Jul 17, 2007

Securing our water supplies – Strengthening rural communities

Securing our water supplies

Strengthening rural communities in a changing climate

Speech by Anthony Albanese MP

Shadow Minister for Infrastructure and Water

to the NSW Farmer’s Association Annual Conference

16 July 2007

In December last year, the National Farmers Federation stated that climate change is possibly the greatest threat confronting the nation’s farmers and their productive capacity now and in the future.

I think the NFF was spot on when they said that.

And just last week, the NFF President David Crombie made very clear in a public statement that “farmers are committed to leading the agenda on climate change in Australia.”

I warmly welcome the commitment of all farming organisations to being part of the climate change solution for Australia.

Climate change will directly affect water supply, temperature and the frequency of extreme weather events, and there is no question that all areas of agricultural production will be affected by climate change.

In turn, this will have direct flow-on affects for the communities and secondary industries associated with farming. It will also impact each and every Australian.

The CSIRO has stated climate change will impose a series of environmental, social and economic impacts on rural Australia, including an increase in the severity of droughts.

The key climate change impacts for Australia on water supply and agriculture will be less rainfall and increased evaporation, with water problems intensifying by 2030 in southern and eastern Australia.

The drought has led to an increase in prices, and just this week milk went up 50c, adding $5 to the average weekly grocery bill.

And it’s worth noting that the recently established NSW Rural Mental Health Network identified climatic change impacts, such as drought, as a key external driver of mental health problems in rural Australia. The NSW Farmers’ Association highlighted that deaths from suicide of male farmers and farm workers are now double that of any other group in the male population.

Climate change is a serious issue for rural Australia and Labor will engage with farmers to find solutions.

We are committed to a comprehensive approach to dealing with climate change. We are not only considering the threats, but also developing policy to capitalise on the opportunities presented by climate change.

Innovation and investment must be at the heart of Australia’s response to climate change.

Common sense tells you that water supply issues and climate change are integrally linked. For Labor, water supply issues and climate change are two sides of the same coin. Without a strategy for climate change, you don’t really have a strategy for water. And, of course, you can’t solve the water crisis without tackling climate change. As a nation we must take action on water and climate change every year, not just in election years.

One of the most obvious impacts of climate change will be on reduced water supply in the Murray Darling Basin.

The Murray Darling Basin is struggling to cope now, and the best science tells us that, in the long-term, we’ll just have to get used to less water.

Adapting to less water and a changed climate, and mitigating the impacts of climate change presents risks and opportunities for farmers.

Climate change may improve growing conditions in some regions of Australia. In many regions, however, increasing variability and severity of climatic events, and increasing water scarcity will severely test conventional farming systems.

Whether the local effects of climate change are positive or negative, investment in efficient, new technologies is needed to ensure the ongoing viability of farms and the regional communities that depend on them.

There are also great opportunities presented by climate change. New emerging global carbon markets can drive significant investment in carbon offsets and carbon friendly products. And agriculture can make a significant contribution to meeting the challenge of climate change.

The great risk is that, in establishing a carbon market, the Howard Government will ignore agriculture, while concentrating on protecting energy dependent industries.

In this regard, the recent report of the Prime Minister’s Task Group on emissions trading is indicative of a mindset among senior policy makers that is strongly prejudicial to the interests of agriculture.

The Prime Ministerial Task Group report, released in June, recommends adoption by 2012 of a carbon trading scheme by Australia under a ‘cap and trade’ model that shields energy related and export-exposed industries.

Agriculture was excluded from the task force, which comprised senior bureaucrats and representatives from energy and energy intensive industries.

This was short sighted and fails to recognise the significant contribution agriculture can make.

As the NFF rightly said at the time, this is not simply an issue for the mining, energy and transport sectors, as the government approach has been. But the NFF’s concerns fell on deaf ears.

I agree with David Crombie when he said earlier this year that:

“It is extremely short-sighted for the Prime Minister to overlook agriculture, and a host of others, as part of this important taskforce. We fear the taskforce may be compromised before it begins, which raises questions about how seriously the Government is taking the threat of climate change.”

They were strong words from Australia’s peak farming organisation.

I want to reassure the peak farming groups that Labor is very aware of their interest in climate change, and we will be listening to their concerns.

While a cap and trade carbon market has been supported by Labor for some time, the specific model and suite of policy settings recommended by the Task Group raises some significant issues and concern that the agricultural sector has been disregarded.

Agriculture can contribute significantly to sequestering or storing carbon – through tree planting which we often hear about, but also through soil carbon sequestration.

Soil carbon sequestration is potentially a critical element in ensuring farming can play a meaningful role in carbon markets.

In Australia and globally, agriculture could achieve a significant reduction in the risk of climate change by taking CO2 back out of the atmosphere and storing it in the soil.

