Annual Report Is a Summary of Operations and Performance of the Company from 1 St August 2007 to 31 St July 2008

annual re2port 008 Murray Irrigation Limited

Murray Irrigation Limited about this report

The Murray Irrigation Limited 2008 Annual Report is a summary of operations and performance of the company from 1 st August 2007 to 31 st July 2008.

Operations and performance for this period have been measured against the company’s key Menindee Lakes performance indicators as detailed in the Murray Irrigation Limited 2006 – 2011 Strategic Plan ,

Menindee in addition to meeting our statutory reporting responsibilities . The company performance has Weir 32 also been measured against its core business goal, despite the challenges presented by the drought, to supply water to shareholders at the lowest sustainable price.

This Report provides a concise but comprehensive summary. The objective of this Report is to

r e

v i

R provide information to our member-customers to demonstrate our transparency, accountability

r and performance in this the most difficult year encountered in the history of the company. a

D Included in this information are comprehensive five-year comparisons of our performance at the beginning of each chapter and detailed audited financial information.

Featured on the cover of the Report are photographs that attest to the broad range of elements that represent our company, from water delivery to construction to engagement of key policymakers and more.

The 2008 Annual Report is distributed on request to all member-customers and is available electronically via our website (details below), as per the requirements of our Constitution. This Report is also distributed to stakeholders so they may better understand the operations and performance of our company.

Additional copies of the Murray Irrigation Limited 2008 Annual Report can be obtained by:

Lake • Visiting the Murray Irrigation Limited website www.murrayirrigation.com.au . Victoria Wentworth • Visiting the Murray Irrigation Limited offices at Deniliquin, Finley and Wakool. • Writing to Murray Irrigation Limited, P.O. Box 528, Deniliquin NSW 2710. Mildura

bidgee R Murrum iver Hay

M ur ray River NEW SOUTH WALES

B Moulamein illa bo ng Cr E e d ek W w a a r k d o R o iv Conargo Swan l e R r Jerilderie Hill iv er S.A Wakool Deniliquin MIL Location N.S.W. Barham Finley Berrigan SYDNEY Mathoura CANBERRA VIC. Tocumwal MELBOURNE Mulwala A Moama LEGEND Murray Irrigation Ltd Echuca

Murray Irrigation Limited D Registered Office; 443 Charlotte St Deniliquin, PO Box 528, Deniliquin NSW 2710 Telephone 03 5898 3300, fax 03 5898 3301; Website: www.murrayirrigation.com.au ABN 23 067 197 933

Front cover, left: Murray Irrigation Director Kel Baxter (L) and Deputy Chairman Gordon Ball with Minister for Climate Change and Water, Senator Penny Wong, at the Edward River Escape. Front cover, right: Paul and Debbie Martin with sons Jack and Ben beside Wyam Creek on their property “Gynong”, Wakool. S Albury Hume Reservoir Wagga Wagga Reservoir Dartmouth cont C Ab Gl F C Ge C Y in e om om hai o ar b n anc s A I A D F D I r er nde nde Ch Ch Ch Ch Ch Ch rm i in p ev p c udi na i i yar re re al any any i al iat u r ap ap ap ap ap ap an’ c c p x ents tor’ e M rac to to . c v e s – te te te te te te i o tae s ie Di pr n ange al rs rs ns y s fi r r r r r r dent Rep . w ’ ’ ofi re n s i an 6 5 4 3 2 1 . nde taem dec rep . . m an : : : : : : cto . l . . ort e d Co Pr Po B M W en ci r’ . au u ort . . . pen lar i yr otec ater s angi . . nde al l si . . . ts mp ic . . . . R di e ne atio . . . y . . . . . s e nts . 2 . . . denc t taem p . . pen any ti . 0 and s s . . . . rep . . s ort v er n n . 0 n ...... grow g g 7 ...... denc or / e c i ...... ou c e c 0 . . . . . e u ...... om es nvi dec . t 8 . . . . nts l ...... tu r ...... th . . . . . as e ro ...... m re . l . . . . arti 2 ...... an . . . . . nm u 0 ...... ets and ...... ni 07 ...... d ...... ty ental o ...... di / ...... n ...... 0 str ...... relatio ve ...... 8 ...... uc . rsity ...... values ...... ture ...... ns ...... In ...... side ...... back ...... c ...... ov e ...... 84 83 82 81 80 80 59 56 5 54 42 36 28 24 18 12 . . . . 8 6 4 2 r

1 contents year in review

August 2007 I Filling of the Wakool Main and I The temporary water price on the Mulwala Canal commences. Murray Irrigation’s exchange I The 1st August allocation Stock and domestic water is reaches season’s peak - remains zero across all systems available from the majority of $1,100/ML. of the Goulburn-Murray channels, with limited irrigation system and also in the NSW deliveries available as channels fill. November Murrumbidgee system. I The Federal Government agrees I The Murray Irrigation Board I NSW has only 200,000ML to a one-off grant to offset announces changes to water available to meet town, stock Murray Irrigation’s tax liability accounts for 2007/08, with no and domestic, industry and related to $27M of community interest applied on outstanding irrigation requirements in Landcare works carried out by quarterly accounts until 31st 2007/08. the company between 1995 and August 2008, and a 10% discount I The Murray-Darling Basin 2004. [Note: This decision is when accounts are paid on time. Commission (MDBC) Living subsequently reversed and the grant Murray pilot water tender not paid.] December closes early. The project aimed to buy 20GL of water for the October I The DWE announces a further environment. 10% of the NSW Murray Valley I The NSW Minister for Water, water suspended in 2006/07 is I The Commonwealth Water Phil Koperberg, announces the to be returned, bringing the total Bill is passed. Key components return of a further 10% of the repayment to 55%. include prohibition of the NSW Murray Valley water compulsory acquisition of suspended in 2006/07. January 2008 water by the Commonwealth, a guarantee that the Common- I George Warne resigns to take up I Appointment of Anthony wealth will honour the States’ the position of Chief Executive Couroupis as the new Murray Water Sharing Plans for the life Officer with the State Water Irrigation General Manager, to of the Plans, and development Corporation (NSW). Chairman take up the position on 25th of a Basin-wide plan with the Stewart Ellis becomes Executive February 2008. enforcement of a sustainable and Director. I The DWE announces a further integrated cap on surface and I Details of the Commonwealth 10% of the NSW Murray Valley ground water diversions based Government Grant of $20,000 water suspended in 2006/07 is on Commonwealth Scientific for irrigators in the Murray- to be returned, bringing the Industrial Research Organisation Darling Basin are released. total repayment to 65%. (CSIRO) modelling. Eligible activities include payment I The DWE announces unlimited of fixed charges, installation or carryover for all licences from September upgrade of pipes for stock and 2007/08 to 2008/09. This means I The Murray Irrigation Water domestic water, reconfiguration high security licence holders Exchange opens. of systems and laser levelling. will be able to carryover water I The Department of Water and I Announcement of up to to 2008/09. Energy (DWE) provides Murray $500,000 of Commonwealth February Irrigation with provisional Government funding to assist arrangements for a basic supply with modernisation planning I The DWE announces 25% and of stock and domestic water, for our water supply. then a final 10% of the NSW emergency provisions for I The sale of 100,000ML of Murray Valley water suspended permanent plantings for Murray Irrigation’s 221,000ML in 2006/07 is to be returned, September, and reinstatement supplementary water access bringing the total repayment to of 25% of suspended water. licence to the NSW Government 100%. for $20M is finalised.

2 e y n i r a e r we i v pril A Marc I I I I I I I I I o E to 3 del w e e a r ir s 2 M l e f o T I to G Co T T T A Co G Ne 2 th e ye a wat I a b beg a l ( m th put A ice ong u hor LWM nt r l l n lre n n n n y J 0 4 1 n f x h he he he he ut re g r i ove en nding fta anag t s e e ar oc oc d Wat ur viro ti ti d 7t th th s tho i 3 ig ter roduc i w unc uroupi gat t i nce er ady i er ve in umn un tle tle Li Bas

gn er te kes er A M M 0th A ati r at at A n pla to Mu NSW w DWE em a r ay

na m s y r vi ut i ns deli i pr al M nme nme me me ion es us h i Apr

e 209. em pli P) on pro il o ho on. wi ac i an In ar purc ay . arc ina s ng c Vale l annua n. e er ent $ i r ir ubmi tr lwala ti the i th l, nts nts re ur ce t ent fo nti i ver s M e c ali on 50M il pr unt f Au ept M nc lder h a h. c te nts nt. anag e le i i beg anno ati c c has L a wh an gat r t y . n July terg ent l. a los ana deli le ate ray ur ed. of ra g

hang res or es t ntly hig re ons ta and W a i s (C and i st ra r ngt l men ower e l t ed ion Govnmenter er s ns ed o th in rget i ralian r purc the en water th

gemn unc ove ves tran m, ver OAG) ag Proposed w wat ta h s to ransfer nge f a at is h A e en c the whi es pon beg ti r or L whi i secur fi vailable. Prog nter requi on ts. are nthony o of the y nmentalr n Monda es 25% Mu to e sfer de ments i ng Tue nanci k

r f 125GL sume hase for NSW

d of J din ool i ch wi t man a for the nal on ch wi ns with water no ram red nd Plan ra r ty re g re al men y d sda uly . al close n l orks s l y y t J J Ma I I I I I I I I uly une y and M R i t Wat op s C t b c s general genera T L T 2 G T T T Em t ag ac D 2 Pl y pur Fut um For i t par and t G s opt pac for M r Ir i NS s nves i r r he C o di he B t pray el om s ear udget 1 0 andholder t ar he DWE he C he C he C he C om ov ov arl t epor an i c rel rem raur 8 1 l tio ig wa es gat W M io kage cha ur b v km 1 i er for i nm er nm er ing bat c at eas s argo on c ng , t ed wi and wi o d s n wi ns ic cus as e Plan m i s om ur i y-D pat ion, due to s l and hi te om om SI OA se on e i . s of s e uni i ent aloc for ed. B ent n Plan fo for i Sag r s evelo ec r t Ri s ai w RO vesr ur c ay pany h $ e t t ent ent as r ent r muni monw ar me G me i t on t i ur

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ra ate uply c y L h nti announ m th es in i n I ver lin n w t r r he M 5. l det a i r at ’ . y ta nclude s Ar s it Sust ult d at t e p a volunta r ’ developme t

on t r Valey . A y t g et s ig Wate 8B ion c eade i he lem g B lem es i r n t M by gat t Comm h s ut over 208 uth ate et y at i om a g vesr ena ealt ults o hig n ed b wa i th ai ure pl er he N for s or ngs pro ur in aloc Le as r ur g i i ec ents ents ha on t r c s’r n or r r pl m e in s g re

l Xpre h es of t ray R ow e io for ur abl ader te $3 the n s /2 wi nnel F are v ay wat y Mu et it ffic ine . h a z bot Mur n t idi r m i onwe at ity SW o y . T 0 or th. e an and ion b tupor ac .1 o secu ne n the t l f he ed t

i Yi yr he N s rom ng ing he e um, h is e nt of ’ 9 B to he eg ar he s nc ro ray- r r x el s SW’s er k l it r al o t t s ion d ay y to ds i et to . e t y h’ en s . s I I I I I Out s man pro O pl c F A Th Mode D ( S Mur ap Car p t p web l i i Pac de t p r ou Oct i p no a n n our ar nve he he tr SR a as outhe urc urc urc ro ebr un re ng an c eve fo rg pl vel uc tco t e e a LW vi v kag i ob m r be I si ica s anis che e o v ager ha ha ha ng ide Au uar r to be v l ture tme ) de opme lopme a t ie o , c m er ontin r e. y Ir an er sed sed sed at ti e for nis n r w f MP s s

for s t ag e y 20 onti ati u ons 7 for t

pos i wa ea. nt a ope s r 2 of M on sef no 3% $ a , at h e ali put t Ri r

of a onal 0 O t nt of an igat ei s ue re t ion P h 0 1, nt Go p k . u n unc a er 09 for nd four e it is ver r 8 e i r n l o ur ues rat 871. w s fro ppl ions . en of the ma ce f , w web ion, . subm ur Go c Str o Go Coun ve ed ional ent wate in at t m ont roje i t r p r

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Giv uc k toge tlem er en xe nme NSW si u y Ir i h the n er et Inte t p t nt i inu lem ve r ion ture in tt e c c it r ur en y tr t b utive rec i e igat h the m d r r l en nt d, the

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3 year in review chairman’s report

2007/2008 has been another $12.B over 10 years present a Taxation tough year and a year that will be significant challenge to the company, remembered for the unprecedented member-customers and the region In September 2007 the Federal long-term changes on conditions in terms of future access to Government announced a one-off affecting the supply and irrigation water and cost of water grant to offset Murray Irrigation’s management of water in the supply. The Water Act will result in tax liability related to Landcare Murray-Darling Basin. greater regulation of our business. works carried out by the company between 1995 and 2004. This was Once again the year opened with Murray Irrigation has consistently a pleasing development and was zero allocation and the company sought feedback from member- thought to be the conclusion of an prepared itself for an equally bleak customers on preferred options issue that has dogged the company. outlook ahead. for ways forward and responses Unfortunately, the grant was to Government, including the 100% of the NSW Murray Valley subsequently not paid following the Community Leaders’ Forum water suspended in 2006/07 was change of Government in and various landholder meetings. returned by February this year, but November 2007. The clear message was for Murray our general security and conveyance Irrigation to enter the water market. Every effort has been made to allocation remained zero. A number This represented a different role for achieve a final resolution to this of our member-customers chose to the company, and one not previously issue but with no satisfactory sell their water available to irrigators envisaged. outcome to date. outside of our business and downstream of the “choke”. For the first time we had a nett annual Modernisation Plan Delivery entitlements and transfer of water from our licence termination fees The Modernisation Plan saw our of 12,623ML. irrigators take the first steps toward The requirement to terminate Also for the first time the Federal the development and evaluation delivery entitlements when water Government entered the permanent of options for the future of the entitlements are transferred without water market with $3.1B to spend. company’s irrigation and drainage the corresponding delivery Together with water purchasing by system. entitlements was introduced on the the Murray-Darling Basin 8th April 2008. Irrigators and representative Commission, the Living Murray groups from agriculture and local This was an essential measure to program and the Water for Rivers government have been instrumental allow the company to manage the program, a total of 19,282 Murray in this process by contributing their financial and infrastructure impacts Irrigation entitlements left our area. views and aspirations for the future of the sale of water entitlements, The water purchasing continues, as of irrigated agriculture in our following the entry of the do the impacts on our member- region. We acknowledge the Government into the water market. customers and the company. commitment and support of our Stakeholder Reference Group The vast majority of our member- Commonwealth Water Plan members and landholders to this customers took heart from the process, during what are confronting decision and viewed it as a measure The Water Act 2007 (Cth) and the climatic conditions. of security for those who wanted to Commonwealth Government’s stay on as irrigators into the future. Water for our Future funding of

4 chairman’s report

The Australian Competition and representations at all levels, never Consumer Commission’s focus on more important than now as the water charging and water market global food crisis impacts on the rules has lead to the incongruous world. situation of a body totally removed Thank you to my fellow Directors, from irrigation making decisions Murray Irrigation management and about the future operation of our staff for their effort and support water supply business, at the throughout the past year. We look Commonwealth’s request. forward to better times ahead.

The road ahead

The drought continues. It is testament to the resilience and fortitude of our irrigators and their communities as they continue to endure through these tough times.

As we face the road ahead we Stewart Ellis acknowledge our future will be Chairman one of reduced water sales. We are 3 November 2008 making every effort as a company to respond to that scenario. This involves a reconfiguration of the company itself and a review of the current year’s budget. While this will have implications for the level of service offered to our member- customers, these changes will also provide the framework necessary for our member-customers to continue to operate into the future.

Murray Irrigation and the Southern Riverina Irrigators continue to lead representations to both State and Federal Governments for relief from fixed water charges to assist member-customers stay on as irrigators.

As irrigators we produce the best t r

staple food supplies in the world. o p e r

This is a fact we make in our s ’ n a m r i a h c

5 general manager’s report

The 2008 irrigation season has been challenges throughout the year. inextricably linked and the very real one of the most difficult on record. prospect of a further low water sales Murray Irrigation has continued to It was ‘bookended’ by zero NSW year in 2008/09 will place further engage its member-customers in the General Security allocations, stress on the physical and financial decision making processes of the resulting in the lowest Murray resources of both. company – this effort has ranged Irrigation Limited water sales from one-on-one discussions, recorded in the history of the attendance at Landholder Association Governments’ Activities water exchange and the company. meetings, Murray Irrigation hosted These conditions necessitated the The Commonwealth’s Water Act meetings, and via our main implementation of a range of 2007 was passed by both Houses communication tool, Talking Water. measures to deliver as much available of Parliament in early 2007/08. water as possible on-farm, while Its key components included the minimising operating costs. This was Business Performance prohibition of the compulsory a significant challenge for both our acquisition of water by the Comm- The company has been was able member-customers and staff, but onwealth and the development of a to contain its operating loss in both have coped admirably well Basin-wide plan to oversee the 2007/08 to $1.41M, despite a drop given the circumstances. While implementation of a cap on water in budgeted water income of almost conditions remain dry, the outlook diversions, based on Commonwealth $12M, or 43%. This result was for the coming irrigation season does Scientific and Industrial Research primarily achieved by the careful look slightly better than at this time Organisation (CSIRO) modelling. last year. Hopefully this brighter management of expenditure which outlook is not dashed as the season fell by $7M against budget. The hostility of Government policies progresses. Only time will tell. Excluding the company’s non- toward the irrigation industry in controllable costs (primarily general also became more obvious Having commenced employment depreciation and Government through 2007/08. The Australian with Murray Irrigation in February Charges), the reduction was 24%. Competition and Consumer 2008, I have experienced less than Commission’s publication of a The reduction in controlled costs half of the period that is the subject number of Discussion and Position was achieved by the transfer of of this Report. What I have Papers shows a pathway for increased operations employees to Govern- experienced during this time is Commonwealth Government ment funded capital works projects. the legacy left by former General involvement in our activities. This Manager, George Warne. The esteem Despite the combined operating will manifest itself both directly and in which Murray Irrigation is held losses of $5M incurred by Murray indirectly through a variety of by the Australian bulk water manage- Irrigation over the past three years influences over our internal and ment industry is testament to his of limited water sales, the company’s external water charging and trading leadership during 13 years in this role. Balance Sheet remains strong. environments. Unrestricted cash totals almost The Australian irrigation industry The Commonwealth Government’s $34M; in addition, since continued to operate in a dynamic $50M direct foray into the market privatisation, funds have been set and primarily hostile operating for water entitlements is also likely aside to meet a significant portion environment during 2007/08. to have significant long term of future capital expenditure Murray Irrigation was at the centre consequences for the size and shape requirements. There is no doubt of this storm. The double blows of of our area of operations. Combined that continued drought would test ongoing drought and the continued with the conclusion of the NSW that strong position, as it would test implementation of Governments’ Government’s Living Murray direct the resolve of our member- water reform agenda presented many purchasing activities, a significant customers. Our financial success is considerable and primarily unforseen volume of water is set to leave

6 g n e r e e ’r r s e g a n a m l a tr o p l n P f e t P t staf c w me C ma o a o o ye i L A I jo me a pa T N a I i th o th r c I M m t wa Th P g Ag C B U p M G es nc r und he ha hro ec r r n lo n ‘I peti i ontr ompa xp o i r ote f n-goi f f and la la lan u t a as r so he iga r iga r as red OA ov ine ad nd e e a tic r ur ar ve s c iga on-g our wat ter n r r ns. ns’ t few e ov nag e f wh

n n r in cat e es ee rac o pa ugh ch cipl e r nt e n exc s re t o tal u ing. ra e nanr c cia ndi is chang e it R l a r d a n-f n r R b er m Ho G ac ted pons to ti te sr ec ular and Wa me tar i s we te b cka t

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de lli me c r u o s u and c two als of he d ea wil archi M m, upt ies to ct ve r, ber-c to i th d by hat d P s t r t Counci o d ng par ter c cu man r ng B d a ked t o n t le ment r landsc Me i i dur ompo t e la while nat nt her wer di vit effor o g th th ng an I utpu uth ray ur avai me on M ake by as es f $41M. lt hi ac ht he int ng n outsa Man t landh announcem e Go e fi ure as be a ie morandu to e e us ural s rg Gov one o to ka tab , th asi G rag ng dli n er P irelessly nts deve ct ently . nte lable Go was reinfo e overlo dev h f s o z ticipant e m e g a n a M of Mur fut to ts. Th e ts are v th nent o e cou , and ero ge’ f igati r Ir ure for t l ape o in n. in ro g ne for t lishe

raur y a sign age e Lan 2008. In lotage w shor of Aust mer scale r rg vnments’er focu resour for e re ure Riv the LW M nments er door closes elo lopment of older 208/09. eed i over Ju ra water or ndi ment Plan wo d a new e M s. D e i se of r m, an f Aust ly 2008 sili t pm - for t m of i er s ifi s i f the oked i n dholder ray vnme r D water o ensure ng eco of the v ur on he nment ce nve he n ent cant rali ence n th thr arli na ir en rced espi ray he on- lev v tn d ralian y of an s st- t the ng yer P

ly e n of te ent el s, al The re m ar f per manag to i the Pl e an ke si and pe envir with as po pl surf ext of pr rg Wh condi re and t to bo im of t repl adit bur wi to tw wat Adm woul Ho pr to st de capi Bot S cont from di of s x t gni aff co ma ac ffer ou org oduc y f f a other p m rfor li and when t el t si unc th pac as new man ens fo we h ne n den on he y ta

er or s r i ver h s ac ac ile t e are t t c sto r ve m es th i vest nd e hav e fi w i al w in o t d i i d m eam r n a nue t ent ff t am i on t onal w t ni omp ans e drai th e c c man s t nme ver s he dr i e bac su i ement t t s as of mwr ing on of ant t wa ons ater e ge m aff a dr es M st ear has he w le ch iv e re o Go i opens, re anc of t rf w d : im t er t sh orks uc , ben rat wor ont , I ha y n i el o c th has te upor a ly t ale o ac ce any o e . tho nt M ha r ur an sul ce ext owin ay y oc nd m manag nage h r ought k fr ate ai r i g e, he dr i vels pr m i e

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with an im osit mpa ed envir he r har be Gover re doubt ed o t s ntin bot ctio he ver the nar gat its ed ove work i t in co tur t r h we at ht. e ch n ib r ent n-goi nd ver oo have te tinue d in lu e m o t s u -de r-c t-f iv an inc emai pr de io ti debi sr h mp n. y de ds ct equi in two mi r n ued me in h ful u

. per on tude cl u be is in ve unde mo o n to the a re ed t e of t us hi te pro to plo g re li ra e live v n ips i the reh nm n ng good r t s d men on not t s i ver pas nati d ed to p ar n tom li n – th ati b 2007 m of wat s l r r tin u r sur n me co u r l e el tati n ved yme is he r y y eas ce ak o r atic en se l m r eso metres en sr d ons f it in ts y s y . he y t on is s and e t ta is a or s ur

er nt n- as in in e in ng sive y g t e en l ure ing nt l urc l /08, nt e ons d t s is in o g t ar e er o o g e . T c i w t e as jus m c e s c i c T m M o r ope of r or apr al i T / 8 0 0 2 ar A w an c t t t 3 G c ha t w s of mpos s mpl hem hat w ale he f ale t i es es us om ont om om us qual x ve Nov no gnifi uc r re he he he s el it n il r ene the fer ore an gani d s ac r ur pe umpt ul pond t t ive l al tom tom h it th r t

nts nt, l t ady , ra droug re b as y as ex i opr pa me pl in em uture ts w c s c tur r and Mur wi ly t a an opor ting al o enjo on he ne for te c future s c ir em e lo O 9 0 li is e of ne sat y I il ue per n v e ant s c

e e s kil a c m nc l l ent e i d to do w M i w iew pec y is s te l r ompl r r th l y ate ons be o the i ion t s hange r r i s s o the e en ik ead t

hi . it t gat l e i r ie its . T , s a nit I r nt to thr r 20 nt the s Co ht is t u ation ig me na i c x and e s e t of t te ng ra l nc tic es y t t . w E s m e o 20 T am c . v ly t t twe aff and adv ion f tr ation iate ko o l l hi ger o do s p in et o c of Mur ear ir s re u offer e nt o al he 08 uc man as he r on many m emb al on-f onme his s in t tunit e. r ay he our o be r oug c xec lat d upon t o we of the ly e te onfront 08 ture ti s onfi that di e x ar T organi l bene Ir hange u mus re o c ve f m v pe ions i m of c /09 pis he or o ng a mor y c m ut he c iew h m y to al ar bed r x r v m . for nt w ray 20 t r e onti igat de -c pec er ive y e i th of s m. prro g org e fit hal re t is hi . hange onths of us pl w apl is s nt is e ont s e and are the Manage re s Ir mpl ation gani tak p be ion. m 08 e te he vi nuing t that le t il br ac that w s r ome anis that t i r c d to l be d do ew e nge inue /0 tion. e al kil gati e m es T o e . ing a s i t i r a y 9 ’ we ik ati - ie The s ber s n wil we l t s r ti s m e s s he wn

do on’s he d

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7 general manager’s report company profile

Our Vision Our Mission Our Values

Murray Irrigation is recognised as Manage and maintain Murray We will be highly reputable in our a leader of the irrigation sector in Irrigation’s share of the Murray business dealings and will conduct Australia. River’s water to support member- all business activities with honesty customers’ needs. and integrity.

Operate the most efficient, Our business decisions will be fair accountable and responsive and follow due process. irrigation company in Australia. We will meet high standards of Meet best practice in customer quality and will strive for service and shareholder engagement. continuous improvement.

