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Assessment of the socio-economic impacts of Murray River blue-green algae blooms Stage One NSW Office of Water

8 September 2010

Liability limited by a scheme approved under Professional Standards Legislation

8 September 2010

Restrictions on the report use

This public report was prepared at the request of the NSW Office of Water solely for the purposes of assisting the NSW Office of Water to assess the socio-economic impact of blue-green algae blooms on regional communities and industries along the Murray River, and is not appropriate for use for other purposes.

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We accept no liability for any loss or damage which may result from your reliance on any research, analyses or information so supplied. The attached report provides the outcomes of our preliminary analysis.

NSW Office of Water Assessment of the socio-economic impacts of Murray River blue-green algae blooms Ernst & Young i

Contents

1. Introduction........................................................................................................ 1

2. Impacts of Algal Blooms ...................................................................................... 6

3. The Murray River region .................................................................................... 26

4. Major industry sectors in the Murray River region .............................................. 46

5. Stage 2 data collection and analysis methodology .............................................. 63

6. Conclusions and next steps ............................................................................... 78

Appendix A Reference list .................................................................................... 80

Appendix B RACC Press Release .......................................................................... 82

© 2010 Ernst & Young Australia.

Liability limited by a scheme approved under Professional Standards Legislation.

NSW Office of Water Assessment of the socio-economic impacts of Murray River blue-green algae blooms Ernst & Young 1

1. Introduction

1.1 Background The Murray River is Australia’s longest river and an iconic natural attraction that stretches over 2,500 km across New South Wales (‘NSW’), Victoria and South Australia. The Murray River region supports a wide range of communities and economic activities across the three states and is home to a number of key ecological sites, agricultural industries and some key attractions and activities along the river including house boating, paddle boats, water sports, fishing and golfing. In 2008, there were some 2.8 million day and 3.9 million overnight visits to the Murray River region, generating direct expenditure of $1.4 billion to the region1.

A map of the Murray River is shown in Figure 1 below.

Figure 1: Map of the Murray River

Source: www.murrayriver.com.au

In 2009 and 2010 major blue-green algal blooms occurred along the Murray River and tributaries. These blooms impacted on water use from Lake Hume to Mildura Weir. Management of algal bloom impacts and investments to reduce algal blooms are a significant cost for government and the community.

1.2 Scope of work We understand that the overall objective of the consultancy is to assess the socio-economic impacts of these blue-green algal blooms on regional communities along the Murray River. As per the project brief, NSW Office of Water (‘the Office’) seeks to undertake this project in two stages:

► Stage 1 of the project involves the identification and high level assessment of the social and economic impacts of the 2009-2010 Murray River blue-green algal blooms on regional communities and industries along the Murray River in NSW and Victoria

1 Tourism Research Australia, Destination Survey Results http://www.ret.gov.au/tourism/Documents/tra/Destination%20Visitor%20Survey/DVS_Murray_River_region.pdf

http://www.murrayriver.com.au

http://www.ret.gov.au/tourism/Documents/tra/Destination%20Visitor%20Survey/DVS_Murray_River_region.pdf


based on media and literature research. Stage 1 also involves development of the data collection methodology and draft survey design for Stage 2 to ensure coverage of all significant Murray River water users in the NSW and Victoria regions.

► Stage 2 of the project involves undertaking a more detailed socio-economic impact assessment of the 2009-10 Murray River algal blooms.

This report provides our findings for Stage 1 of the project only. Specifically, the scope for Stage 1 of the project, as stipulated in the consultancy brief, included:

► Literature and media review;

► Profile of major impact sectors in the Murray River region;

► Assessment of the geographical distribution of socio-economic impacts and confirmation of Stage 2 study boundaries; and

► Establishment of the data collection methodology and draft survey design for Stage 2.

Ernst & Young understands that the information presented in this report will be used to guide and be used as input into Stage 2, should it proceed.

