions to be considered. (For example, in the case of the Sydney water subsystem, water catchments and riparian systems extend over 200 km south-west of the city centre but less than 100 km to the north. In the case of the energy subsystem, the coal-fired electrical generating capacity, which supplies most of the needs of the metropolitan area, is up 150 km to the north and north-west of the city centre, with none being to the south.) Boundary critique also drives consideration of the various dimensions, which can be used to represent problem information. For example, many of political and social aspects of the problem, which are otherwise viewed as impediments to progress, are now included in the problem definition. The result is that the political and social discourse occurs as part of the problem-structuring and ultimate problem resolution. These issues are “swept in” to the problem boundaries.

Historically, consideration of the water subsystem has been primarily technologically driven. The obvious reason for this is that there are significant technological challenges to construct and manage water system infrastructure. However, there is another pressure, which influences development of the water subsystem. As noted in the initial narrative, this is due to the institutions responsible for this infrastructure having been dominated by technologists, primarily engineers. Consequently, particular technological approaches have been favoured over others (for example, water carriage, rather than dry conservancy).

But the holistic, systemic nature of the subsystem and the interrelationships which exist across the subsystem boundaries into the metropolitan system itself must be recognised. This provides important insights as to how holistic approaches can be taken to evaluate potential solutions and how these may be integrated into the final outcome. Such an approach achieves two things. First, it avoids over-emphasis of one subsystem element (in the case considered here, the water supply), without adequate consideration being

303 Chapter 7 – Case Study : Sydney’s Water System… given to other important subsystem elements (in this case, the consideration of various options in relation to sewerage, stormwater treatment, riparian flows, health implications, economic implications and other factors identified in the dimensional analysis of the problem subsystem). And second, it allows the identification of potential opportunities to employ alternatives beyond those which are represented in the established technological paradigm.

Furthermore, the qualitative system model allows the exploration of a range of scenarios representing ways in which the system might respond to a variety of hypothetical but plausible disturbances. This allows an assortment of strategic responses to be considered and their potential impact on the entire domain of interests to be evaluated, across all problem dimensions.

Thus, the broad process steps of an alternative approach proposed are these: 1. Establish a working group which is broadly representative of the domain of interests; 2. Undertake the problem-structuring approach (as developed in Chapter 6 and demonstrated in this chapter), with two fundamental aims in mind: a. to develop a rich, qualitative model of the problem system, which structures rather than discards problem information; and second b. to explore critically the response of this system model to the hypothetical disturbances. Thus, the decision-making domain becomes informed regarding the: i. intrinsic values (both of object and moral kind); ii. extrinsic values; and iii. preferences, which might be attributed to various members of the domain of interests; As noted earlier, these might be used to inform the development of a values hierarchy (see Step 4 below); 3. Develop a set of narratives to be used in community engagement to confirm and enrich the understanding of the problems system; 4. Construct a values hierarchy, based on the information developed in the first three steps. This would use the insights gained from the critique of the cognitive

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maps, the exploration of the system response to the hypothetical disturbances, and the interrogation of the narratives; 5. Utilise multi-criteria decision analysis techniques to understand objectively the impact of options from which a solution to the problems system can be selected. That is, develop a practical solution, which satisfactorily acknowledges and takes into account the needs of the entire domain of interests.

The critical approach underpinning the technique developed here, in particular, evaluating the trilemmas and a set of narratives, can give significant insight into several steps in the process above. The contribution in relation to Step 2 has been discussed earlier and will not be elaborated upon further here. However, little has been said so far regarding Step 4, the construction of the values hierarchy, and Step 5, identification of potential options for evaluation during the decision-making process.

The distinction between intrinsic and extrinsic values and the importance of this in coming to terms with Type 3 problems has been emphasised in a number of places in this dissertation. The critical discussion and evaluation, which takes place as the trilemmas are constructed, and when the “As-Is” system model is characterised and described, would be expected to be of use in identifying issues of extrinsic value and both types of intrinsic value (those of the object kind and those of the moral kind). The way in which this is achieved is through the critique of the trilemmas by considering the interactions between the forces represented in the triangle. The trilemma device can be considered to be a means by which intrinsic and extrinsic values can be identified and distinguished (see Chapter 6, section 6.3.5.1.3). The reason this is important is because the different types of values (that is, “object” intrinsic values, “moral” intrinsic values, and extrinsic values) would be expected to require quite different types of criteria or indicators at the lower levels in the values hierarchy. Although a process for achieving this was not developed here, it is thought that this would be a fruitful area for further investigation. The other application where the approach developed in this dissertation would be expected to be useful is in the identification of options for evaluation in the decision- making process itself (that is, in Step 5). In this case, the trilemma device can be used as an end in the problem-structuring process. As the utopic, dystopic, and plausible future states of each system element are considered during the critique, it requires consideration of likely responses of the trilemma system element. Thus, it sheds light on possible paths

305 Chapter 7 – Case Study : Sydney’s Water System… forward in order to resolve the problem. These can be considered as candidate strategies for evaluation in the multi-criteria decision-making process.

The conclusion drawn from this brief critique suggests that the problem-structuring approach developed in this dissertation provides a powerful means by which to critique established urban planning and infrastructure planning approaches. It also suggests an alternative means to undertake this planning, which would appear to have substantial advantages over existing methodologies.

7.4.6 Concluding Remarks This case study set out to test three key propositions of the thesis in the context of a real problem situation. The first of these was to confirm that the problem under consideration – the development of the Sydney metropolitan water system – was indeed a Type 3 problem. That is, it was to demonstrate that the Type 3 problem actually exists.

The two other propositions relate to application of the problem-structuring approach developed in Chapter 6. The first application is prospective in its nature: it seeks to use general systems theory as the paradigm for modelling the system, and to develop a problem representation which uses established behavioural and cognitive psychology theory. This is framework is used to structure the information in such a way that it aligns with human behaviour and cognitive function. In this case, a robust, qualitative model of the metropolitan system and the water subsystem was conceived.

The second application is retrospective. Having developed a system model and subjected it to a robust critique from a wide representation of the domain of interests, a framework was thereby created against which other approaches can be tested and evaluated. In this case, the planning approach developed by the NSW State government was evaluated. In addition, it was anticipated that examples relating to the other important issues identified in the dissertation might be identified. For example, the distinction between sustainability and sustainable development, and engineering practice might be expected to be topics of interest in consideration of metropolitan water systems. The approach was successful in this application, identifying a clear position of sustainable development in government planning process. In addition, a dated paradigm underlying the government planning process was identified. This appears to be ineffectual in dealing

306 Chapter 7 – Case Study : Sydney’s Water System… with Type 3 problems of the complexity of the metropolitan water system. This application also enabled an alternative paradigm to planning to be outlined.

7.4.6.1 Characterisation of the Type 3 problem The historical narrative describing the evolution of Sydney’s water system and the institutional arrangements which evolved to develop and manage it points out that the metropolitan water system increased in complexity over the two centuries or so of Sydney’s history, evolving through all three stages of problem complexity. It is only in the last 30 years that the system evolved into a Type 3 problem. Interestingly, this coincides with the divergence between the predominant worldview of the Sydney community from the established, instrumentalist, positivist worldview to which engineering practice has largely adhered for the last 70 years or so. This suggests that there are opportunities for engineers to reconsider the underlying approach to 21st- century practice, in the context of the philosophical principles developed in Chapter 4.

An important consideration of the Type 3 problem (which was the focus of the first part of the case study), was the moral position taken by the participants in the Warren Centre project regarding sustainability. In section 2.5.1, two distinct moral positions were identified: a “conservationist” approach (as represented in the “sustainable development” position) and “deep ecology” approach (as found in the “sustainability” position). The full spectrum of beliefs and values appeared to be represented among participants. There was no explicit discussion of these two philosophical positions as part of the formal project activity, however there was informal discussion, in particular in relation to issues such as the health of the Hawkesbury-Nepean and the Shoalhaven river systems. It is perhaps a deficiency of the case study that these issues were not explored more thoroughly, so as to make them unequivocal. In the second part of the case study, the prevailing paradigm was one of sustainable development – the “triple bottom-line” approach was explicitly stated in the State government planning documents. 7.4.6.2 Demonstration of the problem-structuring approach Part A of the case study provided a full demonstration of the way in which the problem- structuring approach is used in a real application. The process was established to engage representatives of the full domain of interests, resulting in a rich, robust system model. The response of this model was tested using scenario analysis and the outcome subjected to critique by members of the project team. An important outcome of this work was a body of information, accepted by participants as descriptive of the range of worldviews

307 Chapter 7 – Case Study : Sydney’s Water System… represented in the domain of interests. To call this “objective” information, or even “rationally determined” information, would not be entirely accurate, because of the range of beliefs and values influencing both identification and interpretation of this information – in such a situation, true objectivity is neither achievable nor desirable. The important point is that the information derived from this approach is an agreed representation of the problem, which incorporates all the important issues, irrespective of interpretation. This recognises that there will be different, even opposing interpretations of the agreed problem information, according to the worldview and belief system of the reader.

This body of information is useful in two ways. It can be the first step in developing a solution to the problem, providing useful background for objective investigation of the problem in order to identify a range of potential solutions for evaluation. This was confirmed in Part A of the case study. Alternatively, the approach can be used to inform critical examination of other approaches which might be used to identify solutions to the problem. Part B of the case study demonstrated such a critique.

7.4.6.3 Critique of Alternative Methodologies The NSW State government appears to have undertaken a significant amount of work, through its agencies and departments, to prepare a set of integrated, long-term strategic planning documents at state, metropolis, and agency level. However, critical examination of this process identified significant deficiencies. These can be thought of as being a consequence of two broad defects in the governments planning process. The first of these is that this systemic nature of the metropolis and the water system is not recognised. This creates a number of issues: • Too much emphasis is given to one system element (the supply of water), appearing not to recognise the relationships between water supply and other system elements; • System boundaries are not established and, hence, there is no clear delineation as to what interests should be included or excluded from consideration in the problem; • The multidimensional nature of the problem is not recognised, with a consequence that important issues are seen to be external to the problem rather than part of it. (Surprisingly, the political dimension, as an election approached,

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appears to have been assumed to be outside the system boundary, rather than within it), • The plan appears to have been developed in pieces, following a mechanistic model, rather than having been developed using a holistically defined planning process.

The second defect is that the approach used by the government fails to acknowledge the existence of diverse worldviews within the domain of interests. The approach taken by the government is one of sustainable development. This would be less of a problem if the structure of the approach at least acknowledged that there is a significant worldview represented in the community which takes a sustainability approach. In many aspects, catchment and riparian management are at odds with sustainable development. Acknowledging this difference and seeking solutions which might satisfy the aspirations of both groups would be one way to avoid conflict. The conclusion drawn here is that the current paradigm underlying the planning approach, despite very significant resources being committed to it, has substantial deficiencies. Utilising a planning framework integrating the problem-structuring approach developed in this dissertation, together with established multi-criteria decision analysis techniques as broadly outlined in section 7.4.5 of this chapter, would provide an opportunity for major reform of the planning process.

7.4.6.4 Reflexive Critique and Lessons Learned from the Case Study An as noted in Chapter 1, qualitative research is influenced by the beliefs, values and worldview of the researcher, in relation to the problem being investigated. In evaluating the case study, it is important to recognize the influence of these on the case study outcome. The most significant of these was the influence applied by the researcher in adopting the systems methodology which was developed in Chapter 6 as the framework for undertaking the Warren Centre project. The methodology which was considered by the project steering committee in contrast to the approach used here was the traditional business strategic planning approach. Proponents of this approach argued that such an approach was tried and tested and, were it to be applied in such a way as to ensure widespread community consultation, it would be expected to deliver a reasonable outcome. The opposing view (argued by the author and which ultimately prevailed), was

309 Chapter 7 – Case Study : Sydney’s Water System… that several attempts, using this type of approach, had been made previously to resolve the Sydney metropolitan water problem but these have not been successful.

Because this problem-structuring approach was new (the case study was its first application), it was subject to considerable modification as the engagement of project team members took place. Although a framework for conducting the case study had been prepared in advance, changes were made as suggestions for improvement were contributed. The author attempted to be open-minded and encouraging of suggestions to improve the process, however not all either could or should have been accepted. As noted earlier, this resulted in some criticism that some outcomes were unduly reflective of the researchers values (the most notable example being the preparation of the strawman narrative). It is important to note however, that this should not be seen as a particular defect of the process, unless the fundamental philosophical principle of the practitioner being engaged as part of the system (rather than independent and detached from it) is rejected. For subsequent cases, one means to avoid this issue would be to have more than one process facilitator, so that multiple perspectives and worldviews can be brought to the process, thereby widening the attractiveness to the participants.

A related point is that the meaning of language used in the problem evolved as people’s understanding of the problem increased. As familiarity with the approach grew, the process was accepted by most participants as being a powerful means by which to frame complex issues and to understand the relationships that exist between various parts of the system. It is important that the tendency towards creating jargon is resisted and that the language used to describe features of the problem system is widely accessible to people who may not be familiar with the problem itself. In terms of facilitating the modelling process, a glossary of terms and a process manual could be prepared. Such a manual should not be prescriptive but rather should provide general guidance. However, this does not address the use of jargon in the resultant narratives. The critique of the narratives needs to identify the use of jargon, either ensuring that it is fully explained or contextualised before the narratives are finally disseminated to the their intended audiences.

In conclusion, the three stated aims of the case study were satisfied: the existence of the Type 3 problem was established through the example of the metropolitan water system

310 Chapter 7 – Case Study : Sydney’s Water System… in Sydney. The problem-structuring approach was demonstrated. And a number of clear benefits of using this approach in comparison to establish planning practices were identified.

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Appendix 7.1 – Outline of Problem-Structuring Approach

Problem Statement The question or issue to be addressed is stated concisely.

Problem System and Sub-System Boundary Definition and Critique The system boundary is defined and subjected to group critique in order to establish those aspects of problem which are to be included and those which are to be excluded. It is important to note that consideration of the system boundary needs to take into account all dimensions of the problem (the three spatial dimensions and the temporal dimension). Aspects of the problem which require detailed examination or which are thought to be major influences on system behaviour are represented as sub-systems. Sub-systems are also subjected to boundary critique.

As part of this process, problem dimensions are determined in order to add richness and depth to the system under consideration.

Preparation of Background Narrative Depending on the particular problem under consideration, a background narrative may be required, both to establish problem typology (that is, to confirm the existence of a Type 3 problem) and as a means to introduce participants to the richness of the problem system. Not all problems require the preparation of a background narrative. Typical problems where narrative preparation might be considered useful would be those situations where there has been an awareness of the issue for a considerable time, but with little progress being made because of conflicting perspectives on the problem and how it should be resolved. Major infrastructure problems (water, power generation, and intractable waste disposal are typical of such problems). Whether or not a background narrative is prepared will largely depend on project participants and their knowledge of the problem itself. In some cases, it may be more valuable to prepare the background narrative (at least in draft form) prior to undertaking the problem system and sub-system boundary definition and critique. In this case, a further revision of the narrative is be required to incorporate information resulting from the boundary definition and critique.

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Identification of Problem Dichotomies and Forces at Work within the System Problem dichotomies represent conflicts, choices, opposites, and forces in tension which, taken together, are representative or symptomatic of system behaviour. Underlying each dichotomy is one or more forces within the system, which resolve to determine the system state at any point in time. Through identifying problem dichotomies, force-pairs can be discovered. In some cases dichotomies will be directly representative of force-pairs, while in others they will be symptomatic of underlying force-pairs, which then need to be identified. Identification of force-pairs is used to inform the later construction of trilemmas, which, in turn, are used to represent system elements.

