Water Management - A Sunburnt Land Leads the World

Speech by the Australian Deputy Prime Minister and Minister for Trade, The Hon Tim Fischer to the World Bank Study Group on Water, Canberra 14 April 1998.

Introduction

Don Blackmore, Chief Executive, Murray-Darling Basin Commission, Dr John Langford, Chief Executive, Water Services Association of Australia, Mr Daryl Hill, Managing Director, OPCV, Mr Geoffrey Spencer and Mr Walter Stottmann, leaders of the rural and urban sections of the World Bank delegation, other distinguished World Bank delegation members, ladies and gentlemen.

I am pleased to welcome to Australia this World Bank study group looking at how we are tackling the significant challenges we continue to face in urban and rural water management.

Australia is a country of vast extremes and contradictions.

On the one hand we are the globe's driest inhabited continent, having the least river water, the smallest area of permanent wetlands, the most variable rainfall and the lowest run off. On the other hand substantial parts of the country are often under floodwaters and still others receive regular tropical rainfalls.

A celebrated Australian poem in fact describes our land as a "sunburnt country... of droughts and flooding rains".

Australia is also a land of contradictions in another sense. The majority of our population is found in a few large cities scattered around our coastline, generating all the challenges associated with contemporary urban living. But our rural agricultural sector is a significant driver of the economy and a substantial proportion of our exports come from the land.

Water is therefore of paramount importance to our economy. Our need for water - for ourselves, for stock and for irrigation - makes it essential that we continue to manage our water supply well. In fact, we are a world leader in water management.

The Australian Water Reform Agenda

We are world leaders on this front because we have realised that we cannot afford to ignore the warning signs which our ecology is giving us about use of our environmental capital. We have to live off the interest generated by Australia's substantial natural endowments. We need to manage carefully the resources which are required for the welfare of future generations.

Over the last decade we have recognised that major contributors to our national wealth, such as the Murray-Darling Basin, have been experiencing severe ecological stress.

Consequently, Australia has taken steps to ensure that we can continue to draw on our precious water resources in a sustainable way.

In 1994 all Australian governments - Federal and State - agreed on a comprehensive water industry reform framework. To be fully implemented by the year 2001 the major elements of this framework include:

• pricing reform based on the principles of consumption-based pricing, full-cost recovery and the reduction or elimination of cross-subsidies;
• implementation by States and Territories of comprehensive systems of water allocations or entitlements, including allocations of water for the environment as a legitimate user, backed by separation of water property rights from land title;
• the introduction of arrangements for trading in water allocations or entitlements; and
• the structural separation of the roles of service provision from water resource management, standard setting and regulatory enforcement - allowing the private sector to have a role in service provision.

Partly as a result of these reforms - which are already being put in place - we have seen water consumption in major urban areas falling and operating costs have also fallen.

When fully implemented we expect to see these reforms generate an economically sustainable water industry with better environmental outcomes. We'll have healthier rivers, improved water quality and a more sustainable future resource.

The World Bank and Australian Water Expertise

I hope that all those involved in this study tour find Australia's water management solutions helpful in considering how to tackle the great problems of water usage in the developing world.

The World Bank plays an important role in fostering sustainable development and reducing poverty around the globe. Australia strongly supports the World Bank's activities and in 1997-98 will provide $A121.5 million to its concessional lending arm, the International Development Association. And we know that water is a particular focus in your efforts to assist developing countries.

Australia also recognises that water is a critical natural resource for the countries in our region. The availability and quality of water is a major determining factor in reducing poverty and achieving sustainable development. In 1997-98, through our aid program, we will spend an estimated $40 million on the water supply and sanitation sector - most of it in the construction of urban and rural water systems in developing countries.

I would also take this opportunity to bring to your attention that Australian companies are successfully providing solutions to a range of water problems both here and overseas. Australian consultants are already providing advice to the World Bank on various aspects of their water infrastructure programs.

Let me give you some examples of World Bank projects drawing on Australian expertise.

• Brisbane Water, together with Canberra's electricity and water authority, ACTEW, have recently won a quarter of a million US dollar contract to partner Phnom Penh's water authority in improving their institutional capacity to develop their water supply.
• the Snowy Mountain Engineering Corporation - or SMEC - last year completed a dam safety engineering contract in Brazil, and
• in Indonesia we expect this year to start a five year project to improve water supply and sanitation in Jakarta and in a number of other provinces. This will be undertaken jointly with the UNDP/World Bank Regional Water and Sanitation Group for East Asia and the Pacific.

Indeed, Australia has been steadily increasing its role as a supplier of goods and services to the World Bank in recent years. Our share of the Bank's foreign procurement budget rose from 1.2 per cent in 1995-96 to over 1.4 per cent last financial year. I would urge you to continue to use efficient, experienced and high-tech Australian companies to meet your project needs.

Conclusion

I would like to close today by thanking the World Bank for recognising that Australia's expertise in water management issues represents global best practice.

That expertise has been forged in a very unforgiving climate - the result of our dependence on a "sunburnt" land.

We are only too pleased to pass on our expertise to help you in helping the developing world. What's more we will be even more pleased, where appropriate, to sell it to you!

I will leave you with the following thought.

Water received a very bad rap in ancient times. The Roman poet Horace said in his major treatise on writing, "The Art of Poetry" - and I paraphrase here - that no poem written by a "water-drinker" could ever be good enough to be handed down to posterity.

I'm sure Horace was partial to wine rather than water not only because it suited his muse but also because Roman wine was probably safer to drink than Roman water.

But while it is important that we be able to drink wine - and I certainly recommend Australia's excellent wines to you - it is even more important that we are all able to drink safe water.

That, Horace's caveat notwithstanding, is what will enable us all to lead a civilised life - in a sustainable way.