1.3 The Murray River region There is no formal statistical definition of the Murray River region that satisfactorily encompasses the economic centres along the full length of the river and across the three state jurisdictions that it impacts upon. For the purposes of this study, the Murray River region is defined as comprising the area occupied by those Local Government Areas (LGAs) that immediately surround the Murray River. These LGAs are presented in Table 1.2

Table 1: Local Government Areas belonging to the “Murray River region”

New South Wales (NSW) Victoria (Vic) South Australia (SA)

► Wentworth ► Balranald ► Wakool ► Murray ► Berrigan ► Corowa ► Albury ► Greater Hume

► Mildura ► Swan Hill ► Gannawarra ► Campaspe ► Moira ► Indigo ► Wodonga ► Towong

► Karoonda East Murray ► Mid Murray ► Murray Bridge ► Southern Mallee ► Unicorp. Murray Mallee ► Berri Barmera ► Loxton Waikerie ► Renmark Paringa ► Unicorp. Riverland ► The Coorong ► Alexandrina

The focus of this study is on the impacts on the NSW and Victorian LGAs along the Murray River. We have not considered South Australia (SA) in this study, however through our stakeholder consultation it was apparent that downstream users and consumers of water in SA are also impacted by blue-green algae blooms.

A map of the broad Murray River region, as adopted for this project, is presented in Figure 2.

2 We note that this definition does not exactly concord with the Australian Bureau of Statistics’ “Murray Statistical Division” for New South Wales.


Figure 2: The Murray River region

Source: Regional Profile 2010 – Murray Now

1.4 Blue-Green Algae and the Murray River 1.4.1 Blue-Green Algae Blue-green algae is a type of bacteria known as Cyanobacteria, which uses light to produce oxygen and to grow. The two most common types of blue-green algae in the Murray River are Anabaena and Microcystis.

Blue-green algae in small amounts are a natural part of the freshwater environment. However, if conditions are favourable, they reproduce at very high rates to form “blooms”, which are essentially explosions in blue-green algae growth that dominate the aquatic environment, forming unpleasant and sometimes toxic scums. Blue-green algae outbreaks on the Murray River impact not only on the Murray River ecology, but also more broadly on the industries that rely on the Murray River water in the broader Murray River region.3

1.4.2 Causes of blue-green algae blooms A series of favourable environmental factors need to develop before blue-green algae will bloom. Those factors interact with each other in a complex way and it is therefore not possible to blame algal blooms on any single one of them. The factors which interact to favour the extensive growth of blue-green algae include:

► Stable water columns – for blue-green algae to bloom the water body needs to have little or no flow, calm weather with little or no wind and hot sunny days. These factors allow the water column to stratify, which is where a layer of warm surface water remains unmixed with the cooler, deeper water below it. Stratification can also result from differing densities through the water column, where saltier, denser water at the bottom remains unmixed with the fresher surface water above;

► Sunlight – the water body needs to receive plenty of sunlight, with clear sunny days and low turbidity to allow the light to penetrate into the water; and

3MDBA Blue Green Algae Fact Sheet http://www.mdba.gov.au/water/blue-green-algae

http://www.mdba.gov.au/water/blue-green-algae


► Nutrients – Blue-green algae require nutrients for growth, with blooms more likely to occur when high concentrations of phosphorus and nitrogen are present in the water. Both total phosphorus and total nitrogen concentrations within the water of the Murray River are usually sufficient to promote the excess growth of blue-green algae at times when other environmental factors are also favourable. Some species of blue-green algae can also convert elemental nitrogen into compounds necessary for their growth, thus reducing their reliance on nitrogenous nutrients dissolved within the water.

If these factors all combine together and then persist for a few days, blue-green algae cells will accumulate in the surface layer of the water source and, if the conditions persist for a number of days, can multiply to dramatic numbers and create a bloom. Blooms exist for as long as the favourable conditions remain in place.4

For more detailed information on the Murray River blooms refer to the Murray River Algal Bloom Evaluation and recommendation for future management of Major outbreaks (NSW Office of Water, 2009).