The way in which problem dichotomies are identified is through a well-established, facilitated technique known as “brainstorming”. In this process, participants engage in a free-ranging discussion of the issue, followed by the rapid proposition of dichotomy candidates. No criticism is allowed during a brainstorming session, so as not to stem the flow of ideas. Once all the dichotomies have been identified, each is analysed critically to determine the nature of the force-pair underlying it. In some cases, dichotomies may have no underlying force-pair, in which case they are discarded. There is considerable skill required from a facilitator in conducting this process to ensure that all participants have an equal voice and that the brainstorm list is elicited creatively and freely.

Representation of System Elements (Trilemmas) Trilemmas are triadic constructs of three system forces in tension, which result in system states at any point in time. The system forces are represented by the arrows within the triad and the system states are described at vertices of the triad (see Figure 6.5). Although the system forces need not be independent, they form true trilemmas only when the forces would be expected to act in tension when the system is subject to a substantial shock or disturbance. The system state represented at the vertex, when its associated force is dominant, can either be highly desirable, that is, utopic, or highly undesirable, that is, dystopic. Practically, the actual system state is a plausible combination located somewhere between the two.

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Characterisation of the “As-Is” System State The “As-Is” system state is a word-rich description of each system element, describing its current state. In turn, each force in the triad is set aside and the relationship between the remaining two forces is explored and the consequent effect upon the system states represented at each vertex. This illuminates the balance between the utopic and dystopic system states, which were identified in the previous step, by assuming each force in turn to be dominant over the other two. The “As-Is” system states can be represented at the vertices of the triad by describing a plausible future in words, sitting between the utopic and dystopic positions. Alternatively, a summary “As-Is” system state can be described. In this instance, the plausible system states represented at each vertex are synthesised into a paragraph describing the state of the system element as a whole. In both cases, a symbol is placed within the triad indicating the approximate place where the three forces resolve.

Investigation of the system response to a Plausible, Hypothetical Disturbance A plausible, hypothetical disturbance is introduced to the system and the likely system response is considered. Analysis of the system response is intuitive, so that many different perspectives and worldviews, representing those of the entire domain of interests, can be incorporated into the qualitative system model. Different types of disturbances can be imagined (for example, sudden step-changes, more gradual ramp-changes, and so on). Scenarios can then be envisioned to represent how the system might ultimately respond, together with insight as to how it might achieve the new system state. An important consideration in conceiving the hypothetical disturbance is that it is selected with a view to ensuring that it impacts widely over the whole system. Plausible, hypothetical disturbances can be simple (for example, a 100% increase in the price of water) or can represent more complex interactions of parameters. It is suggested here that to consider more than three parameters in the disturbance becomes unmanageable. Furthermore, a disturbance with three parameters can be characterised comprehensively by representing it as a triad or “disturbance triangle”. This can be a useful approach when there are several “meta-issues” to be considered.

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Two scenarios are considered in response to the introduction of the disturbance:

“Likely Future” Response of the “As-Is” System The “Likely Future” system response of each trilemma is visualised.

“Desired Future” Response of the “As-Is” System The “Desired Future” response of each trilemma is visualised.

In both cases, depending on the size of the participant group, exploration of both “As- Is” and “Desired Future” system responses can either be carried out in a single plenary session or, desirably, in small groups. This type of discussion is often most productive in groups of five to seven people, with a facilitator ensuring that no one position is dominant and that all group members have the opportunity to contribute. For example, if there were about 20 participants, three small, facilitated groups could be asked to consider the responses of the system. Each group prepares a brief report and presents this to a plenary session of all participants. Plenary discussion contrasting the three approaches yields further insights into the response of the problem-system.

Once these two cases have been investigated, consideration is given to what changes would be required to the “As-Is” System model for it to be able to achieve the “Desired Future” response.

Changes Required to the “As-Is” System Model to Achieve the “Desired Future” System State The necessary changes to each trilemma are visualised for the total system to be able to deliver the “Desired Future”.

The process used to determine changes required to the “As-Is” system model is much the same as that used to determine the “As-Is” and “Desired Future” system responses noted above. Each trilemma, in turn, is considered in facilitated, small-group discussion, followed by a plenary discussion of the output of the groups.

Up to this point, focus has been on the way in which system elements are likely to respond to the disturbance. Consideration is now given to the way in which the whole

315 Chapter 7 – Case Study : Sydney’s Water System… system would respond, taking into account relationships which would be expected to exist between system elements. Particular attention is given to the system states which are represented at the vertex of each system element.

Integrated System Model Development Once the trilemma analysis is complete, relationships are identified between system states, trilemmas, and forces in order to produce a depiction of the integrated problem system. This system model is then utilised to inform thinking about the holistic nature of the system in its response to disturbances.

Again, this is achieved through facilitated, plenary discussion. Consensus representations of each trilemma are placed on posters (for example, on flip-chart paper, and fixed to a large wall) and relationships drawn in between trilemmas, vertices, pairs of vertices, or system forces. The aim of this step is to identify where the major influences exist between system elements and to gain some insight as to how the system might respond as a whole. There should be no constraints on the extent to which the system is represented: the trilemma system map should be embellished by notes, comments, depictions, and text. These should all be recorded for future reference (a small digital camera is useful for this task).

Narrative Development The next step in the process is to develop a set of “agreed” or “uncontested” problem information. It is important to note that agreement and contestability of information only relate to whether or not the issues identified are significant in determining system response. Interpretations of influence of these issues may differ significantly between individual participants, depending on the worldviews or perspectives of various members of the domain of interests and these interpretations may be in conflict. This information is identified through plenary discussion and critique.

In order to represent the set of information and to arrive at some understanding of how this information affects system response, various interpretations are captured in a set of narratives. The narratives have two functions: one is to produce a rich, comprehensive description of the problem itself, including interpretations of how the problem system might respond to the hypothetical disturbances; and the other is to use this information

316 Chapter 7 – Case Study : Sydney’s Water System… to engage with the domain of interests by presenting an array of different interpretations and representations to choose from. That is to say, taken as a whole, the set of narratives represents the accumulated knowledge and understanding of how the system is currently and how it might respond to a disturbance.

Once the narratives have been prepared, they are subject to critique, not only to ensure that the agreed problem information is represented within the narrative, but so that they are as free as possible of the jargon which may have emerged during the problem- structuring analysis. These narratives are then used to engage as wide a representation of the domain of interests is possible.

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Appendix 7.2 – System and water subsystem boundary critique

This boundary critique follows the twelve questions identified by Ulrich with minor modification (Ulrich’s system was originally conceived of for planning delivery of social services) Ulrich (1987)). Ulrich’s twelve “boundary questions” are intended to provide a means by which the normative and objective content of the system design may be challenged or disputed, either by the designer or by those affected by it.

Metropolitan system boundary critique The metropolitan system is defined as being bounded by the greater Sydney metropolitan area, plus current and future water catchments and resources. The metropolitan system considered here are those aspects of the metropolis which relate either directly or indirectly to the water subsystem.

“AS IS” “DESIRABLE FUTURE” CRITIQUE SOURCES OF MOTIVATION SOURCES OF MOTIVATION 1. Who is the beneficiary of the The inhabitants of the metropolis 1. Who ought to be the The inhabitants of the metropolis The metropolis is a human social system (S)? of Sydney. beneficiary of the system, S? of Sydney. system which exists for the benefit of its constituents.

2. What is the purpose of S, that Economic, social, and 2. What ought to the purpose of Economic, social, and The aim for a sustainable is, what goal states is S able to environmental prosperity. S, that is, what goal states ought S environmental prosperity. metropolis is long-term prosperity achieve so as to serve the be able to achieve so as to serve without compromising other beneficiary? the beneficiary? moral interests.

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“AS IS” “DESIRABLE FUTURE” CRITIQUE SOURCES OF MOTIVATION SOURCES OF MOTIVATION 3. What is S’s measure of success A broad range of economic, 3. What ought to be S’s measure A broad range of economic, There is considerable difficulty in (or improvement)? social, and environmental of success (or improvement)? social, and environmental identifying appropriate indicators indicators. indicators. which fully represent both the prosperity of the metropolis and the interests of non-human constituents. A range of both quantitative and qualitative indicators is needed.

4. Who is the decision-maker, The State government of New 4. Who ought to be the decision- The State government of NSW Although socially stable and that is, has the power to change South Wales (NSW). maker, that is, have the power to and the Federal government of prosperous, there is ongoing S’s measure of improvement? The Federal government of change S’s measure of Australia in consultation with dissatisfaction in the way in which Australia. improvement? representatives of the domain of the challenges of growth of the interests. metropolitan system are handled by the State government in particular and, in some instances, the relevant Federal instrumentalities.

5. What components (resources All fiscal, social, and 5. What components (resources All fiscal, social, and Many members of the domain of and constraints) of S are environmental policy parameters and constraints) of S ought to be environmental policy parameters interests feel excluded from the controlled by the decision-maker? within the constraints and controlled by the decision-maker? within the constraints and decision-making process and influences of a liberal democracy. influences of a liberal democracy. lacking in influence in planning outcomes, particularly those relating to the development of social and service infrastructure.

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“AS IS” “DESIRABLE FUTURE” CRITIQUE SOURCES OF MOTIVATION SOURCES OF MOTIVATION 6. What aspects of the problem Municipal/community and 6. What aspects of the problem Municipal/community and The challenge for policy-makers is are part of S’s environment, that national resources which are ought to be part of S’s national resources which are to engage the domain of interests, is, should not be controlled by S’s independent of the greater system. environment, that is, should not independent of the greater system. taking important perspectives into decision-maker? be controlled by S’s decision- account to arrive at an informed, maker? responsible path to development of the metropolis which takes into account all moral interests of the constituency.

7. Who is involved as designer of The State government of NSW, 7. Who ought to be involved as The State government of NSW, There is a pervasive societal view S? under the administrative advice of designer of S? under the administrative advice of within the metropolis that political the NSW Public Service, with the NSW Public Service, with processes are unnecessarily some portfolio responsibility some portfolio responsibility secretive and exclusive and that being with the Federal being with the Federal broader consultation with the government. government. domain of interests is desirable.

8. What kind of expertise does Restricted professional expertise 8. What kind of expertise ought A richer cross-section of expertise The NSW government uses a flow into the design of S, that is, largely identified and selected by to flow into the design of S, that representing an appropriate select group of consultants and who is considered an expert and the NSW Public Service. is, who ought to be considered an balance of technical competence advisers which is generally what is his/her role? expert and what should be his/her and community representation. constrained by legally binding role? confidentiality arrangements. A broader utilisation of expertise representing the entire domain of interests is desirable.

9. Who is the guarantor of S, that The State government of NSW 9. Who ought to be the The State government of NSW Greater utilisation of the various is, where does the designer seek (with the Federal government guarantor of S, that is, where (with the Federal government instruments of the democratic the guarantee that his/her design having responsibility in specific ought the designer seek the having responsibility in specific process is desirable. will be implemented and will areas). guarantee that his/her design will areas) with additional community prove successful, judged by S’s be implemented and will prove consultation through the measure of success (or successful, judged by S’s measure democratic process. improvement)? of success (or improvement)?

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“AS IS” “DESIRABLE FUTURE” CRITIQUE SOURCES OF MOTIVATION SOURCES OF MOTIVATION 10. Who is the witness Political parties, media, 10. Who ought to belong to the Political parties, media, A broad range of institutions and representing the moral interests government bureaucrats, witnesses representing the moral government bureaucrats, other representatives should be that will or might be affected by consulting firms. interests that will or might be consulting firms, community involved in major policy decisions the design of S? That is to say, affected by the design of S? That groups, non-government affecting the long-term who among the affected does get is to say, who among the affected organisations, environmental sustainability of the metropolis. involved? ought to get involved or groups, professional institutions. These should be actively engaged represent those involved? by local, state, and Federal government from policy development right the way through to implementation and legitimation.

11. To what degree and in what Current institutional arrangements 11. To what degree and in what The sustainability/sustainable The domain of interests should be way are those affected given the only partially recognise the moral way ought those affected be given development discourse should be engaged in the chance of emancipation from the interests of those other than the the chance of emancipation from broadened to include all moral sustainability/sustainable premises and promises of those human inhabitants of the the premises and promises of interests in the constituency. development discourse so that the involved? metropolis. those involved? worldview to be adopted when policy determination has matured properly reflects the interests of the entire constituency.

12. Upon what worldviews of The anthropocentric worldviews 12. Upon what worldviews of In this critique, the sustainability To the extent that long-term either those involved or those largely prevails, with human either those involved or those worldview is preferred over and sustainability of the metropolis affected is S’s design based? interests being placed above those affected ought S’s design be above the sustainable currently enters policy of other species and ecosystems. based? development position for long- considerations, the paradigm is Late-modern capitalism is the term viability of the complete one of sustainable development. predominant influence on most domain of interests. Hence, human interests are placed aspects of government. above those of other interests within the constituency.

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Water subsystem boundary critique The physical water subsystem is defined as being bounded by the catchment, storage, distribution and logistics, recycling, sewage and stormwater removal and treatment, and waterborne waste disposal infrastructure, together with the resources required to construct, operate, and maintain them.

“AS IS” “DESIRABLE FUTURE” CRITIQUE SOURCES OF MOTIVATION SOURCES OF MOTIVATION 1. Who is the beneficiary of the The inhabitants of the metropolis 1. Who ought to be the The inhabitants of the metropolis The water system itself exists to water subsystem (Sub-S)? of Sydney. beneficiary of the Sub-S? of Sydney. support development of the metropolis of Sydney. The important point to consider is that in developing such a system, it ought to be done without compromising the interests or well being of other species or ecosystems.

2. What is the purpose of Sub-S, To provide water, sewerage, 2. What ought to the purpose of To provide a sustainable The purpose of the water system that is, what goal states is able to sanitation, drainage, and waste Sub-S, that is, what goal states subsystem of water, sewerage, ought to be to provide facilities achieve so as to serve the treatment facilities and services ought Sub-S be able to achieve so sanitation, drainage and waste and services for the metropolitan beneficiary? for the metropolitan system. as to serve the beneficiary? treatment facilities and services system but without compromising for the metropolitan system. downstream riparian health, the ecological integrity of catchments, or otherwise compromise the interests of the constituency.

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“AS IS” “DESIRABLE FUTURE” CRITIQUE SOURCES OF MOTIVATION SOURCES OF MOTIVATION 3. What is Sub-S’s measure of Provision of adequate water and 3. What ought to be Sub-S’s Provision of a sustainable water, A range of both qualitative and success (or improvement)? satisfactory sanitation and measure of success (or sanitation, and stormwater quantitative indicators needs to be stormwater drainage for the improvement)? drainage system which does not developed which fully represents metropolitan system, without the compromise the economic well- the integral nature of both the need for constraints due to an being of the metropolitan system water system and metropolitan inadequate supply of water or and also takes into account the system, and which takes into deficiencies in sanitation and requirements for environmental, account the interests of all stormwater requirements. ecological, and social prosperity. stakeholders. 4. Who is the decision-maker, Ultimate decision-making 4. Who ought to be the decision- An independent statutory As often happens with Type 3 that is, has the power to change authority sits with the NSW State maker, that is, have the power to authority (or authorities) problems, the issues of the water Sub-S’s measure of improvement? government, with most change Sub-S’s measure of accountable to the domain of subsystem have become heavily responsibility delegated to Sydney improvement? interests. politicised. Bringing a greater Water Corporation and Sydney independence to the issue so that Catchment Management special interests do not have an Authority. Federal government undue influence on policy would has some portfolio responsibility, be better achieved with a fully for example, environmental independent governance model. regulation.

