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Menindee project on shaky ground

Tuesday, 9th October, 2018

By Craig Brealey

A federal government document leaked to the BDT shows that the argument for the reconfiguration of the Menindee Lakes fails on every count.

Yet this “worthless” business case was used to help justify the unprecedented payment of $78 million to the owners of the Tandou cotton farm, according to a researcher who has reported on the deal.

Maryanne Slattery, Senior Water Researcher for the Australia Institute, last week published a report on the controversial purchase by the Commonwealth of the Webster Ltd farm last year. 

“The Commonwealth Department of Agriculture and Water paid Webster’s nearly $80 million to buy their Lower Darling water, including unprecedented compensation of $40 million,” Ms Slattery told the BDT.

“This was based on the Menindee Lakes reconfiguration from the business case.

“At the same time, the same department commissioned a report that basically says the business case isn’t worth the paper it’s written on.” 

The report is a scathing review of the case for the changes that would all but empty the lakes and force Lower Darling River landholders to relinquish their rights to water.

The business case lacked detail and had no regard for the environment or the people who would suffer from it, according to the report written by an international technical services firm.

It was commissioned by the Federal Department of Agriculture and Water Resources (DAWR) to examine the case put forward by the NSW Government and the Murray-Darling Basin Authority which want federal funding for the project.

Titled “Due Diligence on Menindee Lakes Business Case” it was presented to the DAWR in October last year.

“In general, the business case does not represent an organised, comprehensive, consistent or persuasive case for the project,” the Jacobs Engineering Group Ltd says in its final report to DAWR.

“It does not include all the elements that would be expected for a project of this type and, in some instances, provides cursory consideration of key project issues.”

Jacobs Engineering has 250 offices around the world. It has its headquarters in the USA where its clients include the Pentagon. 

The stated aim of the Menindee Lakes Project was to save water but Jacobs could find no evidence of that: “There is no clear statement of actual expected evaporative water savings”.

The NSW part of the business case claimed that 72 gigalitres could be saved, but the MDBA put the savings at 116 GL, the report noted. Neither provided any evidence, nor was there anything to show that it was value for money:

“Based on the information provided...it is difficult to confirm if the project is providing a reasonable return on investment compared to the alternatives.... There is no evidence of standalone economic analysis.”

Further, “insufficient” money was available to assess the inevitable environmental and cultural consequences of the project which includes emptying the deepest of the lakes, Cawndilla, and reducing the lakes’ capacity to less than a third.

No consideration had been given to what the work would do to Menindee, Kinchega National Park, the breeding and passage of fish, aquifers or Aboriginal archaelogical sites.

The business case did not even provide maps of its proposed infrastructure works, concept designs were lacking and there was no “clear statement” of the total cost, the Jacobs found.

No explanation of how the changes to the lakes could be legislated was provided. There was also “no evidence of any recent community consultation” with landholders or townspeople, and a “lack of evidence of the involvement of the relevant Aboriginal parties” and native title holders, the Barkandji people of the Darling River.

“Cursory regard” was given to the economic and social impact and the benefits were not stated:

“There is limited evidence to provide any confidence that the identified benefits are real”.

The Jacobs’ assessment also makes it clear that the Murray-Darling Basin Plan, as it has become, relies on the sacrifice of the lakes, the Wentworth-Broken Hill pipeline and the requisition of water licences from landholders on the Lower Darling.  

“The removal of Lower Darling high security entitlement avoids the need to continue providing a large operational reserve (in the lakes), enabling the reserve reduction from 275 GL to around 80 GL,” says the business case.

“This component of the package is therefore fundamental to the success of the overall package.”

The business case states that the impact on the Lower Darling will be limited  mainly to stock and domestic and some irrigation pumps “given the intended buyback of high security licences.”

But it failed to explain why the water licences should be bought back or how much it would cost, Jacobs found.

“The amount allocated for buybacks is not revealed and is reported as ‘commercial in confidence.’

“The business case does not provide evidence of the need for the removal of Lower Darling high security entitlements, nor does it provide NSW’s strategy for how it proposes to manage these entitlements.”


* On Friday night at 6pm Ms Slattery will address a public meeting at the Musicians’ Club.

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