The findings of a report by the Productivity Commission National Water Reform 2020 matter to all Australians, whether you live in a city or a drought-ravaged town. If governments dont manage water better then entire communities may disappear. Agriculture will suffer and nature will continue to degrade.

Most Australians know all too well how precious water is. Sydney just experienced asevere drought, while towns across New South Wales and Queenslandran out of drinking water. Under climate change, the situation will become more dire, and more common.

It wasnt meant to be this way. In 2004, federal, state and territory governments signed up to theNational Water Initiative. It was meant to secure Australias water supplies through better governance and plans for sustainable use across industry, environment and the community.

But a just released report by the Productivity Commission says the policy must be updated. It found the National Water Initiative is not fit for the challenges of climate change, a growing population and our changing perceptions of how we value water.

The reports findings matter to all Australians, whether you live in a city or a drought-ravaged town. If governments dont manage water better, on our behalf, then entire communities may disappear. Agriculture will suffer and nature will continue to degrade. Its time for a change.

A big job ahead

The report acknowledges progress in national water reform, and says Australias allocation of water resources has improved. But the commission makes clear theres still much to be done, including:

• making water infrastructure projects a critical part of the National Water Initiative
• explicitly recognising how climate change threatens water-sharing agreement between states, users, towns, agriculture and the environment
• more meaningful recognition of Indigenous rights to water
• delivering adequate drinking water quality to all Australians, including those in regional and remote communities, especially during drought
• all states committing to drought management plans.

Busting water illusions

The commissions proposal to make water infrastructure developments a much larger part of the National Water Initiative is a critical way to keep governments honest.

For years, state and federal governments have used taxpayers dollars to pay forfarming water infrastructurethat largely benefitsthe big end of town large, corporate irrigators.

For example, the federal government last year announced an additional A$2 billion for its Building 21 Century Water infrastructure project. This type of funding represents a return to schemes like the discreditedBradfieldscheme, a plan to redirect floodwater from Queenslands north to the south, including to South Australia.

Suchmegaprojects, even when relabelled or reconceived, perpetuate simplistic myths of the early 20th Century that Australia the driest inhabited continent on Earth can be drought-proofed.

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As the report highlights, when governments in 2004 signed up to theNational Water Initiative, they agreed to ensure investments in water infrastructure would be both economically viable and ecologically sustainable. But many proposed water infrastructure projectsappear to be neither.

This includes the construction ofDungowan Dam in NSW. For this dam, the commission notes, any infrastructure that improves reliability for one user will affect water availability for others and the prospect of new water is illusory.

The commission warned projects that are not economically viable or ecologically sustainable can burden taxpayers with ongoing costs, discourage efficient water use and result in long-lived impacts on communities and the environment.

Equally disturbing is that billions of dollars for water infrastructure are currently targeted primarily for primary industry (such as agriculture and mining) while communities in desperate need of drinking water that meets water quality guidelinesmiss out. Thousands of Australians in more remote communities stilllack accessto drinking water most Australians take for granted.

Water scarcity under climate change

Water availability under climate change features prominently in the report. The commission says droughts will likely become more intense and frequent and in many places, water will become scarce.

The report says planning provisions were inadequate to deal with both the Millennium Drought and the recent droughtin Eastern Australia.

The commission also said more work is needed to rebalance water use in response to climate change. One need only look to the 2012 Murray-Darling Basin Plan one of the key outcomes of the National Water Initiative which didntaccount for climate changewhen determining how much water to take from streams and rivers.

Overcoming past failures

As the commission report notes, one key policy failure since the 2004 National Water Initiative was signed was the federal governmentsdismantling of the National Water Commissionin 2015. It meant Australia no longer had a resourced, well-informed agency to mark the homework and make sure the reforms were being implemented as agreed.

The report offers ways to overcome a range of past policy water failures, including strengthening governance architecture for the National Water Initiative.

Importantly, the report also called for better recognition of the rights Aboriginal and Torres Strait Islander people hold over water.

Aboriginal communities and corporations ownjust 0.1%of the more than A$26 billion of water entitlements in the Murray-Darling Basin. Clearly, such gross inequities must be overcome.

What happens in the Murray-Darling Basin is key to national water reform. There is overwhelming evidence thebasin plan needs fixing.

To start, subsidies for irrigation-related water infrastructure should be halted until a comprehensive audit is conducted to determine who gets water, when and how. And an independent, properly funded expert agency should be established to monitor, advise and implement thelaw for managingthe Basins water resources.

The800-page report of the 2019 South Australia Murray-Darling Royal Commission proposes many ways forward. Yet unfortunately, that substantial body of work is not mentioned in the Productivity Commissions report.

Still waiting for change

In 2007, the worst year of the Millennium Drought,Prime Minister John Howardsaid the current trajectory of water use and management in Australia was not sustainable. He said:

In a protracted drought, and with the prospect of long-term climate change, we need radical and permanent change.

We are still waiting for that change. If Australia is to be prosperous and liveable into the future, governments must urgently implement water reform including adopting recommendations from the Productivity Commissions report.

If it fails to act, our landscapes will degrade, agriculture will become unsustainable, communities will disintegrate and First Peoples will continue to suffer water injustice.

This article first appeared in The Conversation. Written byQuentin Grafton:Director of the Centre for Water Economics, Environment and Policy, Crawford School of Public Policy, Australian National University