Victoria’s report: Social and Economic Impacts of the Basin Plan

The Victorian Government commissioned an independent social and economic analysis to understand how irrigators and communities across the southern connected basin (NSW, Victoria and SA) have been impacted by the Murray Darling Basin Plan, as well as to identify potential further impacts.

The dairy industry in Victoria is now more exposed to the water market and heavily reliant on the allocation market. Victoria is aware that the dairy sector will be the first group to be exposed to the risk of rising allocation prices.

The horticulture sector in Victoria has purchased large amounts of Victorian High Reliability Water Shares, now laying claim to more than 40 per cent. If allocations drop below 40 per cent there will not be enough water to supply industries across Victoria, New South Wales and South Australia.

High Reliability Water Shares have been disproportionately targeted by the Commonwealth in the past. This has increased Victoria's risk in dry years, as the entitlement market helps to lessen the impact of drought in Victoria.

Reduced water availability may impact future tariffs and system infrastructure requirements.

Irrigators who participated in Commonwealth buybacks previously are now much more reliant on allocation purchases: from zero to 12 per cent on the allocation market prior to participation, to 26 to 52 per cent after participation.

Developing socio-economic criteria for additional water recovery

The Victorian Government, after consultation with key Victorian stakeholders and communities, developed and published a position (October 2018) on socio-economic criteria to ensure that projects for additional water recovery above the 2,750 GL target do not create adverse socio-economic impacts.

Download Victoria’s Criteria to Benefit Basin Communities.

At the Murray-Darling Basin Ministerial Council meeting in December 2018 Victoria secured agreement on socio-economic criteria to ensure that any additional water recovery above the Basin Plan’s 2,750 GL target must only occur with neutral or positive socioeconomic outcomes for communities.

Ministerial Council meeting communique (December 2018).

Socio-economic criteria for additional water recovery.

More information

There have been numerous studies about the socio-economic impacts of the Basin Plan. For more information, download the following reports or fact sheet:

Socio-economic impacts in the southern Murray Darling Basin - Implications for additional Basin Plan water recovery (PDF, 1.5 MB)

Social and economic impacts of the Basin Plan in Victoria (PDF, 8.8 MB)
Social and economic impacts of the Basin Plan in Victoria (DOCX, 5.8 MB)

Social and economic impacts of the Basin Plan - fact sheet (PDF, 384.7 KB)
Social and economic impacts of the Basin Plan - fact sheet (DOCX, 177.9 KB)

MDBA Community profiles

Basin Plan – GMID socio-economic impact assessment (RMCG)

ABARES Insights: Analysis of water recovery in the Murray-Darling Basin (PDF, 769.6 KB)

Page last updated: 11/09/20