Friday, April 20, 2007

The Clarence River and the Great Big Water Grab 2 - the issues

Photo: Clarence River near Ulmarra

In my last post I spoke of Mr Turnbull's grab for the waters of the Clarence River to provide water to the people of Brisbane and South East Queensland. In this post I want to spell out the issues as I see them as simply and as clearly as I can.

Any proposal of this type will generate opposition as well as a range of responses, especially from those with environmental concerns. These are important issues that need to be addressed. But I think that there is a broader set of principles involved.

As a statement of general principle, most if not all Government decisions over resources create a pattern of winners and losers.

In the case of the Big River, the immediate losers are the people of the Northern Tablelands and the Northern Rivers who lose access to a resource, the winners are the people of Brisbane and SE Queensland who gain water.

There are direct and indirect or longer term losses associated with the Clarence proposal. Direct losses include the potential affect on the livelihood of those who depend upon the river. Indirect losses include the opportunity costs associated with loss of alternative uses of the water.

There are no benefits that I can see for the people of New England to offset these losses. All benefits flow to the people of Brisbane and SE Queensland. To add salt to the wound, to the degree that the Turnbull proposal involves tax payer money, then the people of New England will in fact be subsidising Brisbane.

This leads me to my first conclusion. If the dam is to proceed, the people using the water should pay the full cost of the water including any direct losses plus opportunity costs, the people of New England should be compensated for those losses and costs.

Two issues then arise. How do we place a value on the losses and opportunity costs? What mechanism might be used to distribute the payment for the losses and opportunity costs?

These are not easy questions to answer to begin with, with the difficulties increased by the absence of any form of New England Government.

To illustrate this last point, consider the difficulties facing the NSW Government in responding to this issue.

The NSW Government does not recognise the New England I am talking about as an entity in any sense what so ever. This makes it hard for it to deal with the issue.

The Iemma Government faces a second problem in that adoption of the approach I am talking about would in fact seriously constrain the future freedom of the NSW Government to do as it wills. Here we have already seen in the case of the proposed Tillegra dam that Sydney itself is quite prepared to play water politics, to override local interests, to gain immediate political advantage.

In all these circumstances, I think that the most that we can expect from the NSW Government is a political response determined by its judgement about the various political forces involved.

This leads me to my second conclusion. If we cannot rely on either the Federal Government or State Government to recognise, let alone respect, the New England interest, then it is up to the people of New England to discuss and present issues in a way that forces consideration of the New England interest. The starting point here needs to be a revived conversation about possible uses of the waters of the Clarence.

I say conversation because I do not think that there is any present agreement even on the issues themselves. I may be wrong, but I have the strong impression that the water grab took people by surprise even though it has been clear for some time that water politics would lead to such moves.

In the meantime, political forces are likely to stall the dam in the short term.

The Federal ALP has attacked the dam, while the Federal National Party itself is vulnerable in some New England electorates. However, the issue will not go away. For that reason, I think it important that the conversation be pursued.

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