Water Compliance Report 2021-22

Summary

• Victoria has a zero-tolerance approach to unauthorised take, ensuring a level playing field for all water users.
• Victoria is committed to maintaining its strong compliance record to maintain integrity of the entitlements market and protect the environment.
• Water corporations have greater capacity for more compliance and enforcement activities than in past years due to continued investments in metering and system monitoring technology, coupled with systems to better target risk.
• As at 30 June 2022, water corporations have more than 52,000 meters installed, about 30,841 of which have telemetry that provide real-time intelligence on compliance. Water corporations with rural customers also conducted a total of 170,718 manual meter reads and additional inspections to ensure that meters are maintained and functioning efficiently.
• 3,390 potential breaches were reported between 1 July 2021 and 30 June 2022, 2,197 more than in the previous year. The increase in the number of potential breaches detected can be attributed to better use of data monitoring and reporting systems to improve identification of non-compliance.
• 2,140 enforcement actions were taken between 1 July 2021 and 30 June 2022, including 230 statutory notices, 6 restrictions of water supply of high-risk offences and 13 cases recommended for prosecution.
• In July 2020, Victoria introduced new regulations that enable water corporations to issue penalty infringement notices for less serious offences of unauthorised take and breaches of take and use and works licences. In 2021-22 there were 18 penalty infringement notices issued.

Non-urban water compliance and enforcement in Victoria

Zero tolerance for unauthorised take

The Victorian Government is strengthening the state’s zero-tolerance approach to unauthorised take to ensure a level playing field for all water users.

In October 2019, the Water Act 1989 was amended to strengthen penalty provisions that make it easier to prosecute offences, increase the maximum fine for intentional water theft and related offences if they cause substantial harm to $990,000 for companies and $198,000 for individuals, and allow for the suspension or cancellation of licences for taking water and works.

In May 2020, the Minister for Water appointed Mr Des Pearson, Victoria’s former Auditor-General, to undertake a comprehensive independent review ensuring Victorian irrigators and water users have a robust compliance and enforcement system, with checks and balances in place that helps maintain – and continue to build – confidence in the market. The review found that most irrigators and water users were already doing the right thing, with low levels of non-compliance. There are several areas where compliance and enforcement approaches could be further strengthened to provide consistent and quicker resolutions.

In July 2020, the Victorian Government also introduced regulations that enable water corporations to issue water infringement notices on smaller volumes of unauthorised take as well as breaches of works and take and use licences.

In July 2021 Mr Des Pearson completed his assessment of progress made implementing the independent compliance and enforcement review. The assessment highlighted good progress has been achieved implementing the review recommendations and that unauthorised take has been substantially reduced during peak irrigation season.

Compliance activities and enforcement action statistics 2021–22

Water corporations report annually on their compliance and enforcement activities in accordance with clause 7.3A of their Statement of Obligations. The following state-wide statistics have been compiled for the 2021–2022 reporting period.

Compliance activities

In 2021–22, there was a greater level of compliance activity as water corporations continued to invest in installing new meters, telemetry on meters and database management systems that enable better monitoring of water take, greater scrutiny of potential breaches, and more comprehensive compliance reporting.

As at 30 June 2022, there were more than 52,000 meters installed across Victoria. Approximately 30,841 of these meters have telemetry which allow water corporations to quickly detect breaches of the Water Act. Between 1 July 2021 to 30 June 2022, water corporations with rural customers conducted a total of 150,206 manual meter reads and 20,512 additional inspections to ensure that meters were maintained and functioning efficiently.

Water corporations with rural customers reported that they detected 3,390 potential breaches between 1 July 2021 to 30 June 2022, this is 2,197 more than in the previous year. The increase in the number of potential breaches detected can be attributed to better use of data monitoring and report systems to improve identification of non-compliance. Water corporations also commenced 3,397 investigations and finalised 3,346 investigations (including potential breaches carried forward from the previous year). Unauthorised take continues to be the dominant category of potential breaches at 97%.

Number of potential breaches detected and investigations

Approximately 98% of all potential breaches detected were in the Northern Region of Victoria, which is commensurate with the higher number of water users and licence holders in the region and the high level of activity in the water market every year.

Potential breaches by area

Enforcement actions

Water corporations have a range of enforcement options to pursue. Advisory letters and verbal warnings are usually the first enforcement action taken in response to a breach, followed by a formal warning letter, notice of contravention, reduce, restrict or discontinue water supply, or prosecution. From 1 July 2020, water corporations are able to issue water infringement notices for less serious offences. In 2021–22 there were 18 penalty infringement notices issued. Water corporations may take more than one enforcement action if the water user does not rectify the breach after one enforcement action.

Between 1 July 2021 to 30 June 2022, water corporations took 2,140 enforcement actions against breaches of the Water Act 1989 (Table 1). This is 56% more than the 1,376 enforcement actions taken in the previous year and 19% less than the 2,658 enforcement actions taken between 1 July 2019 and 30 June 2020.

In 2021–22, 76% of the enforcement actions reported by water corporations were verbal warnings, advisory letters or formal warning letters. Similar to the number of potential breaches detected, approximately 98% of all enforcement actions taken were in the northern region of Victoria where there are more water users and licence holders.

Summary of enforcement actions taken between 1 July 2019 to 30 June 2022

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Enforcement actions taken in Northern Victoria and Southern Victoria from 1 July 2021 and 30 June 2022

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Prosecutions

There were 20 prosecutions between 1 July 2021 to 30 June 2022 including 10 cases that were carried over from the previous year.

Summary of prosecutions between 1 July 2021 to 30 June 2022

The following provides more details about prosecutions that were finalised between 1 July 2021 to 30 June 2022 and prosecutions that will be carried forward to the next year.

Prosecutions carried forward into the 2022–23 Financial Year

Priorities for 2022–23

DEECA, together with water corporations, is committed to a zero-tolerance approach to water theft so that there is a level playing field for all water users. We are committed to ensuring that Victoria has a strong and robust compliance and enforcement system, with checks and balances in place that helps maintain – and continues to build – confidence in the market. This year we have three priority area for 2022–23 and three ongoing priorities:

Priority areas for 2022–23

1. Embedding a compliance risk based planning and proactive monitoring approach into regulatory regime
2. Building regulatory capability of staff by providing compliance training and operational procedures for safe, efficient, and consistent work practices
3. Implementing the Water (Infringement) Regulations 2020 ​and the Water and Catchment Legislation Amendment Act 2021 ‘Place of Take’ changes

   Ongoing Priorities  

4. Implementing a consistent zero-tolerance approach to addressing unauthorised take ​
5. Delivering on metering action plans and the Non-urban Water Metering Policy ​including applying telemetry cost benefit analysis where required
6. Regularly and consistently engaging and communicating with the public about water compliance