LIBRARY WATER RESOURCES VICTORIA Department of Water Resources 1991 /92 ANNUAL REPORT i SECRETARY'S FOREWORD The Water Resources Portfolio was created on 21 January 1992. While the Department of Water Resources had been in existence for only five months to the end of the 1991 /92 financial year, the objective of creating a viable, efficient and environmentally sensitive water sector has been a recurring theme of water policy since 1984. Broadly, the Department's role has. been to lead the industry to improve water management, using tools such as bulk water entitlements, sector reform and performance assessment and monitoring. Water policy in Victoria over the past ten years has created an environment and the tools necessary for to improved viability and resource management in the water sector. Achievements include the development of accountability mechanisms such as annual reporting regulations, a business planning system, and guidelines for evaluation of capital projects. The level of professionalism and management expertise has improved; there has been pricing reform and micro-economic reform through restructure. Environmental monitoring such as salinity programs, monitoring blue-green algae will provide long-term benefits along with improved resource management through environmental inventories and other publications, such as Water Victoria: The Next 100 Years and Drinking Water Quality: Victoria 1984 - 1989. The Water Act 1989 represents a major shift in the way water is viewed. It establishes the framework to treat water as a tradeable commodity with clear definitions of rights and entitlements. More autonomy and accountability is now allowed to authorities, with better protection for waterways. The Department worked with both Melbourne Water and the Rural Water Commission to set the framework for their corporatisation. These moves have placed the authorities in position to provide better resource utilisation and customer service in the coming years. The formation of the Department of Conservation and Natural Resources on 6 October 1992 sets the scene for integrating land and water issues in catchment management and for speedy conversion of existing water rights to bulk water entitlements, thus facilitating the establishment of a competitive market for water. Future programs for the water sector must further embrace performance monitoring and review (including self assessment and peer review), as well as accepting accountability to Government, ratepayers and the wider community for the responsible management of Victoria's water resources. ALAN THOMPSON Acting Secretary Department of Conservation and Natural Resources ~-!i-BU&i~l!t~~~~-'J-~~--T-~i~t[~~ II CONTENTS SECRETARY'S FOREWORD •.• . ••••••••••••••••••••••••.•.....•..•....... 1991·92 HIGHLIGHTS ANO ACHIEVEMENTS • . • . • . • . v ACKNOWLEDGEMENTS ............................................... ~ PART ONE • REPORT ON OPERATIONS ANO PERFORMANCE . • . • . vii INTRODUCTION .................................................... 1. RESOURCES OF THE WATER SECTOR . 3 1.1 Economic and Financial Structure of the Water Sector . 3 1 . 1. 1 Introduction . 3 1.1.2 Water Sector Balance Sheet (June 1991) . • . • . • . 3 1 . 1.3 Water Sector Performance Monitoring 1983-1990 . 6 1. 1.4 Financial and Economic Performance of the Victorian Water Sector . , . , . 9 1.1.5 Non·Financial Performance Indicators • • • • . • • • • • • . • • . • • . 9 1 .2 National Water Industry Performance Review 1987/88·1990/91 • . • • • 1 0 1 .3 Financial Accountability Measures . • . • . • • . • • . 10 1 .3. 1 Business Plans . • . • • . • . • • • . • • 1 0 1 .3.2 Pricing Reform . • • • • . • . • . • • . • • . • . 11 1 .3.3 Rate of Return Reporting . • . 11 1.3.4 Financial Reporting . • . • . • • • . • • . • • • • • • • . • . 12 1.3.5 Industry Commission Inquiry into Water Resources and Wastewater Disposal . 1 2 1 .3.6 Financial Assistance to Non-metropolitan Authorities . 13 1.3.7 Country Towns Water Supply Improvement Program (COWSIPl . 14 1 .3.8 Assistance to River Management Boards • • • • . • . • • 14 1 .3.9 Priority Victoria Projects . • • • . • • • . • • • . • • . • 14 2. STRUCTURAL REFORM OF THE SECTOR . 17 2.1 Introduction . • • . • . • . 17 2.2 Structural Reform of the Non-metropolitan Water Authorities . • . 17 2.2.1 Introduction • • . • • . 17 2.2.2 Macedon Region Water Authority . 19 2.2.3 Caliban and Campaspe Region Water Authorities . 19 2.2.4 South West Region . 19 2.2.5 East Gippsland Region . 20 2.2.6 North East Region . • • . • . • . 20 2.2. 7 Swan Hill Region . • . • • • . • 21 2.3 Melbourne Water Corporation . • . • • • . • . 21 2.3.1 Formation of Melbourne Water . • . 21 2.3.2 Corporatisation . • • . • . • . 21 2.4 Rural Water Corporation . 22 2.5 Waterway Management Authorities . 