Government buys back $430m worth of water for Murray-Darling Basin

$430m Murray-Darling water deal reignites food production, river health debate Thu 18 Jun 2026 at 4:24pm In short: The federal government has spent more than $430 million buying back almost 86 gigalitres of water for the environment under the Murray-Darling Basin Plan. The deal involves a company associated with an Australian superannuation fund selling water entitlements to the Commonwealth. What's next? The purchase has drawn criticism from politicians and farming groups, but environmental advocates say recovering environmental flows is essential to restoring the health of Australia's largest river system. A mega deal to sell water back to the Commonwealth has been announced on a government tender website, reigniting debate over the future of buybacks in the Murray-Darling Basin. The deal involves a company associated with an Australian superannuation fund selling almost 86 gigalitres of water to the federal government for environmental use. The Commonwealth has spent more than $430 million acquiring the water as part of efforts to recover water under the Murray-Darling Basin Plan, taking environmental water recovery to more than 380GL towards its 450GL target. The purchase has drawn criticism from politicians and farming groups who argue productive water is being removed from agriculture, while environmental advocates say the recovery is essential to restoring the health of Australia's largest river system. One Nation warns of food production impacts One Nation Member for Farrer David Farley said the purchase of almost 86GL of water from major institutional investor State Street Australia Ltd would have an immediate impact on food production, irrigated farming and supermarket prices. He said the water had previously been leased into agricultural production each year through Brisbane-based Argyle Fund on behalf of Aware Super. "What's been reported today is a massive $430 million water buyback out of the heart of the food bowl of Australia," Mr Farley said. "It's an enormous amount of water, circa 86 gigalitres of water. "It will have an immediate impact on production. It will have an immediate impact on spring planting and irrigation intentions and ultimately it's going to have a flow-on effect straight into the supermarkets of Australia. "All that water that's been sold today is out of the food production chain completely. "So it's a massive, massive hit to the heart of the food bowl of Australia, where 40 per cent of Australia's food comes from." Rather than criticising the seller, Mr Farley questioned why the federal government had purchased the water before reviews of the 2007 Water Act, the 10-year Murray-Darling Basin Plan review and a national food security strategy had been completed. "I can't express to you the gravity of this," he said. "It is not only on agriculture, it is on regional communities, it is on food processing and it's ultimately into the supermarkets in food pricing." Coalition says communities will pay the price Shadow Minister for Water and federal Riverina MP Michael McCormack said further water buybacks under the Murray-Darling Basin Plan were damaging communities reliant on irrigation and reducing food production capacity. Mr McCormack said the impacts extended well beyond farming businesses. "It's not just the farmers," he said. "It's the baristas, it's the motor mechanics, it's the hairdressers, it's the schools." He said the latest purchase reinforced a trend of buybacks being concentrated in southern New South Wales and northern Victoria, where much of Australia's irrigated food was produced. "Food security equals water security equals national security," he said. Government says Basin Plan is on track Environment Minister Murray Watt said the government was on track to recover almost 400 gigalitres of water for the environment by the end of the year, bringing the Basin Plan close to its 450GL target. He claimed more than 380GL had already been recovered via water-efficiency infrastructure projects and voluntary water purchases, with a further 20GL expected from willing sellers. "We remain on track to reach 400GL by December, and it's good to see this process nearing the finish line," Mr Watt said. He said the government was taking a balanced approach by combining infrastructure investment, voluntary water purchases and community adjustment assistance. While acknowledging buybacks could affect some regional communities, he said a $300 million Sustainable Communities Program would help Basin towns diversify their economies and build resilience for a future with less water. Farming group opposes further buybacks National Farmers' Federation water committee chair Malcolm Holm, who farms near Blighty in the southern Riverina, said the organisation remained firmly opposed to further water buybacks. He described the additional 450 gigalitres as "a choice, not an environmental necessity". "More buybacks and water acquisition in any form are not the answer," Mr Holm said. He argued the government should instead invest in practical measures such as carp control, repairing river infrastructure and improving fish passage. "This must be the end of buybacks," Mr Holm said. "The focus now must be on environmental, economic and social outcomes, not simply chasing another litre of water." Conservation alliance backs water recovery The Murray-Darling Conservation Alliance welcomed progress towards reaching the environmental water target. Co-national director Craig Wilkins said the commitments were "the bare bones of what is needed to save our rivers and to prevent species like the Murray cod from going extinct". He said voluntary purchases from willing sellers were "by far the most cost-effective way" to recover environmental water. "The river desperately needs more water flows because the Murray-Darling Basin can't keep producing food and fibre unless the river itself flows and is healthy," Mr Wilkins said. "We can't have food security without water security."