Black hole in the basin "fix"

The new Murray-Darling management structure is set to fail, writes JACK WATERFORD EVERYONE “knows” why the Murray-Darling river management has been such a mess. The basin runs through four states and a territory, each with its own local interests, not least in irrigation and agriculture. Upstream interests have paid too little attention to downstream interests and needs. Water has been over-allocated, and the environment has not had priority. The Commonwealth’s capacity to take a lead role has been undermined by state and party politics, greed, entrenched rights and drought. But that’s all past, we understand now. Last week the Council of Australian Governments accepted a new model of basin management, with agreed principles and ideas, and, after the payment of a hefty bribe to Victoria, apparent goodwill and common purpose all round. If only it would rain, there might be orderly and sustainable circulation through the nation’s most important veins and arteries. Don’t bet on it. The new model of riverine governance could hardly illustrate better one of the central problems of government in the 21st century, problems that also bedevil education and health care, and which will also certainly hinder effective action against climate change and the development of an emissions trading system. The problem is not primarily a constitutional one, but it is a reflection of the fact that the Constitution, which divided power between the Commonwealth and the states, did not set models of how to exercise power jointly. When they do, who governs, and how? To whom are the bodies created responsible? How is money raised, authorised, spent and reviewed? Whose show is it, and how and where does the public, the public interest or the political or judicial process get a look in? The agreement between the Commonwealth and the basin jurisdictions - Queensland, NSW, Victoria, South Australia and the ACT - sets out principles of river management agreed in March, within the context of the national water initiative, which Victoria has just joined. There is to be a basin plan, responsibility for the implementation of which will, in theory, lie with the Murray-Darling Basin Authority, an “independent and expert” reconstitution of the old basin commission. It’s “assisted” in every ambiguous sense of the word by a ministerial council and advisory committee, as well as by a committee of federal and state officials. The authority will be established by a limited referral of powers to the Commonwealth from the states, (probably) some complementary legislation and a base agreement (with semi-constitutional status) of working principles which can be changed only by the unanimous agreement of the parties. The authority must prepare a plan, with which the Commonwealth minister (currently Penny Wong) must agree. If she doesn’t she can send it back with “suggestions.” If she is still unhappy, she can give the authority directions in writing, which must be explained to parliament. The authority’s role is to “prepare, implement, monitor and enforce” the basin plan, as well as to “implement” decisions made by the Ministerial Council and the Basin Officials Committee. There’s little doubt where the real power lies. The agreement says the officials committee will be “responsible for high-level decision-making in relation to the operation of the River Murray system.” A Commonwealth-state ministerial council has a generally advisory role, but an executive role in relation to water allocations to each state and territory, as well as over local environmental initiatives and “under certain circumstances, critical human needs and natural resource management programs.” This, on top of an explicit reaffirmation in the agreement of “the autonomy of the basin states to manage water and other natural resources within their catchments” provides ample scope, down the track, for blackmail, coercion and sweetheart deals designed to elicit cooperation. Got that so far? A quick refresher. Who’s in charge and who will we hang if it doesn’t work out? Who’s actually deciding things? Just in case there is any confusion, the agreement says “decisions of the Basin Officials Committee will be exercised consistent with the delegations received from the Ministerial Council. These delegations will relate to objectives and outcomes consistent with those set by the Ministerial Council, and consistent with the authority having the autonomy to decide on the matters set down in the corporate plan covering program design, delivery, monitoring and reporting arrangements required to implement the decisions of the Ministerial Council and the Basin Officials Committee.” Clear now? The Commonwealth will appoint the chair and the chief executive of the basin authority, though it must “consult” with the states and ACT about these appointments. The states and ACT can put up two part-time members of the authority (the Commonwealth can veto these) and the Commonwealth two (the states can veto these). Decisions of the Ministerial Council require the unanimous support of ministers. On top of the general arrangements, each state and territory that is party to the agreement will make a separate bilateral agreement with the Commonwealth about programs in its jurisdiction. One could go on through details of the agreement to find potential stumbling points. They might be summarised as showing that, where everyone is in absolute agreement about what to do, the arrangements should work swimmingly. If anyone kicks up a fuss on anything, paralysis is virtually inevitable, at least until the Commonwealth bribes a player back into unanimity. It does not take a cynic to imagine a host of problems ahead. The potential does not turn on changes of government (states are quite used to putting state before party, just as they have long put state before nation). The potential increases massively when any question of compulsorily acquiring water allocations arises; even more when allocations are transferred from sector (say, agriculture) to sector (say, environmental flow or city water) or from region to region (say, from Victoria to SA). At least, once there is actually water to fight about. The susceptibility of the various bodies to rendering accountability to various parliaments, external audit requirements, administrative review or judicial review is far from clear. Most of the dispute-resolution mechanisms, such as they are, involve fights between the parties, not between the bodies and outside parties such as farmer or environmental groups. My opinion, for what it is worth (say $20,000), is that it will be beyond the power of the Commonwealth to constitute the authority without its actions being subject to judicial review under Section 75 of the Constitution, but the value of this may be destroyed by the mixed accountability to ministerial councils and officials’ committees. It has been in fields such as this, as with special purpose grants and mixed responsibilities for health, or aged care, or education, or public housing, that parliamentarians and auditors-general walk away in bemusement. They are unsure of where their authority starts and where it ends. When they get too inquisitive they will be told it is the responsibility of the other side and outside their jurisdiction. The consequence is an accountability and governance black hole. And, almost certainly, very poor management. This is not what the parties have intended but the sort of lowest-common-denominator response we always get with such hybrid arrangements. Structures matter. If, at a time of zeal and sense of common purpose in tackling great national problems, the Commonwealth cannot get good organisations to do the work, it is unlikely to get good work. However valiant, expert and independent the new body, it is being set up to fail. • Jack Waterford is editor-at-large of the Canberra Times, where this article first appeared. Photo: Susie Harders/iStockphoto.co