Promote viable and informed We will be commercial in our member-customers in a thriving business dealing in the interests of regional community. our member-customers. We will also be diligent, innovative and Be proactive in the development resourceful. and implementation of policies to improve natural resources. Our decisions will be well informed.

There will be high levels of transparency in all decisions, actions and the reasons for outcomes. MURRAY IRRIGATION REPORTING PERIODS The Board of Directors and Murray Irrigation financial year management team will be accountable for their decisions and August 1 – July 31 actions.

Irrigation season Directors will meet best practice in corporate governance and act at all Operation of supply August 15 – May 15 times in good faith and in the best interests of the company as a whole. Water monitoring June 1 – May 31 We are committed to a high Supply and drainage water Winter : June 1 – August 31 standard of safety for staff, customers quality monitoring and the wider public. Spring : September 1 – December 31 We will exercise high standards in Summer/Autumn: January 1 – May 31 our duty of care to the environment. Murray LWMP (income & expenditure) financial year and targets We will be a supportive, ethical July 1 – June 30 workplace that empowers staff.

8 Murray Irrigation Limited

Murray Irrigation Limited is I Regional population Australia’s largest private irrigation company, formed in 1995 as an – 33,000 including adjacent service towns unlisted public company. The company is based in southern I Offices NSW, and its shareholders are the – Deniliquin, Finley and Wakool member-customers who own the 2,398 landholdings it supplies water to. This represents almost 1,715 I Depots family farm businesses. – Deniliquin, Finley and Wakool Irrigated agriculture is the foundation of the social and I Staff – 126 economic wellbeing of our towns and businesses; water is a significant I Water Entitlements part of the region’s capacity to – 1,494,312 entitlements from the NSW prosper and thrive through variable climatic conditions. We strive to Murray Regulated River resource operate the most efficient, accountable and responsive I Landholdings supplied – 2,398 irrigation company possible, maximising the water available for I Area of operation productive use. Food and livestock – 748,000ha are the focus of regional production including rice, wheat and other Supply system cereals, canola, maize, tomatoes, I potatoes, onions, milk, prime lambs – 2,954km gravity-fed earthen channel and cattle.

We are also committed to our I Drainage catchment stewardship of this important part of – 249,000ha the Murray-Darling Basin. Working with Government and irrigators, I Drainage system through the Murray Land and Water Management Plans, we are investing – 1,425km gravity-fed earthen channels in on-ground works, education and awareness, to better manage our I Sub-Surface drainage catchment natural resources and protect the – 25,000ha Murray River. I Sub-Surface drainage system – 115km pipes, 54 pumps, 2,100ha evaporation basins e l i f o r p

y n a p m o c

9 management structure

Board of Directors Board of Directors

The Murray Irrigation Limited Board of Directors develops the company’s strategic direction and is ultimately responsible for the Anthony company’s compliance with its Couroupis licences and other legislation. There General Manager are nine Directors serving on the B.Ec.(Hons), Warren Elsbury Grad.Dip.CSP Deputy General Board, including seven Member Manager Directors who are company Company Secretary shareholders, elected by shareholders, Dip. Bus. Info proc., Fellow ICS, Member and two Non-member Directors Stewart Ellis , Executive Director, AICD with specialised expertise, who are 1st December 2007 – 24th February 2008 appointed by the Board and George Warne , General Manager endorsed by shareholders. Stewart to 30th November 2007 Ellis was Executive Director from Evangel December 2007 to February 2008. Aseervatham Civil Engineering Manager Sections of the Company B. Sc (Hons), Fellow IEA, MASCE, CPE AWMA Murray Irrigation is a joint venture partner in AWMA, with Jenny McLeod Peter Knill Automated Water Management Environment and Mechanical Communication Engineering Australia. It holds a 50% share in the Manager Manager business, which is based in Cohuna, B. Sc. Eng. Member IEA, B Ag. Sc. (Hons), Victoria. Murray Irrigation’s Deputy ASCE MA Org. Comm. Chairman Gordon Ball and Director Michael Humphris are directors of AWMA Board . AWMA designs, Dean Stubley Andrew Lelliott manufactures, supplies and installs Finance Manager Services Manager automated water management B. Business (ACC), CPA B Business, infrastructure to farms, irrigation ACCT Cert. EE, ASA Resigned 11th supply businesses and urban water July 2008 authorities. For further information visit www.awma.au.com .

Business Development Unit Peter Ketye David Watts MILCast Water Distribution The Business Development Unit Manager Manager works at an industry and individual B. Ag Sc., MBA, Member AICD level to support new investment and encourage higher value agricultural production. This includes evaluating water requirements, developing new Aaron Drenovski water instruments, sourcing finance, Works Manager and addressing investment barriers B. C Eng., B. Bus, MBA and identifying investment opportunities for the company, according to pre-determined investment criteria.

10 $ $ go w o f i o r Li W co mp T Fi C Th e C E The C a st i an d an i (LW La n fo an of or ac t cu s w i 1 i $ re m W fu i d d ass ni s nv o ncl ncl n rom $ ec nd 44 3 1 , e ard e ur f ake nvi he at ate om m 42 p ve o i r t t nded ore ce resp di ork at nan d d d ve l vel 0 2 ve et t vil the c iv ei to mer lac ia he i m e mai ud ud 5M d M M. er n E Ci nc e h st im p e asso F lv s, and refu 5 c MP it r ho nm r r vab ti o o ro t at es nv ironme

redi e i km s and and l me ement ie s ons em ent p es ing ve s ian c En nv ironme ina ava pm pm ce A Ma nag han 2 23M to t r uni . vil ld oli n s, om mp le i r ciat n l ). Wor u le hrough , a 2, em e nnual t r epor rbis in for s nts $65M. me en s, in W ate er new dr T ibl nce t i g ilabi gati pre ni E en t. ent cy an sou e wit s of s c nd 9 con s pany En vironm ed s at t ta ke hol t ne e 54 . nig ne cat val his 0, devel i T hme co njun c ks i and nt me nt nt s D fundi on and d pay T ion o $50M, de em ent par of c n S for rc tor th e lit 0 kms m he inger r tro d ivi t nt al and tur c 00 h W ate r M i ue e o i iv e nvi y , nt an n thi nour v his on Ma nage ’ the ng at ion d ivi s at mwate nt and ta te is ainag ass folowe onstr ier co mpan is s l,

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f O , i hig a C flo whe ion wor Mur s a l B 7 ce upl c i ing b i up to 1 ed, re et ut on manag io 9 nanc s s r ate he ge re apac t ur ead t t t r n a g i r r e t er for 8 uil s wi s i ws pl ion div r for hok i r n s h s c . and unde the c nt c ea Wat w s s r r orde than 5 r orde o May , in vi y pi n wa gati ys ray ding ban o-ordina hanne ac ar upl c m e. Wor th th i e ity l we gati te e ime ter c t ir e v hanne k, age hange 2, wat ound the t ock e on to 2 ur pes m w Ri to s i r i r , o me te 350 r ac i y e me r on F ,10 i ity nc s of up ig e e of ng s a the s d ve r i l . n i tiv e s on ks er and at and a ys l upl wate it r ML r s l or udi 0 ks l ting te us s , ion to t ey , e h te ak ,3 taff t sr m er ng

e 98 y r s . 1 company profile CHAPTER 1 water services

Our core business is providing efficient irrigation supply services to maximise the water available for productive use

How we are performing

Performance

2003/04 2004/05 2005/06 2006/07 2007/08

Delivery efficiency 77% 78% 83.6% 69% 33%

Water delivered as ordered no data 99.7% 99.9% 97% N/A* Water delivered in accordance with order period – four day minimum notice

Water price Sum of fixed and usage charge excluding LWMP charges $20.60 $21.11 $22.57 $25.25 $26.34

* Due to modified performance delivery arrangements this performance measurement was not available.

12 “Efforts to deliver water efficiently have focused on operation of the system to minimise losses”

Pictured here David Hulands, Channel Attendant, from Wakool, adjusts a regulator gate.

We are committed to delivering operated under an emergency provided with limited water to water as efficiently as possible while operating plan in 2007/08, with provide a basic supply of stock and maintaining the current service levels water delivered for stock and domestic water for 2007/08. In to our customers and minimising the domestic water supply and irrigation response, Murray Irrigation environmental impacts of operating under significantly modified introduced modified arrangements our irrigation supply system. arrangements. for the supply of stock and domestic However, maintaining deliveries in water. On the back of channel filling The NSW Government another year with a zero general in September, we were able to implemented contingency planning security allocation and zero allocation provide a limited irrigation program. for allocating the water available to to the company’s conveyance licence Murray Irrigation also introduced NSW between competing interests. has been difficult, resulting in a arrangements to intermittently supply The Minister for Water, the Hon Phil reduced service to our customers in irrigation water to landholdings with Koperberg, established Critical Water order to maintain some service, permanent plantings. Advisory Committees to provide primarily a stock and domestic water advice to the NSW Government on Focusing on long-term objectives is supply, for as long as possible. priorities for allocating the available a challenge in the face of the dire The NSW Murray Lower Darling water. Murray Irrigation was short-term water shortages. However, Regulated River Water Sharing Plan represented on the committee by our primary objective remains to which was suspended in October George Warne and subsequently deliver water to customers at the 2006 remained suspended for Jenny McLeod, with Director lowest sustainable price. Our water 2007/08. With ongoing dry Malcolm Holm representing NSW management and price strategies s

conditions the Federal and State Farmers. At the start of the 2007/08 include: e c i

Governments announced a Murray water year Murray Irrigation had no v r

I Delivering water as efficiently as e Drought Contingency Plan in April water available, with the small s r

possible. e 2007, and the normal Murray- volume of carryover water t a

Darling Basin Agreement water suspended. I Controlling costs and related w :

impacts on the company’s water 1 sharing arrangements were r e

In September, through the price. t

suspended. With only minimal water p

Government’s contingency planning a available on our licence and also on- I Developing alternative income h arrangements, Murray Irrigation was C farm, Murray Irrigation effectively sources to offset water price rises.

13 Figure 1.1 Delivering water efficiently water supplies along with water Comparison of water available to for irrigation. Total capacity of the Murray Irrigation by source, 2003/04 Efforts to deliver water efficiently system is 12,350ML/day and we to 2007/08. have focused on operation of the operated at levels far below full system to minimise losses, rather % capacity. 100 than investment in infrastructure and technology in 2007/08. Increased flexibility in ordering with State Water available for irrigation Water and in making deliveries to 80 The only water available to Murray customers and changed operating Irrigation in the 2007/08 season conditions improved delivery was 117,918ML of suspended water, efficiency beyond what would 60 which returned progressively for normally be anticipated given the October through to February, and low level of deliveries. This is the 70,000ML was allocated to the result of exceptional seasonal 40 company’s conveyance licence conditions and resulted in a reduced through the contingency planning service, with member-customers process. Figure 1.1 compares water having to pump their stock and 20 availability by source for the past domestic requirements. five years. For the first time there 4 5 6 7 8 0 0 0 0 0

/ / / / / Controlling costs

3 4 5 6 7 was a nett transfer out of the region, 0 0 0 0 0 0 Costs have been controlled in the which totalled 12,623ML. Water 03/04Allocation04/05 05/06Snowy06/07 Advance07/08 trading is discussed in more detail Carryover Supplementary Water past year largely by reducing Transfers programmed works and transferring in Chapter 3. staff to government funded There was no off allocation water programs. These are short term available this year from either measures in response to drought supplementary river flows or from and reduced water income. the sale of water remaining in the channel system at the end of the Our licensed access to water season. Nor was there any opportunity to access additional Murray Irrigation remains the water through Snowy Hydro Ltd. largest holder of NSW Murray River water entitlements (Table 1.1) Murray Irrigation customers have and the largest water user in the an existing debt of 177,627ML to NSW Murray Valley. We take water Snowy Hydro following advances from the Murray and Edward on allocations made in 2004/05 Rivers, from Government operated and 2005/06. The next time infrastructure through our open, Murray Irrigation’s general security gravity-fed channel system, to allocations reach 41% repayment deliver stock and domestic and town of this water debt will be required.

Table 1.1 Murray Irrigation NSW Murray Regulated River Water Access Licences July 31, 2008

Licence type Entitlements Total Murray Valley Entitlements

High Security town 3,170 53,000

High Security Irrigation 117 183,504

Conveyance 300,000 330,000*

General Security 1,190,670 1,667,773

Supplementary 121,704 250,000

*Includes 30,000ML adaptive environmental allocation

14 Stretching our limited supplies Using our channel system provides Figure 1.2 mutual benefits, reducing water Five year comparison of water Controlling delivery losses was the travel times by up to six days, and delivery and loss volumes. critical operating factor in 2007/08 reducing transmission losses such as ML to stretch meagre water resources as evaporation and seepage. It also 1,000,000 far as they would go. Deliveries on- increases NSW’s capacity to deliver 8 3 0

Deliveries , 5 farm totalled 29,401ML for the water to users downstream of the Loss 8 9 season (Table 1.2). Barmah-Millewa choke on the 800,000 Murray River, although river Calculating delivery efficiency capacity was not an issue last year as 8

Murray Irrigation has changed the 0 downstream users were also affected 0 4 6 2 ,

600,000 , 8 1 5 way it calculates delivery efficiency 5

by low water availability. The 6 6 in line with the National Water additional flows through our system Commission’s new benchmarks. help reduce our losses; the more 400,000 Previously we have measured water in the system, the higher its efficiency as water delivered on-farm delivery efficiency. as a percentage of our nett flows

200,000 8

Flows this year were particularly 8 7 0 (nett flows = gross diversions – 6 4 , 6 9 6 4 2 0 3 8 , 5 , 2 8 , 7

important in reducing losses and 1 , 2 2 3 9 0 9 accredited escape flows). This is 9 8 1 4 5 1 0 , 1 0 9

maintaining stock and domestic 8 2 reported in Table 1.2 as delivery , 9 efficiency 1. However, the new water supplies, particularly to the 0 9 03/0403/04 04/0504/05 05/0605/06 06/0706/07 07/0807/08 benchmark requires us to calculate south-western parts of our district. delivery efficiency as a percentage of gross diversions, including Table 1.3 accredited escape flows (other Murray Irrigation’s credited escape capacity from the supply network to planned deliveries). This is reported local waterways in Table1.2 as delivery efficiency 2. ML/day

Assisting river flows Edward River Escape 2,400*

Negotiations with the DWE, Wakool River Escape 500 State Water and River Murray Finley Escape Water resulted in an agreement to (to Billabong Creek) 250 continue water diversions from the Perricoota Escape Murray River through Murray (to Murray River) 200 Irrigation’s supply system, returning it to the Murray through credited Yallakool Creek Escape 50 escapes downstream of the Barmah- Total 3,400 Millewa Choke. * Above design capacity.

Table 1.2 Murray Irrigation diversions and delivery efficiency 2002/03 to 2007/08

2003/04 2004/05 2005/06 2006/07 2007/08

GS Allocation 45% 42% 56% 0% 0%

Gross diversions 1,225,616ML 1,284,693ML 1,642,345ML 755,538ML 149,352ML

On-farm deliveries 658,608ML 651,240ML 985,038ML 222,688ML 29,401ML

Other planned deliveries (credited escape flows) 346,347ML 429,440ML 441,186ML 401,660ML 60,112ML s e c

Unaccounted water 220,661 204,013ML 216,121ML 131,190ML 59,839ML i v r

1 e

*Delivery supply efficiency 77% 78% 83.6% 69% 33% s

r e

2 t

*Delivery supply efficienc y 82% 84% 87% 83% 60% a w

Unaccounted water 75ML/km 69ML/km 73ML/km 44ML/km 20ML/km : 1

per km of channel r e t p

*See calculating delivery efficiency explanation. a h C

15 Figure 1.3 We continued to work in close co- The price of water Unaccredited escape flows as a operation with State Water to place percentage of net diversions advance orders for water as accurately For our customers, the water price % as possible, so that no unnecessary is a key indicator of the company’s 3.5 water was released from the Hume or performance. Our aim is to provide 5 . 3 Dartmouth Dams. Normal ordering water at the lowest sustainable price, 3.0 procedures were suspended due to where sustainability relates to the low inflows. The accuracy of orders long term viability of the company,

2.5 placed dropped significantly as a and the operation and maintenance result of much lower flows in the of our infrastructure. We are a not- for-profit business and we do not 2.0 system, which magnified any change 2 2 in orders. Diversions in the Mulwala issue dividends to our shareholders. Canal generally range from 6,000ML Any trading surplus is used to 1.5 to 10,000ML/day in summer, but last minimise future water price rises, year were less than 1,000ML/day for to the benefit of our shareholder- 1.0 most of that period. customers. 5 0 . 7 . 0 Wetland watering The 2007/08 sum water price 0.5 0 8 7 6 5 4 increased 4.3% from $25.25/ML to 0 0 0 0 0 / / / / / No wetland watering was 6 5 4 3 7 0 0 0 0 0 $26.34/ML. This included: 0.0 undertaken, given the seasonal 03/04 04/05 05/06 06/07 07/08 conditions, and the farm wetland I an increase of $0.28 in watering program Murray Irrigation Government charges following participates in with the NSW the release of the Independent Murray Wetlands Working Group Pricing Tribunal’s four year was suspended for the year. pricing determination in Water quality September 2006. IPART set a 23% increase in government The quality of water Murray charges from 2006/07 to Irrigation diverts remains at low 2009/10. EC levels. Goulburn-Murray Water I an additional $0.06 for provides data on the salinity levels of infrastructure maintenance water in the Murray River at Lake and renewal. Mulwala, where both Goulburn- Murray Water and Murray Irrigation I 3.5% CPI increase in other supply offtakes are located. Salinity company costs, including levels ranged from 41-55EC payroll. throughout the season, with an The total of $26.34 is based on a average of 52EC in 2007/08. There fixed charge of $12.64 per delivery was no testing for blue-green algal entitlement and $13.70 per levels in 2007/08, as Lake Mulwala megalitre used, assuming water algal levels only reached amber levels use equal to 70% of entitlements. throughout this period. However, based on water deliveries

Table 1.4 Quality of water diverted from Lake Mulwala for irrigation

2003/04 2004/05 2005/06 2006/07 2007/08

54EC 55EC 57EC 45EC 52EC

16 of 29,401ML, the actual cost per Challenges Figure 1.4 megalitre delivered in 2007/08, Water price, showing variable (usage) (water income divided by sales) Access to water and delivery of and fixed (entitlement based) was $596.10/ML (figure 1.4). extremely low flows will be a components

challenge in the year ahead. Reduced $ $ Murray Irrigation’s Board of average sales in the long term as a 30 600 Total entitlement charge Directors set the water price based 0 1 result of drought, government policy, Total usage charge Average price per . 6 on recovering costs, with water ML delivered 9 and more conservative farm water 5 25 500 sales equivalent to 70% of the management decisions will continue company’s entitlements. Water sales to put upward pressure on the water

in 2007 equated to only 2% of 0

20 7 400

price and reduce the operational . 5 3 9 . entitlements, resulting in the $1.5M 1 efficiency of the system. 2 1 loss from irrigation operations, 5 9 . 5 1 5 3 . 1 15 0 300 . detailed in our financial statements. Continuing to improve our water 1 1 1 The basis for water budgets has been supply efficiency, whilst minimising 1 steadily reduced over the past six cost increases to our member 10 200 years from 83% of entitlements and customers is our fundamental 0 0 challenge. The decision by both 4 the budget for 2008/09 is still under 7 3 . 6 . 2 . 1 6 2 6 2 5 . 9 7 1 1 5 . 100 5 review. the NSW and Commonwealth 0 . 6 9 9 1 2 9 2 9 . . 5 . 4 Government to buy water 1 7 3 3 entitlements for environmental use 2 Minimising costs 0 0 from individual sellers within our 02/0303/04 03/0404/05 04/0505/06 05/0606/07 06/0707/08 03/0403/04 04/0504/05 05/0605/06 06/0706/07 07/0807/08 Our strategy is to manage business will increase the pressure controllable expenditure, to on the company to maintain its strategically influence government delivery efficiency. water pricing policy, and to offset Making good decisions about how Figure 1.5 increased expenditure with to further upgrade, modify and Average price of water per megalitre medium-term to long-term cost rationalise our irrigation supply in delivered on-farm. reductions or other efficiencies, an environment of such low water (Total water income $17,526,000 divided by megalitres delivered 29,401ML) such as water savings. availability and low confidence Efforts to reduce costs during the $ presents a significant challenge. $ 30 600 Total entitlement charge past year have continued. Savings 0 1 Total usage charge Average price per . 6 were achieved through continuation ML delivered 9 5 of the following measures: 25 500

I Redeployment of staff to 0

20 7 400 . government funded programs. 5 3 9 . 1 2 1

I Deferral of maintenance and 5 9 . 5 1 5 3 . 1 other projects. 15 0 300 . 1 1 1 I Suspension of business 1 development investment. 10 200 I Reduced plant and equipment 0 0 4 7 3 . 6

operating costs. . 2 . 1 6 2 6 2 5 . 9 7 1 1 5 . 100 5 0 . 6 9 9 1 2 9 2 Revised vehicle policy and 9 .

I . 5 . 4 1 7 3 3 related FBT costs. 2 0 0 02/0303/04 03/0404/05 04/0505/06 05/0606/07 06/0707/08 03/0403/04 04/0504/05 05/0605/06 06/0706/07 07/0807/08 s e c i v r e s

r e t a w

: 1

r e t p a h C

17 CHAPTER 2 managing our assets

Our asset management strategy is commercially sound, based on optimal maintenance and replacement of infrastructure, to maintain and improve our services

How we are performing

Performance

2003/04 2004/05 2005/06 2006/07 2007/08

Provide for future asset refurbishment Asset Renewal Reserve $21.8M $26.8M $30.5M $34.4M $36.8M

Annual asset renewal levy per entitlement* $1.51 $1.55 $1.60 $1.66 $1.72

Asset renewal expenditure as % replacement asset value (target 2.5%) 0.9% 1.2% 2.3% 2.1% 1.8%

Maintenance expenditure as % of channels replacement value (target 1.7%) 1.5% 1.4% 1.9% 1.3% 0.6%

LWMP capital expenditure $4.6M $4.1M $2.5M $1.9M $2.8M

* Charged on delivery entitlements from 2007/08.

18 “The construction and refurbishment of stormwater escape channels overseen by our engineering and environment divisions may be considered a third element [of our asset management program] although it has traditionally been seen as part of our environmental management.”

Refurbishment of Berrigan Creek Stage II

The company’s strategy for I Rationalising assets where funded as part of the Murray Land managing its $770 million worth possible to reduce long term and Water Management Plans of water supply and stormwater refurbishment costs and ongoing (LWMP), but once completed new assets is inherently conservative, operational and maintenance works become company assets for with a high regard for the serious costs. operation, maintenance and consequences of asset failure. Our depreciation, so we have added this aim is to achieve cost-effective, Our asset management program to our asset management reporting. optimal asset management which has two key elements – capital We have continued to accelerate minimises the risk of failure. refurbishment generally overseen by our civil engineering and mechanical capital expenditure where possible Our strategies include: engineering divisions, and ongoing while government funding is maintenance and minor construction available. Capital works have also s I Maximising capital expenditure t overseen by our works division. provided an opportunity to re- e s

under government funding s

deploy works staff and make water a programs by 2010 to put the The construction and refurbishment r distribution savings in response to u company in the best possible o of stormwater escape channels drought and reduced water sales, g n position going forward from i overseen by our engineering and g

with programmed maintenance a

that point. environment divisions may be n halved, to cut costs. a

considered a third element although m

I Building adequate reserves for :

it has traditionally been seen as part 2

future asset refurbishment r e

of our environmental management. t

beyond 2010. p Stormwater channel construction is a h C

19 Our Capital works program year of 15 years of funding available as part of the ‘dowry’ provided to Supply and drainage infrastructure the company when it was formed form the largest item on the in 1995. The annual asset renewal company’s accounts and attracts the expenditure is currently at a rate of majority of our annual expenditure. 1.8% of total replacement asset value. While our total infrastructure replacement value is $770M, We also have significant capital infrastructure valued under our expenditure for construction of capital works program has a new stormwater escapes under replacement value of $445M. This the LWMPs. This includes both does not include our earthen supply Government and landholder channels, which are managed and funded capital. maintained in perpetuity, which All expenditure of Government have a replacement value of $325M. funds is audited by Sinclair Knight Merz on behalf of the NSW The average life of capital assets is Government. At the conclusion of 100 years, based on engineering the Government LWMP and Asset evaluations undertaken by Kellogg Renewal funding, expenditure on Brown & Root in 2002. Major assets our assets is expected to fall back to worth more than $100,000 are between 1% and 1.5% of total asset constructed, refurbished and replacement value. maintained to provide a lifespan of 120 years. Assets worth less than Asset Maintenance Renewal $100,000 are constructed, refurbished Reserve and maintained to provide a lifespan Due to the extraordinary seasonal of 80 years. Minor assets (for example, conditions Murray Irrigation mechanised gates) have a life of 20 to applied to the NSW Government 40 years. All works are undertaken in to vary its contribution to the Asset accordance with these criteria, and to Maintenance and Renewal Reserve meet the relevant Australian Standards for 2008. The proposal put to where appropriate. Government was that the Levy Funding would not be collected in 2008. Interest earned by the Reserve Government grants continue to form would continue to accumulate the largest part of the company’s within the Reserve – this is the infrastructure funding (Figure 2.1). source of the Reserve’s growth in The 2007/08 year was the thirteenth 2008. A similar proposal has been put to Government for 2009. Figure 2.1 Murray Irrigation capital expenditure by funding source Murray Irrigation will address increasing the Reserve contributions $ Millions to replace the deferred contributions 20 during the water pricing process for

Dowry the 2009/10 season, subject to the Drains return of more ‘normal’ seasonal Company funded conditions. We do not consider these 15 actions will place it at any additional financial risk; in fact, these actions will assist it and member-customers.

