UPDATE: NSW will cap the amount of water that can be bought for the environment under the Murray Darling Basin Plan.
Primary Industries Minister Katrina Hodgkinson said there would be a three per cent per valley per decade limit on the amount of water the Commonwealth Government could purchase.
However, Federal Water Minister Tony Burke's office said the Commonwealth was not planning buybacks at a rate higher than 3 per cent during the next three years
Ms Hodgkinson said the Commonwealth Government had ignored the "very real concerns" of NSW Basin communities about the environmental water buyback program and the cap was a "more sustainable rate of purchase."
She said once the limit was reached NSW would not approve or process any more purchases.
“We tried to work collaboratively with the Commonwealth to find strategies that will improve water use efficiency, allow Basin communities to adjust, and make water available for environmental flows, however NSW has been brushed aside," Ms Hodgkinson said.
Ms Hodgkinson said the NSW Government wanted teh focus of water recovery to be on infrastructure, environmental works and measures and strategic purchases rather than open purchase tenders.
“However the Commonwealth has ignored our legitimate concerns, and has expected us to sign up and trust them, which is dangerously short sighted,” Ms Hodgkinson said.
“Once the personalities have moved on, what remains will be in black and white, so it is important that we get this right.” Ms Hodgkinson said the restriction would have no impact on trade for consumptive purposes, licence transfers that are part of an infrastructure project, or temporary trades of allocation water.
“The NSW Government will not stand by and allow the Commonwealth to take the lazy option which removes water from productive purposes in NSW.”
A statement provided by Minister Burke's office said if NSW put forward projects to secure a reasonable share of SDL “offsets” through initiatives such as environmental works and measures, and delivers the expected yield from its infrastructure projects, remaining water purchases to bridge the gap in NSW will be below the rate of 3 per cent of the baseline diversions per decade.
The statement said the Commonwealth was committed to prioritising infrastructure investment to deliver water savings.
"In NSW alone $2 billion of Commonwealth funding has been committed to delivering infrastructure projects.
"When the Commonwealth enters the water market it provides an opportunity for irrigators to sell their entitlements if they choose, generating cash flow which can help them restructure their farm businesses.
"It is unfortunate that the NSW Government is seeking to limit this option and preclude farmers from making their own choices about how to manage their farm assets."
National Irrigators Council chief executive Tom Chesson said the NSW Government’s move was not a surprise and NIC was supportive of a cap on water buybacks.
He said the NIC had secured a commitment from the Leader of the Coalition that in Government it will cap water buybacks at 1500 Gigalitres.
“NIC is concerned that this and other outstanding issues with the proposed Intergovernmental Agreement (IGA) on how the Murray Darling Basin Plan will be implemented and funded will continue to fester until the IGA is signed.
He said originally the IGA and the Basin Plan were meant to be signed off in tandem.
“We would strongly urge all sides ensure that there is adequate funding made available to implement, meter and monitor the Basin Plan,” he said.
Mr Chesson said it made no sense to spend $12 billion of taxpayers’ money recovering water if there is no money left to manage the water.