1.4.3 Problems Associated with Blue-Green Algae When blooms of blue-green algae occur, they interfere with uses and users of the water and can affect human health and have far-reaching consequences for the environment and the economy. Algal blooms affect water quality by causing undesirable tastes and odours, discolouration and unsightly scums. Blue-green algae can be toxic, with some species producing toxins that cause liver damage, stomach upsets and disorders of the nervous system in humans. Contact with high concentrations of blue-green algae can cause skin and eye irritations. Although no human deaths have been attributed to blue-green algal toxins in Australia, stock deaths have been documented and there is evidence of poisoning of wildlife and domestic pets. Long-term exposure to humans may include tumour / cancer promotion and increased risk of various neurodegenerative diseases, including motor-neuron disease and Alzheimer’s dementia.

As the bloom subsides, the dead and decaying algae can reduce the oxygen levels in the water, causing stress or death to other aquatic organisms, such as fish. During periods of drought, aquatic ecosystems can be severely degraded by algal blooms.

Community water supplies can be disrupted when filters and equipment are blocked and additional treatment (using activated carbon) is required to remove any dissolved toxins that are produced by some blue-green algae. Blue-green algae blooms can also prevent water-based leisure activities such as fishing, water skiing and swimming, potentially adversely affecting recreation and tourism.5

1.4.4 Management of Blue-Green Algae on the Murray River NSW and Victoria all have monitoring arrangements to detect and measure blue-green algae, and comprehensive emergency plans for dealing with algal blooms. They also have detailed arrangements for alerting the public of health risks, and the water supply authorities have advanced treatment techniques to remove dissolved toxins. The management of individual algal blooms is best undertaken at a local level, as the most effective approaches differ according to each bloom and each location. Along the Murray River there are Regional Algal Coordinating Committees (‘RACCs’) covering the Albury to Tooleybuc area (the Murray RACC) and the Tooleybuc to the South Australian border area (the Sunraysia RACC). The RACCs include all the relevant managing authorities and keep South Australia informed as well. Within South Australia, the management of algal blooms along the River Murray is similarly coordinated between the supply, management and health authorities.

4 MDBA Blue Green Algae Fact Sheet http://www.mdba.gov.au/water/blue-green-algae and consultation with The Office 5 ibid



Once a blue-green algal bloom occurs, very little can be done to stop it. Frequent testing of toxicity will help inform water use decisions and identify if alternative water supplies are required for stock and domestic uses. Drinking water supplies undergo additional treatment, using activated carbon to remove dissolved toxins and make the water safe for consumption. Flushing the water body with higher flows can disperse blooms and break up stratification; however during drought the option of flushing is not always available. Public alerts are issued to ensure all water users are aware of the problem and avoid direct contact with the water. These alerts are in the form of media statements and direct notifications to user groups, including the use of signage at affected locations.6

1.5 Structure of the report The remainder of this report is structured as follows:

► Chapter 2 provides a literature and media review, as well as outcomes of the stakeholder consultation, relating to the impacts of blue-green algal blooms;

► Chapter 3 outlines the geographic distribution and socio-economic assessment of the Murray River region;

► Chapter 4 summarises the major industry sectors in the Murray River region, including those most impacted by blue-green algae outbreaks and an estimate of the likely costs to these industries of blue-green algae blooms;

► Chapter 5 details the data collection methodology and draft survey design for Stage 2;

► Chapter 6 outlines conclusions and next steps;

► Appendix A provides a list of references; and

► Appendix B provides an example of a Regional Algal Coordinating Committee (‘RACC’) press release relating to blue-green algae blooms.

6 ibid


2. Impacts of Algal Blooms

The key themes from the stakeholder consultation were:

► Tourism is impacted by blue-green algae blooms, although the extent of this impact is not known. Tourism includes:

► Camping / caravan parks and other accommodation;

► Waterskiing, sailing and other recreational boating;

► Recreational fishing;

► Cafes and restaurants;

► General retail trade;

► Golf courses; and

► Wineries.