10 It offers flexibility in a drought that is having a major impact on both. The Reserve remains a key part of our long-term asset management 5 strategy to ensure adequate funding is available to maintain the structural

6 7 8 9 0 1 2 3 4 5 6 7 8 integrity and capacity of 9 9 9 9 0 0 0 0 0 0 0 0 0 9 9 9 9 0 0 0 0 0 0 0 0 0 1 1 1 1 2 2 2 0 2 2 2 2 2 2 infrastructure.

20 Mechanising regulator gates along the Berrigan Creek. During the past year we continued Barratta Weir, the Box Creek our asset refurbishment program with outfall into the Edward River the roll out of the 2007/08 regulator system, was also upgraded. This gate mechanisation program. Because upgraded structure is important of the zero allocation and restricted to flood control. water deliveries during the year it The installation of drainage inlets was possible to begin work in August to control surface run-off into our 2007, rather than waiting for the stormwater escapes system is 12-week irrigation off-season to essential to compliance with begin in May 2008. There were 227 Murray Irrigation’s Environment sites completed, with expenditure Protection Licence with the NSW totalling $5.59M in 2007/08. Environment Protection Authority, Other capital refurbishment works and also to the irrigation industry’s A total of 18 other asset refurbish- public perception. ment projects were undertaken Conargo Shire approved the during the year, totalling $2.2M. construction of Warragoon Stage II. These included the replacement of This stormwater escape will provide subways, access culverts, road culverts stormwater relief to the Mokanger and installation of piezometers at the Basin, east of Deniliquin. Drop and the Mulwala offtake. Construction will commence in 2008/09. Expanding our Supervisory control and data acquisition Since the commencement of the (SCADA) system LWMPs in 1995, a large proportion of the stormwater escape construction Murray Irrigation has over 200 sites program has been completed. that can be remotely controlled or Completion of the stormwater escape monitored. A major upgrade of the system in Berriquin is dependent on SCADA backbone is under way receiving additional funding from with Stage 1 complete which government through the Murray includes Deniliquin Office Radio LWMP program. Tower and a Canopy Broadband link to Sandridge Radio Tower.

Stormwater construction Figure 2.2 The major focus of the stormwater Proposed cumulative regulator gate mechanisation program 2005 to 2011 and actual construction program was refurbish- completion to date (trend line). ment of the Berrigan Creek and Box No. of regulator gates Creek stormwater systems. This mechanised 1,200 work was funded by the Berriquin Scheduled mechanisation target – cumulative and Denimein LWMP program. Scheduled mechanisation target – annual component Scheduled Mechanisation Target annual component Mechanisation completed – cumulative Key features of the work were: the 1,000 installation of drainage inlets to allow Murray Irrigation and its member- Scheduled Mechanisation Target cumulative customers to better control run-off 800 from landholdings; enlargement and reforming of banks to provide 600 s improved surface drainage relief t e s in Berrigan Creek; and desilting s a

400 along Box Creek. Fencing along r u o both the Berrigan and Box Creeks g n is proceeding, including an 200 i g a opportunity for revegetation, with n a

approximately 43km fencing along m

0 :

the Box Creek and 11km fenced Completed Winter Winter Winter Winter Winter Winter Winter 2

prior to program 2005 2006 2007 2008 2009 2010 2011 r e t p a

h Completed Winter 2005 Winter 2006Winter 2007 Winter 2008 Winter 2009 Winter 2010 Winter 2011 C

21 Maintaining our infrastructure our channels. The program proposed included more than 135km of The company’s works program is channel spraying in the east of the focused largely on the continual region where sagittaria is most maintenance of the supply and prevalent (including Mulwala, stormwater systems, and minor assets Barooga, Berrigan, Mairjimmy and valued at less than $10,000. For this Finley channels). Arsenel is four reason maintenance expenditure is times more cost effective than benchmarked as a percentage of the desilting and deweeding with $325M replacement value of excavators but use is restricted to channels. short periods when channels are emptied in May and before winter In 2007/08 we reduced our frosts set in. Water flows in channels maintenance expenditure to provide where Arsenal has been used must drought savings, with expenditure also be managed carefully, cut from $4.1M to $1.9M. particularly where there has been no Works staff were redeployed to the rainfall to allow the residual chemical government funded regulator gate to break down. A water withholding mechanisation program. period of six weeks applies following The total number of jobs logged the chemical application which has for 2007/08 was 2,609, with 92% the potential to delay deliveries to completed; there were 2,568 logged landholders on channels where an the previous year and 98% Arsenal program has been completed. undertaken.

Stock and domestic pipes Maintenance of floodplain structures There were more than 88 stock and Murray Irrigation is required to domestic pipe supplies installed operate and maintain floodplain during the season. With water at structures in accordance with the a premium, landholders quickly state government ‘Guidelines for realised that pipes would be more floodplain development – Stage 1- efficient than filling a farm channel in 4’. In 2007/08 we complied with all order to fill a house dam, given that requirements of these guidelines. many had little water for irrigation. Under this program we replaced five subways in the Wakool District, and Weed control we are currently investigating the An extensive weed control program replacement of another subway in was planned for winter 2008 the Wakool district. following past success of herbicide Arsenal Xpress in controlling the Safety procedures invasive emergent weed sagittaria in A number of safe work method Table 2.1 statements (SWMS) were updated as Scheduled maintenance works completed part of our annual review, and new statements have been developed. 2005/06 (km) 2006/07 (km) 2007/08 (km) Random safety site inspections Bank building 63.4 55.6 2 were completed including indepth Desilting 304.8 101.3 22.1 safety audits, with overwhelming compliance to safety procedures Grading access tracks 967.8 505.2 264.1 by staff. Sand access tracks 80.4 39.1 –

22 Challenges The Federal Government is supporting significant investment Depreciation is a significant fixed in irrigation infrastructure. It is cost on our business and continued essential that this investment adds investment in new infrastructure value to the company, and to will continue to increase this cost, irrigators’ ability to use water and and the cost of water. There is no generate income, so that they can easy solution to this issue, but we are afford the ownership of an upgraded investigating alternative depreciation system. methods which may allow us alter depreciation from year to year so There are opportunities under the that it is more in line with the Modernisation Project to develop variability of water use on-farm partnerships with Government to from year to year and therefore identify and co-ordinate the most be more in line with annual farm effective infrastructure investments. income and ability to pay. This includes identifying the future direction of the company’s Internal quality assurance (QA) operation, with the potential for audits have highlighted the need for decommissioning of some areas and additional resources to complete intensification of water delivery OH&S housekeeping inspections. infrastrucure use in others. s t e s s a

r u o

g n i g a n Garry Reid, Plant Operator, Deniliquin, redeployed to the mechanisation program, works on a a m

concrete pier extension near Denilqiuin. : 2

r e t p a h C

23 CHAPTER 3 business growth and diversity

Diversifying our business and providing services to help irrigators generate the best possible returns on their investment in the region will help us to manage industry risks

How we are performing

Performance

2003/04 2004/05 2005/06 2006/07 2007/08

Increase income from ancillary businesses Annual income from ancillary business $184,000 $514,000 $539,000 $616,000 $884,000 % of total irrigation income 0.7% 2.1% 1.8% 2.5% 2.7%

Increase value of Murray Irrigation entitlements Average annual water entitlement price with DE $430.57 $548.27 $569.29 $525.70 $605.17 Value compared with river entitlements Not avail. Not avail. 86% 66% 68% Average annual water entitlement price without DE ––– –$895.66 Value compared with river entitlements ––– –100%

Increase extent of high value crops ML used 24,561ML 25,430ML 25,465ML 18,512ML 1,834ML % of total water use 4% 4% 3% 8% 6%

24 “Funding has been received by NSW Farmers’ from the NSW Department of State and Regional Development to employ a part-time dairy support officer to continue to promote and support the dairy industry in this region.”

Ruth Kydd from the Myrtle Park area feeds her 390 calves.

Activities to encourage new giving the customers the option of Figure 3.1 investment and diversify services purchasing the water entitlements MILCast customer profile by were placed on hold in 2007/08. back after five years for a price value of sales.

It is difficult to promote any kind agreed to at the commencement of $ of new investment with the effective the lease agreement. Feedback on 4,000,000 failure of irrigation water supply to the proposal from shareholders has landholdings. been both positive and negative. 3,500,000 Implementation of Water Bank has Apart from drought, the dominant been affected by: the requirement 3,000,000 feature of 2007/08 was the entry for termination of delivery entitle- of Government into the permanent 2,500,000 ments when water entitlements water market, with four different are transferred without delivery organisations active : Water for 2,000,000 entitlements, staff resources and by

Rivers, the Murray-Darling Basin y t

concerns about the effectiveness of i 1,500,000 Commission, the Department of s r

the business model. e v

Environment and Climate Change i MILCast 1,000,000 d (NSW) and the Department of d n

Environment, Water, Heritage and a

Murray Irrigation’s precast concrete h

500,000 t 7 8 6 5 the Arts (Commonwealth). 4 w 0 0 0 0 business, MILCast, has traditionally 0 / / / / / o 6 7 5 4 3 r 0 0 0 0 0 Water Bank been the largest contributor of 0 g s

03/04Agriculture04/05 05/06 06/07 07/08 s

income from ancillary business e n

The proposed Water Bank has been MIL Shareholders i

investments. This continued in MIL Works & LWMP s further developed. Water Bank u 2007/08, with total sales from Other commercial b would purchase water entitlements : MILCast increasing by 6.5% largely 3 from customers within Murray r e

due to an increase in commercial t

Irrigation, then rent these p (external) sales. MILCast increased a entitlements back to the customer, h their sales of products to Murray C

25 Irrigation customers, as a result of Hydro power plant the investment through the LWMPs and also increased their commercial Relatively low flows on the Mulwala sales (Figure 3.1). Profit from Canal during 2007/08 prevented external sales was $147,000 in energy generation from the hydro 2006/07 and $306,000 in 2007/08. power plant on the canal at The Drop between Berrigan and Barooga. AWMA Aquaculture Due to factors including significant In conjunction with the Seafood Research and Development work, Co-operative Research Centre and higher input costs and reduction in commercial investors, business sales due to drought, our joint planning around the development of venture initiative AWMA Pty Ltd a commercial venture at the Wakool has reported a loss for the period. Tullakool Sub Surface Drainage During the year AWMA has been Scheme (WTSSDS) progressed in successful in winning tenders to a 2007/08. However, after successfully number of major urban and completing the research to develop industrial water projects, including the technology for commercial gates supplied to the Sydney aquaculture using the saline water desalinisation plant, thus opening pumped by the WTSSDS, it is more opportunities in non-irrigation disappointing that the commercial areas. There remains significant development is unable to proceed opportunities for work related to because of risks around the irrigation refurbishment and new confidence of water supply. meter investment right across the Groundwater volumes pumped Murray-Darling Basin. AWMA from the scheme have declined from remains one of Murray Irrigation’s more than 14,000ML/year to less largest suppliers as a result of the than 3,000ML/year in 2007/08. dowry-funded gate refurbishment Mineral Harvesting program. There was no dividend Minerals are also harvested from distribution for 2007/2008. Murray the WTSSDS – salt, gypsum and Irrigation’s Deputy Chairman, magnesium chloride (bittens). Gordon Ball, and Director, Michael Cheetham Salt Pty Ltd currently Humphris, are directors on the has the contract for mineral AWMA board. For further infor- harvesting. In 2007/08, no salt, mation visit www.awma.au.com . bittens or gypsum was removed, although gypsum is being stockpiled at the site. Figure 3.2 Murray Irrigation water use by crop type.

Volume Water trading (ML) 500,000 Murray Irrigation for the first 03/04 time was a nett exporter of annual 04/05 400,000 05/06 water, with a nett transfer out of 06/07 07/08 12,623ML. Many member- customers sold the small volume 300,000 of water available on-farm as a result of the water suspended in 2006 being returned into a buoyant 200,000 annual market.

The Water exchange 100,000 The exchange illustrated the scarcity of water available this season, setting 0 Rice Annual Pasture Perennial Pasture Winter Crops Other a new maximum temporary water

N.B: “Other” includes a number of minor crop types including horticulture and viticulture price (Table 3.1). It traded only

26 11,537ML of water - 80% less than Development to employ a part- the previous season – with a total time dairy support officer to value of sales of $7.8M. Prices continue to promote and support ranged from $200/ML to a the dairy industry in this region. maximum of $1,100/ML. Commencement of this project was delayed because of the continuing drought. Trading Water Entitlements

The value of Murray Irrigation Challenges water entitlements changed significantly in 2007/08. The The most significant challenge facing introduction of delivery entitlements, Murray Irrigation and this region is with access charges based on delivery access to sufficient water to be able entitlements not water entitlements, to provide an irrigation service. In combined with the presence of 2007/08 Murray Irrigation Governments in the permanent effectively did not have an irrigation water market, has increased the program. Aside from the obvious value of Murray Irrigation water economic impact of this situation, entitlements significantly. The confidence is undermined. To comparative value with similar river continue to invest, existing member- entitlements (as indicated by the customers and potential new entrants DWE register of sales) increased require confidence in the future of significantly in 2007/08, with water water availability and the capacity of entitlements with no corresponding Murray Irrigation to deliver the delivery entitlements selling at the water available to their properties. same price as NSW Murray New pricing arrangements and Regulated River Entitlements. transfer arrangements have added Trade continued internally, as part complexity to ownership and of property sales, and independently. transfer of Murray Irrigation’s On July 31 2007 there were 33,050 entitlements. The continuing entitlements in non landholding purchase of water entitlements for accounts and of these 19,282 or 1% the environment by Government of Murray Irrigation entitlements from sellers across our region will were owned by government. impact on future water sales and the efficiency of our supply system. Water use Table 3.1 Investor confidence has been Summary of Murray Irrigation temporary water trading and water exchange operations significantly affected by the ongoing uncertainty of water supply, with a 2003/04 2004/05 2005/06 2006/07 2007/08 zero water allocation and no conveyance water. The company has Murray Irrigation Class C Allocation 45% 42% 56% 0% 0% made every effort to assist existing MIL Water Exchange customers with ongoing high value Number of Sales 1,345 1,155 1,258 1,403 902 y t enterprises during the year, including i s Total volume traded (ML) 79,181 66,729 95,068 58,936 11,537 r feed lots and permanent plantings. e v i Total value of sale $5.7M $4.9M $4.2M $12.3M $7.8M d

Figure 3.2 shows water use by crop d n type. Crop type “other” is currently Average price $/ML $70.13 $73.35 $44.59 $370.73 $680.04 a h t

our only method of recording water w

Lowest price $/ML $50.00 $44.00 $34.00 $70.00 $200.00 o use on non-standard crops such as r g s

horticulture and viticulture. Highest price $/ML $150.00 $200.00 $140.00 $800.00 $1, 100.00 s e n i

Dairy Industry Murray Irrigation Area Trade s u b

Funding has been received by Net temporary trade into : 3

NSW Farmers’ from the NSW MIL area (ML) 114,726 65,873 93,474* 47,127 -12,623 r e t

Department of State and Regional * Excludes transfer from Snowy Hydro Ltd p a h C

27 CHAPTER 4 policy & community relations

We provide a voice for our customers and the region by actively contributing to the development of water policy and strengthening our relationships with stakeholders

How we are performing

Performance

2003/04 2004/05 2005/06 2006/07 2007/08

Provision of information to customers Scheduled Talking Water issues 60 64 65 51 50 Additional Talking Water issues 12 9 28 24 20

Total Talking Water issues 72 73 93 75 70

28 “Communication and lobbying efforts related to the drought have been intensive throughout the year at a local, State and Federal level.”

South Australian irrigators from the Murtho Irrigators Group and the Pike River Land Management Group visited the local area to meet with local farmers and Murray Irrigation staff.

Drought dominated the 2007/08 to provide informed responses that I Contribute to the development year at the local level, with our captured the interest of the public. of government water-related efforts focusing on securing access The constant public criticism of policy. to basic stock and domestic water the irrigation sector without any I Achieve media coverage of requirements. Adding to these acknowledgement of its importance water issues where Murray extraordinary circumstances the to the local, regional and national Irrigation has specific knowledge Commonwealth Government economies is both demoralising and and expertise. aggressively pursued an agenda frustrating. I Better inform, understand and of water reform in the Murray – Clear lines of communication and respond to the needs of our Darling Basin. The extent and pace engagement with our customers, stakeholders, in particular our of public policy reform in water and with State and Commonwealth customers. management in 2007/08 is Government stakeholders, have been unprecedented and has already had I Support industry alliances and critical in responding to both the significant implications for Murray networks. s n

seasonal conditions and the changing o i

Irrigation. t a

political environment. l

Identifying our stakeholders e Communication and lobbying efforts r y t

Our key communication and i

related to the drought have been Murray Irrigation’s stakeholders n

engagement strategies are to: u intensive throughout the year at a include those organisations whose m m local, State and Commonwealth I Lobby influential decision decisions have the potential to affect o c level. Media interest in the issue has makers at all levels, including our operations, most specifically the & y c been constant and often ill-informed. short or long term access to water. It i

government, to maintain access l o

This resulted in significant pressure to water. includes those groups or organisations p on our chairman and staff resources :

currently involved in our operations 4 r e t p a h C

29 and in administering the water- on many aspects of the communities operations of our member- related affairs of our customers. within our area of operation, from customers. Within our local the rating base of local councils to communities we generally respond Irrigated agriculture underpins the number of children at schools. to engagement opportunities that the economic and social fabric of have a regional, water or our region. As a monopoly service Given our limited resources we agriculturally based focus. Tables 4.1 provider we recognise that our typically engage with organisations and 4.2 summarise our stakeholders, operations, our ability to continue to where we have shared interests, and their area of interest in our business, deliver water, and our ability to help where there is some ability to and the particular issues of interest manage environmental risks have influence decisions which will affect and engagement in 2007/08. the potential to significantly impact the company or the water- related

Table 4.1 Murray Irrigation’s stakeholders - Government agencies

Stakeholder Relationship with Murray Irrigation Key issues in 2007/08

GOVERNMENT AGENCIES

NSW Government through Sets legislation and policy, State water policy, Access to water through NSW critical water supply NSW Department of Water represents state interests to the Murray- arrangements while Water Sharing Plan suspended, Land and Energy Darling Basin Ministerial Council,regulates and Water Managment Plan governance, licence compliance company licences,partner in regional water and review of Irrigation Corporation licence conditions, sharing plan and implements government Council of Australian Governments (COAG), intergovern- water policy, funding partner in asset renewal mental agreement, water trading policy (entitlement and annual) and government funding for asset renewal works

NSW State Water Bulk water supplier Day-to-day water orders, deliveries and transfers, water Corporation trading, operation of Mulwala Canal, escape and supplementary flows in rivers and creeks

NSW Independent Pricing Reviews and sets our bulk water prices 2006-2010 determination on State Government water and Regulatory Tribunal charges

NSW Department of Regulates Environment Protection Licence, Reporting, licence compliance, pollution control, LWMP Environment Catchment Management Authorities implementation, and water purchase for Living Murray and Climate Change

Mining licences, agricultural extension, Rural Assistance Authority exceptional circumstances NSW Department of fisheries issues and research partner assistance package, reporting, research projects, licence Primary Industries compliance, recruitment of native fish stock, and participation in extension activities

Murray-Darling Basin Partners in integrated catchment Living Murray Initiative, water savings, water trading, Commission management and sustainable management water recovery plans and water tender of Murray Darling Basin resources

River Murray Water Manages Murray River storages flows and Resource outlook and river management options operations including escape flows and flows to supplement rivers and creeks

Murray Catchment Auspice agency for LWMP investment and Implementation including report of the LWMPs Management Authority integrated catchment management policy, and funding partner

National Water Implementation of the National Water Water entitlement registers, water measurement, reporting, Commission Initiative, and contributes to federal water benchmarking and implementation of National Water policy and benchmarks Initiative

Australian Competition and Trade practices and pricing Development of Water Market Rules, Water Trade Rules and Consumer Commission Water Charge Rules in accordance with the Commonwealth Water Act, and termination fee

Department of Water for the Future – water purchase Water for the Future – modernisation funding, Environment, program and water efficiency investment, Commonwealth Entitlement Water Holder and Water, Heritage and federal water legislation, and LWMP funding amendments in accordance with COAG intergovernmental the Arts partner agreement, and Murray critical water planning LWMP funding beyond 2007/08

Department of Agriculture, Drought assistance and LWMP funding $20,000 Murray Darling Basin irrigation grant and LWMP Fisheries and Forestry funding beyond 2007/08

NSW State and Regional Opportunities for regional development Women in Irrigation Leadership Program, dairy industry Development support and development funding

30 Table 4.2 Murray Irrigation’s stakeholders – Member-customers, community and business relationships

Stakeholder Relationship Key issues in 2007/08

MEMBER- CUSTOMERS, COMMUNITY AND BUSINESS RELATIONSHIPS

Customers Shareholders, water users, water entitlement Water availability and drought, water trading, holders; and partners in sustainable changed delivery operations, water price structure, production and water efficiency initiatives and LWMP implementation

Board Irrigators and specialists providing leadership Response to drought, company policies, response of for company state and national political changes and policy initiatives, Water for the Future and government water purchasing program

Staff and contractors Key business resources vital to our success, Company’s response to drought, implementation of and providers of skills and services company policies, Quality Accreditation, Occupational Health and Safety, and purchase and tendering processes

Local Government Customer for town water supplies, partner in Town water supplies, impact of reduced water Murray LWMPs,development consent availability on local communities, impact of water authority for major works and water trader reform on land values and rate base, maintenance of local infrastructure, LWMP implementation, and approvals for stormwater construction

Town communities Provider of business services and staff for our Impact of reduced water availability on local company and shareholders communities, and economic dependence on irrigated agriculture and environmental initiatives

Students Children of our shareholders,future Wildlife survey and other environmental initiatives, employees, shareholders, and business and grants programs and provision of school resources community leaders and field trips

MILCast, AWMA Key suppliers and provide additional income Asset renewal program, gate mechanisation and stream for company asset refurbishment, business management and profitability

Southern Riverina Irrigators (SRI), Elected landholder representative lobby Murray Irrigation fixed charges, water purchase and Landholder Associations groups termination fee policy

Modernisation Project Customer group to provide input to Establishment and initial consultation with member Reference Group modernisation study customers

LWMP working groups Provide consultation and direction for LWMP contingency implementation arrangements, implementation of Murray LWMPs priorities for remaining funding and support for future funding

Research and educational Partners in research projects and training for LWMP research projects, and river health survey organisations staff and irrigators

Conservation groups Partners in sustainable resource Reporting, sustainability performance, water trading management and competitors for water and water recovery initiatives

Other irrigation companies Collaborators on operational issues, partners Response to ACCC, and input into Commonwealth in industry developmentand promotion of Water Act irrigation s n

Commodity groups: RGA, Producer networks and businesses involved Water availability, promotion of regional opportunities o i t

SunRice, Murray Dairy in irrigated agriculture and tender for water entitlements a l e r

Industry groups: Bondi Group, Professional networks for information National Water Commission initiatives (metering, y t i

NSW Irrigators’ Council, exchange and education, joint approaches reporting, water trading, water pricing, entitlement n u

Irrigation Australia Limited, on water policy development and improved registers, formation of National Irrigators Council, m

National Farmers Federation water management input into National Farmers Federation, Technical m o c Working Group – Water and Bondi group, and &

National Irrigation Corporation Water Entitlement y c i

: 4

r e t p a h C

31 Engaging with Governments on between the States in March 2008, followed by an Intergovernmental policy issues Agreement on Murray-Darling 1. Council of Australian Basin Reform in July 2008. These Governments, Intergovernmental agreements are fundamental to the Agreement on the Murray institutional and governance Darling Basin arrangements for Murray Irrigation’s and its member-customers’ future 2. Water for the Future access to water, the cost of our bulk 3. Australian Competition and water supply, and the rules around Consumer Commission the sale of water entitlements. The extended drought has made the issues facing the Murray-Darling Basin and in particular the River Murray Irrigation convened a range of 1. Commonwealth Water Act landholder meetings, this one at Rob 2007 & Intergovernmental Murray System a national priority Brown’s woolshed, Blighty. Agreement on the Murray and focus. Darling Basin Murray Irrigation participated in Having failed to reach agreement debate around the proposed with the States for the referral of changes both directly with State powers in relation to water, the and Commonwealth Ministers and former coalition government passed with aligned key stakeholders, the Water Bill with its implement- primarily NSW Irrigators’ Council, ation restricted to subject areas the National Farmers Federation where the Commonwealth has and the Bondi Group. Fundamental existing legislative power. Key to our efforts was to ensure that elements included the creation of where changes were introduced the Murray Darling Basin Authority, that the existing “water sharing which will be responsible for arrangements” and “requirements development of a Basin-wide for consensus decision making” by plan with the enforcement of a governments around water sharing sustainable integrated cap on surface between the States were preserved and ground water diversions. The in the new legislation. Commonwealth Water Act also provides for the Australian 2. Water for the Future Competition and Consumer Murray Irrigation has received Commission (ACCC) to provide $500,000 from the Water for the the Minister for Water with advice Future program to complete a on Water Market Rules and Water Modernisation Plan for the Charge Rules and for the ACCC to company’s irrigation supply and determine water charges. These rules drainage infrastructure. Sinclair will apply to Murray Irrigation. The Knight Merz have been appointed Act precludes the compulsory to complete this Plan. One outcome acquisition of water entitlements of this Plan is to develop the and creates the Commonwealth business case for future investment Environmental Water Holder. by both the Commonwealth and With the change of government Murray Irrigation in modernisation in November, the Commonwealth or reconfiguration of our infra- began a new approach to reaching structure. The Plan is due to agreement with the States in be completed in February 2009. relation to the Murray-Darling In March 2008 the Commonwealth Basin. This resulted in a announced its entry into the water Memorandum of Understanding