5. What components (resources Virtually all resources are 5. What components (resources All decisions ought to be The politicisation of Sub-S has and constraints) of Sub-S is controlled by the decision-maker. and constraints) of Sub-S ought controlled by the decision-maker resulted in a constrained and controlled by the decision-maker? to be controlled by the decision- but should be made on a fully secretive planning and design maker? informed basis after wide process which largely excludes consultation with representatives community and broader moral of the domain of interests. interests.

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“AS IS” “DESIRABLE FUTURE” CRITIQUE SOURCES OF MOTIVATION SOURCES OF MOTIVATION 6. What aspects of the problem The technically-determined 6. What aspects of the problem The range of socially- and There should be a clearly defined are part of Sub-S’s environment, parameters which define the ought to be part of Sub-S’s technically-determined parameters consultative process established that is, should not be controlled requirements of the water environment, that is, should not which define the requirements of early in problem identification and by Sub-S’s decision-maker? subsystem be controlled by Sub-S’s decision- the water subsystem planning which identifies the full maker? range of parameters which are important to the entire constituency of the metropolitan system (S) to which Sub-S must respond.

7. Who is involved as designer of Sydney Water Corporation in 7. Who ought to be involved as Sydney Water Corporation, in When the Water Board was Sub-S? consultation with Sydney designer of Sub-S? consultation with Sydney disbanded and corporatised, the Catchment Authority has ultimate Catchment Authority and other engineering resources were largely authority for the design. Much of relevant agencies, should have dismantled, with the technical this is outsourced to preferred ultimate authority for the design. design responsibility being sub private sector engineering Sub-contracting design to the contract to the private sector. companies. private sector is effective provided The result was a considerable loss all areas of expertise required are of “corporate memory” and readily available and that experience. Privatisation of contextual history of the design may well be the optimal subsystem is properly maintained. solution provided there is a means to preserve important historical context.

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“AS IS” “DESIRABLE FUTURE” CRITIQUE SOURCES OF MOTIVATION SOURCES OF MOTIVATION 8. What kind of expertise does The main design expertise sits 8. What kind of expertise ought There ought to be an extension For the last 150 years, the flow into the design of S, that is, largely within the various to flow into the design of Sub-S, beyond the purely technical predominant influence on design who is considered an expert and disciplines of engineering. that is, who ought to be domain of engineering to ensure of Sub-S has been the various what is his/her role? considered an expert and what that the subsystem as optimal disciplines of engineering. The should be his/her role? interaction with the metropolitan reliance on the purely engineering system as a whole. solution has potentially constrained the introduction of innovative solutions which may be more beneficial to the broad domain of interests in the long- term. The purely technical engineering paradigm should be extended to include non- engineering input.

9. Who is the guarantor of Sub-S, The guarantor of the Sub-S design 9. Who ought to be the The guarantor of the Sub-S design Ultimate responsibility sits with that is, where does the designer sits with the State government of guarantor of Sub-S, that is, where should with the State government the State government of NSW seek the guarantee that his/her NSW, which is democratically ought the designer seek the of NSW, which is democratically through two acts of Parliament. design will be implemented and accountable to the people of the guarantee that his/her design will accountable to the people of the The use of democratic processes will prove successful, judged by metropolis. be implemented and will prove metropolis. to inform design of systems and Sub-S’s measure of success (or successful, judged by Sub-S’s subsystems within the community improvement)? measure of success (or represented by the State of NSW improvement)? is largely limited to four yearly state elections. Greater use of referendum or other consultative processes could increased both democratic participation and accountability of the State government.

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“AS IS” “DESIRABLE FUTURE” CRITIQUE SOURCES OF MOTIVATION SOURCES OF MOTIVATION 10. Who is the witness There is no formal representation 10. Who ought to belong to the A more formal process to Representation of all moral representing the moral interests of all moral interests which it witnesses representing the moral recognise moral interests and take interests is limited to that will or might be affected by within the boundaries of Sub-S. interests that will or might be them into account so that the environmental and ecological the design of Sub-S? That is to Some special interest groups such affected by the design of Sub-S? purely technical is not overly legislation and the extent to which say, who among those affected as environmental and That is to say, who among those influential in design of Sub-S. special interest groups influence does to get involved? conservation organisations speak affected ought to get involved or design of Sub-S. for non human species. represent those involved? Community groups representing those of affected communities often have significant voice.

11. To what degree and in what Processes are largely informal, 11. To what degree and in what There ought to be a process by A formally constituted process to way are those affected given the with the loudest voice being given way ought those affected be given which the complete range of identify the full range of moral chance of emancipation from the most weight. the chance of emancipation from moral interests in Sub-S identified interests should be considered. premises and promises of those the premises and promises of and formally represented. involved? those involved?

12. Upon what worldviews of The predominant worldview on 12. Upon what worldviews of The worldview ought to represent The worldview which has either the involved or those design and operation of Sub-S. is either the involved or those both the technological and influenced the development and affected is Sub-S’s design based? the instrumentalist engineering affected ought Sub-S’s design be broader non-technological issues design of sub-S. has been paradigm. based? relating to the design of sub-S. predominantly the instrumentalist, positivist engineering paradigm, which is now somewhat out of step with broader community expectations. Furthermore it does not fully acknowledge or non- human interests, generally placing the means of humanity above those of other species and ecosystems.

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Appendix 7.3 – Background Narrative : Sydney’s Water System

Note: three official histories of the Sydney Water Board have been cited extensively here, in most instances referring to author name and page number only: Henry, F.J. (1939), The Water Supply and Sewerage of Sydney, Halstead Press Pty Ltd, Sydney, Aird, A.W., (1961) The water supply, sewerage, and drainage of Sydney, 1788-1960, Hallstead Press Pty Ltd, Sydney, and Beazley, M. (1988), The Sweat of Their Brows: 100 Years of the Sydney Water Board, 1888-1988, Water Board, Sydney, Illawarra, Blue Mountains, Sydney, Australia

Introduction This narrative is to briefly trace both the development of the metropolitan water, sewerage, drainage system and to consider the underlying arrangements for the institutions responsible for the construction, operation, and maintenance of the system. In doing so, there are two underlying intentions. First, is to provide reader with a comprehensive understanding of the way in which the water system developed as the city of Sydney grew over the last two centuries or so into a substantial metropolis and to provide background information for the other parts of the case study – that is, to provide both a temporal and a spatial representation of the problem. And second, is to establish that the problem of providing a sustainable water system for Sydney is indeed a Type 3 complex problem. The narrative places particular emphasis on the development of the institutional arrangements for development of the water system because it is argued here that this is both reflective of and germane to the nature of this problem.

Broadly speaking, since European settlement in 1788, there have been four eras of differing institutional arrangements. The first of these was the progressive development of relatively minor infrastructure to provide water for the newly established township and, as its population grew over the subsequent fifty years or so, to address issues of security of water supply and sanitation. This work was done under the direction of the Governor and, later, with advice from the Governor-appointed Legislative Council. The second phase began in the 1840s and continued for about 40 years. This was a transitional period as responsibility for water administration was progressively transferred from the Governor to a municipal Council for the newly-declared City of Sydney and subsequently to the Legislative Assembly established in 1856. The third phase commenced in 1888 with the appointment of a statutory board to oversee and manage the water supply and sewerage systems and this continued for about a century. The final era commenced in the 1970s with major reforms to the statutory authority and continues

327 Chapter 7 – Case Study : Sydney’s Water System… to the present day. The general thrust of the argument presented here is that these institutional arrangements are both reflective of and, in part, responsible for the emergence of the Type 3 problem, which exists with Sydney’s water system.

The early era – colonial government At the Royal Commission into Sydney’s water supply in 1869, Prof. Smith, the chairman of the Commission, summarised the history of the city’s water supply up to that time (Smith (1869a)). The original choice by Governor Phillip of the location for the settlement was made on the basis of having a clean water supply, so the Sydney Cove site, with its clear stream, was selected. Unfortunately, plentiful water was not to be found: Smith quotes an article in the Sydney Gazette (19 October 1811), which refers to a drought in the second year of settlement, 1789, during which the colony nearly ran out of water. The Governor ordered that three tanks be cut into the sandstone banks of the stream, near where Hunter and Pitt Streets now intersect, to hold additional water for dry times. Although the exact time of construction is not clear, Smith dated the tanks (which gave the Tank Stream its name) at about 1802. It was not long before these were becoming polluted and regulations were orders were given by the Governor in 1810 to protect the water supply. Smith reports a further drought in 1811, in which the tanks dried up for several weeks. After a period of relatively wet years, there was another drought in 1820, and a severe drought in 1823/24. The reported rainfall in 1823/4 (about 19 inches (480 mm)), was less than half the normal average.

By the early 1820s, it was becoming apparent that Sydney was subject to a wide variation in rainfall, and that prolonged dry periods might be common. By then, the population of Sydney had reached 10,000 and water was becoming to be of critical importance. By 1826, pollution of the Tank Stream became so severe that it was abandoned as a water supply and water was carted from Lachlan Swamp (now the ponds in Centennial Park) to a watering point in Hyde Park (Smith (1869a), Aird (1961f)). John Busby who arrived in Sydney in 1824, having been appointed as Mineral Surveyor to the Government, proposed cutting a tunnel from the Lachlan Swamp to Hyde Park. Hence, the first piece of legislation relating to water supply in Sydney was enacted: the Water Tunnel Act (4 William IV No 1) of 1833, which approved the construction and maintenance of Busby’s Bore, to bring water from Lachlan Swamp to Hyde Park, with the Tank Stream becoming the de facto sewer and rainwater drain for the city. The tunnel was started in

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1827 but was not completed until 1837, however seepage into the tunnel was able to supply enough drinkable water for the city from 1830. By the time Busby’s Bore was completed, the population of Sydney was over 20,000 and the tunnel was capable of delivering about 350,000 gallons of water per day (1.5 million litres per day), which was barely adequate. However, in 1838/39 there was another drought and Busby’s Bore was not able to supply enough water (Aird (1961f)).

Busby’s Bore was in use for many years and, at its peak, was capable of delivering 400,000 gallons (1.8 m litres) per day. There was to have been a reservoir excavated in Hyde Park to hold 15 million gallons (68 m litres), but it was never built. In 1838/39, there was a severe drought (referred to in Darwin’s Voyage of the Beagle) and, although Busby’s Bore did not run dry, there were very serious water shortages, with people paying 6 pence per bucket for water during this period.

At this time, the population of Sydney was growing quickly102. Throughout this period, the institutional arrangements consisted entirely of direction by the Governor, together with legislation enacted by the recently formed Legislative Council103. There were two pressures which led to a change in these arrangements. First, was the Colonial Office in London seeking ways to reduce cost and to move the administrative responsibility to the local residents and second, was a growing discontent from within the colony demanding a greater urgency in responding to problems of water supply and sanitation (Clark (1978) p55). This led to the declaration of Sydney as a city in 1843 (Richards (1883)) and a corporate body being established for its administration. A municipal council was appointed to administer the Sydney Corporation (Clark (1978) p55). The primary responsibility of this newly established council was to provide water to the rapidly growing city.

102 In the decade from 1830 to1840 population grew of 11,500 to 29,000. 103 There was a strong emancipist movement in the colony in the 1820s, with an influential group attempting to persuade the British government to establish trial by jury and the house of assembly. In 1828 an act of Parliament was passed on the recommendation of Governor Darling that between 10 and 15 members were to be appointed to the Legislative Council by the Secretary of State on advice from the Governor. Members of the Council were to be chosen from leading landholders and merchants with the British Parliament having the right to disallow legislation enacted by the Legislative Council within three years of the Governor’s assent (Manning Clark, p 64-65).

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The era of transition – from colonial administration to self-administration Following the 1838/39 dry spell, there was a wet period of about nine years, during which there was frequent flooding, again followed by a dry year in 1849, in which the rainfall at South Head was only 21.5 inches (550mm) (compared to an average of about 50 inches (1,270mm)). By the early 1840s, it was clear that Lachlan Swamps and Busby’s Bore were not capable of delivering adequate water to the city and in 1849, there was a proposal to build two small dams, holding about 10 million gallons (45 m litres) in the area of the Lachlan Swamp, but this work was not commenced. In 1850, a Special Committee was appointed in 1850 by the Municipal Council of Sydney “to inquire into and report on the best means of procuring a permanent supply of water to the city of Sydney”. The committee considered areas around Bunnerong, Cook’s River, George’s River, and the Nepean River, however before the committee could report, a new Governor, Charles Fitzroy, was commissioned and he appointed a board104 to re-examine the question. The board made recommendations relating to the development of Botany Swamps which were implemented. The first step was installing a steam pump in 1854 (Smith (1869a), Aird (1961f)). The board recommended confining activities to the Lachlan Swamp area, pumping water to a new reservoir to be built at Paddington, with a capacity of 12 million gallons (55 m litres) (about 40 gallons (180 litres) per head of population). A small pump was installed in 1854, which transferred water through Busby’s Bore. In 1858, three 100-horsepower stream-driven pumps were installed, two of which generally ran 24 hours a day. A 30-inch (750mm) main delivered water from the pumping station at Lord’s dam to a reservoir at Crown Street holding 3.5 million gallons (15.9 million litres) and another at Paddington holding 1.5 million gallons (6.8 m litres). These reservoirs contained only two days’ supply. The major problem with the system was that capacity was insufficient to accommodate a prolonged dry period, even with the subsequent construction of six small dams down the course of the stream to Botany Bay. The quantity of water pumped in 1868 was 956 million gallons (4.34 gigalitres). Reticulated water supply was introduced in 1844, with about 70 houses being connected. The cost of this was 5 shillings per room per year (Smith (1869b)). The reticulation network increased significantly in the 1850s and 1860s, requiring night-time water restrictions to be applied in 1862 and the construction of the six small dams in the Botany Swamps in 1866-67. By 1874, the system was delivering 4 million gallons (18.2 m

104 The Board consisted of the Commander, Royal Engineers, Lt-Col. Barney, the Colonial Architect, E.T. Blackett, the Civil Engineer, G.K. Mann and two “gentlemen of the colony”, R.M. Robey and R. Tooth.

330 Chapter 7 – Case Study : Sydney’s Water System… litres) per day. A further dam was built at Bunnerong 1876-77. At the time of completion of the first stage of this scheme in 1858, the population of Sydney was estimated to be about 87,000 people. When the Smith Royal Commission (referred to above) reported in 1869, the population had grown to about 118,000 (Smith (1869a)).

At the Royal Commission hearing on 31March 1868, Thomas Woore read a paper proposing the construction of a dam on the Warragamba River. The dam wall would be 600 feet (182m) along the top and about 170 feet (52 m) above the floor of the gorge. The wall would have been masonry, supported downstream with rubble and with puddling materials in front of the dam wall. Gravity feed of water to Sydney would allow three years’ supply. The president of the Royal Commission, Professor Smith, reluctantly rejected the proposal on the basis that the Warragamba dam would have been the largest dam in the world and he was concerned by experience with smaller dams in England which had failed and had “spread devastation in their course”. The risk of economic loss was considered too great, despite that “if successful, the results would be magnificent, and the work would be a monument of engineering skills and boldness that could not fail to command a world-wide fame”. Professor Smith added that although he later became aware of a dam in the Upper Loire in France nearly as great, the risk of flood at the Warragamba site during construction would also be substantial (Woore (1869)). This Royal Commission and the subsequent report of an expert engineer from Britain, W. Clark, appointed to confirm the recommendations of the Royal Commission in 1877, set the direction for the next eighty years for development of the Upper Nepean to supply Sydney’s water.

