Murray-Darling Basin Plan: Implementation review 2023

Terms of reference

I, Jim Chalmers, Treasurer, pursuant to Parts 2 and 3 of the Productivity Commission Act 1998, hereby request that the Productivity Commission (the Commission) undertake an inquiry into the effectiveness of the implementation of the Basin Plan 2012 (Cth) (Basin Plan) and water resource plans.

Background

The Basin Plan provides for the integrated management of water resources of the Murray‑Darling Basin in ways that optimise the objectives and outcomes in section 5.02 of the Basin Plan and promote the objects of the Water Act 2007 (Cth) (Water Act).

Under section 87 of the Water Act, the Commission is required to undertake five‑yearly assessments of the effectiveness of the implementation of the Basin Plan and water resource plans. This inquiry is the second such assessment. The first assessment was completed on 19 December 2018. This subsequent 5-year assessment is due 19 December 2023.

Scope of the inquiry

In accordance with the provisions of Part 3 of the Water Act, the Commission is to report on the matter of the effectiveness of the implementation of the Basin Plan and water resource plans for the five-year period ending 19 December 2023.

In undertaking the inquiry, the Commission should assess the progress towards implementing the Basin Plan, including the:

• extent to which the Basin Plan is on track to be delivered within statutory timeframes,
• the likelihood and extent to which activities and arrangements currently in place will ensure that these provisions and timeframes will be met,
• the effectiveness of reforms to address previous Productivity Commission recommendations, including the Joint Basin government response to the Productivity Commission inquiry report: Murray–Darling Basin Plan: Five-year Assessment (2019), and
• the extent to which the current framework for implementing the Basin Plan, including the framework for monitoring, reporting and evaluation, is likely to be effective in supporting implementation of the Basin Plan.

In undertaking this assessment, the Commission should have regard to relevant agreements and reviews or audits that have recently been completed or are ongoing. Where possible, the Commission should avoid unnecessary duplication with recently completed or ongoing reviews, including those focused on compliance and enforcement, Basin Plan implementation, the Murray-Darling Basin water reform roadmap and national water reform.

The Commission should consider the impact of major droughts, floods, and the COVID-19 pandemic on the effectiveness of implementing the Basin Plan and water resource plans over the assessment period.

The Commission should also have regard to the differing responsibilities of the Basin states, the Department of Climate Change, Energy, the Environment and Water (DCCEEW), the Inspector-General of Water Compliance (IGWC), the Commonwealth Environmental Water Holder (CEWH), the Murray–Darling Basin Authority (MDBA), the Australian Competition and Consumer Commission (ACCC) and the Bureau of Meteorology (BOM).

The Commission should assess progress towards full Basin Plan and water resource plan implementation in the context of the differing timeframes applicable.

The Commission should make findings on progress to date and recommendations on any actions required to ensure full implementation of the Basin Plan and water resource plans.

The Commission should also consider and provide practical advice on the Basin Plan and water resource plans that could improve:

• the operation of the Basin Plan and water resource plans, particularly their ability to address future challenges including the impacts of climate change, their recognition of First Nations values, and their ability to efficiently support the maturation of environmental water management; and
• the efficiency and effectiveness of implementing the Basin Plan and water resource plans and contribute to the information available for the 2024 review of the Water Act and the 2026 review of the Basin Plan.

Given the breadth of the issues available for consideration, the Commission should consider reporting separately on:

• the effectiveness of the implementation of the Basin Plan and water resource plans over the five years since the previous assessment; and
• advice and recommendations on future actions and opportunities to simplify the framework of the Basin Plan to ensure effective achievement of its outcomes.

Process

In undertaking the inquiry, the Commission should undertake an appropriate public consultation process, including establishing a stakeholder working group in accordance with section 89 of the Water Act, inviting public submissions and releasing a draft report to the public.

The Commission should consult widely with relevant Australian Government, Basin state and territory government agencies, key interest groups and affected parties. These consultations should include, but not be limited to, parties with interests in agriculture, industry, the environment, First Nations people, local government, regional development, planning, emergency management and tourism. The Government has asked Basin jurisdictions to co‑operate with this inquiry, including by providing the Commission with the information it considers necessary in undertaking its inquiry.

The final report is to be provided to the Government by 19 December 2023.

The Hon Jim Chalmers MP
Treasurer

[Received 2 May 2023]