32 market for entitlements, with an Murray Irrigation is actively involved in the following organisations initial budget of $50M. This and committees either as representative membership or individual coincided with the announcement appointment: by the NSW Government of their I Bondi Group intention to purchase up to 125GL for the Living Murray. These I Irrigation Australia Ltd (merger of IAA and ANCID) announcements followed the early Murray Catchment Management Authority – Board closure of the Murray-Darling Basin I Commission water purchase of I Murray CMA Incentives Review Group 20GL. Continuing drought, and the presence of Government in the I Murray CMA Sodic Soils Incentive Group market for water entitlements for I Murray Dairy Board and Industry Steering Group the environment, has resulted in Murray Irrigation, in parallel with I Murray Darling Freshwater Research Centre Community our Modernisation Planning project, Advisory Committee initiating discussion with the I MDBC Community Reference Group for the Living Murray Commonwealth about integrated investment in our region in I MDBC Community Advisory Committee preference to their current approach. I National Irrigation Corporation Water Entitlements Register As a result of our member- customers selling their water I NSW Murray Critical Water Advisory Group entitlements to Government and I NSW Irrigators’ Council electing to transfer their water entitlements without terminating I National Irrigators’ Council delivery entitlements Murray I Snowy Hydro Consultative Committee Irrigation changed it rules to require the compulsory termination of I State Water Customer Service Committee delivery entitlements. This only applied where water entitlements I Tuppal Creek Management Plan Steering Committee were transferred without delivery entitlements. Murray Irrigation Murray Irrigation has participated in the following projects and working groups in 2007/08 introduced this change to avoid an increasing number of landholdings I National Farmers’ Federation Taskforce for the Water for with delivery entitlements and no the Future water entitlements, leaving the owner with limited or no capacity I National Water Commission National compatible water to generate the revenue required to register working group meet our annual access charges. I National Water Commission National Performance Framework for rural water providers 3. Australian Competition and Consumer Commission I National Water Commission, Water Accounting Development Committee In early 2008 the ACCC commenced the development of its I Ricegrowers’ Association of Australia Environmental Water Rules and Water Charges Champions Program s

rules as required under the Water n o i Act 2007 (Commonwealth). The t a l e

ACCC has developed issues papers r

y t and positions papers for: i n u

I Water market rules m m o c

I Water charge rules – &

termination fees y c i l o p

: 4

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33 I Water charge rules for Customers and shareholders infrastructure operators I Water charges rules bulk water Providing information about water availability and access, drought Water charge rules and I initiatives and government legislative management changes were the focus of Murray Murray Irrigation has prepared Irrigation’s communication efforts written responses to each of these with its member-customers. papers and also met with the ACCC on five occasions, including a joint Our key customer communication meeting with the NSW Irrigators’ strategies include: Council and the other NSW I Single page faxstream/email Irrigation Corporations. One of the ‘Talking Water’ issued each key issues for Murray Irrigation and Tuesday, which is our primary other group schemes in NSW and vehicle of communication South Australia is the concept of (figure 4.1) with 50 scheduled “transformation”, where the Water issues last year, including Act 2007 allows for irrigators within allocation announcements, and groups schemes to transform their 20 additional issues providing water entitlements to a water high priority information entitlement on the state register, whilst maintaining a contractual I Weekly radio broadcast on local arrangement with the group scheme radio 1521QN ‘On the Land’ for delivery. rural program I Regular media releases to local, regional and metropolitan Water industry alliances audiences depending on the Where governments consult issue. between themselves at a national I Modernisation Reference Group and state level, locally owned of 24 members to provide input irrigation companies like Murray and direction to the develop- Irrigation have had difficulty ment of the Company’s planning for modernisation. Membership Figure 4.1 participating in debate, while Number of ‘Talking Water’ government owned irrigation is diverse, includes members recipients authorities effectively have a place from across our area of operation, at the table through their Ministers landholder associations, industry No. of and also local government. (This recipients and department heads. While we group has for the moment 1,500 continue to make representations to the NSW Government, industry replaced Murray Irrigation’s alliances have become increasingly Focus Group.) 3

9 important, with Directors and senior I Bi-monthly meetings with SRI,

1,200 2 , 8 1 0

7 management maintaining their 2 the peak representative group for 7 , 1 1 4 , 0 1 4 participation in water industry the local landholder associations 1 6 , 0 1 ,

1 groups over the past year. 900 I Attendance at SRI and The development of a National Landholder Association meetings Irrigators’ Council, led by NSW I LWMP extension activities 600 Irrigators’ Council, has been a major initiative driven by the strengthened In October and November power of the Commonwealth in Murray Irrigation actively worked 300 relation to water policy as a result with CentreLink to increase the of the passage of the Water Act and access of our customer-members to 7 4 5 6 8 0 0 0 0 0 the $20,000 irrigation management / / / / / 6 3 4 5 7 recent referral of powers by the 0 0 0 0 0 0 NSW Government. grant announced by the 03/04 04/05 05/06 06/07 07/08 Commonwealth Government in October. This included holding 10 landholder meetings attended by nearly 600 people.

34 Challenges 1) Ensure our significant but limited resources are directed The unprecedented drought being toward actions where the experienced in the Murray-Darling company can contribute to Basin has crippled irrigated decisions that will impact on agriculture in this region and has current and future access to brought a national focus to water water and its price. policy. Our member-customers are facing another year of limited or no 2) Continue to provide our farm income, challenging their member-customers with the financial and emotional resilience. best practical and timely information to make sound The wide range of issues being business decisions in both the addressed by Government and the short and medium term. amount of information in the media is daunting even to those involved 3) Make prudent and cost- in the water industry. Arguing our effective investment decisions case and having a public voice is a about our infrastructure that continuing challenge. prepare Murray Irrigation and our member-customers for the The Commonwealth Government’s future. Water for the Future has a significant focus on water purchases, 4) Always recognise that as well as preparing the irrigation profitable and sustainable industry for the impact of climate irrigation farming is the key to change. Managing the impact of the prosperous future of the government water purchases on company, its shareholders and the company and on remaining the region. member-customers is a significant issue. The current approach by Government, including the ACCC draft rules, has the potential to pit member-customers against each other and the company.

The ACCC will play an important role in determining the basis for our water entitlement trading.

The development of the Basin Plan by the Murray-Darling Basin Authority by 2011 will be crucial to any changes required to the Murray Lower Darling Water Sharing Plan in 2014.

Murray Irrigation is a large

organisation in the regional context, s n o but only one of a myriad of key i t a stakeholders in the current l e r

Australian debate about water. The y t i key challenges for Murray Irrigation n u in this complex debate, are to: m m o c

y c i l o p

Graduates of the Women in Irrigation Leadership Program. The Program was funded by

the Department of Agriculture, Fisheries and Forestry and offered by Murray Irrigation. 4

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35 CHAPTER 5 protecting environmental values

We are undertaking initiatives and developing policies to improve the health and productivity of the regional environment.

How we are performing

Performance

2003/04 2004/05 2005/06 2006/07 2007/08

100% compliance with company licences Number incidents reportable to regulatory agencies 00 10 00

100% landholder compliance with company environmental policies (Total Farm Water Balance, Rice Growing) Number identified policy breaches 26 11 25 00

Minimise area affected by high watertables - <2m (March) 10,056ha 8,447ha 14,334ha 3,257ha 346ha

Implement the Murray Land and Water Management Plans (LWMPs)* Increase landholder participation in the plans 696 782 949 1,058 1,103 Maintain government investment G: $6.5M G: $8.5M G: $7.6M G: $10.2M G:$20M Maintain landholders direct co-investment LH: $3.9M LH: $5M LH: $5.7M LH: $7.9M LH: $3.2M

*All LWMP information based on July to June funding year.

36 “Our strategies to address waterables include the company’s policies, provision of stormwater networks and sub surface drainage, and improved on-farm and regional water management.”

Colligen Creek, Wakool district.

A healthy environment is essential NSW; a 30-year, $498M public- of Berriquin, Cadell, Denimein to productive agriculture. We are private partnership between and Wakool. The total area of the committed to addressing the direct landholders, local, State and Federal LWMPs is 960,000ha, which impacts of providing irrigation and Governments. represents almost a third of the stormwater services through Murray CMA area, with 3,036 The Murray LWMPs have five major improvements in risk assessment properties including 2,035 elements: and management systems, company commercial irrigated landholdings, policies and implementation of the I Stormwater and subsurface which are the primary target of Murray Land and Water drainage infrastructure. the Plans. Management Plans (LWMPs). I Best management of land, water and vegetation on-farm. Participation in the LWMPs Murray Land and Water I Education. A new record of $16.743M of

Management Plans s I Research and development. government funding was paid for the e u l

Monitoring and reporting. a The Murray LWMPs remain the I provision of incentives to assist with v l a company’s major environmental The LWMPs are an integral part a range of approved on-farm works t n program. They link the company’s of the Murray Catchment Action in 2007/08. Contribution to these e m

works by landholders totalled n performance with landholders’ Plan 2007. Murray Irrigation is o r i performance and consider both the implementation authority for $2.06M and the landholder survey v n indirect and direct regional the Murray LWMPs, and remains conducted as part of the LWMP e g n program indicated landholders had i environmental impacts and contracted through the Murray t c e outcomes. Catchment Management Authority contributed a further $15.249M to t o non-incentive LWMP works. The r (CMA) to continue their delivery. p They represent the first co-ordinated, : There are four component plans number of landholders undertaking 5 r

long-term, regional approach to e

based on the geographic sub-districts works has increased from 1,058 in t natural resource management in p 2006/07 to 1,103 in 2007/08. a h C

37 Figure 5.1 Uptake of the LWMP program in environmental initiative called Funding contributions to LWMP 2007/08 was remarkable given the Caring for Our Country. This is on-farm works 1995-2008 difficult seasonal conditions and extremely disappointing and has significant progress toward impacted significantly on the achievement of the targets for the momentum the Murray Plans had $102.6M LWMPs was made. The increased developed over the last five years. $193.3M uptake is attributed to revised cost All funding contributions are sharing ratios, the drought bonus for audited by Sinclair Knight Merz native vegetation protection provided on behalf of the State Government. by the Murray CMA, and significant Annual expenditure is detailed in uncertainty about future Australian our 2008 Compliance Report, $290.8M Government contributions to the available from our website. Murray LWMPs. Tables 5.1 and 5.2 provides a Government Contributions The NSW Government has summary of the LWMP on-farm Landholder cash contribution continued to support the (in accordance with LWMP works completed during the year, Heads of Agreement) implementation of the Murray and cumulatively over the 12 years Additional landholder contribution LWMPs with funding provided in of the program to date. 2008/09. However, the Australian All funding contributions are audited Government to date has failed to Figure 5.1 shows the total of by Sinclair Knight Merz on behalf of provide any further funding for the contributions since 1995. the State Government. Annual Murray LWMPs from their new expenditure is detailed in our 2008 Compliance Report, available from our website.

Table 5.1 LWMP On-Farm Implementation Summary 1995 – 2008

Total number of landholdings 3,036 Number of commercial landholdings 2,035 farms

Works completed Cumulative works Incentive Item 07/08 completed Total target No. – landholdings – landholdings – landholdings

Irrigation Accreditation Course 18 1,464 1,865

Farm Plans 177 1,229 1,639

Irrigation Recycling Systems 127 934 1,639

Storage Systems 143 689 1,538

Table 5.2 LWMP Native vegetation implementation

Incentive item Works completed Cumulative LWMP 2016 Catchment 07/08 works completed target

Vegetation to Reduce Salinity (including perennial pasture) 5,800ha 45,950ha 72,542ha

Protect and restore remnant vegetation 1,829ha 5,251ha 16,305ha

Active management of native vegetation 6,488ha 17,106ha 38,619ha

38 Environmental risks through the Murray LWMPs since 1995 when more than 115,000ha One of the most significant (12%) of the 905,000ha LWMP area environmental risks the region faces was affected by watertables within is that of rising watertables and 2m of the surface. associated soil salinisation. Our aim is to maintain or reduce the area Extensive biannual groundwater affected by shallow watertables monitoring through a network of (0-2m), with a target of less than 1,500 piezometers shows the area 50,000ha affected incorporated affected by shallow watertables in within the catchment plan. The March 2008 was only 346ha (figure region could be described as 5.2), which increased slightly in experiencing a “salinity holiday” August 2008 to 1,557ha. This because of the successive years of represents only 0.04% of the region. below average annual rainfall and The continuing dry weather significantly reduced irrigation sequence and low water allocations water availability. have been major factors in the improvement of watertable levels, Our strategies to address waterables particularly since 2002 (figure 5.2). include the company’s policies, However, the risk of rising provision of stormwater networks watertables, salinity and and sub surface drainage, and waterlogging remains a long term improved on-farm and regional threat to the region, particularly water management. The given the naturally widespread high implementation of stormwater groundwater salinity (figure 5.3). and on-farm water management strategies have been co-ordinated

Figure 5.2 Depth to watertable, Murray LWMP region, March 2008 s e u l a v

l a t n e m n o r i v n e

g n i t c e t o r p

: 5

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39 Groundwater quality In 2007/08, irrigation intensity across the Murray Irrigation areas The salinity of shallow groundwater was extremely low and was only is monitored every three years, and 0.04ML/ha, due to the zero while there has been some variation, announced allocation. There were there is no discernable trend. only three landholdings which grew Groundwater quality samples were rice using groundwater and there last collected in July 2006. Figure were no breaches recorded for either 5.3 shows the shallow groundwater policy. salinity in 2006. There were 854,216ha with groundwater salinity Managing stormwater greater than 5,000EC, compared to 927,200ha in 2003, 872,372ha in As our landscape is so flat, and 2000 and 818,212ha in 1997. This natural drainage relief in our region presents a significant risk of soil is minimal, stormwater that is not salinisation if watertables are not removed quickly following controlled. significant rainfall can lead to Murray Irrigation has two policies waterlogging, rising watertables, which are designed specifically to soil salinisation and reduced influence on-farm water use and environmental health. The discharge contribute to the control of of water from our stormwater watertables in the region: Total Farm network also has the potential to Water Balance (TFWB) Policy and affect receiving waterways, which all Rice Growing Policy. ultimately lead to the Murray River.

Figure 5.3 2006 shallow groundwater salinity in the Murray LWMP region, monitored every three years

40 The company’s strategies with Challenges regard to stormwater are four-fold. Maintaining Government’s commitment to the Murray LWMPs I We are continuing to build “Heads of Agreement” funding for stormwater networks to improve the four Murray LWMPs is a the region’s capacity to manage priority. and remove stormwater. There are significant challenges I We encourage landholders facing Murray Irrigation and its through the LWMPs to hold members in relation to the future stormwater on-farm by direction of on-farm and regional providing incentives for properly environmental initiatives, and the constructed storages on opportunities to access future appropriate soils. funding. I We have implemented a stormwater policy detailing the There will be funding opportunities conditions under which under the Australian Government’s landholders have access to the Water for the Future Funding, stormwater network to improve Caring for our Country and control of water quality. potentially Climate Change and Carbon Trading initiatives. These I We undertake extensive monitoring of stormwater for opportunities need to be identified flow, salinity, total nitrogen, total and pursued. What is clear is that phosphorus, turbidity, blue-green these opportunities will be different algae, and agricultural chemicals, to those previously experienced in line with our Environment with the Murray LWMPs. Protection and Water Murray Irrigation and its member- Management Works Licences. customers face policy and climatic Murray Irrigation’s storm water uncertainty. This presents a difficult escape system was not utilised in business environment for the 2007/08. Company and for our member- customers, and demands that Murray Irrigation reconsider the Subsurface Drainage size and nature of its business, while In addition to our stormwater our member-customers reconsider networks, Murray Irrigation the structure of their farm operates a groundwater pumping businesses. scheme to provide subsurface drainage to the Wakool district. The Wakool Tullakool Sub-Surface Drainage Scheme (WTSSDS) represents a major part of the company’s infrastructure, with operating costs in the order of s e

$400,000 a year. This cost is shared u l a v

two thirds by Murray Irrigation l a and one third by government. t n The Scheme includes 2,100 ha of e m n evaporation basins, 110 kms of o r i underground pipe and 52 pumps. v n e

In 2007/08, only 2,885ML was n i t c

pumped by the WTSSDS. e t o

Left: Paul and Debbie Martin and sons Jack and Ben, Wyam Creek, “Gynong”, Wakool. r p

Right: Paul beside the storage dam at “Gynong”. : 5

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41 CHAPTER 6 company culture & structure

Murray Irrigation is constituted to supply water at the lowest sustainable price to its members and maintain reserves to ensure the continued viability of the business

We are committed to a high standard of safety for staff, customers and the public; with a culture of continuous improvement, clear direction, respect and accountability

How we are performing

Performance

2003/04 2004/05 2005/06 2006/07 2007/08

Staff turnover target 10% to 15% 13.2% 12.9% 14.9% 10.7% 18.6%

Reduce number days sick leave per FTE 4.8 4.7 4.9 4.1 8.08

Reduce number of lost time injuries 5710 55

42 “We are one of the region’s largest employers with 126 staff. The majority of staff are based in Deniliquin. Staff are also based in Finley, and Wakool.”

Pictured here David Pearson, Plant Operator, Deniliquin, redeployed to the mechanisation program, levels off a wing-wall raising near Deniliquin.

corporate governance

Performance Measures Board of Directors area of expertise, most particularly in the areas of finances, engineering or The company is a non-profit, Murray Irrigation’s Board of environmental management. They unlisted, public company and the Directors during 2007/08 consisted cannot be shareholders. Board of Directors takes ultimate of seven member Directors and responsibility for the corporate two non-member Directors. While Chairman governance of the company. This all Directors are independent of includes responsibility for strategic management, member Directors are The Chairman and Deputy planning, protection of the company’s shareholders in the company. Chairman of the Board are elected financial position, legal and licence Shareholders elect member by the full Board, for a term of two compliance, risk management, Directors via a postal ballot, with the years. Both positions are open to any auditing, reporting and evaluation member of the Board. e election confirmed at the following r u

of Board and the company’s t

Annual General Meeting. They are c u

performance. The Board approves r t

elected for a four-year term, with s the company’s water price and Changes to the Board of Directors half retiring every second year. & structure, issues shares, water and e r

Shareholders have endorsed changes u t delivery entitlements, and approves Non-member Directors are l to the make-up of the Board and u the trade of shares and entitlements. c nominated by the member Directors removal of geographic boundaries y n

to serve terms of four years. a In practice, Murray Irrigation’s for the nomination and election of p

Shareholders ratify or veto the m structure is more like a co-operative Directors. This will begin to take o appointment of the nominated non c than a private company. Our effect in the 2007/08 years. One : member Directors at the AGM. Non- 6 shareholders are also our customers position was cut in 2007 and a r e member Directors must have a t and are linked to the company by further position will be cut in the p a

tertiary qualification and a minimum h ownership of landholdings. 2009 elections. of 10 years of experience in a relevant C

43 Our Directors Mrs Alexandra Anthony MAICD Member Directors Mrs Alexandra Anthony is from the Mr Stewart Ellis Wakool district and is a Member Director who was first elected to the Mr Stewart Ellis Chairman MIL board in 2003 and re-elected Chairman MAICD in 2007. Mrs Anthony is a member Mr Stewart Ellis is from the Wakool of the Murray Catchment district and has been a Member Management Authority board, Director since 1995. He was re- member of Murray Darling Basin elected to the Board in 2005 and Community Advisory Committee, elected Chairman in December member of the Lower Murray 2005. Mr Ellis is Chairman of the Darling Customer Service Snowy Hydro Consultative Committee and Secretary of the Committee, Delegate to the NSW Wakool Branch of the Rice Mr Gordon Ball Irrigators’ Council, and Chairman of Deputy Chairman Growers’ Association. She is also a the Bondi Group. He is Director on Graduate of the Murray Darling the Board of the National Irrigation Basin Leadership Program. Corporations Water Entitlements Register, the National Irrigators Mr Kelvin Baxter Council, and Irrigation Australia Ltd. MAICD Mr Gordon Ball Mr Kelvin Baxter is from the East Berriquin district and has been a Deputy Chairman Member Director since 1995. Mr MAICD Baxter was re-elected to the Board Mrs Alexandra Anthony Mr Gordon Ball is from the East in 2007. He is a member of the Berriquin district and has been a Hume to Yarrawonga Waterway Member Director since 1995. He Advisory Group, the Murray- was last returned to the Board in Darling Basin Community Advisory 2005. Mr Ball is a Member of the Committee, and the National Water Murray Lower Darling Customer Commission, Water Accounting Service Committee. He is a Development Committee. He is Member of the Riverina Institute also a community representative on of TAFE Advisory Council. He is the Murray-Darling Basin Mr Kelvin Baxter also a director of Automated Water Commission Community Reference Management Australia and is a Panel for the Living Murray. community representative on the Mr Leigh Chappell Murray-Darling Basin Commission MAICD Community Reference Panel for the Living Murray. Mr Leigh Chappell is from the West Berriquin district and was elected as a Member Director in December 2005. He is a past Executive Officer of both the Southern Riverina Mr Leigh Chappell Irrigators and the Murray Valley Groundwater Users Association.

44 Mr Malcolm Holm Conduct and conflict of interest GAICD The Board operates according to a Mr Malcolm Holm is from the East code of conduct adopted from the Berriquin district and was elected as Australian Institute of Directors, a Member Director in December based on acting honestly, in good Mr Malcolm Holm 2005. He is a Past Chairman of the faith and in the best interests of the Southern Riverina Irrigators, and an company as a whole. Executive Councillor for the NSW Farmers’ Association. He is also Directors are asked to resign from Deputy Chairman of Murray Dairy. executive position on district or regional landholder associations Ms Vicki Meyer upon being elected, to prevent GAICD possible conflicts of interest between Ms Vicki Meyer is from the West these groups and the need for Directors to act in the interests of Berriquin district and was elected Ms Vicki Meyer as a Member Director in 2007. the company as a whole. She has 25 years experience in Directors have a code of conduct for Agribusiness throughout the water trading, which prevents them Riverina and is General Manager acting on or using information prior of Deniliquin Freighters. She is to it being available to shareholders. also a past Director of Bendigo Directors must not receive Community Bank, Coleambally, commission for water transactions. and of the Griffith Business Centre. Directors must also notify the Chairman of any water entitlement Non-member Directors or annual market transactions. Mr Anthony Read

Mr Michael Humphris, Earlier this year the Board adopted FCA, FSIA, MAICD the formal practice as part of the Mr Michael Humphris is a agenda to declare any potential Non-member Director who was conflict of interest at the beginning appointed to the Board in December of each meeting, after which the 2007. He is an Accountant and Directors declaring an interest Consultant/Specialist Advisor with exclude themselves from the related BDO Kendalls. He holds non- debate. executive board positions and sits on Training and Professional Advice Mr Michael Humphris various professional and educational committees. Directors have the right in connection with their duties and responsibilities as Directors, to seek Mr Anthony Read, ME, MBA, independent professional advice at FASCE, FIEAust, CPEng the company’s expense. Prior written approval of the Chairman Mr Anthony Read is a

is required, which will not be e r

Non-member Director who u unreasonably withheld. t c was appointed to the Board in u r t s

December 2005. He is a Principal &

Engineer and Manager Agribusiness e r u t

with Kellogg Brown Root Pty Ltd l u c in Adelaide. He is a director of y several companies involved in the n a p

growing, processing and marketing m o of almonds and pistachios. c : 6

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45 Shareholder access to the Board Committees Shareholders have access to member Directors as their elected representatives, and through Audit and Risk Management Committee landholder associations including Southern Riverina Irrigators, Michael Humphris (Chair since December 2007) which meets regularly with senior Gordon Ball (Chair August - December 2007) management and Directors. Alexandra Anthony Shareholders can submit a request to the Board of Directors for a Stewart Ellis resolution to be put to the annual Malcolm Holm (since December 2007) general meeting, but ultimately Vicki Meyer (since December 2007) the Board approves all items for consideration at the AGM. Shareholders can also request that Environment Committee the company holds a general Stewart Ellis (Chair) meeting to consider specific resolutions with the support of Alex Anthony (since December 2007) at least 5% of shareholders. Leigh Chappell (since December 2007) Board performance Malcolm Holm The Board of Directors is responsible for setting the company’s Infrastructure Committee strategic direction and has endorsed Anthony Read (Chair) the 2006-2011 Strategic Plan, and the company’s Vision, Mission and Gordon Ball Values. The Chairman of the Board Leigh Chappell is ultimately responsible for the Stewart Ellis company’s sustainable performance. Daniel Liphuyzen (August – December 2007) The Board has five committees, Kelvin Baxter (since December 2007) each with its own terms of reference, which report to the Board after each committee Nomination Committee meeting. Relevant papers and Stewart Ellis (chair) minutes are provided to all Directors. Committees are Gordon Ball appointed for terms of two years, David Hunter (August 2007 – March 2008) and the current appointments Malcolm Holm (since March 2008) were made following the AGM in December 2007. Attendance at Board meetings and committee Remuneration Committee meetings is included in the Stewart Ellis (Chair) Directors’ Report. Staff provide reports to meetings of the Board Gordon Ball committees and to the Board, and Michael Humphris (since August 2007) senior managers attend these meetings by invitation.