Clark evaluated the Royal Commission report and other submissions received in the meantime. These were the Upper Nepean scheme, Loddon and Wingecarribee, Port Hacking, Lower Nepean Scheme, the Warragamba, the Grose, George’s River, Port Hacking and Woronora, Erskine Valley, Tube Wells, and “Mr Sadler’s Proposal”. He eliminated all except four, these being the Upper Nepean gravitation scheme, Loddon and Wingecarribee gravitation scheme, the Lower Nepean pumping scheme and the George’s River pumping scheme. In his conclusion, Clark discussed costs, the risk of flooding during construction, operating cost, complexity of construction (including tunnels, pipework etc), long-term storage capacity, and the opportunity for future development for irrigation, pastoral and manufacturing. Clark’s recommendation was to

331 Chapter 7 – Case Study : Sydney’s Water System… develop the Upper Nepean scheme (Clark (1877)). The Upper Nepean scheme consisted of building a small dam, 10 feet (3 m) high, on the Nepean River near Pheasants’ Nest. A tunnel 4½ miles (7.2 km) long carried water to the confluence of the Cataract, Nepean and Cordeaux rivers. Another small dam would be built on the Cataract River at Broughton’s pass and a tunnel 1¼ miles (2 km) long, which would take the water to the western slope of the George’s River basin. A system of channels and short tunnels would then deliver the water to a reservoir to be built at Prospect. The reservoir at Prospect would have a wall height of 80 feet (24 m), and would hold 10,635 million gallons (48.3 gigalitres), of which 7,110 million gallons (32.3 gigalitres) would be available for supply by gravitation. From Prospect, the water would be distributed to the existing reservoirs, and a new distribution reservoir at Petersham (Clark (1877)).

Clark confirmed the Royal Commission’s recommendation of the construction of Prospect Reservoir, and in addition, recommended construction of further reservoirs (complementing the Crown Street and Paddington reservoirs) at Petersham, Newtown, Woollahra and Waverley. He also recommended design principles for reticulation of water through the suburbs, the use of ball-cocks to connect the mains, the fitting of stop- cocks and meters, a system of rating which differentiated between properties with gravity feed and those requiring pumping and further recommendations from his experience regarding the setting of water rates.

The first water from the Upper Nepean scheme was delivered in 1886 and the Botany Swamps system was decommissioned and, in 1896, was dismantled. The Botany Swamps dams remained largely intact until they were badly damaged by heavy rainfall in 1931. At its peak in 1886, its annual delivery was 1,864 million gallons (8.4 gigalitres) (Aird (1961e)).

In the early 1850s, there was considerable disquiet on the state of the sanitation of Sydney. In 1851, the Sydney Morning Herald published a series of ten articles describing the inadequacy of the water supply and the unsanitary drainage and sewerage conditions of the city (Clark (1978) p51). The catchment around Sydney, consisting of a number of small creeks had become open sewers and little had been done by the municipal Council to solve the problem. In January 1854, the Legislative Council passed an act which dissolved the municipal Council, appointed three commissioners to administer the

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Council and, in particular to authorise the raising of a ₤200,000 loan to commence construction of the sewerage scheme. By the end of 1854, the Legislative Council, impatient with the lack of progress, appointed a select committee to investigate the matter. The result of this activity was the commencement of five sewers along the creek lines draining into Sydney Harbour. In addition, minor sewers from a number of city streets were also planned feeding, either into the five main sewers or discharging directly into the harbour (Henry pp156-157). By 1877, 33 miles (53 km) of sewers had been constructed servicing the Woolloomooloo and Fort Macquarie areas, and the area drained by the Tank Stream.

But by the 1870s, there was a substantial pollution problem in the bays of Sydney Harbour into which the sewers all discharged. In 1875, there was an outbreak of typhoid on a ship moored at Fort Macquarie, leading to an outcry regarding public health, with a petition of 3,800 signatories being presented to Parliament in 1876. The Sewerage and Health Board was appointed by the government in 1873 and included two engineers, E.O. Moriarty and W.C. Bennett, both of whom had worked on the Nepean scheme. In 1887, the board proposed construction of two much larger sewerage schemes, the northern system which would service what is now central Sydney and the eastern suburbs, discharging into the ocean at Bondi; and the southern system servicing the area from Redfern, Waterloo and Mascot, discharging at the mouth of the Cook’s River in Botany Bay. These designs were approved by W. Clark, an English engineer appointed by the government in 1877 to review the 1869 Royal Commission findings. Construction commenced in 1880 and was completed in 1889, with responsibility for its operation being transferred to the newly-established Board of Water Supply and Sewerage in 1890.

There was a critical water shortage in the early 1880s, with only ten days’ water supply being stored. The construction of the Upper Nepean scheme had been started and the Hudson Brothers (the founders Clyde Engineering) were appointed to build a system of timber-and-iron pipes and viaducts to supplement the Botany Swamps water supply. It was this system (referred to as the Hudson’s Temporary Scheme) which, in 1886, delivered the first water from the Upper Nepean scheme to the reticulation system (Aird (1961d)) and two years later, in 1888, the Water Board held its first meeting (Clark (1978)).

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Institutional arrangements There are a number of important aspects regarding the transition in institutional arrangements during this period. The declaration of Sydney to be a corporation and the appointment of the Sydney City Council, together with the later establishment of the Legislative Assembly shifted the primary responsibility for administering the affairs of Sydney from the Colonial Office in London and the Governor to the citizens of NSW. Furthermore, professional engineers started to become more conspicuous in management of the issues. These engineers, many of whom had military as well as civil engineering backgrounds (these being the only truly distinct areas of practice within the engineering profession at the time105) assumed leadership roles in these activities106. This transitional period was by no means smooth. The early councillors were accused of self- aggrandisement, making their first priority the building of a Town Hall, rather than directing their limited funds toward social improvements. There were allegations of ineptitude and financial mismanagement and these were substantiated by a committee of enquiry held in 1849. Further public campaigns, including newspaper articles and petitions from local merchants and manufacturers led to appointment of a further committee of enquiry by the Legislative Council in 1852, resulting in the dismissal of the council and the appointment of a three-man Commission to administer the affairs of the city. The optimism within the community on the appointment of the three-man commission was short-lived: efforts to raise capital through a debenture issue were largely unsuccessful and the engineer in charge of the Botany Swamps project was replaced due to incompetence. It seems that incompetence was not confined to the engineer on the project, with three separate select committees recommending dismissal of the board of Commissioners, resulting in council administration being restored in 1857. Also, there were concerns regarding public health issues, in particular the use of lead piping for drinking water distribution, the slowness of extending the reticulation network and the rising rate of water-borne disease in areas which had not yet received reticulated supplies. Further enquiries were conducted in the early 1860s, culminating in the Smith Royal Commission of 1868/69.

105 Although it is noted that the British Institute of Mechanical Engineers was established in 1847. 106 The 1852 Board of Enquiry consisted of five members two of whom were engineers, one a civil engineer and the other the Commander, Royal Engineers. The Smith Royal Commission (1869) also consisted of five members two of whom were civil engineers. The expert report of 1875 was conducted by a civil engineer, W. Clark, who was brought from London to undertake the task. Engineering education did not commence in Australia until late in this period with the establishment of the Engineering Faculty of the University of Sydney in 1883 (Aird (1961) pp10 and 15).

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The Royal Commission noted earlier was one of the most important landmarks in the history of the institutions responsible for the development Sydney’s water system. Not only did it consider proposals which influenced develop of the water system for the next century or more but also, it established a mechanism, which brought about significant institutional change. The commission was chaired by John Smith, the “Professor of Physics etc”, at the relatively young University of Sydney and its membership included three civil engineers and the Surveyor-General. The Commission sought evidence from a wide range of participants and recommended the commencement of capital works on the Upper Nepean, a reticulation system using a new reservoir at Prospect, with reticulation to small reservoirs in the municipalities, and a rating structure which would cover the interest and maintenance on capital expenditure (Smith commission (1869) pp33-43). But despite the clarity of the Royal Commission’s recommendations, the political process delayed commencement. Political parties had not yet become established and there were frequent changes of ministries. The findings of the Royal Commission and the alternatives it had investigated were extensively debated. There were further public debates and enquiries, including an expert report by W. Clark in 1877. The influence of the three engineers on the original Royal Commission was still significant and the recommendations of the Smith Royal Commission were largely confirmed and, in addition, it also recommended construction of a sewerage system diverting outflows from Sydney Harbour to the Pacific ocean. The metering and rating of water was also supported (Clark (1877)). But the administrative arrangements were still being debated, some favouring private arrangements with others arguing for a government-owned or government-guaranteed water company. Finally, it was agreed to establish a board representing the affected municipalities together with a group of appointed expert members. This resulted in an act of Parliament in 1880, enabling the appointment of the Board of Water Supply and Sewerage (later generally known as the Water Board), but it was not the late 1880s, upon the completion of the upper Nepean scheme, that the board was formally appointed and held its first meeting (Clark (1978)).

Clark (1978) makes some interesting observations regarding this transitional period in administration. Until about 1860, there was only a limited mechanism for raising public finance and this constrained the development of Sydney’s infrastructure. However, the development of water and sanitation infrastructure seems to have lagged other areas (such as railways) which enjoyed significant development at that time. It appeared that

335 Chapter 7 – Case Study : Sydney’s Water System… an one hand, the colonial government did not want to take responsibility for developing and administering the infrastructure but, on the other, it was reluctant to devolve the authority to local government. It was only when water shortages and the threat of serious disease reached crisis point that action was taken. But there is a different interpretation which may be placed on this series of events. The situation in Sydney was not particularly different from other colonial cities, nor indeed, cities in Britain itself. Sanitation was not well understood (the miasmic theory of disease had not yet been replaced by Pasteur’s ground-breaking work, first proposed in the 1870s) and water supplies were not reliable. To understand this more fully, it is illuminating to first consider the same period in Britain, because at the time Britain still had full authority for the administration of the colony of NSW.

By the early 19th century, the industrial revolution in Britain was well underway. There had been a major migration from the countryside to the growing industrial cities. As the population of these industrial metropolises grew, sanitation became a major problem and there were outbreaks of diseases, such as cholera and typhoid with growing frequency and social impact. At the time, the prevailing miasmic theory was that disease was caused by the foul smell emanating from open drains and marshes – that is, the smell was actually the disease itself, rather than a by-product. It was not until 1878 that Pasteur’s work on the origins of disease was published, and it was not until the end of the century that Pasteur’s work was widely accepted in the administration of public health. Nonetheless, notable figures such as Edwin Chadwick, drew a correct conclusion from an incorrect theory: that the solution to public health required reform of the water supply and sewerage system107. Chadwick’s work was focused on London and identified the problem with the sewerage system as being mainly an engineering one but with substantial administrative defects, whereas water supply was largely an administrative problem due to a lack of cooperation between the water supply companies. The solution identified by Chadwick was to consolidate the sewers commissions and water companies into one organisation and to construct a new design of ovoid, pressurised drains which would be flushed by water, thus removing the miasma from the streets. One consequence of Chadwick’s work was an act of Parliament, the Public Health Act (1848), which established General Boards of Health, to reform the administration of sanitary systems. But within London, Chadwick’s reforms were largely unsuccessful, being

107 Chadwick’s famous work was the 1842 publication Report on the Sanitary Condition of the Labouring Population of Great Britain.

336 Chapter 7 – Case Study : Sydney’s Water System… opposed in Parliament and generally not supported in the community. A major outbreak of cholera in the late 1840s prompted Chadwick to produce another report in 1850 (On the Supply of Water to the Metropolis). This was influential in the eventual disbanding of the London Board of Health in 1854 and the creation of the Metropolitan Board of Works108 in 1855. The formation of the Metropolitan Board of Works partly consolidated the highly fragmented responsibility for water, sewerage, and drainage and to undertake the major engineering works required for a substantial water, sewerage, and drainage system. Further consolidation of responsibility took place in 1888, when the Metropolitan Board of Works was replaced by the London County Council. This organisation remained in place until 1965 when it was abolished and the responsibility of its successor, the Greater London Council, was extended considerably to accommodate the growth in London over the previous 80 years. (Boyne and Cole (1998), Schwartz (1966), Parkin (2000), Wheeler (2000)).

The point of this comparison is this: Sydney was by no means unique in struggling with the problems associated with its rapid growth in population. There were two fundamental problems identified in this era that were associated with relatively rapid urbanisation. One was the technological challenge in dealing with the provision of a clean water supply and sanitation issues of densely populated urban areas. The other was the challenge of moving from directive to participative public administration, in response not only to social demands for greater representation but also the recognition that the increasingly complex nature of large urban areas required it. The general solution to this problem was to establish two bodies: a public works body to develop the capital infrastructure; and an administrative body, governed by elected representatives of the municipalities serviced by the infrastructure. In the case of London, the public works body was set up in 1855 and a joint engineering and administrative authority established with the creation of the London County Council in 1888. In the case of Sydney, the administrative authority was established with the appointment of the Water Board in 1888 and the Department of Public Works retained responsibility for major capital projects until 1924. Although the structural arrangements established in London and

108 It is important to note that in mid-19th-century Britain, elected representation of municipal bodies was in its relative infancy (having been established in the 1830s) and there was both horizontal and vertical fragmentation of responsibilities assigned to local government. On one hand, across the London parishes were bodies known as Vestries, with various responsibilities, such as paving, lighting, cleansing, “watching”, and so on, while on the other, there were tiers of special-purpose bodies with responsibility functions as baths and wash-houses, schools, police, and burials. The formation of the Metropolitan Board of Works was to address at least part of this fragmentation.

337 Chapter 7 – Case Study : Sydney’s Water System…

Sydney were slightly different, the response to the problem was fundamentally the same: creation of a body with a strong technological capability to carrying out the necessary civil engineering work and administrative authority representative of the local government constituencies to provide services to rate-payers.

In both cases, these arrangements remained in place for the best part of a century. Over this period, both cities saw dramatic improvement in standards of public health, with diseases such as typhoid, cholera, dysentery, tuberculosis, diphtheria and even, on rare occasions, bubonic plague being largely eliminated. In the case of Sydney, although there is no doubt that at times progress was frustratingly slow, the institutional reform which took place over the period from 1840 to 1890 had a profound and long-lasting beneficial impact on the development of the city and the well-being of its citizens. At the heart of these reforms, there emerged a paradigm which recognised the reliance of society on the engineering profession to create and implement technologically sound solutions, with oversight and administration by a body representative of the local government constituencies. But, in the case of Sydney at least, it would be quite misleading to suggest that these institutional arrangements were particularly efficient. As will be discussed below, there were continuing criticisms of the effectiveness of the Water Board and its structure was changed on several occasions, largely as a result of enquiries provoked by public dissatisfaction.

