Melbourne Water is reviewing whether it continues to offer Keilor farmers who own water entitlements discounts on their fees.
Three years ago, the water body introduced a pricing relief scheme that allowed Keilor irrigators to transfer their water allocations, in part or full, for environmental uses.
This meant farmers only had to pay their annual licence fees of $275, rather than $66.30 for every megalitre of their allocations, irrespective of the amount used, in addition to licence fees.
A Melbourne Water spokesman said when the scheme was initiated in 2013, it was agreed that it would be reviewed after three years.
A meeting to review the scheme was held in June.
“The pilot of temporary trading arrangements, which had been in place for the past three years, and the long term future of the water entitlements in Keilor were discussed,” he said. “Melbourne Water advised that if licence holders want to continue to hold the entitlements in the longer term, payment would eventually become necessary, consistent with all other licence holders in the state.”
Fourth generation Keilor farmer David Milburn said the news came as “a bit of a shock”. The former vegetable farmer said landowners in the area have held onto their water allocations because, without them, the value of their land diminished.
“The problem is, the water isn’t available all the time. People aren’t interested in buying it because there’s no guaranteed supply,” he said.
Melbourne Water has held a bulk entitlement on the Maribyrnong River since 2000, which gives it a 9.5 per cent share of inflows into Southern Rural Water’s Rosslynne Reservoir at Gisborne to supply water entitlements to Keilor irrigators. There are currently 44 licence entitlements issued to Keilor landowners on the Maribyrnong River.
Victoria’s 10-year millennium drought, which began in 2000, made farming unsustainable at Keilor. Between 2006 and 2010, there wasn’t any water left to supply farmers, and pumping bans were enacted.
Despite most farmers ceasing operations, most continue to hold their water entitlements.
Melbourne Water has agreed to run the pricing relief scheme again for 2016-17, and will consult further with landowners before a final decision is made.