46 Audit and Risk Management Remuneration Committee Company Memberships Committee Conditions of employment and Murray Irrigation holds remuneration of senior management membership of the following Responsible for accounting and are the responsibility of this organisations: reporting practices and related Committee, including annual issues including audits, financial remuneration, bonuses or other I Australian Environment information and accounting incentives. Foundation (AEF) controls, management of I Australian Water Association investments, administration The Remuneration Committee’s (AWA) agreements with government and key recommendations in 2007/08 Bondi Group identifying risks to the company. included that: I A representative from the company’s I Irrigation Association of auditors Johnsons MME may attend Annual wage increases in line with Australia (IAA) the wage price index and Mercer this meeting by invitation. Johnsons I National Irrigation Corporation salary scale be approved. MME continue in office in Water Entitlement Register accordance with section 327 of Board Remuneration (NICWER) the Corporations Act 2001. Member Directors are paid a fixed I NSW Irrigators’ Council Environment Committee rate of $22,640 per annum and a day (NSWIC) rate of $255 for committee meetings The Environment Committee I Irrigation Australia Limited helps the Board to achieve and special projects. Non-member environmental compliance and Directors are paid a fixed rate of I Australian Conservation implement the Murray Land and $35,375 per annum and a day rate Foundation Water Management Plans (LWMP) of $510 for committee meetings and special projects. The Chairman of for the company’s area of operation. Donations and sponsorships The committee also oversees the Board is paid a fixed rate of The company does not make environmental audits, maintains $45,280 per annum and a day rate donations to any political parties. communication between the Board of $510 for committee meetings and special projects. and external agencies, and reviews Sponsorship is provided to water the company’s environmental The fixed rate referred to above is and environmental industry-related management and administration for the preparation and attendance events, to local schools and of environmental agreements with at scheduled meetings of the Board. organisations providing learn-to- government. The day rate is for undertaking swim programs within the Murray Infrastructure Committee special projects and attending Irrigation areas of operation and to meetings in addition to the local schools within the Murray This Committee makes scheduled Board meetings. irrigation area of operation for recommendations on fulfilling Reasonable expenses incurred by individual projects to the value of the Board’s responsibilities for the Directors whilst undertaking their $250 per primary school and $2,000 maintenance, refurbishment and duties are reimbursed by the per secondary school. renewal of the company’s water company via a claims system. supply and drainage infrastructure. This includes management controls All Murray Irrigation staff, and policies, assessment of funding including corporate executives, priorities, costs and performance, are remunerated according to our refurbishment and renewal strategies, remuneration management system. and review of government Under the system, positions are e infrastructure funding and assessed by Mercer Human Resource r u t operational agreements. Consultants using the Cullen, Egan c u r & Dell method of rating salaries and t s

Nomination Committee &

wage rates are capped at the 25th e

The Nomination Committee’s r

percentile of the national general u t primary objective is to assess the l market. No staff member receives u c skills required by Directors, the company shares or securities as part y n

General Manager and the company a

of their payment or bonus schemes. p secretary, to identify suitable m o candidates as necessary and c : 6 recommend appointments. r e t p a h C

47 our staff

We are one of the region’s largest I Maintaining a high standard of employers with 126 staff. The safety for staff, customers and the majority of staff are based in public. Deniliquin. Staff are also based in I Provide an ethical workplace Finley, and Wakool. that values staff contributions. The company’s Vision, Mission and I Provide on-the-job training and Values guide staff in the operation career development. of the company. As well as being a Our Quality Assurance (QA) and respected employer in the Occupational Health & Safety community, some key strategies (OH&S) accreditation are key for our staff include: company strategies that apply across

Table 6.1 Murray Irrigation workplace profile

2003/04 2004/05 2005/06 2006/07 2007/08

Employees 128 134 137 134 126

Full time employees 123 129 132 129 119

Part time employees 55557

Full time equivalent 125.8 131.45 134.45 131.5 122.9

Employees under Enterprise Bargaining Agreement 43300

Employees under contract 124 131 134 134 126

Casual staff 72424

Males 108 114 113 111 105

Females 20 20 24 23 21

% male employees 84.4 86.7 84 83 83

% female employees 15.6 13.3 16 17 17

Turnover rate (%) 13.2 12.9 14.9 10.7 18.6

Average number of sick leave days per employee 5.4 3.8 5.5 5.8 8.1

Total payroll for irrigation activities, including wages, benefits, pension and redundancies $7,651,000 $7,900,000 $8,500,000 $7,607,280 $7,841,297

% male Corporate Group members 90 90 90 90 90

% female Corporate Group members 10 10 10 10 10

% male Board members 90 90 91 91 78

% female Board members 10 10 9922

Average age of workforce (years) 43.7 43 43.6 42 45.8

Average age of male employees (years) 45.2 44.4 45.1 45.3 47.1

Average age of female employees (years) 35.6 35.5 36.4 38.1 40.2

Average length of service 13.6 12.4 11.3 11.2 12.9

48 the business. Staff are integral in Changed work conditions in Figure 6.1 maintaining the company’s QA Total injuries reported by type response to drought and OH&S accreditation, which 50 is important to our corporate Murray Irrigation staff continue governance as well as the safety of to take on new tasks, principally our staff, customers and the public. construction of government funded works, and this continues to be 40 Murray Irrigation has an integrated important to the company in Quality/OH&S Management managing its operations during this system which meets the difficult 2007/08 season. 30 requirements of the Quality Standard ISO9001) and OH&S Whilst the company elected not to Standard AS/NSZ480. work a four day week this year in 20 response to the severe drought, We also aim to provide best practice employees were asked to take their in corporate governance and full entitlement of leave accruing 10 strategic leadership for our staff, throughout the year. our member-customers and within 7 8 6 5 0 0 0 0 / / / / 6 7 5 4 0 0 0 the irrigation industry. In an endeavour to further reduce 0 0 company expenditure, staff were 0Slip/trip/fall4/05 05/06 injury 06/07 07/08 Our workplace profile redirected where possible from Manual handling/strain injury company-funded projects to Bite/sting injury Impact Injury During 2007/08, our workplace government-funded projects. Foreign body injury profile did not change substantially. This applied particularly to water Details of our profile, including distribution and works staff and this Directors, are shown in table 6.1. was predominately assisting with All of Murray Irrigation’s staff are the regulator gate mechanisation employed under individual common program. law contracts. We remain a largely Staff numbers remained relatively male-dominated workforce, static; however, there was a higher although there is variation in the than usual turnover of staff percentage of male and female staff indicating some nervousness of staff between our nine main work in relation to future employment if groups, as shown in table 6.2. the drought persists.

Table 6.2 Murray Irrigation gender distribution by workgroup as a %

Work Group Men Women Total No.

Work group Men Women Total No.

Civil Engineering 100% 0% 7

Environment & Communication 25% 75% 16

Executive & support 67% 33% 3 e r u Finance 20% 80% 5 t c u r t

Mechanical Engineering 100 % 0% 5 s

MILCast 100% 0% 2 e r u t Services 79% 21% 14 l u c

Water distribution* 93% 7% 45 n a p

Works 100% 0% 29 m o * Reception staff in Finley and Wakool are funded and managed through water distribution c : 6

r e t p a h C

49 High standard of safety for staff, covering each of our offices and depots, and representing all staff customers and the public members. Membership of the Our OH&S policy commits us to: committees includes nine employer- appointed members and 24 staff, I Provide a healthy and safe work with each committee having three environment for employees, employer representatives and contractors, customers and generally six staff. Each committee visitors. includes representatives from office I Ensure staff, contractors and or depot Work Groups. We are sub-contractors and the public currently actively reviewing the comply with all OH&S Safety Committee structure in line conditions set by the company with a workplace communications or through legislation. policy based on our existing Work I Ensure works conducted, Group System with a view to its organised or supervised by implementation early in the new Murray Irrigation do not harm financial year. employees, contractors, or customers, or endanger the The company recorded five lost time public. accidents (the same as last financial I Comply with and keep up-to- year) and recorded a year end lost date with all OH&S legislative time accident frequency rate of 22.22 requirements and current against a target of 15. It is of note that industry standards. the severity rate has dropped to 32 (last year 54). (Figure 6.1 and Table We are committed to the develop- 6.3). ment and continuous improvement of safety practices which are The annual process of reviewing regulated by the NSW Occupational and updating the company’s Safe Health & Safety Act 2000, Work Method Statements (SWMS) Regulations 2001 and Standards has been completed. Staff meetings and Codes of Practice. Murray are regularly held where a standard Irrigation’s safety performance is agenda item of the meeting includes summarised in Table 6.3. discussions about identification of any site hazards and changes to Murray Irrigation currently operates applicable Safe Work Practices. four local OH&S committees

Table 6.3 Murray Irrigation accident and injury summary

2003/04 2004/05 2005/06 2006/07 2007/08

Fatalities 002 00

Work Cover reportable incidents 043 00

Investigations conducted by Work Cover 101 00

Directions given to MIL to provide documentation under the OH&S Act 001 00

Provisional improvement or prohibition notices were placed on the company under the OH&S Act 000 00

Types of accidents

Near miss incidents 852 10

Lost time Injuries 5710 55

Lost Time Injury Frequency Rate *N/A *N/A 40.3 20.7 22.2

Accident Severity Rate *N/A *N/A 93 54 32

* N/A Not available

50 Murray Irrigation uses Australian human rights and workers’ rights are Standard 1885.1 (1990) which is comparatively well ingrained within the workplace injury and disease the Australian workforce, although recording standard to calculate its we recognise that protecting these safety statistics for lost time injuries rights remains an issue in many and severity. developing countries that are both customers for, and competitors with, The Lost Time Injury Frequency Australian agricultural producers. Rate is the number of hours lost from accidents per million hours There were no breaches of human worked. The accident severity rate is rights or labour laws reported the number of working days lost in within Murray Irrigation during the year divided by the number of the year. Nor have there been any lost time injuries in the year. complaints registered in accordance with the company’s policies developed as part of our human Other health initiatives resource handbook, which addresses The company provides free specific issues including harassment, influenza vaccination to all staff, discrimination and workplace annual medical tests for chemical violence. These policies are aimed at spray operators and hearing tests securing the safety of all employees for plant operators. and promoting a fair workplace, and are supported by counselling and Murray Irrigation also ensures that grievance resolution polices. transport to medical services is readily available for staff who are Murray Irrigation’s leave provisions seeking treatment under Workers are consistent with NSW and Compensation. Commonwealth legislation, and include annual, personal (sick, carers and parental), special, study, paid and Fostering a fair, ethical workplace unpaid maternity and volunteer that values staff leave. The number of staff taking the different type of leave available We operate in accordance with is summarised in table 6.4 NSW and Australian legislation and labour regulations. Enshrined within The company has a comprehensive this legislation are the rights to human resources manual which is freedom of association, equal the prime document that governs employment opportunities, freedom staff and all new employees are from discrimination, protection of inducted into the company in human rights, and prohibition of the accordance with the company’s use of child labour. Protection of induction process.

Table 6.4 Number of staff and number of days leave taken by category in 2007/08

Average days per e Type of leave Number of days r u

staff member 2007/08 t c u r t

Annual 2,335 18.10 s

Long Service Leave 82 0.63 e r u t l

Leave Without Pay 499 3.87 u c

Sick 993 7.97 n a p

Maternity 73 0.57 m o Special 54 0.42 c : 6

Volunteer 0 0.00 r e t p

Study 0 0.00 a h C

51 Some of our staff are also All staff receive a copy of our shareholders in the company and weekly Talking Water newsletter own water entitlements. The Board distributed to customers. Staff are Corporate Governance manual encouraged to read this newsletter includes a code of conduct for water to keep them up to date with trading; these protocols also apply to current water issues and company our staff and are designed to prevent activities. We also publish a staff insider trading. There were no newsletter monthly which provides reported breaches of the company’s an opportunity to recognise the code of ethics, nor of the water efforts of staff, as well as providing trading protocols, in 2007/08. news and information.

Each work division holds group Communicating with staff or “tool box” meetings at least quarterly. These meetings involve With the difficult season quality assurance reporting including experienced and the changes that discussions on our key performance were made to working arrangements indicators and OH&S issues. because of drought conditions, several meetings were held with An annual review of individual staff to discuss the season. performance is held between each staff member and their manager early in the calendar year. These Table 6.5 meetings are intended to provide a Murray Irrigation Limited training 2007/08 more formal opportunity to identify areas of improvement. This review Course Number of staff attending is also used to discuss and identify *First Aid – full course 11 individual staff training *First Aid – refresher 61 requirements, needs and aspirations for the coming year. *OH&S Construction (White) Card 11

*Manual Handling 9 Recognising staff *4WD 8 For several years Murray Irrigation *Farm Chemical – full course 3 has provided annual staff awards *Farm Chemical – refresher 4 to recognise staff excellence. The *OH & S Committee 4 recipients of these awards are nominated by co-workers who *Confined Spaces (Full) 8 recognise excellent service and *Confined Spaces (Refresher) 8 outstanding performance. *Fire Warden 5 On the job training and career *First Attack 5 development *Forklift 9 We provide both essential training *Traffic Control – Red 14 and professional development *Traffic Control – Yellow 14 training. Table 6.5 details the company-required training *Project Management 4 completed in 2007/08. This training *Risk Management 1 was primarily required as part of Additional Requested Training 76 OH&S policy and involved 255 staff and 18 different courses. Total 255 Additional requested training * Mandatory training provided in accordance with our OH&S Policy included a wide range of courses. Civil Construction III ...... 27 completed in 2007/08 Murray Irrigation continues to Water Certificate III ...... 5 completed in 2007/08 6 ongoing to be completed mid 2009 supporting its water distribution and works staff to acquire industry

52 recognised qualifications. All new Board of Directors takes ultimate employees in this area are required responsibility for the corporate to complete the study and practical governance of the company. training for Certificate III in Water This includes responsibility for Operations and Certificate III in strategic planning, protection of the Civil Construction. company’s financial position, legal and licence compliance, risk A total of 27 staff completed their management, auditing, and reporting Certificate III in Civil Construction and evaluation of the Board and the in 2007/08. In addition five staff company’s performance. The Board completed the Water Certificate III approves the company’s water price in 2007/08 and six are scheduled to and structure, issues shares, water complete their Certificate in 2009. and delivery entitlements, and Attracting and retaining skilled approves the trade of shares and professional staff in our rural entitlements. workplace is an important challenge In practice Murray Irrigation’s for the company. We are continuing structure is more like a co-operative our association with Latrobe than a private company. Our University this year sponsoring shareholders are also our customers another civil engineering student. and are linked to the company by We also support local schools by ownership of landholdings. taking a number of work experience students. Challenges

The current climate of drought Purchasing procedures and aggressive Government water Murray Irrigation has developed recovery has been challenging for purchasing policies and tender staff, management and Directors. procedures to provide clear direction Uncertainty created by another year to prevent theft and fraud. The beginning with zero allocation and company also has a gift policy in the by the Government’s water recovery company’s code of ethics. Contracts program is unavoidable for staff and purchases in relation to working in a water supply company government-funded projects such such as ours. as asset refurbishment and LWMP works and incentives are also Adding to the uncertainty for staff reviewed by government auditors. was a review of the structure of the organisation, which was overdue in Supplier and contractor occupational the life of the company. health and safety systems and procedures are considered during The challenge is to maintain staff, the tender and supplier evaluation improve skills and maintain process and products purchased are enthusiasm while adjusting the subject to health and safety business to the changing operating assessments. Risk assessments are environment, in order to provide the e required on new product purchases. necessary level of service required r u t

Where items may affect staff or by member-customers. c u r t

public safety, the local occupational s

For Directors, the challenge is to & health and safety committee is e

make decisions in the best interests r consulted prior to the purchase. u t of all. Member-customers have a l u c

Wherever commercially sensible, diverse range of needs in the current y n

Murray Irrigation purchased environment. It is this diversity that a p products and services from within will see the company continue to m o the local community. reinvent itself into the future, in c : 6

order to best meet the challenges r

The company is a non-profit, e that are ahead. t p

unlisted, public company and the a h C

53 financial statements 2007/08

54 f o c A Indepn A D Not C S B Inc D i t c n a n al c udi as ir ir at c anc om ec ec h em urac es t t t flo or’s 2 2 2 2 2 2 2 2 2 2 1 1 1 1 1 1 1 1 1 1 s or s or e e t ent 9 8 7 6 5 4 3 2 1 0 9 8 7 6 5 4 3 2 1 0 o 9 8 7 6 5 4 3 2 1 y w dent t n s s t het ’ ’ t indep at and he dec r of s tepor Cr Fi Lan Non-Ca Rec Infl Se Com Rem Rela Equ Non-C Cur Non-C Cur Inco Expens Re Su a i t em ate fina nanci aud c .. gme larat m edi ind n e ven l hang ent ows . d men R C Pr D O Pr C Tr ren D Pr In Avai O In Tr ren C i onc . ty me ted .. ndenc une m s i . ont r ur ash nci t & efer efer es ves vent th th ov ov t oper ade ade ep t . . t t ar ue nt i ur ur . . . St it es on al st n e m e t a t . . . A ver es r L Wate er er i es fr lab t . . . tax i i y epor sh Par m li ent al rent rent tm ra ...... i r si si andb iabl I and s om re re ...... ndanc Ri ati i or a a se ...... m nfor of on on in ent b ti . . . . le s nd nd e t y Fi d d . . . . . ent t ts ti ute on ...... T on s at A ...... Lia r dec es Si t T T s s k Plant it es equity nanc s and f O ...... ax C s y or . . . . em s Oth Ot ies Manage t ax ax s ...... gnif d M for o o ...... as r Ar perat of e et bil A ...... la at Li f Sal E h A th h .. anage s L Re c Audi ing rati it ion Ope quity nts er er abil ...... C ic i an s ange Equi e ...... ies abi s e ount ...... ing et ant api ...... tai m Payab R d on ...... F and ...... i s li me ...... rati t tor inanc me em ned e Equipm ...... tal i me tie ...... val A Ac e c e ...... s e nt d s c ...... ng nt In s ber iv Expe ...... ent nts le c t ...... P for iv ...... ounti ve abl i Pl .. ... s ...... al rofi P ...... iti s ...... s ans s ...... rofi A e Us ...... ting e e ndit ...... s nt ts ...... s s ...... ng s ...... in t e ...... ts to Act ure ...... g ...... P ...... t ol N ...... he ...... ivit ...... ici e ...... t ...... Equi ...... es ...... ie Cash ...... s ...... ty ...... M ...... eth ...... od ...... 82 81 80 80 79 7 76 76 75 75 75 75 74 73 72 72 72 72 72 71 71 71 70 69 69 69 69 68 68 67 6 6 63 62 61 60 59 56 5 financial statements 2007/08 directors’ report

Your Directors present their report Meetings of Directors together with the accounts of the company for the financial year to 31 The following table sets out the number of meetings of the Directors held July 2008 and the Auditor’s report during the financial year to 31 July 2008, including meetings of the Board’s thereon. committees, and the number of meetings attended by Directors.

Directors Director Board Audit & Risk Environment Infrastructure Remuneration Nominations Management

The following people were Attended Maximum Attended Maximum Attended Maximum Attended Maximum Attended Maximum Attended Maximum Directors of the company during AM Anthony 10 10 44 2 2 ------the 2007/08 financial year up to the date of this report: GG Ball 10 10 44 - - 44 33 44 KS Baxter 8 10 - - 11 12-- -- I AM Anthony re-elected as Member-Director effective from L Chappell 10 10 -- 22 34-- -- 13 December 2007. SG Ellis 10 10 44 3 3 44 33 44

I GG Ball MD Goudie 44 - - 1 1 ------

I KS Baxter re-elected as MJ Holm 9 10 22 3 3 ------Member-Director effective from M Humphris 89 4 4 - - - - 2 2 - - 13 December 2007. DR Hunter 35 ------44 I L Chappell DT Liphuyzen 44 - - - - 22 - - - - I SG Ellis VC Meyer 66 2 2 ------I MD Goudie was a Member Director from 1 August 2007 to AL Read 10 10 -- - - 44-- -- 13 December 2007. MJ Holm I Director’s interests I M Humphris was appointed as a The relevant interests of the Directors in the share capital, water and delivery Non-member Director on 16 entitlements, as of the company, as at July 31, 2008, are as follows: August 2007 and endorsed at

the Annual General Meeting on Direct Indirect Water Delivery 13 December 2007. shareholding shareholding entitlements entitlements I DR Hunter was a Non-member Member Directors Director from 1 August 2007 to AM Anthony Nil 2,434 1,434 2,434 16 March 2008. GG Ball Nil 1,686 1,686 1,686

I DT Liphuyzen was a Member KS Baxter Nil 7,133 7,133 7,133 Director from 1 August 2007 to L Chappell Nil 1,035 1,035 1,035 13 December 2007. SG Ellis 1,000 Nil 1,000 1,000 I VC Meyer was elected as a Member Director at the MJ Holm Nil 1,484 1,484 1,484 Annual General Meeting on VC Meyer Nil 2,411 2,661 2,661 13 December 2007. Non-member Directors M Humphris, DR Hunter and AL Read hold no Murray Irrigation I AL Read shares, water entitlements or delivery entitlements.

56 N Ot Bul am De P co M Em ir Re Ot ir yea Th e R I T P Inc P e th be c Mu l C Ex an r ons as n i r ro ro iga r iga r he iga r re e et at fo nt u s pens t dh her her ti or prec e re venue r ome r r fit ( fit ( pl k e w

p ia er l a p i c of ist re tax ra Profi k w st l Wat ay older ti ti ti oy e es i r D ct ed o ext ere as fol sa on on on r ex re su L L e t ia nc T ls Ri s ti oss) oss) eni and 10 ki v e be lts ti fr er supp pen a t ax endi ipa enue i t c a on Li s on an ve f t nd (Loss) eve of the co mpany fo om liqui wit m l r t he from se nef t i v ng ac it nue s o t hin ed du su ti n. d ow it y ly 150 kilometr vi he s

ply o an = = = = = - - - lometres to ty of 12,086 s 24,145 ------13,496 (4,123) (2,086) (4,930) (7,004) (3,154) (8,381) (1,410) 7,963 - - - Bila 208 r - -- -- i - area ------ng the per - - - Mur = = ------f w bong ------fr $’0 ater to om the 26,819 24,526 33,379 30,602 = - - - (2,234) (5,953) (7,130) (3,766) (8,220) (2,777) (3,783) - - - ra = = ------e 207 - - - 0s y the s r the - - - = == - - -

------t iod o ------= = ------R me over apli to Pla com in o thes outc the expl rec fundin Mana of M The St organi The D infras st com Under by sur that Your D rec of t gove re and t cons be is that thei Go thou re not v e andar v i venue b venue of andar m the ei o pl ns wa ver d i he w n t r c Di e n e rder t a gni pan pli om t nm r gh t pt c c c us man ra ur he Infras is and t ber uc r in hi t n e r gem mat y of eit at L ompa ompa uc r nm s r os leadi e u g s ds anc m e ati s ect th d A s of bot i i e f tha y ac sd and and Wa ven re c ed as on of t her orks s. t t he r ent i y I f hould not y ed, has e Cor t o f on t ent y ay wil ent ur s or s er s or e wi a di the m o r c A he I t t y ng ny ny ue of w t mandat r be pa ount s or t fundi m or e wor e in the SB ec i r and no oper t reve he be fe cons s ar a fundi h t o t t Plan drainage i has st c y gat uc r c and ar o ac t ei nfr are he the por s ont 104 r h ac c r el ob i om rec of c he he e c t ib pt in the t n o a not n m i n r tur as t

nu id hi ks on L ng ompan In i ut c obt uc r g t of t hieve an e at ng, be t i r or be eipt Land and nue to t pany ter M c s v , whe ont e t u b i r e uc r once com io e. e of ion view , or tr xte e P nor c ount lig re et s y . A te aine -fo pe A om ns iew equi imi he re of t a ed t i r t nt d s r fr t c ev e ure the c of profi A og

e me c r-profi ans y . b ati r funding c anag om ing n the t to c to w pany . . T s pur T d adv o te ned the re ut ordi hould be a d c o re ram he g wor ng P ount ax t, d. nt may fer ate v n ed as he nis val quit s the Wate

r that e s s L ie ng o re ue me d as hic e ic t g w t to ks ue aw e d as ing ab d ly , r e s st

am e nt h r le ts l T w dur be 2 E i E l l al N s M E A R A M O C e t 2 f w w t an 2 T t l r i de t i eve and us e ic s nc mpro o o 10 er rans ubje epor e h nti 0 % and M 0 v n s a h e nv nv loc hi t s hi is g ate it he t t a r the SW n 8 ued b nounc r ur e e tai th v m lude o hout th f nc n no bre i s s 8. 6/ tl n o r i ls i i i g n ng the n wate l li was tal ronme ronme w e at rwa fe ls i n i e ation c em i 0, of th t. a nat e. P s ve 07 s r about t to y I ion for ce r r Mur re y e of n a e. 0 d on page y t A s e m me ed f y ent f o T e e and a re nc con ed t 19 u s r r

t por s t ros c ar t pr 0ML de N n i 2 r ur he he fi e c in re l a i r ig e nt and ntal ra e p o nts n b s 9 o be i t 3, rom a l ac re . pe tami S he r wate l 2 ent nanc t ,4 live e s ation

y g o 31 c the h p a a goe N or W en 28 in he y I of 01 c e quire om l P a r 0 q l e R S itl t re ation s e be r 7M equi s s e u do i r nants W De rote 20 y e ne ML r r c n o i t 1 for of ial Jul wate 8 the e em s a t s r Li its pany Cl ord l ponding to pr su g ig andhol l n 2 t v r o L s e t the ntit c u 08 ye al ir t mi im dis y 2 re si ent was c ation w s l s ply ar t a l to wat o 17 onme tion . f o on s t r av T ar e c me /0 holds t o g ow t par te ate e le s 0 li s c ni pe int i to 3 ompany he s ve c a wer no s harg d is 9 s t me e h ur ail . F nt to c ding has fic C 8. of thi upl ci a f f han i yanc Li re e the me del ntal e it e

abil nc e ur e nts fi ant

hange c an hav e as 1 J r e y es sr i ac e enc and n nt of e the ive on is d ie e t d ity n uly ce s

o d e fo r r y . s s 57 financial statements 2007/08 before the end of the season are included in this report, as in the Rounding of amounts to the opinion of Directors, this may limited. The directors expect this nearest thousand dollars will result in a loss to the company prejudice the interests of the of at least $8M at the end of company. The company is of a kind referred 2008/09. to in Class Order 98/0100, issued by the Australian Securities & There has been no other item, Indemnification and Investments Commission, relating to transaction or event of a material and insurance of officers the rounding of amounts in the unusual nature likely, in the opinion Directors’ report, which have been of the Directors, to affect significantly During the financial year the rounded off in accordance with that the operations of the company, the company paid a premium Class order to the nearest thousand results of those operations or the state indemnifying officers of the dollars. of affairs of the company in company. A condition of the subsequent financial years. contract is that the nature of the Lead auditor’s independence liability indemnified and the declaration premium payable not be disclosed. Likely developments and The lead Auditor’s Independence expected results of operations Declaration is set out on page 80 Proceedings on behalf and forms part of the Directors’ The company’s results are influenced of the company Report. by the level of its operating costs, the amounts required to be set aside No person has applied to the in reserves, and income derived Court under Section 237 of the Auditor from the sale of water and other Corporations Act 2001 for leave to Johnson’s MME continue in office sources. The unpredictability of the bring proceedings on behalf of the in accordance with section 327 of available water resource, government company, or to intervene in any the Corporations Act 2001. requirements and river management proceedings to which the company mean it is not possible to accurately is a party, for the purpose of taking This report is made in accordance predict the results of operations. responsibility on behalf of the with a resolution of the Directors. However, Directors will endeavour company for all or part of those to protect the viability of the proceedings. business in all circumstances. No proceedings have been brought Further information on likely or intervened in on behalf of the developments in the company’s company with leave of the operations and the expected court under Section 237 of the results of operations have not been Corporations Act 2001.

