Coleambally Irrigation Co operative chairman Robert Black told the Australian newspaper shutting down one entire district made more sense than the ad hoc purchases occurring under the buyback plan.

He said his asking price was made up of $4000/ML for the water, well above the market value the Government is seeking to pay, and $1bn for the town’s residents, whose businesses and houses would be valueless without a community to support them.

CIC chief executive Austin Evans said the offer had been made to highlight the community’s growing frustration at the refusal of the Federal Government to recognise the impact of the buyback on rural communities.

“What Robert is trying to point out is that if (water) keeps getting picked off we’ll reach a point where it will have an impact on the town,” he said.

The Government’s determination to pay no more than the market value of around $2300 for water entitlement did not take into account the impact on rural communities.

“You can’t (lose the water) and keep the services,” he said.

Coleambally is arguably one of the most efficient irrigation communities in the region.

It is a relatively new district with an average farm size of 200ha limiting the scope for farm amalgamations. Millions spent on modernization in recent years lifted its efficiency to around 90pc in the last irrigation year during which it had a decent allocation, 2005/06.

Mr Evans said, prior to the establishment of the irrigation district there had been six landholders. Irrigation now covered 79,000ha and supported a population of 1200, including 364 farm businesses.