The Water Board era – 1888 to 1983 In the latter part of the 19th century there had been considerable debate on the merits of “wet carriage” versus dry conservancy treatment of sewage. Both technologies were tried. In the period from 1855 to 1875, virtually all of Sydney sewage discharged into Sydney Harbour by the sewers commenced in the 1850s. Water quality of the harbour worsened and in 1875, following an outbreak of typhoid on a ship moored in Sydney Harbour, a petition with 3,800 signatories complaining of the situation was presented to Parliament. Further agitation over the next two years resulted in the Sewerage and Health Board committing to the construction of two outfalls, the Northern System, discharging into the ocean at Bondi, and the Southern System, running to a sewerage farm at Botany Bay (Beder (1990)). The Northern System was completed and handed over to the Water Board in 1889 and the Southern System was completed and handed over in 1890. But by 1890, the Secretary for Public Works, the Hon. Bruce Smith was

338 Chapter 7 – Case Study : Sydney’s Water System… so concerned about deteriorating public health in Sydney due to much of the city’s sewage continuing to be discharged into open drains, that he proposed a separate stormwater drainage system to be built as well as the sewerage system. Expansion plans for the Northern (now called the Bondi system) and Southern sewerage systems had been developed and were under construction, but the western suburbs were developing so quickly that construction of the sewers could not keep up with the rate of urban development. Smith believed that stormwater drainage could be built far more quickly than sewerage. At the time, the Nepean scheme (with a draft of 50 million gallons (227 megalitres) per day) had been completed and the distribution infrastructure was capable of delivering 18 million gallons (82 megalitres) per day, nearly double the normal consumption of about 10 million gallons (45 megalitres) per day. Smith proposed that it would be possible to quickly build a network of stormwater drains which could be flushed using the excess water capacity from the Nepean system and which local municipalities could temporarily use as sewers109. Once the sewerage system was complete, sewer inlets would be disconnected and the stormwater drains would revert to their intended purpose. By 1897, nine stormwater major drains had been constructed in Wentworth Park, Rushcutters’ Bay, Balmain, Erskineville, Long Cove, Iron Cove, Homebush, and North Sydney. According to the medical adviser to the Board, there was a dramatic reduction in disease: mortality from diarrhoea dropped from 10.9 to 6.2 per 10,000, diphtheria from 5.2 to 3.1 per 10,000 and phthisis (pulmonary tuberculosis) from 16.8 to 9.5 per 10,000 population. Also, there had been a major problem with typhoid (which had been exacerbated during the construction of the drainage system due to the manual excavation of the existing open drains) in the inner-city area, but after the completion of the stormwater drains, mortality from typhoid in the Erskineville, Redfern and Waterloo districts had dropped by as much as two-thirds (Aird (1961c)). This resulted in Sydney ultimately having separate stormwater and sewerage systems which

109 In the latter half of the 19th century, there was a significant debate as to the most appropriate means of disposing of sewage. There was a strong lobby for “dry conservancy” because of concerns that “water- carriage” could contaminate drinking water. On one hand, were the dry conservancy advocates who proposed collecting excrement and turning it into fertiliser; on the other, was the water carriage group, which was strongly represented in public officialdom. The debate considered economic impact (both capital cost and operating cost), efficacy, and which would be the least offensive to the public. Generally, engineers, doctors and public officials were in favour of water-carriage, while dry conservancy proponents used largely values-based arguments. Neither water carriage nor dry conservancy were well developed technologies at the time and there seemed to be little attempt to develop criteria for comparison. Ultimately, both technologies were used, but because of the planning and capital expenditure required for water-carriage technology, it ultimately prevailed. Dry conservancy did not require the same development of infrastructure and so was more ad hoc in its application – Beder (1990).

339 Chapter 7 – Case Study : Sydney’s Water System… continues today and, importantly, it established wet carriage as the technology of choice for the transport and disposal of sewage.

By the early 20th century, the area around the sewage farm at Botany Bay was becoming more densely populated and there was growing public concern about the health impact of the sewage farm, resulting in legal action by local residents. In 1905, a recommendation was made to cease farming and to treat the sewage. By this time conversion of the western suburbs drainage system to a main sewer was well under way and in 1908, following a Parliamentary committee of enquiry, it was decided to construct a sewer from the farm on the northern side of Botany Bay to divert both the southern and western systems to an ocean outfall at Malabar, near Long Bay. This work was completed in 1916 (Aird 137-142).

The northern suburbs of Sydney were also serviced by sewers which drained into Sydney Harbour. The original work was done between 1891 and 1898 by the Public Works Department and transferred to the Water Board in 1899. By 1910, the pollution problem in Sydney Harbour from the northern suburbs was extensive and investigations were done to determine whether an ocean outfall could be constructed at North Head. Construction on the North head outfall commenced in 1916 and in the meantime, primary the treatment works at Willoughby Bay were extended. In 1919, legal proceedings were taken against the Water Board for negligence and nuisance, resulting in an activated sludge system being installed together with chlorination of effluent. The North Head ocean outfall system was started operation in 1926 and was fully commissioned in 1928 (Henry 202, Aird 154-156).

In 1901-2, there was another major drought which brought Sydney to a most perilous position and the government appointed a Royal Commission110 to determine a solution. The Commission presented three reports in April 1902, July 1902, and October 1903. The first report recommended a major upgrade of the distribution infrastructure, in

110 The membership was: Joseph Davies, MInstCE (Undersecretary for Public Works), Henry Deane, MInstCE (Engineering Chief, Railway Tramway Construction, Department of Public Works), W. J. Hanna (Commission of the Roads and Principal Engineer for Roads and Bridges, Department of Public Works), Thomas Hughes (Mayor of Sydney), T.W. Keele, MInstCE (Principal Engineer, Harbours and Rivers Branch, Department of Public Works), E.W. Knox, W. L. Vernon (Government Architect) L. A. B. Wade, MInstCE (Principal Engineer, Water Supply and Drainage), with additional appointments being made later that year: Jacob Garrard (President, Metropolitan Board of Water Supply and Sewerage), J. B. Johnston (President, Sydney Chamber of Commerce), J.F. Smith, MP, J.P. Wright (President, NSW Chamber of Manufactures), and J.P. Josephson, AMInstCE (a civil engineer) – Aird (1961).

340 Chapter 7 – Case Study : Sydney’s Water System… particular strengthening Prospect Reservoir, upgrading the canal leading from Prospect to Guildford, a major upgrade to the Ryde pumping station to increase capacity to northern suburbs and upgrading mains distributing water to the southern suburbs. The second report identified sites on the Cataract, Cordeaux, Nepean, and Avon rivers and recommended that the catchments for these be proclaimed, that no further mining and forestry leases, the grazing of livestock within the catchment be prohibited. In addition, the Commission recommended a greater emphasis on conserving water and an increasingly proportion of water which was metered. As a consequence, Acts of Parliament were passed to develop new major headworks, the first being a dam on the Cataract River111. Construction started in 1903 (Aird 25-27).

There was a sustained dry period from 1907 until early 1911, prompting the Water Board to identify another dam site on the Cordeaux River. This was followed by several years of good rainfall and the intervention of the First World War, so the problem was not addressed seriously until 1918, when a Board of Experts was appointed to advise on development of Sydney’s water supply. It recommended the construction of the Cordeaux dam and to commence planning the Avon and Nepean dams. Construction of the Cordeaux dam commenced in 1918 and was completed in 1926. Construction of the Avon dam commenced in 1921 and was completed in 1928. In 1925, construction commenced on the Nepean dam near Pheasants’ Nest and was completed in 1935, following a disruption to construction due to the Depression112.

In 1926, a committee was appointed to continue the work of the Special Board of Experts which had been appointed in 1918. This committee recommended the construction of the Warragamba Dam to be commenced after the Nepean dam was completed, and that the Warragamba be sufficiently advanced that it could contribute to Sydney’s water supply by 1938. In 1928, the chief engineer, G. Haskins, recommended that a small dam at Woronora (originally 60 feet (18 m) high) intended as a local supply for the Sutherland-Cronulla district be increased in height to 200 feet (61 m), giving a capacity of 15,000 million gallons (68.1 gigalitres). This would enable the deferment of

111 When final survey work was completed there was some debate as what the final height of the dam wall should be. Finally it was decided that it would be 150 feet (46 m) high enclosing a capacity of 21,411 million gallons (97.2 gigalitres). 112 Although the design capacity of the Nepean dam was 18,000 million gallons (81.7 gigalitres), due to dry weather from its date of completion in 1935 until August 1938, it only stored about 4,000 million gallons (18.2 gigalitres). Heavy rain in late 1938 filled the dam to capacity.

341 Chapter 7 – Case Study : Sydney’s Water System… the Warragamba Dam by four years113. The Woronora dam was commenced in 1930 (construction was suspended for several years during the Depression) and was completed in 1941 (Aird 88-94, Henry 140).

In the 1934, a severe drought began. Until 1940, the worst dry period on record had been the drought of 1904-1910 and it was thought that the capacity of Sydney for supply should be adequate to cover such a period. It became clear the upper Nepean system was inadequate and, as an emergency measure, a weir, 50 feet (15.2 m) high, was commenced near the site of the current Warragamba Dam, and was completed in 1940.

The 1934-42 drought (at the time of writing this narrative, the longest on record), has been used as the basis for water supply calculations since then (Aird (1961b)). Prior to the completion of the Warragamba dam safe draft114 of the combined Cataract, Cordeaux, Avon, Nepean, and Woronora dams was 92 million gallons (418 megalitres) per day. In 1959-60, Sydney’s daily demand was 201.8 million gallons (916 megalitres). The shortfall had necessitated construction of a large dam, justifying the size of Warragamba.

The original design of Warragamba Dam was for a wall 370 feet (112 m) high, with a capacity of 452,500 million gallons (2,054.4 gigalitres). On completion, based on a nine- year drought, Warragamba had a regulated draft of 274 million gallons (1,244 megalitres) a day. At the time, the daily draft of the entire Sydney system was 310 million gallons (1,407 megalitres) a day. Site survey and selection commenced in 1941 and was completed in 1946. Construction was completed in 1960 (Aird (1961a)).

In 1966, the Water Board appointed the Snowy Mountains Hydroelectric Authority (SMEH) to prepare a evaluation of supplying Sydney and the south coast with water beyond the end of the 20th century. SMEH examined all major catchments feasible for supplying the region with water, rejecting the Wollondilly and Grose catchments because of lack of capacity and rejecting development of the Colo River catchment because of

113 Another dam at O’Hare’s Creek was also proposed this time, but much later (in 1938), due to concerns about its limited capacity, it was decided not to build this dam, rather to proceed directly to the Warragamba project. 114 The quantity of water which can be supplied daily during the longest dry period on record, plus an additional year equivalent to the driest on record, assuming all reservoirs to be full at the start of the drought.

342 Chapter 7 – Case Study : Sydney’s Water System… both the relatively high cost of building a dam, due to the thickness of silt on the river bed and concerns about interrupting freshwater flow into the Hawkesbury River and the consequent effect on salinity115. The scheme recommended was the Welcome Reef dam with a dam wall 200 feet (61 m) high, a capacity of 330,000 million gallons (1,498 gigalitres) and associated developments on the Shoalhaven River. An additional dam, with about the same capacity as Welcome Reef, could ultimately be built on the Shoalhaven River, near the junction with Yalwal Creek. Adoption of the scheme was published in the Sydney Water Board Journal in October 1968116. A number of the environmental and archaeological studies were done in the 1970s, recommending the project proceed with consultation with local communities, taking steps to ensure protection of local ecology. However, for a variety of reasons discussed in the next section, other than the construction of a small dam in the Shoalhaven Valley at Tallowa completed in 1976, the project did not proceed.

Meanwhile, there had been extensive development of sewerage and drainage infrastructure as both the population and the service area grew quickly in the first half of the 20th century. In the period from 1924 to 1936, extensive work was done to determine alternatives for dealing with the increasing population in the southern and western suburbs and in 1936 were commenced on duplicating the sewerage main to Malabar and the installation of primary treatment works at all ocean outfalls. This work was completed in 1941 in addition, extensive work was done on sub-mains feeding the southern and western system. In the period between 1934 and 1960, 878 miles (1,411 km) of sewerage were installed in the southern and western systems (Aird 148-153) and a further 877 miles (1,413 km) were constructed servicing the northern suburbs (Aird 167). By the 1980s, there was general concern about the level of pollution on Sydney’s beaches from the three ocean outfall systems, with beaches regularly being closed to bathers. This resulted in the decision to extend the ocean outfalls at North Head, Bondi, and Malabar so that effluent was discharged several kilometres offshore. Construction on this started in 1984 (Beazley 219). In addition, a number of smaller systems at Parramatta, Hornsby, Manly, Vaucluse, and Randwick were also constructed in the first

115 Snowy Mountains Hydroelectric Authority, (1968), Report on Proposals to Augment the Water Supply to Sydney in the South Coast (5 volumes), Metropolitan Water Sewerage and Drainage Board, Sydney, 116 Sydney Water Board, (1968), The Board Adopts the Shoalhaven Scheme, Sydney Water Board Journal, Oct 1968, pp35-58.

343 Chapter 7 – Case Study : Sydney’s Water System… half of the 20th century. These have mostly been integrated into the ocean outfalls system.

Institutional arrangements The main enabling legislation for the appointment of the Board of Water Supply and Sewerage (the Water Board) was passed in 1880 and a supplementary act was passed in 1888 just prior to the Board’s appointment and first meeting. The intention of the appointment of the board was to take over the control and management of the capital works built by the government, removing responsibility from the Municipal Council of the City of Sydney. Responsibility for construction of capital works was to remain with the Minister for Works but, practically, the Water Board was granted ministerial approval to carry out smaller projects such as reservoirs, pumping stations and mains, with larger infrastructure being built by the Public Works Department. In 1924, in the wake of growing public dissatisfaction with the reliability of the water supply and frustration at the “dual control” system for construction, an act was passed which consolidated responsibility for construction and operation for all water, sewerage, and drainage works with the Board117. Also at this time it was granted complete control of its own finances. (Aird 215-219, Henry 2-3).

The original constitution of the Water Board provided for the Governor to appoint three “Official Members”, one of whom would be the President, for the Municipal Council the City of Sydney to elect two “City Members”, and for councillors of a number of municipalities within the county of Cumberland a further two “Suburban Members”. A rotation arrangement provided for three members retiring every two years. The original intention of the structure was to have official members with technical training and for elected members to represent two constituencies of roughly equal size, the City of Sydney and the other metropolitan municipalities (Aird page 214-219). The 1924 act, mentioned above, increased the size of the Board to 18 members (a President appointed by the Governor for a five-year term and 17 elected members elected from municipal councils within nine constituencies of metropolitan Sydney, two for each of eight constituencies and a ninth constituency with one member). This structure was soon found to be unwieldy, with the need for standing orders to be introduced to control length of meetings, factionalisation, and conflicting advice regarding policy. At this time

117 At this time the board was renamed the “Metropolitan Water, Sewerage, and Drainage Board”.

344 Chapter 7 – Case Study : Sydney’s Water System… there were problems with construction works and a Royal Commission was appointed to investigate. It recommended a change to the structure of the board and, after some parliamentary debate, in 1935, a further act was passed reducing the size of the Board to seven members: a President and Vice-President appointed by the Governor and five members elected from five larger constituencies, representing groupings of the metropolitan municipal councils (Aird 220-222, Henry 9-14).

In 1972, there were concerns that the structure of the Board was ineffectual and the act was changed to bring the board under the direct control of the Minister. The new Board consisted of five members appointed by the Minister and a further three selected by the Minister from a panel nominated by the Local Government Association (Beazley pp 209- 210).

