The $13 billion Murray-Darling Basin Plan was at a "critical moment" as Labor senators joined the Greens and SA Best counterparts to block a move that would have cut environment water flows.
Labor's vote was crucial in disallowing the federal government from cutting by 70 billion litres to 320 billion litres the target amount of water that irrigators must return to the environment in the northern basin, covering Queensland and part of NSW.
Some 2750 billion litres of water are supposed to be secured for environmental use, with about 2090 billion litres secured so far. Photo: Louie Douvis
The Wednesday evening vote was 32 in favour, with 30 against.
Tony Burke, federal Labor's environment spokesman, told Parliament that the entire plan was "at real risk - absolutely no doubt about it".
Water is a fraught issue in the Murray-Darling Basin, particularly during droughts. Photo: Peter Rae
Negotiations with David Littleproud, the federal agriculture and water resources minister, "came very close to being able to reach an agreement", but failed because of the tight deadline on the vote, Mr Burke said.
NSW Water Minister Niall Blair and Victorian Water Minister Lisa Neville on Tuesday warned support for the Greens-led motions - including a vote for a second instalment of savings for the southern basin of 605 billion litres that has now been deferred for several months - would trigger them to withdraw support for the basin plan.
"This move makes the Basin Plan untenable for NSW," Mr Blair said in a statement after the vote. It's understood the minister will be consulting with cabinet colleagues before deciding on the next steps.
"I am urging the federal government to fix the Senate’s sabotage and take every step necessary to prevent the short-sighted and politically motivated action that will destroy this historic reform," he said.
“This is a critical moment," Ms Neville told reporters on Wednesday, before the vote. “If people are going to fiddle, to re-prosecute this plan and put greater uncertainty on communities, we will walk away.”
Mr Blair said the plan had been "is thrown on the scrap heap by the Greens and Labor in a race for votes in South Australia".
Water issues, always a sensitive issue for the lower basin state, are likely to be central in the March 17 SA poll.
“We’ve cleared the first hurdle on the road to restoring the Murray-Darling Basin Plan back to what it was meant to be; security for the river, and for the environment to get what it needs to survive,” Sarah Hanson-Young, the Greens Murray-Darling Basin spokeswoman said.
"All over the Basin, I’ve heard horrific accounts of dried riverbeds, dying wildlife, algal blooms and water simply not coming out of the tap while greedy corporate irrigators get more than their fair share and authorities, including the New South Wales and federal governments, turn a blind eye," Senator Hanson-Young said.
Jamie Pittock of the Wentworth Group of Concerned Scientists and an associate professor at the Australian National University said the case for the 70 billion litres savings for the northern basin was "specious" and at odds with the Murray-Darling Basin Authority's own advisory committee.
“The goodwill in implementing the plan has been so lacking, as we’ve seen in NSW with the alleged theft and shifting the goalposts, which has allowed irrigators to dry up the Darling River," Professor Pittock said.
The implications of a collapse of the plan, should NSW or Victoria pull their support, were not clear.
A letter, however, sent last week by Mr Littleproud to his South Australian counterpart Ian Hunter indicates the Commonwealth would be required to recover 2750 billion litres to meet the Basin Plan. So far, 2090 billion litres had been recovered.
Irrigator groups, representing an industry that potentially had the most the gain from the water savings, said they were disappointed by the disallowance but called for state governments to be cautious before abandoning the plan.
Steve Whan, chief executive of the National Irrigators Council, said failure of the plan "would be a diaster for the environment and for communities seeking stability and certainty".
"No one knows how the process will work out" if the Commonwealth has to intervene directly to secure the full 2750 billion litres, Mr Whan said.
"Let's give it another try," Mark McKenzie, head of the NSW Irrigators Council, said, calling for a delay in response until after the SA elections "to allow cooler heads to prevail".
Chris Minns, NSW Labor's water spokesman, said the state's Liberal-National government was keen to find an excuse to pull NSW out of the plan.
Mr Minns supported federal Labor's move to disallow the water savings.
“We don’t even know how much water is being stolen from the Darling River and by whom,” he said, noting there remains several live inquiries into mismanagement of water in NSW.
Only about two-thirds of water extracted from the Murray-Darling basin rivers in NSW is metered, and only one-third in Queensland. Extraction in Victoria and South Australia is typically closely monitored.
There should be more meters and compliance in place “before we sign for even more water being taken from the Murray-Darling River”, Mr Minns said.
Mr Burke told Parliament that there was a "way to get the plan back on track" if issues such as compliance could be resolved.
"We are very, very close to forming an agreement again," he said.
Ian Hunter, SA's water minister, said the state's Liberal leader Steven Marshall had "said nothing in defence of South Australia in this week’s debate".
"The Australian Senate’s decision tonight to reject amendments to the Basin Plan validates thistruth: the Murray-Darling is equally vital to millions of Australians up and down the river andthe Plan cannot place one state’s needs above the other," Mr Hunter said in a statement.
Among those expressing their disappointment at the disallowance was Phillip Glyde, chief executive of the Murray-Darling Basin Authority.
"I urge all parties to continue to work together in a spirit of consensus and cooperation to deliver the Basin Plan - this remains our nation's best pathway for securing the environmental future of this vital shared resource and the communities that depend on it," Mr Glyde said.
Cotton Australia, an industry group, said it was "appalled" at the Senate vote.
“Tonight the Senate threw common sense out the window and gave in to environmental extremism, while at the same time delivering economic and social uncertainty to communities in the Murray-Darling Basin,” Michael Murray, general manager of the group, said.
“Based on the modelling by the Murray-Darling Basin Authority, communities in the Northern Basin can expect to suffer the loss of 180 jobs as a result of this motion, a devastating blow for small towns,” he said