Premier John
Brumby’s decision to raise the four per cent cap on water trade and the
downturn in the dairy industry has affected the number of people trying
to sell water, Shadow Minister for Country Water Resources and Deputy
Leader of The Nationals Peter Walsh said today.
Mr Walsh has questioned Goulburn-Murray Water’s (G-MW’s) logic in
stating last week that the real measure of producers wanting to exit
irrigation was the number of farmers selling delivery shares as well as
water shares.
“The number of people applying to sell their water shares in
northern Victoria has more than doubled since the Brumby Government
announced it would lift the cap to allow the Commonwealth Government to
purchase water,” Mr Walsh said.
“The fact that producers are retaining their delivery share is not an indication that all is well in the sector.
“G-MW is misreading the dynamics of the industry in an effort to put a positive spin on the numbers.
“Producers are keeping their delivery shares because if they choose
to sell them they will have to pay thousands of dollars in termination
fees to exit the system.
“It doesn’t make sense for people to fork out that kind of money
when there’s a strong possibility the fees could be reduced or waived
if the delivery infrastructure is rationalised as part of the Northern
Victorian Irrigation Renewal Project (NVIRP).
“It’s just good business sense for food producers to retain their
delivery share until such time as NVIRP decides whether it wants to
rationalise their channel. Then they might not be required to pay the
termination fees.”
Mr Walsh said the Brumby Government had to acknowledge the
ramifications of its decision to remove restrictions on water trade.
“The increase in applications to permanently sell water is an
indication that more food producers are trying to exit the industry,”
Mr Walsh said.
“People are selling water because they are short of cash and they’re
keeping their delivery shares because they can’t afford to pay
termination fees.
“The massive increase in those wanting to sell water only goes to show the Brumby Government made the wrong decision.
“It has undermined confidence in irrigated food production to such
an extent that many people now feel the only way forward is out,” Mr
Walsh said.