Murray-Darling River Basin Case Study Australia Background Paper Brian Haisman December 2004 This paper is a product of the study, “Integrated River Basin Management and the Principle of Managing Water Resources at the Lowest Appropriate Level – When and Why Does It (Not) Work in Practice?” The Research Support Budget of the World Bank provided major funding. The project was carried out by the Agriculture and Rural Development Department at the World Bank. The Water Resources Management Group and the South Asia Social and Environment Unit at the World Bank have provided additional support. The study core team includes Karin Kemper and Ariel Dinar (Co-Task Team Leaders, World Bank), William Blomquist and Anjali Bhat (consultants, Indiana University), and Michele Diez (World Bank), William Fru (consultant), and Gisèle Sine (International Network of Basin Organizations). Basin case study consultants include Maureen Ballestero (Tárcoles - Costa Rica), Ken Calbick and David Marshall (Fraser - Canada), Rosa Formiga (Alto Tietê and Jaguaribe - Brazil), Consuelo Giansante (Guadalquivir - Spain), Brian Haisman (Murray Darling - Australia), Kikkeri Ramu and Trie Mulat Sunaryo (Brantas - Indonesia), and Andrzej Tonderski (Warta - Poland). The views expressed in this paper are those of the author and should not be attributed to the World Bank. TABLE OF CONTENTS EXECUTIVE SUMMARY ........................................................................................................i 1. AUSTRALIA IN BRIEF ...................................................................................................... 1 1.1 OVERVIEW ......................................................................................................................1 1.2 ECONOMIC DEVELOPMENT.........................................................................................2 1.3 GOVERNMENTAL SYSTEM ............................................................................................5 1.4 NATIONAL GOVERNMENT ...........................................................................................6 1.5 REGIONAL AND LOCAL GOVERNMENT .....................................................................7 1.6 WATER RESOURCE CONDITIONS AND PROBLEMS ............................................... 10 1.7 RIVER BASIN MANAGEMENT..................................................................................... 14 1.7.1 Pre-1975: The pre-basin management days ................................................................................................. 15 1.7.2 1975 – 1995: The establishment of basin management............................................................................. 15 1.7.3 Post – 1995: The era of micro-economic reform ......................................................................................... 17 1.8 CONTEXT OF NATURAL RESOURCE MANAGEMENT............................................ 19 2. THE MURRAY-DARLING BASIN ................................................................................ 21 2.1 PHYSICAL DIMENSIONS.............................................................................................. 21 2.2 INTERNAL PHYSICAL STRUCTURE OF THE RIVER BASIN................................... 23 2.3 HISTORICAL AND CURRENT DEVELOPMENT OF WATER RESOURCES ............ 28 2.3.1 Water resource development............................................................................................................................. 28 2.3.2 Competition for water......................................................................................................................................... 36 2.4 SOCIAL CONTEXT OF RIVER BASIN......................................................................... 43 2.4.1 Demographics ..................................................................................................................................................... 43 2.4.2 Aboriginal peoples............................................................................................................................................. 45 2.4.3 Manufacturing.................................................................................................................................................... 46 3. MANAGEMENT OF THE RIVER BASIN.................................................................... 48 3.1 PRE-DECENTRALIZATION PERIOD TO 1980............................................................ 48 3.1.1 National water resource management............................................................................................................ 48 3.1.2 State water resource management.................................................................................................................. 49 3.1.3 River basin organizations.................................................................................................................................. 50 3.2 DECENTRALIZATION REFORM PROCESS ............................................................... 54 3.3 THE MURRAY-DARLING BASIN COMMISSION....................................................... 55 3.3.1 The Murray-Darling Basin Cap ..................................................................................................................... 60 3.4 DECENTRALIZATION IN THE MURRAY-DARLING BASIN.................................... 64 3.4.1 New South Wales................................................................................................................................................ 64 3.4.2 Victoria................................................................................................................................................................. 68 3.4.3 Snowy Corporatization...................................................................................................................................... 70 4. PERFORMANCE MEASURES....................................................................................... 72 BIBLIOGRAPHY................................................................................................................... 78 List of Tables Table 1: Australia’s Exports by Sector ($ million)............................................................................................ 4 Table 2: Total Public Sector Revenue 2000-01................................................................................................... 8 Table 3: Total Public Sector Revenue 2000-01................................................................................................... 9 Table 4: Public and private sector employment (‘000s)................................................................................. 10 Table 5: Exceedance of water quality guidelines for Australia...................................................................... 13 Table 6: Estimated extent of land affected by dryland salinity (ha) ............................................................. 14 Table 7: State areas within the Murray -Darling Basin.................................................................................... 21 Table 8: Names and Lengths of the Principal Tributaries of the Murray-Darling Rivers ......................... 23 Table 9: Surface water resources data for the Basin's 26 major catchments............................................... 25 Table 10: Major dams and reservoirs in the Murray -Darling Basin: defined as reservoirs with a gross capacity of 10,000 megaliters or more..................................................................................................... 26 Table 11: MDBC-Controlled Major Structures ................................................................................................. 30 Table 12: Growth in diversions of water in the MD Basin, 1988 to 1994*.................................................. 34 Table 13: Surface Water Use in the Murray-Darling Basin ............................................................................ 38 Table 14: Biotic and environmental condition of reaches in the Murray-Darling Basin........................... 39 Table 15: Estimated Quantity of Salt Mobilized to Land Surface, 1998–2100 ........................................... 40 Table 16: Point & diffuse source nutrient inputs to Murray-Darling Basin rivers...................................... 42 Table 17: Population change, Australia - 1991 to 2001 ................................................................................... 43 Table 18: Murray-Darling Basin: 1996 & 2001 Populations of Urban Centers that had populations over 4,000 people in 1991 ................................................................................................................................... 44 Table 19: Murray-Darling Basin – Rate of change in the number of farm establishments, farm families and farming individuals, 1986-96 ............................................................................................................. 45 Table 20: Manufacturing Activities in the Murray-Darling Basin 1991-92................................................ 47 Table 21: Devolvement of Authority .................................................................................................................. 74 Table 22: Stakeholder Particip ation..................................................................................................................... 75 Table 23: Financial Self-sufficiency ...................................................................................................................