Peter Gooday, the manager of ABARE's Natural Resource Management Branch, said ABARE modelling suggested that a moderate reduction in water availability could have a relatively modest impact on aggregate income generated from irrigation in the Murray-Darling Basin.

However, this would require some substantial changes in the mix of irrigated activities, with water moving away from lower value activities.

Mr Gooday said that one option available to help alleviate the impacts of reduced access to irrigation water was to continue to remove restrictions that apply to interregional trade in water in the Basin.

Mr Gooday also suggested there May be significant benefits from providing irrigators with the additional flexibility to carry water over from the current season into the following season.

In a critique of the National Plan for Water Security, freelance economist Dr Alistair Watson questioned the rationale to publicly fund infrastructure that provides water savings to private irrigators.

“The cost of saving water through these type of investments will often be far greater than the value of water saved,” he told the conference.

In contrast, Dr Watson said governments had a legitimate role to ensure the provision of environmental water, and he supported the plan"s buyback mechanism for the Commonwealth to purchase irrigation entitlements.

Despite the potential for this buyback mechanism to reduce the costs of acquiring environmental water, Dr Watson warned that the Commonwealth would still need to exercise discipline when purchasing water, identifying how environmental improvements will be achieved and how society values them.

Tom Hatton, Director of CSIRO research flagship Water for a Healthy Country, spoke about the CSIRO Sustainable Yield project. The research suggests that water availability May decline across most of the Murray-Darling Basin, but reductions are likely to be greater in the southern Basin than in the north.