This period, which lasted for the best part of a century, could reasonably be described as the era of the engineer. Many of the presidents and official members of the Board and a significant number of the elected aldermen were engineers (Aird 309-321). The Water Board became known as an engineering organisation118 (Beazley 172-173) and developed a strong, internal culture. In retrospect, despite public criticism of the performance of the Water Board and the Department of Public Works (from 1888 to 1925), in the period from 1888 to 1960, despite the major disruptions of the First World War, the Great Depression, and the Second World War, the development of Sydney’s water system was very extensive. Ten major dams were constructed, with a storage capacity of over 400 million gallons (over 1,800 gigalitres)119 – Warragamba dam being one of the largest metropolitan dams in the world. 129 service reservoirs were built and over 6,400 miles (10,300 km) of water mains were laid. In addition, over 4,000 miles (6,400 km) of sewers were constructed and nearly 180 miles (290 km) of stormwater canals were built in areas subject to flooding (Aird 263, 309, 207). But the 1970s, the water board’s unique culture (described extensively in Beazley’s history of the Water Board (Beazley general reference)) was seen to be increasingly out of touch with community expectations. Practices and work habits which had evolved over a century were either no longer relevant or reflected complacency, inefficiency and a level of corruption which was unacceptable. Public dissatisfaction with Water Board culture, politicisation of the issues,

118 The Engineering Club was established in 1935 and from 1951 to 1984 published its own professional journal, the Sydney Water Board Journal. 119 Minor works done in the last 45 years have increased this to over 2,500 gigalitres.

345 Chapter 7 – Case Study : Sydney’s Water System… and a change in expectations which took place in Australia across many public institutions during this period had a profound effect on the Water Board. From the late 1970s to the current day, the Water Board as an engineering institution was gradually and replaced by a quasi-corporate structure. This major institutional change – which is still taking place – will be considered in the next section.

The recent era – post-1972 Following approval of the construction of the first two stages of the Welcome Reef dam in 1968, Stage 1, Tallowa dam and a system of pumping stations, reservoirs and canals to transfer water from the Shoalhaven Valley to the Nepean system was completed in 1977. It has relatively small capacity (90 gigalitres) and has been used to transfer water to the Nepean system in times of low rainfall. A further study was commissioned by the Water Board in 1974 to study the environmental effects of the second stage of the system, the construction of the Welcome Reef dam itself. The study was completed by Snowy Mountains Engineering Corporation (SMEC) and Gutteridge, Haskins and Davey (GHD), two large consulting engineering firms. The study, completed in 1978 and explored environmental, social, and ecological impacts of constructing the dam. This report120 confirmed the findings of the original 1968 study which recommended construction of two large dams on the Shoalhaven River system and proposed that construction should commenced in 1986 with completion in 2000 (Seebohm (2000)).

There were further investigations into the dam proposal in the period from 1982 to 1993. Two studies investigated aboriginal archaeological sites in the inundation area, the second of these recommending that archaeological sites be excavated and aboriginal artefacts collected (Seebohm (2000)). In the late 1980s, SMEC and Sinclair Knight & Partners were commissioned to examine the water supply strategy, tabling their report in 1991 (Snowy Mountains Engineering et al. (1991)). This study undertook a sophisticated modelling approach to both demand and headworks and concluded that there were three options to provide Sydney with water. The first of these was either increasing the capacity of the Warragamba dam (by raising the height of the existing dam wall, or constructing a flood mitigation dam downstream of the existing dam), or a two-stage

120 The report and several associated studies considered the impact of stream flows, erosion, sedimentation, water quality, agriculture and land use, terrestrial vertebrates and vegetation, social and recreational aspects, and eutrophication. There were 86 people permanently resident in the dam inundation area, and 37 of these were totally financially dependent on their property. There were 15 people whose homes would be inundated.

346 Chapter 7 – Case Study : Sydney’s Water System… development of the Shoalhaven. Second was development of reverse osmosis and desalination technology for effluent reuse. And third, was a “risk management” strategy in which further capital investment would be postponed until a crisis point was reached and then additional technology, such as reverse osmosis technology, would be installed expeditiously. The report recommended not pursuing the third option without further evaluation. The report concluded that one or other of these schemes would need to be commissioned by 2011/2012.

In July, 1993 the Welcome Reef development was postponed indefinitely121, the NSW Government appearing to be following the third “risk management” option, together with demand management. Other than the relatively small Tallowa dam (mentioned above), the raising and strengthening the wall of Warragamba dam during the late 1980s, together with a new spill-way to protect against the possibility of a major flood in the late 1990s, there have been no significant headworks since 1972 (Warragamba fact sheet). However, there has been significant work done in sewerage and drainage.

In the last 50 years, a number of smaller sewerage systems have been developed, particularly in western Sydney, there now being about 20 sewage treatment systems in the Sydney metropolitan area, although about 75% of sewage now is treated by the three main deepwater outfalls which discharge into the ocean just off the Sydney coast. (http://www.sydneywater.com.au/OurSystemsandOperations/; http://www.sydneywater.com.au/OurSystemsandOperations/SystemsOperationsWaste water_SystemImage.jpg – accessed 12 Nov 2007) In the 1980s there was considerable public outcry regarding the pollution of Sydney’s ocean beaches and plans were announced to move the discharge of the discharge sewage from the three ocean outfalls from a few hundred metres off the cliff-face to between 2.5 and 3.8 km offshore (SMH 11 Sep 89) further works to upgrade ageing sewage infrastructure and extend the system over a 20-year period was also announced at this time. Although sewerage and drainage work has been the principal infrastructure development during this period, two significant events focused public attention on water supply. First was the apparent water supply contamination by cryptosporidium and giardia in 1998. A Royal Commission122 was appointed, resulting in Sydney Water Corporation (the government-owned corporation which replaced the Water Board in 1983) being broken into two major parts:

121 No Dam is a Welcome Relief for Braidwood, Sydney Morning Herald, 21 July 1993 122 The Royal Commission was chaired by Peter McClelland QC.

347 Chapter 7 – Case Study : Sydney’s Water System…

Sydney Water which has distribution responsibility and the Sydney Catchment Authority which is responsible for catchment management (SMH 30 Oct 89, Stein (2000)). The second event was a prolonged dry period, lasting from 2000 to 2007. By 2005, concern was growing that should the drought extend much beyond the longest on record, Sydney’s supply of water could become precariously low. There was considerable public discussion and dissatisfaction with both government and Sydney Water’s response to the situation (SMH 15 May 2006). Various solutions have been proposed including tapping previously unutilised groundwater, sewage and stormwater treatment, and desalination of sea water. Construction of a desalination plant at Kurnell commenced in 2007.

Institutional arrangements Until the 1970s, much of construction of water reticulation, sewerage, and drainage was done using manual labour123. The workforce was unionised but there was generally a harmonious relationship between the unions and management. However, in 1975, during a period of union militancy and high wage inflation in the broader community, the relationship between the unionised workforce and management deteriorated, culminating in a lengthy strike. During the strike, raw sewage fouled Sydney’s ocean beaches, broken water mains were not repaired, and public dissatisfaction soared. Opinions vary as to the underlying causes of this breakdown in industrial relations: one viewpoint was that the harmonious relationship failed to deliver wage increases which were common in other industries during a period of full employment; another was that it was a generational change as a younger group came through the workforce who had no experience of the hardship of the Depression and immediately after the Second World War when work was scarce; still another was that it was largely a result of a clash between an intransigent board and a new breed of militant unionist (Beazley 201-205). The board had been reconstituted in 1972 in response to perceptions that the prevailing structure was inefficient and bureaucratic. The disruptions of the 1970s led to an enquiry and a further reconstitution of the board in 1983, reflecting new public expectations regarding statutory authorities. The new board consisted of six part-time board members, and a full-time general manager, all of whom were appointed by the government. But the performance of the Water Board had become a major political issue and the problems relating to ocean beach pollution in the 1980s, and continued public perceptions of

123 The Water Board was one of the biggest employers in Australia of migrant labour in the 1950s. It was not until 1970s that boring machinery was routinely used for sewerage excavation (Beazley (1988), pp188-189, 219).

348 Chapter 7 – Case Study : Sydney’s Water System… inefficiency lead to a further restructuring of the in 1993, establishing it as a state-owned corporation. The Water Board responded to becoming a target of public dissatisfaction with advertising and public relations campaigns, an approach which was largely unsuccessful (Beder (1998)). Subsequently, in 1993, the Board was abolished and replaced by a state-owned corporation, the Sydney Water Corporation (referred to as Sydney Water). Since 1983, the Water Board and its successor, Sydney Water, have been transformed from an engineering organisation to a commercial entity (Beazley 173, 213- 215). The engineering group was dismantled, with most engineering being let out to private contractors and the large construction group was considerably reduced in size, with construction work also being subcontracted to the private sector. As a state-owned corporation, the NSW government now expects hundreds of millions of dollars each year in dividends from Sydney Water, with the consequence that income which previously had been directed into capital expenditure is now paid to the State Treasury as a dividend.

In 1998, resulting from findings of the McClelland Royal Commission, responsibility for catchment management was taken from Sydney Water and given to the Sydney Catchment Authority (SCA), a newly-established statutory body representing the Crown. The board of the SCA consists of a managing director and chief executive, and between four and eight board members appointed by the Minister. Three board members must be chosen from a nominee of the NSW Farmers’ Federation, a nominee of the Nature Conservation Council of NSW, and an elected councillor of a local government area within the catchment area (cite Act). The functions of the authority are to supply water to Sydney Water Corporation and other prescribed authorities while taking steps to ensure that catchment areas and infrastructure are managed so as to promote water quality, to protect public health and safety, and to protect the environment. In 2003, the NSW State government, in conjunction with the Federal government, established 13 further catchment management authorities covering all catchments in NSW. These authorities have boards consisting of local residents and landholders and are responsible for advising the government on catchment health. They also have limited funding to undertake environmental projects124.

124 Two of these authorities are the Hawkesbury-Nepean catchment management authority and the Sydney metropolitan catchment management authority. The establishment of these authorities did not replace the Sydney catchment authority which still has the main responsibility for maintaining sustainable catchment health for the Sydney metropolitan area.

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Discussion Several important matters emerge from this consideration of this narrative. They can be considered from two perspectives. On one hand, Sydney like most major cities in developed countries, saw construction of major water infrastructure over the last 150 years or so which made extraordinary improvements to public health and quality of life. The institutions which were responsible for the construction and management of this infrastructure was strongly influenced by engineers – initially civil engineers but subsequently, engineers of all disciplines. Through protection of catchment areas, treatment of water, distribution systems, effluent management, sanitary drainage, sewerage, an integrated water management and sanitation system was developed which effectively eliminated many communicable, water-borne diseases. Water was made available to service both industrial and domestic use, despite major challenges of climate and rainfall variability. Today, these well-documented technical achievements are largely taken for granted.

But there is another interpretation. From the initial days of the formation of formalised institutional arrangements in the mid-19th-century, engineers were highly influential in decision-making regarding Sydney’s water system. From the 1840s onwards, engineers not only took a great interest in development of Sydney’s water system but were very influential in the institutional arrangements which evolved. Engineers were strongly represented on the Royal commission of 1869, an engineer from London, W. Clark, reviewed the Royal Commission’s findings, and engineers were appointed to “official positions” when the Water Board was established in 1888. As Beazley (1988) points out, the Water Board became an engineering institution. Beder (1989b), in her extensive consideration of the development of Sydney’s sewerage system, notes that there is a strong cultural consideration of the influence of engineers on the development of Sydney’s water system. The reliance on water as a means not only to supplying both domestic and industrial requirements for day-to-day living but also as the primary means of sanitation was established early on. For example, in the late 19th century, in the spirited debate regarding dry conservancy versus wet carriage for removing and transporting sewage, wet carriage won the day. Beder argues that this was not simply a technologically-won argument but that the socially-constructed paradigm used by engineers, together with their political influence and expertise resulted in the dismissal of alternative technologies, based on such considerations as cost minimisation (in particular

350 Chapter 7 – Case Study : Sydney’s Water System… the utilisation of existing assets), institutionalisation of technological education (engineers were taught only one technology – wet carriage – without consideration of other technologies). The momentum created by this approach continued to require development of massive infrastructure without adequately evaluating options which may have been more cost-effective and, perhaps, more technologically effective.

Beder touches upon but does not develop fully an important point – the instrumentalist philosophical paradigm which underlies the practice of engineering. It argued here that the situation arose primarily because of the instrumentalist view which engineers take to their discipline. The engineering profession is focused on technological and economic effectiveness. It utilises science and existing technology to develop solutions with minimal capital expenditure and maximum technological and cost effectiveness. The paradigm is not confined to the utilisation of science in the development of technology or the maximisation of capital utilisation but also extends to utilisation of ecological and human resources. As long as society was willing to sacrifice ecological and individual well-being for some notion of “greater good”, the instrumentalist engineering paradigm and the social paradigm of the day were largely aligned. However, in the 1970s the two paradigms diverged.

In the 1960s and 1970s, there was a significant shift in societal values: late modernist thinking, critical theory, and postmodernism had a notable influence on Western thought. While the technologically-focused disciplines such as engineering continued to be based upon an instrumentalist, positivist philosophical perspective, the change in broad community values led to a collapse in confidence in the technological disciplines, including engineering. Social expectations changed significantly, with expectations that labour should be adequately rewarded, occupational health and safety of workers should be respected, and that ecological responsibility (recognising either its extrinsic or intrinsic value) was important. Because the Water Board, with its predominantly technologically- oriented engineering paradigm did not recognise this change in social expectations, it slipped out of step with the community values. Inability to respond to this mounting public dissatisfaction and consequent political pressure resulted in the institution being dismantled and the engineering influence which had dominated the Water Board for a century was largely eliminated. Over a period of about 20 years, the Water Board, as an engineering institution, was dismantled and the engineering services moved to the private

351 Chapter 7 – Case Study : Sydney’s Water System… sector. As a result of public pressure, the Water Board (and its successor organisations, Sydney Water and the Sydney Catchment Authority) became both corporatised and politicised, a state of affairs which prevails at the time of writing.

It will be recalled that in Chapter 3, the Type 3 problem was characterised as a problem which, “due to its uniqueness and complexity, precludes or limits the use of the purely analytical techniques, and which also requires the engagement of a stakeholder set with conflicting worldviews. Human stakeholders have what appear to be irreconcilable differences in beliefs and values, and a willingness to exploit power imbalances coercively to achieve their own ends. Moral status of all stakeholders and their interests may be difficult to identify and some (for example, non-human species) may not be formally represented in the decision-making constituency.” An important point that emerges from this narrative is that the problem of providing a satisfactory water system for the metropolis of Sydney has evolved into a Type 3 problem. For a 80 years or more, the problem can be considered to have been predominantly Type 1 – it was seen to be largely a technological challenge which would respond to the traditional, reductionist engineering approach. In the 1960s and 1970s, the complexity of the water, sewerage, and drainage system continued to evolve and the “soft” issues of operational efficiency, industrial relations, and economic requirements came to be of central concern – the situation became a Type 2 problem. But in the last thirty years, the complexity of the situation increased greatly: apparently irreconcilable differences among human stakeholders, the environmental impact of proposed solutions – particularly in relation to riparian health, wilderness areas, the significance of archaeologically important indigenous sites, and the interests of non-human species – have further complicated the problem situation. Social expectations diverged from those of the traditional engineering paradigm: politics, differences in social perspective, shifts in power, coercive behaviour within the problem constituency, differences in stakeholder worldviews, beliefs and values, and a range of issues with differences of opinion regarding importance became increasingly dominant in the discourse. In recent years, with the prospect of a serious drought facing Sydney, the situation was further exacerbated. The result was inadequate decision-making processes, governance arrangements for the water supply authorities which have been widely regarded as ineffectual, increasing political secrecy and coerciveness, and a lack of community engagement. In short, the situation exhibits all the characteristics of a Type 3 problem.

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Appendix 7.4 – Trilemma System Maps The following are the trilemma system maps representing the metropolitan system. See section 7.3.7.1 for the process for preparing trilemma system maps.

