ࡱ> vxw @ i"bjbjqq +DO<<<<<<<Pxxx8L4P{v2<<"^^^^^^v v v v v v vwRy v<M^^MM v<<^^5v___M<^<^v_Mv__f(h<<Z)^0 sְxc(u$Kv0{v(|zyz Z)PP<<<<z<Z)L^\l_$a^^^ v vPP4DIPP4Public Submission to water market rules issues paper by Murray Valley Community Action Group 9 May 2008 Merrill Boyd, CEO, MVCAG PO Box 137, Berrigan NSW 2712 Introduction The Murray Valley Community Action Group (MVCAG) was established in 1999 to be a social conscience and watch dog committee, understanding the benefits and ramifications of change initiated by government laws or bureaucratic policy decision makers. It represents citizens living in the southern Murray Darling Basin, in the regions of Berrigan, Conargo, Deniliquin, Wakool and Murray Shires. These areas are agriculturally and horticultural dependent with a population of over 40,000 residents. One of the major issues confronting this region is the certainty of supply of irrigation water from the Murray River. The MVCAGs role is to act as an advocate for the community of the Murray Valley on issues relating to the economic and social wellbeing of the community and works to protect, maintain and improve the social, environmental and economic viability of the region. In responding to Australian Competition & Consumer Commissions (ԭ) Water market rules issues paper, MVCAG is responding with the views of its members. Consultation Process The MVCAG acknowledges the start of the consultation process and submits these thoughts in its role of representing the community of the Murray Valley region in the southern Murray Darling Basin. In all instances relating to water it cannot be stressed more strongly that irrigation water does not only benefit the business of the irrigation deliverer and the irrigator but it benefits significantly to the prosperity of all irrigation communities. This is most obvious as locally based technical businesses have undergone massive development as irrigation farms have embraced environmental objectives and structural changes on farm. It is obvious to the MVCAG and should be acknowledged that a strong irrigation sector creates and sustains a strong rural and regional hub. The local service industry and its peoples successfully sustain that community and in-keeping with the thrust of a strong and vibrant rural sector, water security is paramount to 2020 and beyond. Therefore we take the view that water is owned by the farmer but is a resource of the region as well and all water market rules must consider the needs of the farmer as well as the social and economic ramifications of any third party impacts. 2.2 Developing water market rules The Murray Valley community in southern New South Wales embraced irrigation technology and farming before World War II. More recently it has had to adapt to reduced inflows into the Murray River and the impacts of this drought have dictated that this region must accept and endured a zero water allocation. The MVCAG wishes to point out to the ԭ that in good times the Murray Valley can use all the water in a wet year that would otherwise be wasted by going into the sea. This capacity to deal with a large variation between minimum and maximum annual usage is spread through the whole community and farm service providers as well as the irrigation infrastructure operator. MVCAG acknowledges that there are examples of current market supply and demand systems such as the Australian Stock Exchange (ASX) which could be adapted to the water market as long as the information included: transparency timeliness accuracy volumetric data location of the volumes and a price range both for sold water and offered water; this would then assist clear and informed decision making. 3.5 Water market trading objectives The MVCAG believes that for an irrigation corporation to maintain its capacity to operate within its established infrastructure, it is necessary to charge an exit fee for water transferred out of its region. In this instance the MVCAG backed the Board of Murray Irrigation Limited when they instigated a termination fee which brings them in line with other Murray Darling Basin irrigation corporations. (Note: Other industries have take or pay charging arrangements or other unique business practices for their particular businesses and an exit fee is necessary in this Murray Valley district.) The MVCAG takes a community overview that the water delivery company must remain viable so that water can be distributed to irrigators which has the flow on effect of enhancing the viability of the local economy. The MVCAG supports the concept that all water traded; irrespective of whom is the ultimate purchaser must always retain its original tagged characteristics. The MVCAG believes it is imperative that there is an ongoing assessment of the social and economic impacts that may arise if significant water is consistently traded out of a specific region. 5.6 Market information The MVCAG believes that it is important that market participants have timely and relevant market information. This information to include: volumes, market price, whether trade was in or out of the irrigation region. Currently there is no transparency of water sale transactions because of the closed tenders of government entities that are operating in the water market. The MVCAG seeks the immediate introduction of a government funded market reporting service that requires the compulsory notification of sales data within say 24 hours of the transaction or contracts being exchanged. The market reporting service to be totally transparent and available to the public and for it to include such details as price, volume, location, class of entitlement and any other conditions that apply in relation to the sale. The MVCAG supports the introduction of a regime that licenses water brokers. Under this license all trust account facilities be visible and full accountability for all water trades and transactions. The MVCAG wants there to be a regulated code of practice that is adhered to by any operator in the water trading industry. Conclusion The MVCAG acknowledges the task ahead for the ԭ and is pleased that the Minister for Climate Change and Water Senator Penny Wong has sought universal clarification as to how to carry on a water market which is fair and transparent to all. In this instance the MVCAG states that the current lack of transparency of water sales over the MDB has lead to an unhealthy and stressful situation for irrigators when wishing to sell their entitlement and to their associated water providers. MVCAG believes that this response to the ԭs issues paper is the precursor to the development of the water market rules for the Minister and we look forward to a further draft of this advice in mid-2008 for further consideration. PAGE  PAGE 4 5678=UVfqst±p_P>,#hehe6CJOJQJ^JaJ#hehzY6CJOJQJ^JaJhQ106CJOJQJ^JaJ h2ZhzYCJ$OJQJ^JaJ$ h2ZhzCJ$OJQJ^JaJ$ h2Zh0CJ$OJQJ^JaJ$heCJ`OJQJ^JaJ` h2Zh0CJ`OJQJ^JaJ` h2Zh2ZCJ4OJQJ^JaJ4h0CJ4OJQJ^JaJ4 h2Zho4CJ4OJQJ^JaJ4h2ZCJ4OJQJ^JaJ4 h2Zh0CJ4OJQJ^JaJ4678;<=Vcdefqrst ! 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