SG Ellis GG Ball Chairman Deputy Chairman 3 November 2008 3 November 2008

58 I T P P P in Muray IigtonLmed Ma Em R O B D O nc ul rof rof rof h e even ther ther co e prec om ter ploy k Wat above it it/(L it/(L me s E R ials e T ue i f e ati o xpens e er Su a in ax r th f venue Be os) os) on nd Co r com ta om Expen nef and A e Year es ply Bef f tem e

iga r Ir r it st igat r om Ir ntra s atement Expense se ore In Expense mo en cts Expense ti r t t ion Unde sati

fo sho come r the year ended on E uld ion Unde be T xpe a t r read x i f aking nse in con n t r s aking Before Income n a ju 3 nction with the a 1 J uly 200 c s l a i 8 ccompa Tax nyi s t n e m e t a t

ng not es. No 3 4 2 2 te s = = ––– ––– ––– = = ––– ––– ––– = = = –– –– –– = = ––– ––– ––– = 12,086 24,15 13,496 = (4,123) (8,31) (2,086) (7,04) (4,930) (3,154) (1,40) = –– –– –– = = 7,963 $’ ––– ––– ––– = = 20 = –– –– –– = = 0 ––– ––– ––– = = 0 = –– –– –– = = ––– ––– ––– 8 = =

= – – – = = ––– ––– ––– = = –– –– –– = = = ––– ––– ––– 30 24 26 3 (3 (8 (2 (7 (5 (3 (2 = = –– –– –– $’ = = = ––– ––– ––– 207 ,6 ,7 ,5 ,2 ,8 ,2 ,1 ,9 ,7 ,7 ,3 = = –– –– –– 0 = = = ––– ––– ––– 02 83 26 20 19 34 30 53 6 7 79 = = –– –– –– = = ––– ––– ––– = = ) ) ) ) ) ) ) 59 financial statements 2007/08 Murray Irrigation Limited balance sheet as at 31 July 2008

2008 2007 Notes $’000 $’000

ASSETS Current Assets Cash and Cash Equivalents 5 52,938 44,734 Trade and Other Receivables 6 23,944 36,600 Inventories 7 1,480 1,226 Other 8 122 198 –––––––––––––––––––––––––– –––––––––––––––––––––––– Total Current Assets 78,484 82,758 –––––––––––––––––––––––––– –––––––––––––––––––––––– Non-Current Assets Available for Sale Financial Assets 9 18,001 6,774 Investments Accounted for using the Equity Method 10 1,101 1,829 Property, Plant and Equipment 11 263,544 255,786 Deferred Tax Assets 12 2,748 2,187 –––––––––––––––––––––––––– –––––––––––––––––––––––– Total Non-Current Assets 285,394 266,576 –––––––––––––––––––––––––– –––––––––––––––––––––––– TOTAL ASSETS 363,878 349,334 –––––––––––––––––––––––––– –––––––––––––––––––––––– LIABILITIES Current Liabilities Trade and Other Payables 13 10,096 9,973 Current Tax Liabilities 14 8,821 9,164 Provisions 15 2,051 2,050 Other 16 6,204 4,727 –––––––––––––––––––––––––– –––––––––––––––––––––––– Total Current Liabilities 27,172 25,914 –––––––––––––––––––––––––– –––––––––––––––––––––––– Non-Current Liabilities Deferred Tax Liabilities 17 37,119 32,038 Provisions 18 80 68 –––––––––––––––––––––––––– –––––––––––––––––––––––– Total Non-Current Liabilities 37,199 32,106 –––––––––––––––––––––––––– –––––––––––––––––––––––– TOTAL LIABILITIES 64,371 58,020 –––––––––––––––––––––––––– –––––––––––––––––––––––– NET ASSETS 299,507 291,314 ======EQUITY Contributed equity 19 186,452 186,452 Reserves 20(a) 152,111 141,169 Retained Profits/(Accumulated Losses) 20(b) (39,056) (36,307) –––––––––––––––––––––––––– –––––––––––––––––––––––– TOTAL EQUITY 299,507 291,314 ======The above balance sheet should be read in conjunction with the accompanying notes.

60 I P T To N st Muray IigtonLmed A R To nc rof h se ev et ate e tal tal om In it f aluat ts above

R e T Eq eq ment or com ec io t ui s ax ui he tat og n/(D ty ty e/(L on It em nis Year of at t at t e e ev nt ch d Di ems Recogni os) aluation) of inning he beg of he End of the hanges in c an Reco re ctly ges in equit to gnise Avai equit sed D Equi of t d Directly in Equity Fina lable for t y should b y i re ctly to E he year nci y fo al Year Sale Financial r th e rea quity e year d in co njun e n ded ction wi 31 J t h t uly h e accomp 2 0 0 8 No a nyi 9 te ng not s es. = = ––– ––– = = ––– ––– = = = 29,507 291,34 –– –– = = ––– ––– = = = –– –– = = 7,963 $’ ––– ––– = = 20 = –– –– = = 327 230 0 (97) ––– ––– = = 0 = –– –– = = ––– ––– 8 = =

= – – = = ––– ––– = = 2 2 –– –– = = = ––– ––– 26 91 64 = = –– –– $’ = = = ––– ––– 207 ,8 ,31 ,52 = = –– –– 0 = (3 (2 = = ––– ––– 1 19 = = –– –– = 6) 5) 1 4 0 = ––– ––– = = 61 financial statements 2007/08 Murray Irrigation Limited cash flow statemen t for the year ended 31 July 2008

2008 2007 Notes $’000 $’000

CASH FLOWS FROM OPERATING ACTIVITIES Cash Received from Government 30,250 22,679 Water and Other Income 24,604 27,076 Payments to Suppliers and Employees (54,834) (46,726) –––––––––––––––––––––––––– –––––––––––––––––––––––– 20 3,029

Interest Received on Investments 4,841 2,338 Income Taxes Paid - (904) Loan Costs Paid (25) (25) –––––––––––––––––––––––––– –––––––––––––––––––––––– Net Cash Inflow/(Outflow) from Operating Activities 25 4,836 4,438 –––––––––––––––––––––––––– –––––––––––––––––––––––– CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from Sale of Supplementary Water 18,000 2,000 Proceeds from Sale of Property, Plant and Equipment 991 926 Payment for Property, Plant and Equipment (4,723) (3,677) Payment for non-current financial assets (10,900) - –––––––––––––––––––––––––– –––––––––––––––––––––––– Net Cash Inflow/(Outflow) from Investing Activities 3,368 (751) –––––––––––––––––––––––––– –––––––––––––––––––––––– NET INCREASE/(DECREASE) IN CASH HELD 8,204 3,687 Add Cash at the Beginning of the Financial Year 44,734 41,047 –––––––––––––––––––––––––– –––––––––––––––––––––––– CASH AT THE END OF THE FINANCIAL YEAR 5 52,938 44,734 ======

The above cash flow statement should be read in conjunction with the accompanying notes.

62 a ta e l w a r D ta pu s c pr T )b ( a r T )a ( T 1 Mu f a A a th o f G S T ta r ba B C c th to to pr a i h i f th a A T i s n or in in vi er ec epo ate pl t t co uthor dopte nd pl onv ons na ta abil f av e he his he coun he cordi he x x x or h ro e e e t ge ey epa es a se pos r an an th the A ca t ndards ogni fe

he en e cted. em ra r l a

n I s a B no c tax e u po ied inc p se d ied se he th os a det rd anc ist t r at c c A m u S ces s enti e A i us re r ur ci ci a nt ne gen p I djus re ti e m o c t ply i r on ha et es ta ei s t-f por ent i ra d in pe al re al s y Ir polic fin es e e t he ed, es re ta d unde s r bas t s i d t nc ti to the om ng

x c s ust nt r whi ed f mi er ate ti on. is ar T eral pu or-profi . ti o nt cou s ng u o ted anc

he the and ca i r ta ly f o unle ons e rate ar Boar t ipa ri pret er as r a m t ax a ve ly es ben th t he ralia t por Ac it T i per prof e s e od gati tem o i r r wit o c or t se y he es aplie o i t a r a p re P Sta of s t n na ch e c ial xa nti the ned tax l by prono Ac provi y ompa s et not li ts diffe me rel hav r t s c ac exp is ing d, s n Ac h A n i abi ar a pr eparatio a en y ndards, pre ount em ng c umu on Limted po r ti t st et od’ as it c at t le co o he h t expn t re onal re r mbe -for-prof Urgent I at s, 201. hanges i th g vant tax he rentlye cur f o se s ts ion ompany has amoun lit Standards. d, entity d to a e be rences b and t the ustralian y porar de cost ef unting s emnts ha se ny’s pr pared uncemnts , set o at ts a counting Pl o cted t he i ies atr ing Sta la taxa and eco based on ta S ist s s,r ra rwi fin tive

th income tax x en and the n g i nd li se othe dir or lia i ver l the e company ut be ble i pa an i c as defi to unused i n se stated. n or r n defer in ical cost o ap ly ts bili ector inci dif sues the i amounts polici rates are etwen

yab le on ci t ed or e ndards as of the abi butable i f r in entiti fecti s al feren

ncom tie ve ben evenue e t o n c r than lo pal y th liti th n a ned ea s w . s es ose ve e re es are sr es. ces t e d t s h t o of t Land t under Ir di at enforc whe or t int li Cur di as enforc tax are of tem Defer wi pr and un for deuc Defer or l in a tem the ac di No defer re c re c made di of deuc tax pr vehic (i St on 2 The fix charg de rec Re (i bus Re c ( e abi i ) ) i r r r ffer ffer ) at obab o-rat li i r ed c et l ends ec ec a a o o o n i f ven ven l oun i gat he t os ver o rea t e Go be a f Recogn Wat n e v e R porar porar tra nes b rent l gni gni gni re t rom s u 3 Febr s s it Com tly tly rans and enc enc le ut es s. fs and Wat re re for c y et et eab eab i n a nsa ue ue ed t harge akin le t us a bas on A et ti s ei , hen N s ab t s s in in e he d t d t to a C ac s a or ion ed i ed when vai r ng pr lis ver es es t and im ed t act re d t y di y di s ib ct l a i c t when t le t t le le from is nd de Sal hat pa e R e u equi equi tax s ition on ib ax ax her o c i pr e t ar t t t er ent g kno et

lab i le a iv ulta li i nme r r i n r on di o m i r i r s a of an le ny s y ar t on t ea and ec o am ax e a ffe ffe fut t he ibu r i i vati as as ai lev us er t gh gh s ofi ax as SW D li li si bili ti it le t s of t hroug re te elat w nd t og a a o s n t neous t t ng e y fer r r 195 by C tom los o c et et y . y ar he s eas bi bi t t t t nt as enc enc y e t a t t s a mporar ure has R wn as hat her t s t or rec as o ut d no ni ed the e t s s ount fro y . a et em li li ons re ion cha t i n g o of o of se and l ar s et axable s s f ure (t eve

se t t et e at s er in Dis tle t es es A ale o e t ies ies d t he ogn epar s o An e a le et hout t he and als wa e r ly . is porar olows or l d for axab m t ilise n e m axab t ver s rg an if th cor nue t affe no i t t Mur o fse fse . s are . ax bal on a ne o t t nly et a l

ir he ec he State es o re r y di is r iabi Fi te r a l C gal tme f wat s atio d l he i e ic r s t and t c the te is Ar porat thos xc iabil e and ot le he ognis igat c l ti de r i ega offs i ur xe y et d on a ey ar ts e he the c og s t l os amount : ur e ray f i mpor profi ffer lit c y t e , me s iabi NS tle s nt of n ) re d wate ni pti anc ogni e fe an ar as

s i nis ion ly it er t is ie ye re major e ng e for ed e t bas nt tax it t the r y is e e os of s ial on is t s is nt a li re he ar . e nc d e W

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s o uc r ial ch b b iv nme nme se c d was e c ompan e on infr o the ate WC c il hen s the ute ute d A re e t e ent he S h ar y 1 ati and manage s me c at ounts re c ) l e s ur onst s r the pl re the . a c 20 balanc y b y to c c . . pan i hanis 19 31 i tur d b T r ag i r c

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re e c ffe i ve ion of dr nts ram 18 ve re by e N als i r ac s C and an uc gat 3 tor the od pas s li ontr tran C as hor to pro othe rol a he ons dual C 20 furbi t s em . gati a be im et ct d works . 1 and the : whi t Expe on ( mai ture rans omo ti infr SW S . co o t s or i ompany . are s Rev m o s ompa of A s hat c ons 08 om to pre the

ac es val t ity nc as b w i apr r bodie on unting sfe nd manage w b le s ur he s ir n pr D uc o re i and r v s ning c ove fe as inde hing l t d Wate ut c e as i ome Act enu t par in re he ne l pany t or i r v ue r ion h thi c ndit t r r ainag te tate e tr c xpe ompl e re al hat futu ide ed t s woul gator n o nweal danc n and r ed u et c r 1 os d to t pr c epare ed fr of e d are as uc ue t y ve 20 s

d from pare d in t ounti xe og shi , ) hip of $ as

is s of on 23 the th t of ) to ure s nde T 15 5 ye s w d b o the og ture . i s to a pe d for r nis et e t 01 re the y nder n his e s hat om e d .1 on o th ram d he ct

s y as d . he ng e . r ar is e s s 63 financial statements 2007/08 Murray Irrigation Limited notes to the financial statements for the year ended 31 July 2008

can be measured reliably. Under may not be received within the (m) Leased Non-Current Assets AASB118, an asset must have the following 12 months. essential ingredient of being under Certain assets comprising shire road (h) Inventories the control of the Company and this bridges and culverts, have been happens when the particular work Raw materials and stores are stated leased by the Company from public has been completed. The nature of at the lower of weighted average and local authorities for a period of the assets and the fact that the assets cost and net realisable value. 99 years. The Company is obliged to maintain these assets during the cannot be physically detached from (i) Available for Sale Financial the infrastructure already owned by period of the leases. These assets, in Assets the Company means that the view of the long term nature of the economic substance of the Available for sale financial assets are leasing arrangements and the future transaction is that the Company brought to account at fair value. economic benefits that are likely to gains control of these assets at the Distributions are recognised in the eventuate, are included in time of construction. Therefore income statement when receivable. noncurrent assets, on the basis of they are brought to account as control. (Note 11). (j) Investment Accounted for using revenue at this time in accordance (n) Non-Current Assets Constructed with the requirements of Australian the Equity Method Accounting Standard AASB118. by the Company The company’s investment in (iii) Interest Income associates is accounted for using the The cost of non-current assets Interest income is recognised as it equity method as the Company does constructed by the Company accrues. not have control of the operations of includes the cost of all materials (iv) Revenue from the Sale of Assets the entity. The investment is initially used in construction, direct labour Revenue from the sale of fixed assets recorded at the cost of acquisition on the project, and an appropriate is recognised when risks and rewards and adjusted thereafter for post proportion of variable and fixed have been passed to the buyer. acquisition changes in the Company’s overhead. (d) Cash and Cash Equivalents share of the net assets of the entity. (o) Impairment of Assets For cash flow statement presentation (k) Acquisition of Assets Assets are reviewed for impairment purposes, cash and cash equivalents The cost method of accounting is whenever events or changes in includes cash on hand, deposits held used for all acquisitions of assets. circumstances indicate that the at call with financial institutions, Cost is determined as the fair value carrying amount may not be other short-term highly liquid of the assets given up or liabilities recoverable. An impairment loss is investments with original maturities undertaken at the date of acquisition recognised for the amount by which of six months or less that are readily plus costs incidental to the the asset’s carrying amount exceeds convertible to known amounts of acquisition. its recoverable amount. The cash and which are subject to an recoverable amount is the higher insignificant risk of changes in value. (l) Property, Plant and Equipment of an asset’s fair value less costs to (e) Trade and Other Receivables sell and value in use. All property, plant and equipment Trade receivables are recognised at is stated at historical cost less As the company is a not-for-profit fair value. Water accounts are raised depreciation. Historical cost includes entity and the future economic quarterly and are due for settlement expenditure that is directly benefits of the company’s assets is in 30 days. Other debtors are due attributable to the acquisition of not primarily dependent on their for settlement in no more than 30 the items. ability to generate cash flows, value days. in use is taken to be depreciated Estimates of remaining useful lives replacement cost provided that the are made on a regular basis for all (f) Interest on Water Debtors company would, if deprived of the assets, with annual reassessments for Accounts asset, replace it. major items. The expected useful Interest is charged on water debtors lives are as follows: Accordingly, the company’s non- accounts which are overdue and current assets are carried at amounts Water outside of the normal credit significantly in excess of the values Infrastructure ...... 10 to 100 years arrangements . that would be applied if the Leased Assets ...... 40 to 100 years company were a ‘for profit’ entity (g) Doubtful Debts Buildings and Cottages ...... 40 years in accordance with the Accounting A provision for doubtful debts is Plant & Equipment ...... 8 to 10 years Standards had it applied the raised against water debtors accounts Office Equipment ...... 3 to 14 years impairment rules of a ‘for profit’ entity. where the collection of the debt Motor Vehicles ...... 4 to 5 years

64 s pa pr th me o s r i T L L s a o r Wa s ( R r ( T )q ( Ma )p ( Mu a r th f ta i da a r a R th u r ba c ta o o r a r i pa C pa i s nc nc nc or vi er vi er ic en ec ec ec ec ec ate nnu so cqui mount mount ash ) nco cu sua r per ia ong Se ) he he xa xa as even ec e es e e k r ym ya ya te sis goo f ec ogni ogni ogni ov ei bilit r ur l l a ges ewa

in in h flows ra usi ud s i m E G Ta r M ciat r c e e le tion tion sure w l se flows ei ble bles ly . a ces ces epor vab r. a om xpens st nt og te er si ent av iabi s d o o anc ti , i a n re l va Th s ed i ed wi ve s. ues hic y Ir am ti e d pai ng ie l p ls va nanc leav ab ed e t n ds s s t e vice r ie alr ni pro u s o to, i le bles d as on ion. ed n ed a pan are s of aut aut s e y o ing e GST lit are ti n t c le fr for se p t f GST ount spe h or , s lu d n a a to and ri e t GST d wi c n a n a not ng e. are e a y as d and gati Le of vide i r he are i hor i hor a y t th e, e o th xpe un be a he s o t e S d n e s, et c c for lo h flows dat he r s pay om, an nd pa i t n E up t t par wage ct re harge t e a ing

the h t O pre se s of av balance ot r epai ta , thi f e hat un e unpai of e se i on Limted ns c am d by ma re p re ty . ty , ec vit vi r nu rec e

x able. her mou e o n a fro c as omponents of xpectd f of n mea es o the t a e m e l t r e

date e c i v r s u overa ng cov he les at In thi are pre al i r cost t s de i yab les ented o ce re se r payable to the mploye d as e ogni ount u e an io e R d 28 re d a set . e and the c l s a y a P rec m d. Th amo expctd pa s

nt n a se eave su erable fr mpl T whi d aset are n respct of the prov nt days of T s or as par shet. st n investi v r

re po bl includi he sed a red o s and a p nd uthor sa iva xpense s case i e fr are sented as se l b f GST li ice le ( x a GST oyes up c ost unt of and npai i lar es’ n a g utu e abi net r i h ide bles o as the are s tingr are nd ar om n stated G of es and ng li om, or mi re d to ity d at ng e t o ave T S ti r t t i os e nor t y of r is h s ) e s t s e h t o to is de gove Ex di the m ac Supe exc futu as Super The cum da Emplo Si li br futu di 1. mi The that Refe Suply Re (i )t ( Ag m for amou Wa trans res and L equit (i The Res separa Com pr t repor In wat pe funds Vi ar e abi ) C i g 0 s ffer ) S k Le c at ough o com ys t par i r cl l ver e c pec the enc n i f ven m or ter vi l iv e e er s ur ount r e s e R i rep or io ver ods at re c re pa s os l ulat ont nm r fer uply it Com 195 pos pur rann r Not of c y de t a f i pan enc danc t i nt d t ando ion i n m repor tely it t nnua i ted n t ely c ures n a ies lion e ue y Infrast o fi es Va ave uply res e. t n a k lea re y a ib r he i es as ive of ext s he s i ar of an ed us

to a e be y’ for ym ent he a o expr t as ti d to uati ont h o l a i c The se v i r fr ult V i ar ut Lev egali e wi pa futur nanc ny an s nd c o r wn B e 5 ( nd ng ar amoun t basi si i ati ion a pos ed me e om pr ve per t ent bonds Com usi ic s ny i si c ng r r iat r to y i r i r utflo tw ng fr on e en epor d per y ng y of t on i er

uc uper ng ende dat Lan k le the A s ng m t i pur b t ear ount i r ur c gali ne e pa ialy fr gat h t i res s s los Me en ion as si ut ) s dat are s t . t Re fr e t a t No Lev ontr . i ure e hi om b Co pany s , enc e ti ws. om downe ts ave enc ed as he Go ofit ar t t i pos s on nat se a r ts annuati t le om les on un iods d low wit on t Plan y withs s r res ans s as ark mber led to unlik e. C act nnu , t c he se me A y . T e s et enti e o ibu s t Gove the e ntr the S liabil es y t s e n e m at t vr e fe s of thi Go ua as on et s o wi h t of the d o e h he nts C et m et hat pr r f em ver i te ib her vr e ld, volum ons yi an 1. s r de f s s s l s the re ide tan ompany Fund. i tr s th ade tl e er pos ve . e on. s i on a onal s , l ut ten are s i uply l ov in em ity d to t er ti ib al r e s t r y t nm the is xpe e n the ms matc e i r s taki nme to wate ed A l d mate de es pl s ar ds nm uti s v a i

0 t s des o l of ent ic for t the and o ent

r o c e quate at e ons ng. ye ati o e. e te no he nt h, s s th d ’ nt r s s e d on e

ts e y e ar ( be t t us w as T t O of 2 A )u ( be Whe )x ( I b T )w ( i ac M )v ( dol C au di fo t A L fi t br G br be F A c T ns i o he S o in C he “ he f n as y 8( i nanc unds en and an he s he m ut he i ate om o s f in ac r c get ought t ought t ves ag r c thor r ur made e hal de fu s ) cl tr h and r der the ver ount lar a) n re W ou h P i F d n a L m o C R A ta ded pur C ne e pr os ume inanc ons r re r re . her t or uply pan a l t n u o c c f of the i d n u o a i c n a n ounding t s at m He ial to th nme A y I nt ed . ure ity ompan ne sn t une l i c er R nds e ing pol as d Wate ty . is l c ic wi re pos s a us las r a p ate y is nts nt r r outs 31 ordanc in r o ac o ac d n a te i s s l ial ec c e R v n N d as . tral nt an V l a g n s t por s ig es O is ail nc es th t d produc for fut e ne ifi are e of t a t i

e re

Com i ar xpe g n P ation Jul s t s n I er r iv t o es c c he i efe abl y i ed and y w ar i ian S Wt a der t I e v ot ount as ount as ” off lans v o be r Ma anding por ic ab he l ati ha de pe f this y , e o P m d Ir are e y nde s e e r s m A i r of a ki c wi 98 le mpl es n e m u

for g on R ith mi ct pl r e ure Li Not 20 ve 1( t tail and ar y c i l of amount e ompa s ev s . for of a num t th r nagem e

r d amount cur wit n u o c

s M th t /0 ar i ts mi Am m 08 c re be y in em gat ) es e fr re a l i ur ( . e 1 e e g a n a n i d on, r e financ ii) 1 es ene po for st ousa e hdraw i te hel ves om bot st tie nt hat C nd r 0 s or r re rati c ounts i n rounde e R e iabi t n N ve 6. d’s e 0 nti e s t r i nt ent i he t s ral iv ab , ng t ve ti i el ar d on & h c e p s is me nd ves he e ng s li oned tn e m at ye ating us ye and s fer ote ber n from P of t la i e ty , s i ue r al l have nt in in o s e h s ar e n the lans age. re for t s d of . ar ot to d e d t e . 65 financial statements 2007/08 Murray Irrigation Limited notes to the financial statements for the year ended 31 July 2008

