THE Prime Minister's plan to save the Murray-Darling river system is in tatters because no state is willing to make water available for sale. The NSW Government may join South Australia's High Court challenge, aimed at forcing Victoria into selling more of its water.
Victoria and the Federal Government were reported to be close to agreement last night over a partial lifting, in some circumstances, of the state's water trading barrier. However, neither government would confirm details.
The independent senator from South Australia, Nick Xenophon, said the states could not be trusted to act in the interests of the Murray-Darling. "Now is the time for the Federal Government to use its powers under the constitution to take over the Murray-Darling," he said.
But the Water Minister, Penny Wong, ruled out that possibility. "Complete takeover of the rivers would probably mean that we would end up in legal dispute with the states for a significant period."
Under a multibillion-dollar plan, the Federal Government has been buying water from willing sellers to try to restore the health of the Murray-Darling.
On Thursday it said it had purchased about 240 gigalitres of entitlements from the Twynam Agricultural Group for $303 million. The water will come from rivers in NSW and be used for environmental purposes.
That announcement led the NSW Government to suspend further sales, saying it had done too much of the "heavy lifting".
It says the state has contributed 97 per cent of all the water the Federal Government has bought so far.
It says this has happened because the Victorian Government imposed a cap that did not allow any more than 4 per cent of water in Victoria to be bought and used in other areas.
The NSW Government has said it will not allow any further sales until Victoria agrees to sell more of its water.
South Australia is preparing a High Court challenge to the Victorian cap and hopes the state can be forced to surrender some of its water. The NSW Premier, Nathan Rees, is considering supporting the challenge.
Senator Wong said she was unhappy with the NSW decision to halt water sales but that she understood the concerns about Victoria's cap.
The decision taken by the NSW Government threatens a sale of water thought to be worth $70 million. It is believed a group from Deniliquin are in negotiations with the Federal Government to sell their entitlements.
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