EY report below expectations: ADF’s Hoey

EY report failed to meet mark, says ADF's Daryl Hoey


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The contentious Ernst and Young report into environmental upwater fell well below expectations, according to the Australian Dairy Farmers (ADF) Murray-Darling Basin Task Force chair, Katunga producer Daryl Hoey

The contentious Ernst and Young report into environmental upwater fell well below expectations, according to the Australian Dairy Farmers (ADF) Murray-Darling Basin Task Force chair, Katunga producer Daryl Hoey

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Mr Hoey said the report was not the robust socio-economic impact evaluation the states had asked for. “EY admits they didn’t have the data,” Mr Hoey said.

“Its conclusion the 450GL could be recovered on budget and on time is also not evidence-based.”

He said one of the flaws in the report was the price EY had placed on high reliability water.

“It’s been years since high reliability water shares (HRWS) were selling at $1880/ML, which is EY’s price to meet the budget,” Mr Hoey said.

“At best, the report provides a pathway for States and Commonwealth to begin assessing the feasibility and true costs of the measures EY identifies.”

And a Dairy Australia (DA) analysis found EY had acknowledged it was unlikely the HRWS would be as high as it predicted.

The analysis found further off-farm efficiency project costs ran at $4500/megalitre (ML), but could run as high as $8000/ML.

An  analysis of the on-farm projects, proposed by EY, showed the claimed net benefit to the industry of between $70 and $320million was, at best, short term.

“After 10 years, productivity gains are lost because the water savings transferred to the environment are not available for production,” a DA spokeswoman said. “The net benefit assumes an average 16 per cent productivity gain, the feasibility of this assumption is not tested.”

Industries would suffer a net $330 million loss, if the assumed productivity gain was not realised or irrigators were unable to retain their water savings.

The spokeswoman also said EY acknowledged on-farm upgrade programs tended to lead to farmers using more water, not less, and this had the potential to drive up temporary water prices.

FLAWED REPORT: Daryl Hoey, Australian Dairy Farmers (ADF) Murray-Darling Basin Task Force chair, said the report was not a robust socio-economic evaluation.

FLAWED REPORT: Daryl Hoey, Australian Dairy Farmers (ADF) Murray-Darling Basin Task Force chair, said the report was not a robust socio-economic evaluation.

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