23 2.6 Industry Training . 23 2.6.1 Water Training . 23 2.6.2 Training: REALM Training . 24 iv 1991 ~92 HIGHLIGHTS AND ACHIEVEMENTS 3. WATER RESOURCES MANAGEMENT STRATEGIES................ 25 3.1 State Water Resource Planning • • . • • • . • • • . • • . 25 3.2 Regional Water Management Strategies - Gippsland Water Strategy • . 26 0 release of Water Victoria: The Next 100 Years 3.3 Commonwealth State Water Resources Policy . • . • • . • . 27 3.3.1 Australian Water Resources Council (AWRC) • . • • • . 27 3.3.2 Federal Water Resources Assistance Program (FWRAP) . • • • . 28 0 formation of Macedon Ranges, Coliban and Campaspe Region Water 3.4 Blue-Green Algae . • • . • • . • • . • . • • • . 28 Authorities 3.5 Salinity Monitoring and Control . • • . • . • 30 3.6 Environmental Water Requirements . • • . • • . 30 0 initiation of Bulk Entitlements project 3.7 Drinking Water Quality . • . • • . 30 3.8 Future of lake Corangamite and Woady Yaloak Diversion Scheme . • 32 3.9 Lough Calvert Drainage Scheme . • . • . • • • . ·. 34 0 formation of Melbourne Water Corporation 3.10 River and Catchment Management . • . • . • . • . 34 3.10.1 River Frontage Management . • . 34 0 formation of South West Regional Study 3.10.2 Fluvial Geomorphological Studies . • . • . • 34 3.10.3 Economic Benefits of River Management • • • . • • . • • 34 0 finalisation of the Stuart McDonald Review and formation of the Rural 3.10.4 Waterways and Water Quality . • • . 35 Water Corporation 3.11 Water Re·use and Recycling . • • . • • . 36 3.12 Bulk Water Entitlements . • . • . • . 36 3.13 Water Resource Assessment Program . • • . 37 0 formation of Victorian Blue·Green Algae Project Team 3.14 Drought Management Plan . • . • . • . 38 3.15 Dam Safety . • • . • • . • . • • . 38 0 release of major report Drinking Water Quality: Victoria 1984 - 1989 3.16 Alternative Water Technologies . 39 3.17 Groundwater Planning and Policy • . • . • • . 39 0 commencment of Drought Response Planning process 3. 17. 1 Groundwater Assessment and Modelling • . 39 3.17.2 Integrated Surface and Groundwater Investigations . 40 3.17.3 Groundwater Management . • . • . 40 0 preparation of Draft Gipps/and Water Strategy PART TWO · FINANCIAL STA TEMENTS . • . 41 PART THREE · STA TUTORY INFORMATION . • . • . 65 Appendix 1: Major Acts Administered By The Minister For Water Resources. • 67 Appendix 2: Primary Legislation Passed 1991 /92 . • . • . • • . 68 Appendix 3: Statutory Rules 1991 /92. 68 Appendix 4: Significant Judicial Decisions . • . • . • • . • . 69 Appendix 5: Committees, Councils and Other Bodies • . • • • . • • . 70 Appendix 6: Publications • . • . • . • • . • • . 71 Appendix 7: Appointments, Transfers, Promotions, and Other Movements of Persons to and from Senior Offices . • . • • . • . 72 Appendix 8: Declaration of Private Interests 1991 /92 . 73 Appendix 9: Overseas Travel Proposals 1991 /92 . • . • . • . 73 Appendix 10: Public Authorities (Equal Employment Opportunity) Act . 74 Appendix 11 : Personnel . • . • . • . 75 Appendix 13: Freedom of Information . • . • . • 78 Appendix 14: Principal Office Location . • • . • . 78 Appendix 15: Water Sector Reporting Requirements . 79 Appendix 16: Blue-Green Algae Blooms During 1991/92 .... ....•........ 107 Appendix 17: Mergers to 1992 • . • . 113 ACKNOWLEDGEMENTS The 1991 /92 Annual Report was prepared and collated by a project team comprising: Peter Allen Susan Bell (Project Leader} Arlene Cullen Garry Ferris Phil Heaphy Greg McConnell Noel Orr Guido Tresoldi Simon Waters Rob Williamson Brian Wilson The project team would like to thank Gloria Wainshtein and Lachlan Bruce for their assistance in the preparation of this report. The team acknowledges the former Director-General. David Downie for setting the guidelines to prepare this report and his contribution to the Work Plan for the Department in the past five months. The photographs in this report were contributed by: Front Cover: MD Burch and PD Baker Engineering and Water Supply Department South Australia. Confined Spaces Training program: (Figure 7) - Water Training Centre Wurdee Boluc Water Treatment Plant (Figure 8) - Geelong and District Water Board. PART ONE - REPORT ON OPERATIONS AND PERFORMANCE 1 INTRODUCTION The key factors governing the Department's performance are therefore: The Department of Water Resources (DWR) was re-established on 21 January 1992. For 0 water planning issues i.e., ensuring the previous twenty-one months the sustainable use of water resources Department's functions were carried out as while having regard to the needs of part of the Department of Conservation and competing users (including Environment. The Department of Water agricultural, urban, domestic, Resources was originally established on 1 industrial and the environment); July 1984