Impediments to an Australian program for soil carbon sequestration include a range of measurement, permanence, accounting and contractual issues. Solutions to all these issues are available, but have not been progressed as rapidly as they could have been. Labor has been discussing the role of agriculture in climate change with the peak industry organisations.

In particular, we need to tackle the problem of measuring soil and plant carbon. It is a complex issue, but the NSW Farmer’s Association has some excellent ideas about modelling and benchmarking which Labor is very interested in.

Labor in government, will work closely with NSW Farmers to explore the potential role of carbon sinks through investment in vegetation and soils management.

The technology to do it is there, it’s just a matter of getting the economic structures in place. In fact, many of the innovations necessary for a low-carbon future are available today.

The challenge is to increase their application through economic instruments and accelerate the diffusion of low emission clean technology.

However, those who argue for new technology in the absence of economic incentives exhibit a triumph of hope over experience.

If Australia was part of Kyoto, significant economic opportunities would open up through Kyoto’s so called flexibility mechanisms – including both the Joint Implementation and Clean Development Mechanism.

Joint Implementation projects under the Kyoto Protocol allow developed countries to invest in other developed countries and thereby earn carbon credits to meet their Kyoto targets.

Given that Canada, Japan and some other Kyoto ratifiers will be looking to use this mechanism to meet their targets, Australia would be strongly positioned to take advantage of this prospective multibillion-dollar investment.

The Government’s isolation from the international climate change response under Kyoto has effectively excluded us from this scheme which could contribute substantial investment in Australia’s rural communities.

There is lot at stake, and big opportunities are there.

So it is essential that farmers and agricultural organisations collaborate with government to develop a policy framework that supports agriculture in adapting to climate change.

It is also essential that from here on farmers have direct representation in the development of all aspects of climate change policy, including:

• carbon market design;

• investigating the development of viable farm carbon offsets; and

• measures to ensure the long term profitability of agriculture in a carbon constrained economy.

In addition, farmers need to be closely involved in planning for the changes in our climate. That’s why, in June this year, Kevin Rudd announced that a Rudd Labor Government will fast track the National Agriculture and Climate Change Action Plan.

As some of you may know, this policy was announced at a National Farmers’ Federation meeting in Canberra.

The Government has talked about a plan for agriculture but, because the Government is dominated by climate sceptics, their plans remain largely un-actioned.

A Federal Labor Government will also establish an Agriculture and Climate Change Implementation Panel to provide direct and ongoing advice on climate change adaptation in rural Australia.

As I said earlier, water supply issues and climate change are integrally linked. Australia’s strategy for climate change must be directly connected to our water plans.

The National Water Plan

There is no doubt that the decision by NSW, Queensland, South Australia and the ACT to refer their authority over the Murray Darling Basin to the Commonwealth potentially represents a very significant reform.

Bilateral discussions between Victoria and the Commonwealth are continuing, and Federal Labor looks forward to a positive outcome.

At a Federal level, Labor has consistently called for

• greater Commonwealth leadership on water,

• having a Minister for Water and a single Commonwealth water authority,

• the development of water trading and economic instruments to drive reform; and

• the existing $2 billion Australian Water Fund to be used on practical projects.

The Prime Minister’s announcement in January was consistent with many of these objectives and therefore received Federal Labor’s support.

However, it was reasonable for all the stakeholders to scrutinise the National Water Plan and continue to ensure that the details are got right.

So, what of the future direction of water policy in Australia?

Labor strongly supports the National Water Initiative. It emphasises the need for cooperative effort, in the national interest.

The National Water Initiative highlights the importance of community education about the delicate water balance of this nation. It recognises the importance of investment in water infrastructure to deliver efficiencies and water savings.

The principles behind the National Water Initiative are therefore very sound.

It puts public and environmental needs into an economic system – it attempts to establish structures to manage growing demand for water and a diminishing supply, in a way that uses water efficiently and productively.

Australia needs new ways of working with water and a policy framework that guarantees river health and greater certainty and security for investors, farmers and communities.

While current policies include broad principles around allocating water for the environment, restoring flows to stressed rivers and water quality objectives, they remain general and unspecific.

The time has come for some clearer national goals, targets and benchmarks in river health, water recycling and water quality.

That requires leadership from the national government.

Conclusion

In conclusion, it is clear to me that farmers and their organisations must play a central role in responding to climate change and our water crisis.

Labor has a good relationship with farming organisations, and your clear interest and expertise in climate change and water policy is respected.

Australia needs a long-term approach to water and climate policy.

Taking a long-term approach contrasts markedly with the Howard Government response to the water crisis, which saw a $10 billion announcement followed by months of detailed negotiation because the policy detail simply was not there in January.

Indeed, the fact that only $53 million – or one half of one per cent of the promised commitment – has been allocated in the 2007/2008 financial year is indicative of what happens when you have policy on the run.

In future, let’s have proper consultation, particularly with those most affected by the reduction in water supply. That would go a long way to making sure we got the policy right, the outcomes delivered and all sectors of the community working together in the national interest.