Fixing the nation’s water supply system is achievable and would boost our economy by $9 billion, according to a new report released by the Business Council of Australia.

The BCA report has found that instead of taking hard decisions to fix the problem, governments are supporting a flawed water system that is effectively turning sufficient supplies of water at the source into scarcity for householders and business.

The paper – Water Under Pressure: Australia’s man-made water scarcity and how to fix it – says problems and shortages with the country’s water supply system are largely man-made and are now acting as a major brake on economic growth.

 The paper highlights how urban Australians are being offered water restrictions instead of sustainable solutions, and that outdated policies are stopping rural Australians from getting the most value from their water.

“Australia’s water supply system is broken and needs urgent solutions. Unavoidable water scarcity is one of Australia’s greatest myths,” BCA Chief Executive Katie Lahey said.

“Our water supply problems are man-made due to poor planning and management that is turning a sufficient supply of water at the source to scarcity for end-users.

“It is true that water is scarce in parts of the country and rainfall is declining but it is our water system, not the amount of water available for potential use, that is the real problem.

“Australians would not tolerate being asked to continually burn candles at night to avoid widespread blackouts, so we should not accept a water supply system that requires 80 per cent of Australians to endure ever-harsher water restrictions,” she said.

Ms Lahey urged the Council of Australian Governments (COAG) to adopt a national plan that results in better planning for new urban water sources, makes sure all farmers have the option to trade water and provides water to protect the health of our rivers.

The BCA paper contains a detailed action plan for fixing urban and rural water supplies and the management of water nationally, and calls for a national review of water pricing to ensure we all pay a fair price for our water use.

The action plan also calls for governments and water authorities to:

• consider a wider options for new urban water supplies;
• invest in urban water infrastructure;
• plan actively for future needs;
• introduce competition and private investment into water management; and
• adopt measures in the National Water Initiative including dramatically expanding water trading so that farmers can get the best value for their water resources.

“We cannot solve urban water issues with water restrictions alone. Water use in our major cities has declined by 9 per cent since 2001 but our water supply problems are getting worse,” Ms Lahey said.

“And rural Australians deserve better from their governments and water management authorities in terms of ensuring their water can be traded at its highest value and that there is assistance to ensure that rural water use is more efficient.

“Establishing a properly functioning water market, combined with effort and assistance to improve rural water use efficiency, provides real opportunities for rural Australians to overcome many of their water problems,” Ms Lahey said.

Ms Lahey highlighted that the environment does not have to be put at risk in an effective water trading market.

“An effective market for water nationally provides the opportunity to address potential environmental matters, whether it is by achieving efficiencies in water use or by authorities using the market to purchase water for environmental use,” she said.

“If adopted, the BCA’s water reform plans would ensure our urban water use was made sustainable, we would have the capacity to protect our rivers and waterways and we could ensure an even more productive irrigated agriculture sector.”