2 Revenue

2008 2007 $’000 $’000

Revenue from Irrigation Undertaking Income from Water Sales 15,037 17,889 Supply Variation Levy 24 178 Asset Maintenance and Renewal Levy 2,465 2,405 Termination Fees 796 - MILCast External Sales 2,162 1,725 Interest on Funds of Irrigation Undertaking 2,163 697 Net gain on disposal of property plant and equipment 317 167 Other Income 1,181 1,465 –––––––––––––––––––––––––– –––––––––––––––––––––––– Revenue from Irrigation Undertaking 24,145 24,526 –––––––––––––––––––––––––– –––––––––––––––––––––––– Other Revenue Sale of Supplementary Water - 20,000 Interest – Supply Variation, Asset Maintenance and Renewal Funds 2,562 1,894 Land and Water Management Plans Contributed Assets 2,919 1,932 Infrastructure – Contributed Assets 8,015 9,553 –––––––––––––––––––––––––– –––––––––––––––––––––––– 13,496 33,379 –––––––––––––––––––––––––– –––––––––––––––––––––––– Total Revenue 37,641 57,905 ======

3 Expenses

Profit before income tax includes the following specific expenses: 2008 2007 $’000 $’000

Borrowing costs 25 25 –––––––––––––––––––––––––– –––––––––––––––––––––––– Write off of obsolete assets 222 1,253 –––––––––––––––––––––––––– –––––––––––––––––––––––– Depreciation: Buildings 54 54 Plant and Equipment 1,918 1,972 Infrastructure 4,197 4,262 –––––––––––––––––––––––––– –––––––––––––––––––––––– Total Depreciation 6,16 9 6,288

Amortisation Leased Assets 835 842 –––––––––––––––––––––––––– –––––––––––––––––––––––– Total depreciation and amortisation 7,004 7,130 –––––––––––––––––––––––––– –––––––––––––––––––––––– Doubtful Debts 249 174 –––––––––––––––––––––––––– ––––––––––––––––––––––––

66 to po di th a a $ go c I ma a O w T B T N D N ( D ( I I ( ( ( A (a) Inc 4 Mu Un T D D C f T rom t De i) n nc nc d) c b) dvic pl co ompa 9 ax e he reg gg he he o ur sc if e e e a at on e ff )

.1 ve te nef th Defe y fe cr fe rks t om om O N fe der ic ra Amo

c l p c re nt ica re i d a mi os effe n unt t n I profi nm r de be re r re r re eas e ren e r e im r his ti it gg ount . iff um he ut ed a / e t e t ny y Ir 207 as ble o c tha

al fo of at s om A lion d t d t (over r duc e/ ega t aplie ct de t ere ce reg sta e) am red s en e i ax ax t s he t/( unts re a ax ig of c i er ( e m t ri ax o ax ( /inc i to t o i i repo in e t bt rdin nce t at ti r nc gati nif a f it ndi apit n ac los n not expns expns ount f liabi m per inc t ) had i cr ble t i th cal reconcilia ina e nc ci ax lia be ax ep d i om thi Tx a he i ic provis s re n re s) s eas ) amou e c g t ng t r e 14 al es t om on Limted ur a unab le to ant c nc are

f an depre ase lit s waiv ed i before ounts and tax c cognised dir ran g e t fi e) lo ndicated he ompany to i Ta ial va anen y bility alculated on e e e un reconci

ax paya in in nancia se n ax e for io d when ta would be r nt i n pr lu ib atr ca tax ta en ed. xa repo t x ci n i defer defer cer ati xa lcu that w t of i ation se xpense income tax liabi tion for Environment the e on en dif i n pr ti o o tain xpen or ys therear Should the company be lated @ proced l re t r utable to ag on tr n of a t pr ibutable ncome tax atr led as folo feren ble red red tion of i ta lity it w thi , ty n t.por remnt to makrant to the compane a g y for as or year x evi tisati amor ncur adi v s e t o e i eatment o s amount becomes payable which may cost base educed b e on g ir t to ta ta to be vai ct as di in h ces n respct to the ously brough rants rone mental g x liabi x ase e operating profit tali ly t 30% (207: 30%) with the

t s lable for sale c operating lude sclosed rants that hav e be ncome tax expense to ng reci ws: e has be h t o o equity ts (note tional liti on and lo y $9.1 milion $9.1 milio of wa rants f g es (note ved. Howev er the Go in e prrant.oposed g Acord ingl tha pro income tax e n i f t en an o penalty inte ter t 12) to as al Works n a company the fit recived f to the financial ye s o sucesful in having so aco e 1 n how t ld red to abofer l a i c and extraordin Australian Go 7) s n ngoing . unt disposal n re Should it be s re ever it ’s taxation li xpe e t a t or ce st charge dispu ived environme nse compr n e m ver ve, has not to fund ver te y ar int nme ar bet s of up to unsuce s t nm it abil this de diffe be i ere y the

em. brought we nt has now ise for ntal ent it st on an amoun n the what y asociate d wi s: s r

th had recog n t works. company bt w sful and e $ he com the outsandi order of 6 are effectively y to acount e aived, t m ar advised t The com il t to enable th lion en intends to r nised the anomal penal pany he pr ded $ th g whi 6 and the Austr ties were apli m anued int y acr ng amo ======hat i ––– ––– ––– ––– ======com uni rant ch 31 pany has br oug ovi il ––– ––– ––– ––– ======lio –– –– –– –– ======––– ––– ––– ––– = = = = 12,086

= = = = have not si = = = = t has reciv ed Jul –– –– –– –– ======s 4,983 3,62 4,123 4,123 4,2 4,2 n. e compa $ ––– ––– ––– ––– on for ======eact 20 (561) (29) for envi = = = = ’ –– –– –– –– ======390 107 unt 0 ––– ––– ––– ––– ======y 97 0 = = = = –– –– –– –– ======––– ––– ––– ––– 8 0 ivat ======20 - - , y tha

ty a and the tax tax ben brou ali 08 e i ed ny ronmenta an Taxat set. er ation ts request t caused t ht to to pay t there est = = = = – – – – ======––– ––– ––– ––– legal ======–– –– –– –– ======––– ––– ––– ––– Th 30 that (2 (2 (1 ======–– –– –– –– 5 9 3 3 3 3 $’ ======––– ––– ––– ––– 207 is (19 (64 ,6 ,9 ,4 ,3 ,1 ,3 ,7 ,7 ,9 ,9 ======ion 6 –– –– –– –– 0 ght e l = = = = (1 ======––– ––– ––– ––– he 02 71 51 52 81 71 69 83 83 81 81 = = = = he = = = = –– –– –– –– = = = = 1) 8) 5) = = = = ––– ––– ––– ––– ======) ) ) 67 financial statements 2007/08 Murray Irrigation Limited notes to the financial statements for the year ended 31 July 2008

5 Current Assets – Cash and Cash Equivalents

2008 2007 $’000 $’000

Cash at bank and on hand 52,938 44,734 ======Restrictions are imposed on access to certain of the above funds as follows: Supply Variation Reserve Fund – Restricted (Note (i) below) - - Asset maintenance and renewals – Restricted (Note (ii) below) 19,218 27,627 Unrestricted Funds 33,720 17,107 –––––––––––––––––––––––––– –––––––––––––––––––––––– 52,938 44,734 ======(i) Under Rule 15.2 of the constitution, the Supply Variation Reserve Fund was established to provide the Company with adequate funds to financially withstand periods of extended low volume water supply to members. The Supply Variation Reserve funds have been fully drawn down in 200 8 (Note 1(t)(ii)). (ii) Under Rule 15.2 of the Constitution, the Asset Maintenance and Renewal Fund was established to cover capital expenditure for refurbishment, replacement and long term maintenance of the Company’s water infrastructure assets. The amount set aside is calculated after considering the advice of independent external consulting engineers. The amount so set aside totals $36,819,000 (2007; $34,401,000) comprising cash $ 19,218,000 (2007; $27,627,000), and bonds $ 7,101,000 (2007; $6,774,000) and Floating Rate Notes $10,500,000 (2007: $0) (Notes 5 and 9).

6 Current Assets – Trade and Other Receivables

2008 2007 $’000 $’000

Water Debtors 9,432 9,779 Less provision for Doubtful Debts (604) (355) –––––––––––––––––––––––––– –––––––––––––––––––––––– 8,828 9,424 –––––––––––––––––––––––––– –––––––––––––––––––––––– Land and Water Management Plans – Due from irrigators 996 1,080 –––––––––––––––––––––––––– –––––––––––––––––––––––– Government Agencies – Asset Maintenance and Renewal 3,973 5,430 – Land and Water Management Plans 5,810 284 – Supplementary Water Sale - 18,000 – Other 464 302 –––––––––––––––––––––––––– –––––––––––––––––––––––– 10,247 24,016 –––––––––––––––––––––––––– –––––––––––––––––––––––– Other Debtors 3,873 2,080 –––––––––––––––––––––––––– –––––––––––––––––––––––– 23,944 36,600 ======

68 Mu D 01 ( 9 8 7 C R R C F P R I nv a) loa re ar om ispo ev ec aw e pay ra o N u C u C M y r ei aluat tin stm M o N n I ing s va o als me y Ir g r r r r onwea r u C - n vem v ent at ble r u C - n Rat io am s e t n e t n e ia er nts ri n s i gati from m t ent n a e oun ls A A plus ur lth e r Not s and Stores e on Limted s in ca e s s e s s e r as t oc t n A t n Indexed B at t n es s iate s A ociate /(sho t t the A s s e s s ying amount of Comonwr ealth r O – n I – c c e s s b tf r i eg s t n u o onds (a) h t al) t e v nni – s n re – e t o t n A tra d e t ng

v i r o r nsfer t s a of the financial year f i r o e b a l h t o s ed to equity s U e l e n i r o f n i f g l a S n a h t i u q E e l a i c F e s c n a n i e t a t e M y t Indexed Bonds n e m l a i do h t st e s s A s t

for th e y e ar en ded ======––– ––– ======31 ––– ––– ======–– –– ======––– ––– = = = = = 10,5 18,0

======Jul –– –– ======1,0 6,74 7,10 7,10 1,480 $ $ $ $ ––– ––– ======20 20 2 20 = = = = = ’ ’ ’ ’ –– –– ======327 40 12 0 0 0 0 0 ––– ––– ======y 0 0 0 0 = = = = = –– –– ======––– ––– 0 8 8 8 0 0 0 8 0 ======20

08 = = = = = – – ======––– ––– ======–– –– ======––– ––– ======–– –– 1 6 6 6 6 1 $’ $’ $’ $’ ======––– ––– 207 207 207 207 ,8 ,8 ,7 ,7 ,7 ,2 ======1 –– –– 0 0 0 0 = = = = = (3 ======––– ––– 98 29 10 74 74 74 26 ======–– –– = = = = = 6) 0 0 0 = = = = = ––– ––– ======69 financial statements 2007/08 Murray Irrigation Limited notes to the financial statements for the year ended 31 July 2008

11 Non-Current Assets – Property Plant and Equipment

2008 2007 $’000 $’000

Freehold land - At Cost 2,039 2,043 –––––––––––––––––––––––––– –––––––––––––––––––––––– Water Infrastructure - At Cost 228,441 220,585 Less Accumulated Depreciation 40,499 36,404 –––––––––––––––––––––––––– –––––––––––––––––––––––– 187,942 184,181 –––––––––––––––––––––––––– –––––––––––––––––––––––– Construction-in-Progress 24,157 19,391 –––––––––––––––––––––––––– –––––––––––––––––––––––– Leased Assets - At Cost (Note 1(m)) 48,703 48,831 Less Accumulated Amortisation 8,402 7,630 –––––––––––––––––––––––––– –––––––––––––––––––––––– 40,301 41,201 –––––––––––––––––––––––––– –––––––––––––––––––––––– Buildings and Cottages - At Cost 2,175 2,169 Less Accumulated Depreciation 672 622 –––––––––––––––––––––––––– –––––––––––––––––––––––– 1,503 1,547 –––––––––––––––––––––––––– –––––––––––––––––––––––– Plant and Equipment - At Cost 8,299 7,937 Less Accumulated Depreciation 5,383 4,688 –––––––––––––––––––––––––– –––––––––––––––––––––––– 2,916 3,249 –––––––––––––––––––––––––– –––––––––––––––––––––––– Office Equipment - At cost 2,039 1,763 Less Accumulated Depreciation 1,542 1,451 –––––––––––––––––––––––––– –––––––––––––––––––––––– 497 312 –––––––––––––––––––––––––– –––––––––––––––––––––––– Motor Vehicles - At Cost 6,244 5,910 Less Accumulated Depreciation 2,055 2,048 –––––––––––––––––––––––––– –––––––––––––––––––––––– 4,189 3,862 –––––––––––––––––––––––––– –––––––––––––––––––––––– Total Non-Current Assets 263,544 255,786 ======

70 Mu c 41 31 21 R R Wa L A T D Em L S P O T O O P B L C Mo r ur u and and ea rovis lan r ui he mo on ou ec ec ther ther ff ade pera ter ic ploy sed A ldi to ra ent b onc t & E on un st bt e E u C u C o N and Wa r r io C t alanc ngs Cre Ve ful de In y Ir nn ts uct f cil em e i n fo r qui li redi e r r e r r ina r u C - n fras s hic uat se eco qui at ben iat io ri dit porar e gati ts ion nci pmen n i r Inc tr gnis bts t n t n les ion tor ions or ter co pme uct efi n P al

s s ise tempora mpr s on Limted i L i L ed e r y Man of ts ome ure yea t nt in diff i b a i b a ro g t n t he pro r are age A eren Tax (Note 4(d) re s l l r car t i t i e s s fit ment Plan i i s e e s ce and et ou s y s t i –

ng amounts of s – 1 n lo A – u C

e t o a Tr t Ca y di r s 25,786

184,18 moun ugus f e D below: 41, 19, $’ e d a s y r r 2, 3, 1, 3, r t s 0 n e r 043 249 312 547 201 391 862 ffer 0 t ing 0 r e 207 h t o t d n a at ibuta ences atr t e r

Tx a e d each clas of prtyoper , pl O n i f Tx a i L h t A 15,64 n a 12,8 P r e i b a dit $’ s s A 2,0 0 l a i c 38 365 t i l 21 ions e l b a y a 5 ble - - - e se i s t s to: e t a t s n e m Dis $’0 ( (16 (64 posal 892) (1 (6 ant & e 0 s t (4 (7 1) 1) 5) 4) -- - ) )

s for th quipment e Tr (8, $’ y 8 ansfe e ,1 0 1 ar 19 0 9) ------r en in at the beg s ded D ======––– ––– ======31 epr ––– ––– ======–– –– = = = (7, $’ (4,1 (1,0 = = = ––– ––– = = = 10,96

= = = eci = = = Jul –– –– ======0 9,534 8,21 2,748 1,86 (7 (8 (1 ning and $ $ $ ––– ––– ======04) 20 20 20 0 (54 = = = ’ ’ ’ –– –– ======97 16 35 73 29 562 18 639 0 0 0 at 0 ––– ––– ======y 15 52 0 0 0 = = = - –– –– ======ion ––– ––– ) ) ) ) ) ) 8 8 8 0 0 0 ======20

08 e 3 263, 1 nd of 1 87 24 40 Car am

= = = 2, 2, 1, 4, – – ======Ju ––– ––– $ ======,9 ,1 ,3 –– –– 54 ’ = = = 039 916 503 4 189 ======l 0 ––– ––– ou yi r y 20 ======42 57 01 97 –– –– 0 9 9 9 2 1 $’ $’ $’ = = = the ======––– ––– 207 207 207 ,4 ,1 ,9 ,1 ,4 ======nt ng 4 6 1 –– –– 0 0 0 ======––– ––– 94 64 79 35 73 87 1 1 18 07 = = = 0 = = = –– –– = = = 2 5 = = = ––– ––– 8 ======71 financial statements 2007/08 Murray Irrigation Limited notes to the financial statements for the year ended 31 July 2008

15 Current Liabilities – Provisions 2008 2007 $’000 $’000

Employee Entitlements (Note 1(s)) 2,051 2,050 ======16 Current Liabilities – Other 2008 2007 $’000 $’000 Land and Water Management Plans Funds held as Implementing Authority (Notes 1(u) and 27(ii)) 6,204 4,727 –––––––––––––––––––––––––– –––––––––––––––––––––––– 6,204 4,727 ======17 Non-Current Liabilities – Deferred Tax Liabilities 2008 2007 $’000 $’000 The balance comprises temporary differences attributable to: Amounts recognised in profit and loss Consumable stores 288 206 Diesel fuel rebate 64 33 Mulwala Canal usage fee 5 57 Accrued interest 279 138 Investments - 174 Prepayments 37 43 Government debtors 1,192 1,587 Capital allowances and depreciation 34,708 29,355 –––––––––––––––––––––––––– –––––––––––––––––––––––– 36,573 31,593 –––––––––––––––––––––––––– –––––––––––––––––––––––– Amounts recognised directly in equity Revaluation of available for sale financial assets 546 445 –––––––––––––––––––––––––– –––––––––––––––––––––––– 546 445 –––––––––––––––––––––––––– –––––––––––––––––––––––– 37,119 32,038 ======18 Non-Current Liabilities – Provisions 2008 2007 $’000 $’000

Employee Entitlements (Note 1(s)) 80 68 ======

19 Contributed Equity Shares 000’s $’000 2008 2007 2008 2007 Share Capital Ordinary Shares 1,447 1,447 186,452 186,452 ======

72 T T T T N B ( B ( 02 Mu ( c b) a) r r r r al al e ) an an an an t

ra ance ance R Na T B B A B B Wat B Su B T C M B B A T T A Co Re T Wat S Pro sfe sfe sfe sfe

uply r r r r r e R al al al al nn s vai alan alan alan alan o Ret efe ans ans ans ans ans o p y Ir ntr vser e anc anc anc anc e tu nt r r r r vem er er ual R p fit t e s la r from to to to fer fer fer fer fer re i r ly No Re 1 A 31 Jul

ai i ce ce ce ce ri /(L Re e e e e b but Va Suply Con Wat Res buted A gati e v r a ned Pr

Vi ar l – 1 Au – 1 Au – 1 Au – 1 Au ent from from to from to A s: valua e f i r ug – 31 July – 31 July – 31 July – 31 July Suply Va os se pose of Re nd Pur te e ed A valuat at e R vr e or Sa s s on Limted s: y 208 ib tr 1(t ust 207 r R ) vr e ati ion c R R R eta ti d n a cum

s Viation ar ) gu gu gu gu on set ofits (Acumula on uted A . vesr et et et ined sets io – ( st st st st le Inv ained ained ained s ulat vResr n R 20 20 20 20 – 208 208 208 208 N i r e (Note 1(t)i t e Pr ati ote 1(t)i – (Note 1(t) ed 07 07 07 07 set ofits n i a e von R esr e Profi Profi Profi Re stme L n e o e t o se d e s se ts ts ts vr e ser i nts Rev r P t s i) i ve ) te h t o (i t i f o s d Lose) ) s aluat e n i f ion n a l a i c v Resr s e t a t e n e m s t

for th e y e ar en ded ======––– ––– ––– ––– ––– ––– ======31 ––– ––– ––– ––– ––– ––– ======130, 120, 152, 130, –– –– –– –– –– –– ======(10,72) (36,07) (39,056) ======––– ––– ––– ––– ––– ––– ======20, 10, 20, 20,

======Jul –– –– –– –– –– –– ======7,963 1, 1, 1, $ $ ––– ––– ––– ––– ––– ––– ======20 2 ======’ ’ –– –– –– –– –– –– ======267 267 0 84 712 132 0 037 230 0 84 0 0 0 (24) (24) ––– ––– ––– ––– ––– ––– ======y 24 24 0 0 ======–– –– –– –– –– –– ======––– ––– ––– ––– ––– ––– 0 8 8 0 ======20 ------

08 ======– – – – – – ======––– ––– ––– ––– ––– ––– ======1 1 1 1 –– –– –– –– –– –– (10 (20 (3 (36 ======––– ––– ––– ––– ––– ––– 26 20 20 10 09 20 41 20 20 ======–– –– –– –– –– –– 1 1 1 $’ $’ ======––– ––– ––– ––– ––– ––– 207 207 (17 (93 ,23 ,0 ,8 ,65 ,30 ,0 ,13 ,2 ,89 ,0 ,16 ,0 ,0 ,0 ,0 ,13 ======9 1 7 –– –– –– –– –– –– 0 0 ======(2 ======––– ––– ––– ––– ––– ––– 38 19 0 3 0 37 37 62 78 60 0 ======–– –– –– –– –– –– ======8) 3) 0) 3) 7) 5) 2 9 8) 9 2 - - - - ======––– ––– ––– ––– ––– ––– ======73 financial statements 2007/08 Murray Irrigation Limited notes to the financial statements for the year ended 31 July 2008

21 Related Parties

(a) Key management personnel (i) Directors The following persons were directors of Murray Irrigation Limited for the whole of the year ended 31 July 200 8: AM Anthony, GG Ball, KS Baxter, L Chappell, SG Ellis (acted as Executive Director from 1 December 2007 to 24 February 2008 ), MJ Holm, and AL Read. MD Goudie and DT Liphuyzen were directors from 1 August 2007 to 13 December 2007. DR Hunter was a director from 1 August 2007 to 16 March 2008. MJ Humphris and VC Meyer were appointed as directors on 13 December 2007 and continue in office at the date of this report. (ii) Other key management The following persons also had authority and responsibility for planning, directing and controlling the activities of the company, directly or indirectly, during the financial year: GB Warne General Manager (1 August 2007 till 30 November 2007) A Couroupis General Manager (2 5 February 2008 till current ) WR Elsbury Deputy General Manager/ Company Secretary ET Aseervatham Engineering Services Manager AJ Drenovski Works Manager PL Keyte MILCast Manager PD Knill Mechanical Engineering Manager AH Lelliott Services Manager JM McLeod Environment/Communications Manager DW Stubley Finance Manager (1 August 2007 till 11 July 2008) DK Watts Water Distribution Manager

(b) Key management personnel compensation 2008 2007 $’000 $’000

Short-term benefits 1,655 1,587 Post employment benefits 115 115

(c) Key management personnel equity The aggregate number of shares in the company held at balance date by key management personnel were: 2008 2007 Ordinary Shares Held 21,572 21,021

(d) Other transactions with key management personnel During the period the Company sold water for cropping and other activities to a number of Directors and other key management personnel or their related entities on commercial terms and conditions no more favourable than those which it is reasonable to expect would have been adopted if dealing with them at arm’s length in the same circumstances. The value of these transactions totalled $289,000 (2007; $416,000).

Aggregate amounts payable or receivable from directors and other key management personnel or their related entities as at balance date: 2008 2007 $’000 $’000 Water Accounts Receivable 49 47 Accounts Payable Nil Nil

(e) Loans to key management personnel There are no loans to directors or other key management personnel.