The Modern Industrial trilemma… Utopia Dystopia • Articulate, highly regarded, • Weak but influential technologists influential professional institutions Technocratic • Strong regulation not underpinned by • Strong, intelligent regulatory Technocratic capable technologists framework • Powerful design and build lobby pursuing • Strong capacity to design, build and its own sectional interests operate facilities • Strong technological lobby influenced by • Strong local capability with access interests other than technology to global resources Utopia • Readily available avenues to express Influence

Technological community concern • Strong capable community leaders Dystopia ” • Sectional interests dominate s • Good information flow to citizens (media etc) ModernI • Corrupt s • Strong participative culture in the community AIndustrial • Knowledgeable citizens • Intimidated bureaucracy “ C t o al n m ic e C m • Community involved in consideration of • Short-term poll-driven decision-making it m o u ol h n n P is ce ity bl r issues well in advance of decisions being • Public relations used to sell decisions a n st E required Engaged CoerciveCoercive Utopia Engaged Politics • Democratically elected capable CommunityCommunity Politics political representation • Incorruptible • Wise, sustainable approach to public Dystopia agenda • Dominated by sectional and special interests • Strong decisive leadership "NIMBY" attitude prevails • Strategic rather than tactical • Uninterested • Capable, politically neutral • Uninformed bureaucracy

The Modern Industrial trilemma…

Characteristics of the “As Is” situation • Slow decision-making Technocratic • Driven by crisis Technocratic • Fragmented approach to technology • High risk of sub-optimal solutions being selected • Timeframe is too short for optimal outcome •Missed opportunities to optimise across technologies •More expensive in capital and operating costs

• Risk of social disruption Influence Technological • Negative impact on economic growth ” • Risks to environmental outcomes s ModernI s AIndustrial “ C t o al n m ic e C m it m o u ol h n n P is ce ity bl r a n st E Engaged CoerciveCoercive Engaged Community PoliticsPolitics Community

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The Skeptic trilemma…

InformedInformed PrecautionPrecaution Utopia Dystopia • Clear distinction between the • Decision paralysis rational and irrational • No distinction between belief • Balance between belief and and knowledge rationality • Decision to act based on rational understanding level of

risk and knowledge of impact Uncertainty

Skeptic Utopia • Clear distinction between beliefs and Dystopia science ce B • Scientific practice not rigorous n e e “As Is” lie • Beliefs seen as important social elements ci f • Political or sectarian interest influential S • Lack of rigour in scientific method

Responsible Utopia Rational Responsible • Strong scientific institutions Rational ScienceScience • Robust peer-review process UnderstandingUnderstanding • Recognises uncertainty in framing Dystopia conclusions • Pseudoscience replaces rational science • Recognises the importance and • Confusion between belief and reality influence of beliefs and values • Theories not subject to the test of falsification

The Skeptic trilemma…

Informed Characteristics of the “As Is” situation Informed • Although science and technology is practised at PrecautionPrecaution a high level by international standards, it lacks influence in the political process. • Pseudoscience is making inroads into some areas of decision-making. • The precautionary principle is not widely understood or embraced. • Government decision-making is secretive and Uncertainty reactive. • Uncertainty and risk is transferred to other Skeptic parties by government, rather than being managed through soundly crafted policy

e B nc e e “As Is” lie ci f S

ResponsibleResponsible RationalRational ScienceScience UnderstandingUnderstanding

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The Lifestyle trilemma…

QualityQuality of of Life Utopia Life Dystopia • No water-borne disease • Inadequate water for good sanitation • Good sanitation • Poor sewerage and drainage • Plentiful water without wastage infrastructure • Pleasant, comfortable • Desirable lifestyle unachievable due to surroundings restricted water supply

Health/ Utopia “As Life of Quality Is” • Water infrastructure integrated into the ecology Dystopia Lifestyle • Healthy ecosystems both within and • Inefficient, high cost infrastructure around the metropolis • Investment capacity limited • Ecological interests of both human • Economic growth constrained by E s co and nonhuman species well ic lo inadequate water infrastructure m co g o n ic protected n ce al • Water and sanitation expensive by o rn Ec • Reasonable cost of water world standards infrastructure

Utopia Healthy EfficientEfficient • Efficiently functioning market for water, Healthy Economy sewerage, and drainage EcologyEcology Economy • Sound balance between satisfying Dystopia ecological and human needs • Irreparably damaged ecology • Efficient use of capital • Human interests overwhelm those of other • Price reflects social, economic and species and ecosystems environmental costs and benefits

The Lifestyle trilemma… Quality of Characteristics of the “As Is” Quality of Characteristics of the “As Is” situation LifeLife situation (cont’d…) • Standards of public health and • Sydney lifestyle (e.g. swimming sanitation are high by world pools, gardening, public spaces, standards, with little or no water- etc) require significant amounts of borne disease. water. • Generally adequate sewerage and • Approaching the point where are drainage infrastructure, although this restrictions on water supply may is ageing. Health/ constrain economic growth. “As Life of Quality Is” • Water usage is relatively high by • Further increases in water supply developed countries standards. capacity, a respective of the • During periods of low rainfall, some Lifestyle choice made will probably have environmental problems exist and significant environmental and E water restrictions are required. s co economic impact. ic lo m co g o n ic n ce al o rn Ec

Healthy EfficientEfficient Healthy Ecology EconomyEconomy Ecology

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The Business Model trilemma…

MonopolyMonopoly

Utopia Dystopia • Well-run, efficient, low-cost • Inefficient, high cost service provider • High capital cost • Optimum balance between • High operating costs capital costs and • Insensitive to customer needs operating costs Capital Efficiency Dystopia ” • Inefficient operation protected s I by government s ABusiness Utopia • Potentially viable private operators “ • Efficient access to global capital excluded from market Model F market • Development of infrastructure re nt C e • Low-cost ig e a M falls behind economic growth rate B p a nm ita rk r li et • Well-allocated resources across a • Decision paralysis on ve sm o range of competitors important new investment G Utopia PrivatePrivate PublicPublic • Efficient use of low-cost government OwnershipOwnership OwnershipOwnership debt Dystopia • Low-cost • Competitive pressures reduce capacity to • Well-allocated resources across a range serve customers of competitors

The Business Model trilemma…

MonopolyMonopoly Characteristics of the “As Is” situation • Government monopoly. • Water assets are inefficiently operated. • Private operators excluded from market. • Decision paralysis on important new investment. • Dividend being paid to government Capital

revenue rather than being invested in Efficiency infrastructure improvement ” s I s ABusiness “ Model

Fr t e n C e ig e a M B m p a n ita rk r li et ve s o m G

PrivatePrivate PublicPublic OwnershipOwnership OwnershipOwnership

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The Public Interest trilemma…

InformedInformed PublicPublic Utopia Dystopia • Responsible media coverage • Influenced by sectional interests • Well-informed, balanced • Politically biased discussion • Limited public debate • Responds to the public interest Media Utopia Dystopia • Strong local leadership engages a • Sectional and vested interests remove wide cross-section of the community objectivity from decision-making Public • Local communities see themselves ” as an integrated part of the • “Pork-barrelling” a major influence in Interests policy determination I C metropolis s E om • Insensitive to community opinion s n mu • Political process used as a major ic A g it “ ag n ol e it influence on public policymaking • Public agenda driven by media P me y nt

Utopia Involved Strong Involved Strong • Motivated by public good, not vested Community Government interests Dystopia Community Government • Bipartisan approach to long-term • “NIMBY” effect predominates strategic issues • Shallow, uninformed community discussion • Competent, largely independent • Weak or non-existent community leadership bureaucracy • Self-interested local politics dominates the process

The Public Interest trilemma…

InformedInformed PublicPublic Characteristics of the “As Is” situation • Media excluded from information. • Government secretive. • Strong "NIMBY" effect. • Little well-informed public discussion. • Government insensitive to public opinion.

• Limited public debate. Media • Little community leadership. • Gagged bureaucracy. Public Interest” Is C s E omm s A ng tic “ a u li g ni o em ty P e nt

InvolvedInvolved StrongStrong CommunityCommunity GovernmentGovernment

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The Vested Interests trilemma…

FreeFree Market Market

Utopia Dystopia • Vested interests with strong • Weak government does not sense of civic responsibility adequately constrain interests • Guided and constrained by • Solution is expensive and inefficient intelligent regulation • Ineffective regulatory environment • Community concerns and perspectives sought and included in solution Vested Interests

Dystopia • Sectional and vested interests remove Vested” objectivity from decision-making s Utopia Interests I • “Pork-barrelling” a major influence in s • Responsible media coverage policy determination “A • Well-informed, balanced s M • Insensitive to community opinion ic e discussion lit d o ia • Public agenda driven by media P • Responds to the public interest

Informed StrongStrong Utopia Informed • Motivated by public good, not vested Public GovernmentGovernment Public interests Dystopia • Bipartisan approach to long-term • Influenced by sectional interests strategic issues • Politically biased • Competent, largely independent • Limited public debate bureaucracy

The Vested Interests trilemma…

FreeFree Market Market Characteristics of the “As Is” situation • Insensitive to public opinion. • Public agenda heavily influenced by media. • Weak government struggling to constrain private interests. • Public suspicion of political processes. • Little well-informed, balanced discussion.

• Media coverage superficial. Vested • No bipartisan approach to long-term strategic Interests infrastructure issues. • Intimidated bureaucracy. Vested” • Secretive government decision-making. s Interests I s “A s M ic e lit d o ia P

Informed StrongStrong Informed Public GovernmentGovernment Public

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The Social Contract trilemma…

GoodGood Government Utopia Government Dystopia • Motivated by public good, not vested • Sectional and vested interests remove interests objectivity from decision-making • Bipartisan approach to long-term • “Pork-barrelling” a major influence in strategic issues policy determination • Competent, largely independent • Insensitive to community opinion bureaucracy • Public agenda driven by media Politics

Dystopia • Politically active judiciary Social Utopia • Distinction blurred between political • Responsible corporate governance and legal processes “AsContract Is” G practice • Corrupt judiciary o l E v a x er • Interests of all stakeholders • In competent judiciary g m pe na Le is c n iv ta ce considered • Overly influential plaintiffs bar ct tio A ns • Open, inclusive governance • Overly litigious community processes

Utopia CorporateCorporate LegalLegal • Trusted, respected legal processes CitizenshipCitizenship DominanceDominance resolve genuine differences Dystopia • Deters and punishes illegal behaviour • Corrupt or ineffectual directors • Seen as a last resort to resolve • Lack of transparency in governance processes differences • Lack of balance in “triple bottom-line” • Intelligent interpretation of legal principles and social context

The Social Contract trilemma…

Characteristics of the “As Is” situation GoodGood • Trusted, respected legal processes. Government • Judicial and political processes remain Government separate. • Incorruptible judiciary. • Highly litigious public attitudes. • Tendency towards judicial activism. • Largely responsible corporate governance practices. Politics • Secretive, exclusive government policy- making. • Public suspicious of the influence of vested Social interests in policy determination. • Bureaucracy largely competent but “As ContractIs” G o intimidated by politicians. l E v a x er g m pe na • Public agenda strongly influenced by Le is c n iv ta ce ct tio superficial media attention. A ns

CorporateCorporate LegalLegal CitizenshipCitizenship DominanceDominance

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Appendix 7.5 – Multidimensional Conjugate Cognitive Maps

Following are selected examples of the conjugate cognitive maps. In the Warren Centre project, all dimensions were thoroughly mapped during analysis process.

“As Is” – Social Government insensitive to public opinion Media plays the wrong role; it mis-shapes the Influence of media in Competing interests – debate, is counter- “filtering” information no public meeting; no productive Media manipulated “Domain” anymore Media & public policy Erosion of the Disconnect between the instruments for public government and Over-estimation of the opinion influencing community – empowers capabilities of science government media manipulation “Token gesture” to community involvement

Decline in science and Shift in values and engineering Malconnect between public policy and public perceptions of “the good life” – what are the Corporate governance Value of science & opinion characteristics of “the is prudential and engineering good life” fiduciary, not moral Values & Gaps in knowledge of prosperity how life-style affects environment

Public retreat from long- We do not use right Constrain “prosperity” term perspective tools and indicators rather than “economic Where risk lies and how growth” to manage it

People taking things into their own “Likely Future” – Social hands – “sporadic” or individually “small scale” Increase in Divisive, uncohesive anarchy Increased social information and response inequity and misinformation in therefore social the media – Process for tensions legitimate media resolution of information will Social dissent social issues increase but may Social divide will be be swamped exaggerated by Reform will centre Undermines civil crisis around public Panic over principle; society debate/discourse precautionary around social principle goes out expectations of Increasing the window Greater involvement government and of community; impossibility of “As business local government Is” life-style – see Not learning from and communities Goulburn for a history take individual foretaste Technology actions becomes Quality of life marginalised to & aesthetics the point where it undermined Can lead to ill- is constrained to conceived Aesthetic issues solutions in a very solutions become limited state secondary

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“As Is” – Political Need to understand Erosion of the where risk lies and instruments for how to manage it No free public opinion market influencing Government government insensitive to public Public retreat from opinion long-term perspective Policy made in isolation – does not consider the big Disconnect between Market model Poll-driven picture the government and dominates politics community – and all levels of empowers media government manipulation

County Councils no Disconnect between Malconnect between longer elected government and public policy and private sectors, No independent public opinion thereby precluding governance in public possible good instrumentalities and solutions corporations

“Likely Future” – Political

Potential to react efficiently by Crisis drives needs combination of change in government and government attitude private investment and regulation, doing potentially detriment to health and environment Probably will be Can lead to ill- resolved politically – conceived solutions state/federal

Government is more Government given authoritarian power to act

Greater political unpredictability

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“As Is” – Institutional

County Councils no longer elected Market model Career politicians dominates politics lose touch with the and all levels of public – defer to government polls as a surrogate Current “As Is” does not enable creative policy and outcomes No independent governance in public instrumentalities and Planning – no corporations Disconnect between bipartisan and long- government and term approach private sectors, thereby precluding possible good solutions Corporate governance is prudential and fiduciary, not moral

“Likely Future” – Institutional

Potential to react Current situation efficiently by does not lead to combination of Government given long-term insights government and power to act into a “good” private investment solution

Crisis derives needs change in government attitude and regulation, doing There will be a move potentially away from legal detriment to health dominance and environment Reform will centre around public debate/discourse around social Greater involvement expectations of of community; government and local government business and communities take individual actions

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Appendix 7.6 – Straw Proposal Narrative

Discussion Material for Metropolitan Water Options Project Forum Thursday 11 May 2006 Australian Technology Park, Sydney

Characterisation of the “As Is” Sydney metropolitan system [The following characterisation of the Sydney metropolitan system has been described by developing and critiquing seven “trilemmas” representing various forces and tensions which are thought to be relevant to provision of a long-term, sustainable water system.]

General Narrative Decision-making with regard to water has historically been slow and driven by crisis. There is a fragmented approach to technology which runs the risk of leading to suboptimal solutions being selected. Because the timeframe is too short for an ideal outcome to be achieved, opportunities are missed to optimise across a range of technologies and may result in high capital and operating costs. This also leads to the risk of social disruption and can have negative impact on economic growth. Environmental outcomes are also compromised.

Although science and technology are practice at high level by international standards, they tend to lack influence in the political process. In some areas bad or incomplete science has a negative impact on decision-making. The “precautionary principle” is not widely understood or embraced and government decision-making is secretive and reactive. There is a tendency to transfer uncertainty and risk to other parties rather than being managed by the government through soundly crafted policy.

