In 1993 the Mallee community identified that there was a growing salinity impact from irrigation in the region. The Mallee Community proposed that the Victorian Government collect salinity impact charges from any new or varied irrigation to fund activities and works to mitigate and offset salinity impacts from irrigation. Two charges were then introduced, a capital charge paid when the licence was issued, and an ongoing charge which was paid each year based on the expected annual water use. These charges were based on the cost to construct, operate and maintain a Salt Interception Scheme, because at the time this was the most efficient way to reduce salt reaching the Murray River.

Since 1993 the salinity impact charges have increased in line with the Consumer Price Index each year, but the basis for the charges has not been reviewed.

In Water for Victoria, the Victorian Government’s Water Strategy, they committed to improving salinity management in the Mallee, including reviewing the salinity impact charges, and a suite of work which would help to inform the review and improve the salinity management framework already in place.

Since 2017 the Department of Environment, Land, Water and Planning (DELWP), the Mallee Catchment Management Authority (Mallee CMA) and Lower Murray Water (LMW) have been working in partnership to investigate, review and implement changes to the salinity management framework.

In 2020, DELWP contracted Frontier Economics to complete the review of salinity impact charges, which considered improved salinity impact modelling of the region, amendments to the Water Act (1989) in 2019 and the changes to salinity risks in the Mallee. The review concluded that:

  • The capital charge should remain at their current level
  • The annual charge should be based upon a works program which delivers programs and activities in the region to mitigate and offset salinity impacts
  • The charges should be reviewed every five years to ensure that the annual charge continues to reflect the actual cost of the program

The Mallee CMA and DELWP have worked together to develop up a five-year works plan to mitigate and offset salinity impacts in the region. The activities proposed are consistent with the Water Act (1989) and the direction of the Mallee Land and Water Management Plan, and will continue to support Victoria to meet their obligations under the Murray-Darling Basin Agreement in the Mallee.

Under the proposed recommendations, the annual salinity impact charge is expected to decrease by 25% of the current rate.

How to be involved

DELWP encourages you to read the fact sheet for further details and let us know what you think of the proposed changes to the salinity impact charges. We have prepared a set of questions below to understand your thoughts on the proposal and help us gather relevant information from you.