74 C ( Mu a w P Mi ( N 52 T 42 T 32 To To D 22 T A O C P I I I (I (I I I I ( ( ( C S D Ga Ga Inc Inc Inc nc nc nc nc nc nc t o ropo ax nc nc rof he he udit o om on il h ur e et ther $ uthe tal tal nis prec l rea rea rea rea rea rea ang 7. in in ra at

rea rea reas reas reas Cash C re w e ing only tr it e R g e S m o C e R e N ion 6 ) )/los te

a s se se se se se se i re m au om y Ir but ed e se se n r on onwea i f es in oper t mi i r e) e) e) f t s ati / / / / / / o c n o c u m h s a C t s ) )/de he be (de (de (de (de (de (de al C di R uranc /de /dec /dec de r th re he pany e m li ed ri er s on dis Inf on i m xpendi unera t a gati ye on iv vi no cre cre cre cre cre cre cr e n co fi cr cre pos as porati or and lth e year in er t n c ar t rea rea t nanc di n low/( eas i i e eas se m es e m as as as as as as ( i l c on Limted t a r d ot as 207 s al of I om se I ts sposal Govn er e) e) e) e) e) se se e) t a e i ti he in a are e i e i ture amor n n ating ase v r in in in in in in in in on ial ite t n n o i volve i n r r o f m l f n de n v n o he audi ices Outflo w sup on. ( defe oth pro re cur payables prepa in pro s w o s $7. un i t re por d on the a of tments for expn eci r a ti

of non i t a m alue of f o f f o i ventor sati ment, fe i d pr tor ea 6 r o der vi vi er lia Note 1(c)i le surance r r r r vables A mili New O si si

nt yments on f m ed tax li ed tax aset p a C m o r ons on for dou u n t n o ts a e p i mar en he ) from Operat r -cur in ta ned the r bili i d e t o ir on), for which fu es basis that ful x liab i t Land and Wa South i r i t a r vestmnts ar sr o t nd l i ties t s an gator ly p O t s y w l a ent aset se i abi g n i). n the suply ia h t o r e p x E li Wales. vicesr ater lities ties bil di btfu folowing P i t a ture at 31 J it f o r n e e d shires. (Note 1(c)ii). l debts g n ies: rsemnt eiw mbl be ur n i f ter i d ing Act t i

c A l u t n a o t Ma and drainag re m reimbu r v i t l a i c e t uly 208 apar na

uneration: ivities i t i gemnt Plans i s se se r e t a t me e of nt wi n e m ir from re r l igat s t s be r ce esti

for i ion w ve the ec m th d from De ate i e ve ater to d at fe y d throug e red Mai r the NS ar $ 6 sha en .8 ded re m h the Water W S ho il ntenance lion = = = = ––– ––– ––– = = = = lder custom 31 ––– ––– ––– = = = = tate Govnment,er t = = –– –– –– = = (10,934) = = (2 ––– ––– ––– = =

= = (5,93) = = Jul –– –– –– = = = = 4,836 4,983 1,47 7,04 7,963 $ ––– ––– ––– = = = = 20 0 (34) (561) (254) = = ’ $ –– –– –– = = = = 208 123 728 249 0 (95) ––– ––– ––– = = = = y ’ prr o g 13 76 48 18 30 75 27 0 0 = = 7 $ A –– –– –– = = = = ––– ––– ––– 8 0 0 = = = = 20 - dm

0 6. s wi er 08 am est 0 m ini strat il = = – – – = = = = ––– ––– ––– thin = = = = lio –– –– –– (20 (1 = = im = = = = ––– ––– ––– 26 ion (2 (1 (1 = = = = he n) –– –– –– 4 5 1 1 7 $’ ======––– ––– ––– 207 ated (36 (89 (46 ,4 ,0 ,3 ,8 ,48 ,0 ,3 ,2 ,0 ,1 ,8 = = = = $’ the 207 1 –– –– –– 0 = = (2 (5 = = = = and ––– ––– ––– 38 52 28 50 71 46 3 1 2 86 74 6 2 30 19 0 = = = = –– –– –– = = 0) 1) 5) 4) 4) 9) 1) 9 0 9 1 2 = = ––– ––– ––– = = = = ) ) ) 75 financial statements 2007/08 Murray Irrigation Limited notes to the financial statements for the year ended 31 July 2008

26 Non-Cash Financing and Investing Activities 2008 2007 $’000 $’000

Contributed assets from Government 10,934 11,485 ======

27 Land & Water Management Plans

i) Details of income and expenditure on the Land & Water Management Plans are as follows: $’000 Berriquin Cadell Denimein Wakool Total 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 Income Government Agencies 9,920 4,234 4,870 3,289 2,683 2,013 3,240 1,706 20,713 11,242 Irrigator Contribution 1,656 1,648 229 229 127 136 362 371 2,374 2,384

11,576 5,882 5,099 3,518 2,810 2,149 3,602 2,077 23,087 13626 Expenditure Capital Works 2,701 937 32 274 186 728 002,919 1,939 Expenses Incurred (a) 7,883 3,561 4,838 3,019 2,540 1,443 3,430 1,836 18,691 9,859

10,584 4,498 4,870 3,293 2,726 2,171 3,430 1,836 21,610 11,798 Net Funds Accumulated/ (Expended) 992 1,384 229 225 84 (22) 172 241 1,477 1,828

(a) Includes Farm Rebates, Monitoring, Education & Administration ii) Details of the Land and Water Management Plans Funds Held as Implementing Authority are as follows: $’000 Berriquin Cadell Denimein Wakool Total 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 Opening Balance – 1 August 2007 (Note 16) 2,229 845 1,605 1,380 436 458 457 216 4,727 2,899 Add Net Funds Accumulated/(Expended) 992 1,384 229 225 84 (22) 172 241 1,477 1,828

Closing Balance - 31 July 2008 (Note 16) 3,221 2,229 1,834 1,605 520 436 629 457 6,204 4,727

76 T 82 Mu pro g i Mu ( a c f ts ol a) re G - O - n I G - n I W - n Fi R F R S - Tr la h n i e e fin i F e v r t s lo a s pre e T c c a a r r r a h ra a n C e d v o A r e h t v o e n g o b e D r e t a ws e m t s c n c n r Co e m u o i e Fi am ay anc v A l a i c n m n r e m n r e f f ms,r b a i i s e y Ir se l a l a : i c n a n n a n Fi d e s m i d re I ina t n foc

l st n i c o s s a n i nt ia A se i t i l i b a i L se i r r b a l i a v pan st e s s ri ma l perfor o B t n e b e D t n e ed a r o t condit nci gati gat st e s s r o t us y’s a s i s o f - e l es al a i l a nd on L a i c on Limted on s d n e t a cti r o t s i R l rl a S - ana

et, i vities expo the key s

s imited’s ac countin ons and a k s nce. lysed. e fin

M anci The compan y g a n a r N al lia n isk of 1 1 e t o se 9 9 6 6 3 0 e t o counting pol it to cr n e m e bili unpre t s ty and e r r I v n I o m a G o M d e t a t S v T h t r i d Wa o m a re i a p h t v n I a i L re c A h t o l a g polici h b e o edit r e c o c F e q e e i i t a g c e s e c u s e s e i b d e v v r e t t monitor o .s t n I . e e m e n i v i i n g u u dictability in f l u i e y l t n i i t i m t e m t e m r .s t n d s t n e d n n n o u e e h t s e n a w , d o t e v n i t e m e s m y t i isk, liquidity e b e r e t h w s t n g n quity s t n . a s t n i s t n r a n i f i c es f d e r o t d t n u t u f m t s u Po ices l a s e h w e h r e q n i e l e h t e t S s isk thes thrr u n a s n i t or financia i l h t r f n g o c e yt i r a b e s a n e s e n e i c r s n e ument,instr both re a t a s s d o o f e r e r e t n I . s e r i l a i c e i r r a c e s t s r o t i e c re e m e o s o c e a e e t a t a i b t o n r o i D . v

r a g r l a p y n e t a i c ina s i r r a a e u isk r and inter es s i n g re s l a e n i a f t a d d i v s t n s o f d e s d o o d e v .d e i t s e ncial ma ro a d e t a t d n e a c r a s w d e u l instr re s i v s o r s re r o e l l h a r d n a r o n t e i r r i r a s e l a v r v e o c e n o i o c e M o t d e h t n d e t a t e n u o m ou n e m n t a d u l a m v i e c u o d r o f e s e s i n g .e u s i n g r a gh m rket i me la n n i F s u d e i a f t a s t n n c i v r l b a ya r r u d e s t d e de i m o nts, i co gni eb o t s i c n a se .e . t r onthl ni

and lu f t b r i for gn n a la la te is r ncludi th se se y boar d and unreco gnised at ba e k ks t T t i L e p y Wt a v n i r f v i D a u d M w o h n I n i r t u o S m n a n i e h T c m G r I r e u f o g n a . Th m r e a e y a n a r m o ms and condi ng the ter i b a s a r e t r e t r e v o s e v n o g a n a n i a a g i e u l u c l 3 d a d e f r 3 n o e m d i r o e s d me d r e r o h t ar 3 : v e e e h t r f g n i s r u t o t % 7 5 . 6 s i t i l s t d n e n o i t m t i t a l r t s r t s n a n e c c s 1 . e C c o m W l a a m n v n i d n a s r e a s e s 1 e f a e en m l c n i d e t b e s t n e u J t e m ini s e t a i o C h w f p a a t 0 c n O t m n e m o r r e s e ompa o s e t n i g n t t a d n o C s e

ded d n a e c u m y a t d re s r o mise l u r n a l P t n e d u t f o e ings b e d t yl n e m t s n x e a m n e o t c y a W e t a 2 i e c e s e t a r o n . a w , a r e h ra r f g m u n a % 1 2 . 7 r e t e h t 2 o t 9 0 0 i t i r e d n e p e h t d b d e r u t n i n 31 f h t e s a e h s n o re 3 , where manag a m t p h s t r s r o t o pot re r f s t y’s ov 8 . 4 m o e s m n i c a r t n o c n a M r d n i s u g u A e i r P r e e f o n s e t

l u e n y l l m r e t r u t i v h t Jul r e v a n a e s 1 m o i o p l a e s x e s nt i e w i t u o e n I e c c w 2 1 0 n o e h c a a i c o e J t d e l t t e u p y a b m n e m e g a y a d L r o , l a e t n i l f d e a m u q e n o i t a rall isk r management ial d e n i 0 3 . 5 o t % 2 w d a lance date, t n e m 20 a l s t 1 0 2 t n i advse affects oner u n s r u s t r .e t s a x e d tions of n i e t r u o d e t t m A . l l i y t i r u y b y t i re a t v d 8 2 n o c e h t f o l f h t i 08 yr a y r a v o u M e e s e t a r t s d n a d n a v n i u d n i m r e t e c i eh t em c A t i w 0 3 , e p s e m i se t a d t n u o n i e h t n i t a o m e v o f t s e n o e n I . s e r o c c a 0 l a b g r r ent ,% 0 0 2 t ht p A h t n a s t m t n a r e e N re t p a are as ya d y r g ach

e t r epor .e e W rea n e n e a e la t i r w n i d se g c n s 0 i r s t re t a st t l i e . g s . s 7 financial statements 2007/08 Murray Irrigation Limited notes to the financial statements for the year ended 31 July 2008

(b) Financial instrument composition Murray Irrigation Limited’s financial assets and liabilities at the balance date are as follows:

FIXED INTEREST MATURING IN: Total Weighted 2008 Floating 1 Year Over 1 to More Non Carrying Average Interest or Less 5 Years than Interest Amount Effective Rate 5 Years Bearing Balance Interest Sheet Rate

$000 $000 $000 $000 $000 $000 % Financial Assets

Cash and Cash equivalents 2,291 50,644 3 52,938 7.70% Water Debtors 10,428 10,428 10.00% Government Debtors 10,247 10,247 N/A Other Debtors 3,873 3,873 N/A Government Bonds 7,101 7,101 4.94% Other available-for-sale assets 10,900 10,900 8.07% Shares in associates 1,101 1,101 N/A 13,191 61,072 7,101 15,224 96,588 Financial Liabilities

Trade and Other Payables 10,096 10,096 N/A

10,096 10,096

Net Financial Assets 13,191 61,072 7,101 5,128 86,492

* refer comments at Note 28(a)

FIXED INTEREST MATURING IN: Total Weighted 2007 Floating 1 Year Over 1 to More Non Carrying Average Interest or Less 5 Years than Interest Amount Effective Rate 5 Years Bearing Balance Interest Sheet Rate

$000 $000 $000 $000 $000 $000 % Financial Assets

Cash and Cash equivalents 8,542 36,189 3 44,734 6.37% Water Debtors 10,859 10,859 10.00% Government Debtors 24,016 24,016 N/A Other Debtors 2,080 2,080 N/A Government Bonds 6,774 6,774 4.94% Shares in Other Corporations 1,829 1,829 N/A 8,542 47,048 6,774 27,928 90,292 Financial Liabilities

Trade and Other Payables 9,973 9,973 N/A

9,973 9,973

Net Financial Assets 8,542 47,048 6,774 17,955 80,319

* refer comments at Note 28(a)

78 I ( C R c f ( da C O ( G l L T 2 s Un 92 ( Mu T o F po i I Us B bo r n r To i nc lo umar epu edu nt n f) d) e) c apac abil 000 b ote loa iqu i he he as re ov ec ther ) l te w l l nd I

e r l er L l igat icy .

re ma

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proxim te gg equi va a I ng ble A ing nme c

nag r y Ir r ion et y es g mpan ept r Th u ba ic vai rest y i i bles d e reg n se of . sk t ra at di t idi is r ou te Fa i of

T e i ca s. ri he re e m anc a res lable la d i nt e te t Ri C t i d ac at us the is gati r he i ty r sh men nc bove. k i ts is r not ts bonds y t

r Values e ac pec n no pote trali ate red i n a t S

e at ta axi he sho e da c also equi s k i net ma for c c sk on Limted t a f es ndin o om es t t es is r sk i r he mum exposur

s an of ci s t unts nt t te E t r ximu on ai f s has lo a te the i r v li he sale d m ter pany . An analy 28(b) abo sk was av ial k o ws ater debtor r re he alents banks and xposure ty g sk i b r va a s isk that a mo r ca rec e rec eiva k effe y r A aset f f m ise fr ar monthly basi yi r r t ng ter lues of f inanci ld wi h cre di exposure ai ct iv a at the C lable at balance date n a r ng t ter of the shor n bles a ble ve. T th r t r e t o om cash and cash equ m are consi e to cre al los to the Company if value i g inanci th i in n e m e sk the Company inve eputable Australian si nd long ter t s ompany o manage to e balances are manage the vestmnts s of the vemnt in interest rates wil s to main liqu h t o n the ba dit r al aset and f compa der ed lo w st isk at balan idity r wil e isk at bala m effect on profit and eq n i f th ny in tain suf m lance shet. unpredict e compa encounter difficulty in ity o has secur to the n a investm isk.r the m of for l a i c inancial liabilit iv alents and d nce banks. ficient cash to pay folowing plus f st sur

ny e ability of s date d and mo ty to a fi a par nt $ P 529 104 109 ’s e t a t ’ ’ r 71 0

ce s in f o floatin l 0 0 f iquidity is i i 0 0 t date i ver n e m the lo li impac finan the e at uit unds i ne nitor i car g r es, posi + + s the i i r 1 1 ng rat s of cr y of a s t debt %

ate both re nancial yi r sk t ci t its de me ts wi ed i

the for car n t al m se ng am he in acordance wi e se e n acordance wi cur th e 1 ti v E 5 1 1 th banks as wel $ dit r r % m q ng obl arke ’ bts as and w y 29 7 04 09 i m deposit co gnised and unr alue of investmnts or 0 u iti cur e i 1 0 iti ument f nstr : i i ng am change in t anag 0 ount of fi y y y es ts. Thes e a ar igat e em nd Co s and Com ount of fi en ions asociated w ent s ded to max interest r nancial hen the

ail monweal inve and the board m l as oth th a credit th t = = s ––– = = 31 (52 (10 (10 $ P $ P ––– = to met it = eco gni nancial ’ ’ = r stm ( –– = 0 0 he monwealt o o = 7 im ––– = aset 0 0

= f al y f = 9) 4) 1) 9) Jul i –– = = 0 7,0 7,0 t $ ––– = = er ates ise ent 20 Wa = ’ –– = = the int 0 ––– credi = = y 0 = l due sed, –– s = = s are made wi managemnt its r li th in t

––– 8 0 = = 20 - er Manage is set as - -

abil ith s contract 1

% sum 08 etu at the bal h indexed t exposur . dexed bonds. er it financial out below onit n w r ies ningest ear ised inmar = – = = ––– (5 (1 (1 E E

$ $ = = or as q q –– (71 me = ’ ’ = = 0 0 ––– 29 04 09 u hil = = ual 0 s cash i i –– 7 7 $’ = t t = = nt ance 0 ––– 207 y y es ,0 ,0 ) ) ) ) th = = e –– 0 = = = ––– A 0 0 = = –– = : - = c ––– = t = 79 financial statements 2007/08 directors’ declaration

The Directors declare that the financial statements and notes set out on pages 59 to 79: (a) comply with Accounting Standards, the Corporations Act 2001 as amended and other mandatory professional reporting requirements; and (b) give a true and fair view of the company’s financial position as at 31 July 2008 and of its performance, as represented by the results of its operations and its cash flows, for the financial year ended on that date. In the directors’ opinion: (a) the financial statements and notes are in accordance with the Corporations Act 2001 as amended; and (b) there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable. This declaration is made in accordance with a resolution of the directors.

S.G. Ellis G.G. Ball Director Director Deniliquin Deniliquin 3 November 2008 3 November 2008

auditor’s independence declaration

As lead auditor of the audit of Murray Irrigation Limited for the year ended 31 July 2008, I declare that, to the best of my knowledge and belief, there have been: (a) no contraventions of the auditor independence requirements in relation to the audit; (b) no contraventions of any applicable code of professional conduct in relation to the audit.

Hugh McKenzie-McHarg Partner Johnsons MME Albury 3 November 2008

80 independent audit report to the members of Murray Irrigation Limited

Report on the Financial Report about the amounts and disclosures in Inherent Uncertainty the financial report. The procedures We have audited the financial report selected depend on the auditor’s Regarding Taxation of Murray Irrigation Limited, which judgment, including the assessment Without qualification to the opinion comprises the balance sheet at 31 of the risks of material misstatement expressed above, attention is drawn to July 2008 , and the income of the financial report, whether due the following matter. As disclosed in statement, statement of changes in to fraud or error. In making those note 4 to the financial report there equity and cash flow statement for risk assessments, the auditor has been an ongoing dispute between the year ended on that date, a considers internal controls relevant the company and the Australian summary of accounting policies, to the entity’s preparation and fair Taxation Office regarding the other explanatory notes and the presentation of the financial report in taxation treatment of grants received directors’ declaration. order to design audit procedures that for environmental works. The are appropriate in the circumstances, Directors’ Responsibility for the company has brought to account a but not for the purpose of expressing Financial Report liability for the tax totalling $9.1 an opinion on the effectiveness of million however it has not brought to The directors of Murray Irrigation the entity’s internal control. An account any accrued interest that Limited are responsible for the audit also includes evaluating the may be applied if and when this preparation and fair presentation of appropriateness of accounting amount becomes payable which may the financial report in accordance policies used and the reasonableness be of the order of $ 6 million. In 2007 with Australian Accounting of accounting estimates made by the the company was advised that it Standards (including the Australian directors, as well as evaluating the would receive a Government grant Accounting Interpretations) and the overall presentation of the financial to cover this debt plus any penalties, Corporations Act 2001. This report. however it has recently been advised responsibility includes designing, We believe that the audit evidence that this grant will not proceed. The implementing and maintaining we have obtained is sufficient and company proposes to reactivate its internal controls relevant to the appropriate to provide a basis for previous request that this debt to be preparation and fair presentation of our audit opinion. waived . Should the company be a financial report that is free from successful in having this debt waived, material misstatement, whether due Independence the provision for taxation would be to fraud or error; selecting and In conducting our audit we have reduced by $9.1 million. Should it applying appropriate accounting complied with the independence be unsuccessful and penalties were policies; and making accounting requirements of the Corporations Act applied there is potential for the estimates that are reasonable in the 2001 . company to incur additional penalty circumstances. Auditor’s Opinion interest charges of up to $ 6 million Auditor’s Responsibility which have not been brought to Our responsibility is to express an In our opinion the financial report account in this financial report. opinion on the financial report of Murray Irrigation Limited is in based on our audit. We conducted accordance with the Corporations Act our audit in accordance with 2001 , including: Australian Auditing Standards. a) giving a true and fair view of Johnsons MME These Auditing Standards require Murray Irrigation Limited’s Chartered Accountants that we comply with relevant ethical financial position as at 3 1 July 8 0 / requirements relating to audit 2008 and of its performance for 7 0

the year ended on that date; and 0 engagements and plan and perform 2

s the audit to obtain reasonable b) complying with Australian t n assurance whether the financial Accounting Standards (including Hugh McKenzie-McHarg e m e report is free from material Australian Accounting Partner t a t s misstatement. Interpretations) and complying

Albury l a

An audit involves performing with the Corporations Regulations. i 3 November 2008 c n

procedures to obtain audit evidence a n i f

81 accuracy and independence

Our financial processes and the Our Quality Auditor SAI Global SKM on behalf of the NSW information in the annual financial Assurance Services conducted a Government. The annual landholder statements to shareholders on pages re-accreditation audit in February survey, which measures landholder 59 to 79 has been audited by 2007. contributions to the LWMPs are Johnsons MME. The expenditure audited by Dennis E Toohey and As part of our annual licensing of government Asset Renewal Associates on behalf of SKM. requirements we prepare an annual Program funding on capital works is Feedback from agency staff and Compliance Report. This is audited for physical and financial others is received in both written submitted and formally scrutinised validity by Sinclair Knight Merz form and through a public forum as by Department of Water and (SKM) on behalf of the NSW part of the LWMPs annual review. Energy (DWE), Department of Government. Our nationally Environment and Climate Change These external audits help to accredited water testing laboratory (DECC), Murray Darling Basin improve the quality of our systems provides information on stormwater Commission (MDBC) and NSW and the information we include in quality. The lab’s procedures and Department of Primary Industries this report. The external audits processes were audited in August (NSW DPI). Components of the Murray Irrigation is subject to, are 2006 and it has received re- Compliance Report relating to outlined in the table below. accreditation. Murray Irrigation is a Murray Land and Water Quality Assured Company under Management Plan (LWMP) the ISO Standard 9001:2000 and implementation have been audited also has Occupational Health and for financial and physical validity by Safety accreditation AS/NZS4801.

External Audits of Murray Irrigation

Area Auditor Date of Audits Quality Assurance SAI Global Assurance Services Annual integrated surveillance audit ISO Standard 9001:2000 3 yearly integrated accreditation OH&S AS/NZS4801

Government funded Asset Sinclair Knight Mertz (SKM) 2 monthly Renewal Program expenditure asset renewal audit

LWMP Annual Landholder Survey Dennis E. Toohey & Associates Annual

LWMP Implementation Sinclair Knight Merz (SKM) At least monthly

NSW Irrigation Corporation Water DECC and DWE Annual Management Works Licence NSW Environment Protection Licence

Water quality testing laboratory National Association of Testing 2 yearly national accreditation Authorities, Australia

Financial accounts Johnsons MME Annual

Business Plan Johnsons MME Annual

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d f y tc) er o es r s, r f . 83 glossary abbreviations

ACCC ...... Australian Competition and Consumer LPG ...... liquid petroleum gas Commission LWMP ...... Land and Water Management Plan AGM ...... annual general meeting m...... metre ANCID ...... Australian National Committee on Irrigation and m3...... cubic metre Drainage MDBC ...... Murray Darling Basin Commission ATO ...... Australian Taxation Office mg/L ...... milligrams per litre AWA ...... Australian Water Association MIL ...... Murray Irrigation Limited BDU ...... business development unit ML ...... megalitre CMA ...... Catchment Management Authority ML/d ...... megalitres per day COAG ...... Council of Australian Governments ML/ha ...... megalitres per hectare CPI ...... consumer price index mm ...... millimetres CRC ...... cooperative research centre MDFRC ...... Murray Darling Freshwater Research Centre CSIRO ...... Commonwealth Scientific and Industrial Research Organisation MWWG ...... NSW Murray Wetland Working Group DAFF ...... Department of Agriculture, Fisheries and Forestry NATA ...... National Association of Testing Authorities DEWHA ...... Department of Environment, Water, Heritage and N/A ...... not available the Arts NSW ...... New South Wales DPI ...... Department of Primary Industries NWC ...... National Water Commission DWE ...... Department of Water and Energy NWI ...... National Water Initiative EC ...... electrical conductivity OH&S ...... occupational health and safety EGM ...... extraordinary general meeting O&M ...... operation and maintenance EIS ...... environmental impact statement QA ...... Quality Accreditation EMS ...... Environment Management System QMS ...... quality management system ESP ...... exchangeable sodium percentage R&D ...... research and development FBT ...... Fringe Benefit Tax REPAG ...... Rice Environmental Policy Advisory Group FTE ...... Full Time Equivalent RGA ...... Ricegrowers ’Association of Australia GIS ...... Geographic Information System RTA ...... Road and Traffic Authority GL ...... gigalitres SCADA ...... supervisory control and data acquisition ha ...... hectares Seafood CRC ...... Seafood Co-operative Research Centre hrs ...... hours SEE ...... statement of environmental effects IAA ...... Irrigation Association of Australia SKM ...... Sinclair Knight Merz IAL ...... Irrigation Australia Limited SRI ...... Southern Riverina Irrigators IPART ...... Independent Pricing and Regulatory Tribunal t...... tonnes kg ...... kilograms t/yr ...... tonnes per year kl ...... kilolitres t CO 2 - e ...... tonnes of carbon dioxide equivalents KPI ...... key performance indicator TFWB ...... total farm water balance kwh ...... kilowatt hours µg/L ...... micrograms per litre L ...... litres WTSSDS ...... Wakool Tullakool Sub-Surface Drainage Scheme

84 company directory

Murray Irrigation Limited Solicitors Head Office Francis Kelly & Grant (to 1 July 2008) 443 Charlotte Street 144 End Street Deniliquin NSW 2710 Deniliquin NSW 2710 Telephone: (03) 5898 3300 Facsimile: (03) 5898 3301 Taxation Advisors Board of Directors Ernst &Young Stewart Ellis, Chairman 680 George Street Gordon Ball, Deputy Chairman Sydney NSW 2000 Alexandra Anthony Annual General Meeting Kelvin Baxter Leigh Chappell Will be held at 9.30am on Malcolm Holm Thursday 18th December, 2008, at the Deniliquin RSL Club, Vicki Meyer 72 End St, Deniliquin. Michael Humphris, Non-member Director Anthony Read, Further Information Non-member Director Additional information about Murray Irrigation is available General Manager from the company’s website Anthony Couroupis www.murrayirrigation.com.au

Company Secretary Information on the website includes: Warren Elsbury • Annual Reports • Compliance Reports Auditors • Environment/Sustainability Reports Johnsons MME • Completed Research Reports 520 Swift Street • Company Policies Albury NSW 2640 • Media Releases Bankers • Talking Water Commonwealth Bank • Water Supply of Australia • Water Exchange 241 Cressy Street Deniliquin NSW 2710 This Report

Engineering Consultants Design & production: KBR Paula McKindlay Graphic Design 186 Greenhill Road Printing: Specialty Press, Albury Parkside Adelaide SA 5063

Murray Irrigation Limited Murray Irrigation Limited