Standards of public health and sanitation are high by world standards, with little or no waterborne disease. This is due to generally adequate sewerage and drainage infrastructure although this is now ageing and requires substantial maintenance. Water usage is relatively high by developed country standards with Sydney’s lifestyle (e.g. swimming pools, gardening, public spaces etc) requiring significant amounts of water. During periods of low rainfall, significant environmental problems exist, particularly in inland waterways, and water restrictions are required. The point is being approached

363 Chapter 7 – Case Study : Sydney’s Water System… where restrictions on water usage may constrain economic growth. Irrespective of the choice made, further major increases in water supply capacity will almost certainly have significant social, economic, and environmental impact.

Currently, the government has a monopoly over water assets, with private operators excluded from the market. Water assets are inefficiently operated, with income being paid as a dividend the government rather than being reinvested in maintenance and infrastructure improvement.

Government decision-making tends to be secretive and exclusive, with the bureaucracy and private contractors involved in the water industry effectively gagged. The media is excluded from key information, but even relatively superficial media coverage heavily influences the public agenda. There is a strong “NIMBY” effect, with little balanced, well-informed public discussion and a government which appears to be poll-driven and insensitive to public opinion. There is little public debate and little community leadership, other than in some local special-interest groups. There is a general public cynicism that vested interests are influential in policy determination.

With the public agenda heavily influenced by the media there is public suspicion of the political processes and a lack of multi-party approach to long-term strategic infrastructure issues.

The legal processes are trusted and respected with judicial and political processes remaining separate. There tends to be less judicial activism at the State level than has been displayed in recent years at the Federal level. Government and semi-government instrumentalities although governed by boards of directors this lack independence and are not free from government influence. These instrumentalities largely lack effective corporate governance practices.

Critique of the “As Is” Sydney metropolitan system This outline sketch of the Sydney metropolitan system as it stands today, is now considered in terms of eight problem dimensions (Political, Regulatory, Institutional, Economic, Health, Environmental, Social, and Technological).

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Political The current political situation appears to be characterised by a government which is insensitive to public opinion, due perhaps to apparent disconnect between government and the community. Government response seems poll driven, giving the opportunity for manipulation by special interest groups. The media is influential in determining government response to polls and major issues and is manipulated by special interest groups and the government itself. There appears to have been an erosion of the instruments for public opinion influencing government and a general retreat of the public from consideration of long-term issues. Although there has been a significant adoption of the free market model at all levels of government, publicly owned instrumentalities and corporations do not have boards independent of government influence and there is a disconnect between government and the private sector. The combination of these factors potentially precludes the delivery of possible good solutions to complex problems. A further issue in relation to corporate governance is that current governance practice focuses on prudential and fiduciary responsibilities with little emphasis on moral obligation. Where water supply is being considered moral issues relating to wilderness areas, long-term effects of pollution, environmental damage, and energy requirements are important considerations.

Regulatory Regulation currently prevents private operators from accessing certain public activities, water being a notable one. County Councils are no longer elected and have limited responsibility for provision of utilities.

Institutional As with many activities in modern society, politics is now largely considered a career rather than an activity of public service later in life. Career politicians tend to lose touch with the public, with the consequence of needing to defer to polls as a surrogate. Government and semi-government instrumentalities, although overseen by boards, lack true independence and effective corporate governance.

Economic Although there has been a move to opening government business to the private sector, private operators are peripheral to the main operators and there is no free market for private citizens to access. This has led to inefficient operation and maintenance of public

365 Chapter 7 – Case Study : Sydney’s Water System… assets. Economic rationalism is the prevailing government paradigm, with a significant transfer of risk to the private sector. There is little long-term, low interest government debt being applied to water infrastructure. It is open to question how well risk is understood and managed. Although there is a lot of capital available to invest in infrastructure in NSW, there is a reluctance to place capital in long-term investments. With the emphasis that economic rationalism places on economic growth there is a question whether high rates of economic growth are sustainable in the long-term and that whether a better measure may not be “prosperity”.

Health Generally, the health and sanitation of Sydney’s water system is considered to be excellent by world standards. There is essentially no water-borne disease and sanitation from Sydney’s independent drainage and sewerage systems is to a very high standard.

Environmental There are gaps in knowledge of how lifestyle affects environment.

Social There is little opportunity for citizens to influence formulation of public policy. Media coverage is influential though incomplete, with a perception that the debate is mis- shaped by government and special interests. Public meetings are unusual and there is no longer a “Domain” where public concerns are debated. Community engagement is often seen to be a token gesture. The economic rationalist approach has had strong influence on Australian society with a shift in values towards economic wealth, rather than in a more broadly encompassing notion of “prosperity”. There has been a decline in the influence of science and engineering, together with paradoxical overestimation of the capability of science to deliver satisfactory outcomes yet a distrust of the “expert”. Corporate governance is viewed with some scepticism, largely due to the emphasis placed on prudential responsibility rather than fiduciary and moral accountability. There is a low public tolerance for risk and little public consideration of long-term perspectives.

Technological There has been a decline in the interest in science and engineering in recent years. At the same time as an overestimation of the capacity of science to deliver solutions. There has also been a focus on economic return on assets, leading to short-term economic return in

366 Chapter 7 – Case Study : Sydney’s Water System… operating operation and maintaining of public assets, leading to poor reliability and maintenance.

“Most Likely” response of the “As Is” Sydney system Consideration is now given to the way in which the “As Is” system will respond to a situation where: there is a very long period of hot dry weather where rainfall is much below the historic average; Sydney’s population continues to grow at the today’s rate; energy becomes increasingly expensive.

The likely response of the Sydney metropolitan system to such a disturbance is outlined below.

As the sense of crisis increases, the government will probably be given much greater power to act. The consequence of this is to increase social dissent and runs the risk of undermining civil society – the response tends to be divisive and incohesive. Technology becomes marginalised and constrained because of the limited avenues open, due to lack of response time. As the crisis worsens, there is a risk that the government will become more authoritarian. Precaution regarding the consequences of policy gives way to panic. Little regard is given to history and ill-conceived solutions are rushed through the regulatory and political processes. There is a high risk that long-term insights into a “good” solution are missed and opportunities no longer exist to integrate the solution of short-term and long-term problems, due to the urgency of the situation.

Although there will be more rapid deployment of optimal technologies, such as recycling, as lifestyle suffers, the economic imperative dominates, with quality of life and ecology suffering. As these issues become secondary the ecology is the big loser. There is increased risk of people taking things into their own hands, leading to small-scale anarchy, social tension, and inequity.

Production of water will dominate over economic efficiency with the crisis driving change in government attitude and regulation, with potential detriment both to health and environment. The economics of scale is likely to lead to monopolisation and but

367 Chapter 7 – Case Study : Sydney’s Water System… with the current public/private partnership approach there are opportunities to quickly make public and private investment to implement solutions.

As the situation worsens, greater concern and involvement of the community is likely, with local government and community groups being encouraged to take individual action. It is likely that there will be an increase in both information and misinformation in the media: legitimate media information may well increase but also may be swamped by vested interest manipulation.

The issue is likely to take on a national character and will probably be resolved politically at the State/Federal level.

Legal and regulatory reform could be expected as a consequence of public debate and discourse around the social expectations that the community has of government and business to resolve the crisis.

“Desirable Future” response Consideration was being given to imagining what a “Desirable Future” might look like and this is described below.

The community is involved in the early stages as the problem is identified, so there can be careful consideration of the issues well in advance of decisions being required. There is a wise, sustainable approach to the public agenda undertaken by all political parties with strong, decisive leadership. Professional institutions are articulate and highly regarded and trusted participants in the public debate.

There is a well informed, balanced discussion on the seriousness of the issue and a consensual approach is followed to consider and resolve long-term strategic issues. Strong local leadership engages a wide cross-section of the community with local communities seeing themselves as integral parts of the total metropolis.

Public decision-making and policy determination recognises the importance influence of a range of beliefs and values in society. Decisions are made based on a rational understanding of the level of risk and the knowledge of the impact of decisions. There is

368 Chapter 7 – Case Study : Sydney’s Water System… a clear distinction existing between the influence of beliefs and values, on one hand, and science and technological solutions, on the other.

Water is plentiful without wastage with healthy ecosystems both within and around the metropolis. There is good sanitation and water infrastructure is integrated into the ecology. There is an efficiently operating market for water, sewerage, and drainage, with the price reflecting social, economic, and environmental costs and benefits.

There is an optimal balance between capital cost and operating cost, with assets being efficiently constructed and maintained. There is an efficient use of low-cost government debt, efficient access to global capital markets and an integrated public/private approach to the construction and operation of water infrastructure.

Vested interests are encouraged to take a consensual approach to long-term strategic issues and are guided and constrained by intelligent regulation. The strategic nature of major infrastructure development is recognised and handled by government through institutions which transcend political boundaries.

The consensual approach to resolution of long-term strategic issues, motivated by the public good, not vested interests is supported by an open, inclusive governance process. There is intelligent interpretation of legal principles within the social context of metropolitan Sydney.

7.5 References

Aird, W. V. (1961a) The Water Supply, Sewerage and Drainage of Sydney, 1788-1960, Sydney, Australia, Halstead Press Pty Ltd, 105-111. Aird, W. V. (1961b) The Water Supply, Sewerage and Drainage of Sydney, 1788-1960, Sydney, Australia, Halstead Press Pty Ltd, 28-31. Aird, W. V. (1961c) The Water Supply, Sewerage and Drainage of Sydney, 1788-1960, Sydney, Australia, Halstead Press Pty Ltd, 201-203. Aird, W. V. (1961d) The Water Supply, Sewerage and Drainage of Sydney, 1788-1960, Sydney, Australia, Halstead Press Pty Ltd, 18-19. Aird, W. V. (1961e) The Water Supply, Sewerage and Drainage of Sydney, 1788-1960, Sydney, Australia, Halstead Press Pty Ltd, 11-14. Aird, W. V. (1961f) The Water Supply, Sewerage and Drainage of Sydney, 1788-1960, Sydney, Australia, Halstead Press Pty Ltd, 3-11. Australian (2004) The Australian, 23 Oct, Planning for the bigger dry.

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Australian (2005) The Australian, 5 May, New dam needed to slake Sydney’s thirst. Beazley, M. (1988) The Sweat of Their Brows: 100 Years of the Sydney Water Board, 1888-1988, Sydney, Australia, Water Board, Sydney, Illawarra, Blue Mountains, 173-174. Beder, S. (1989a) From Pipe Dreams to Tunnel Vision: engineering decision-making and Sydney sewage system, Sydney, Australia, 369-376. Beder, S. (1989b) From Pipe Dreams to Tunnel Vision: engineering decision-making and Sydney sewage system, Sydney, Australia. Beder, S. (1990) Early Environmentalists and the Battle Against Sewers in Sydney, Royal Australian Historical Society Journal, 76, 1, 27-44. Boyne, G. A. & Cole, M. (1998) Evolution and Local Government Structure: An Empirical Analysis of London, Urban Studies, 35, 4, 751-768. Bryson, J. M. & Ackermann, F. (2004) Visible thinking: unlocking causal mapping for practical business results, Chichester, UK, John Wiley & Sons. Clark, D. (1978) “Worse Than Physic”: Sydney's Water Supply 1788-1888. in Kelly, M. (Ed.) Nineteenth-Century Sydney: essays in urban history, Sydney, Australia, Sydney University Press, 54-65. Clark, W. (1877) Sydney Water Supply: Report to the Government of New South Wales on Various Projects for Supplying Sydney with Water, Sydney, Australia, New South Wales Government, 1-42. Cohen, I. (2006) A sustainable water supply for Sydney - evidence, Sydney, Australia, Parliament of New South Wales. DIPNR (2004) Meeting the challenges – Securing Sydney’s water future, Sydney, Australia, New South Wales Government (Department of Infrastructure Planning and Natural Resources). Midgley, G. (1992) The sacred and profane in critical systems thinking, Systems Practice, 5, 1, 5-16. NSW Department of Planning (2005) City of Cities: A Plan for Sydney’s Future - Metropolitan Strategy, Sydney, Australia, Government of New South Wales. NSW Dept. of Planning (2005) City of Cities: A Plan for Sydney’s Future - Metropolitan Strategy, Sydney, Australia, Government of New South Wales. NSW Government (2006) Metropolitan Water Plan, Sydney, Australia, Government of New South Wales. NSW Premier's Department (2006) A New Direction for NSW: State plan, Sydney, Australia, Government of New South Wales. NSW Treasury (2006) State infrastructure strategy: NSW 2006-07 to 2015-16, Downloaded from: http://www.treasury.nsw.gov.au/sis/sis-2006 (31 Dec 2007). Palme, U. & Tillman, A.-M. (2007) Sustainable development indicators: how are they used in Swedish water utilities?, Journal of Cleaner Production, (in press). Parkin, J. (2000) Engineering Judgement and Risk, London, Thomas Telford, 158-176. Richards, T. (1883) An Epitome of the Official History of NSW, from the foundation of the colony in 1788, to the close of the first session of the 11th Parliament under responsible government in 1883, Sydney, Australia, Thomas Richards, NSW Government Printer, 92. Schwartz, P. (1966) John Stuart Mill and laissez faire: London water, Economica, New Series, 33, 129, 71-83. Seebohm, K. (2000) The Welcome Reef dam Proposal as a Case Study of Social Assessment Practice by Australian Water Utilities: Research Report No. 154, Urban Water Research Association of Australia, 24-53. SMH (2004) Sydney Morning Herald, 20 Oct, The plan is to waste water. SMH (2006a) Sydney Morning Herald, 30 Nov, Era of obsessive secrecy is eased with a grunt. SMH (2006b) Sydney Morning Herald, 9 Feb, The Great Carr Crash.

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SMH (2006c) Sydney Morning Herald, 22 Dec, Record dam low brings new talk of desalination. SMH (2006d) Sydney Morning Herald, 22 Feb, Sydney plan in jeopardy as expert panel axed. SMH (2007a) Sydney Morning Herald, 21 Jun, Desal plant to ‘future-proof’ water supply. SMH (2007b) Sydney Morning Herald, 30 Oct, Rival may seek damages over desal plant. SMH (2007c) Sydney Morning Herald, 22 Jan, Still a bitter taste after the salt is gone. SMH (2007d) Sydney Morning Herald, 7 Feb, Water wars: it’s the sea or underground. Smith, J. (1869a) History of the water supply of Sydney. in Smith, J. (Ed.) Royal Commission Report: Water Supply of Sydney and Its Suburbs, Sydney, Australia, New South Wales Government, 94-98. Smith, J. (1869b) Royal Commission Report: Water Supply of Sydney and its Suburbs, Sydney, Australia, New South Wales Government, 6. Snowy Mountains Engineering, C., Sinclair & Knight, P. (1991) Water Supply Strategy Review: Water Resource Investigations, Phase 1, Sydney, Australia, Water Board. Spearritt, P. (2000) Sydney’s Century: a history, Sydney, Australia, University of New South Wales Press, 166-170. Telegraph (2005) Daily Telegraph, 19 Oct, The public has a right to know. Telegraph (2007) Daily Telegraph, 23 May, Truth goes to water under FOI. Ulrich, W. (1987) Critical heuristics of social systems design, European Journal of Operational Research, 31, 3, 276-283. Wheeler, S. M. (2000) Planning for Metropolitan Sustainability, Journal of Planning Education and Research, 20, 2, 133-145. White, S. (2006a) Review of the metropolitan water plan (final report). White, S. (2006b) Review of the metropolitan water plan (interim report). Woore, T. (1869) Warragamba dam proposal. in Smith, J. (Ed.) Royal Commission Report: Water Supply of Sydney and its Suburbs, Sydney, Australia, New South Wales Government, 148-151, 158.

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