► Livestock that drink water from the Murray River are impacted (health issues and/or death). This impacts most significantly on properties with livestock which are on the Murray River, however, may also be create problems for livestock watering and irrigated agriculture from water diverted from the rivers by channels (e.g. Mulwala Main Canal). In addition, there is the natural distributary system (Gulpa Creek, Edward River) where water already impacted by blooms from the Murray flows; and

► Little impact on other industry is realised, apart from the investment in contingency filtration (e.g. powder-activated carbon) and testing which, based on consultation with local councils, does not come at a significant cost. Furthermore, there are a number of industries in the region who are not impacted at all given that they do not require high quality, raw Murray River water to perform their operations.

2.1 Literature review In order to determine if any relevant previous research had been undertaken on the impacts of blue-green algae blooms, a literature review of Australian and international publications was undertaken. The publications were sourced from:

► NSW Office of Water (‘the Office’);

► Murray Darling Basin Authority; and

► Internet search engines and research data base resources.

A summary of the publications of relevance sourced, and the degree of relevance, is provided in Table 2.

Table 2: A summary articles included in this literature review

Article Source Relevance Implications on assessing algae outbreaks on the Murray River

Costs of Algae Blooms

Murray-Darling Basin Commission

High ► The real costs of algae blooms on water extraction for: ► Extractive; and ► Non-extractive users.

► How can the Office assist with implementing long-term measures to address algae outbreaks?

The economic value of improved environmental

Australian Journal of Environmental

High ► Will the increase of the ‘willingness to pay’ by users to increase environmental attributes reduce the occurrence of algae blooms?


Article Source Relevance Implications on assessing algae outbreaks on the Murray River

health in Victorian Rivers

Management (Vol. 15)

► Can the results of the survey in a sample area provide a general picture of the willingness to pay for users of the whole Murray River region?

Destination Visitor Survey – Murray River Region

Department of Resources, Energy and Tourism

High ► The ongoing drought in the Murray River region reduces the regions appeal as a tourism destination. To what extent will the reduced water flow and increasing occurrences of algae blooms drive down tourism visitors, and tourism expenditure?

Value of Returns to Land and Water and Costs of Degradation: Estimating non-market values

CSIRO Land and Water

High ► Were blue-green algae blooms explicitly considered in the valuation of waterway health? If not, how much would it likely increase the willingness-to-pay value for waterway health?

A preliminary consideration of use and non-use values circumscribing the Lake Hume Water and Foreshore Management Plan

Lin Crase and Rob Gillespie

High ► Can the consumer surplus of this study of tourism spending be applied to other areas along the Murray River where community rely heavily on tourism?

► This study did not provide any finding into the financial implications on extractory users. The effects of algae and reduced water supply need to be addressed by policy makers.

A brief history of the development of rivers for irrigation in the Murray-darling Basin and the environmental consequences today

Stuart Blanch at the Mekong Dialogue Workshop 2002, via Google Scholar

High ► The Murray River generates $22 billion per year of agricultural products. What effect will the governments buy back of water licences have on the Australian agricultural economy? Furthermore, will the reduction of water licensees allow the necessary flows to significantly reduce the occurrence and severity of algae outbreaks?

The Murray River: evaluation and recommendations for the future management of major outbreaks

The NSW Office of Water

High ► How can the Office and other state agencies work effectively to reduce the lag time of data being collected to being analysed?

Water for a healthy Country – valuing recreation in the Murray

Australian Bureau of Agriculture and Resource Economics (formerly of CSIRO Land and Water)

High ► This report summarises the results of a survey, which found the non-market recreational trip value per adult visiting the two sample areas were approximately $500.

► What effect would the increase and severity of algae blooms on the Murray have on this value?

► What would the visitor be prepared to pay for an increase in environmental attributes, and therefore a reduction in algae blooms occurrences?

Estimated annual economic impacts of harmful algal blooms in the United States

Woods Hole Oceanographic Institute

Medium ► The estimated cost of algal blooms is US$49 million (2000 dollars), with public health accounting for the majority of costs, followed by commercial fishing. It can be concluded that this estimate is conservative at best, ranging from between US$34 to US$82 million per year (2000 dollars).

► Significant events where severe outbreaks occur can come at a cost in excess of millions, if not billions of dollars.

The impact of harmful algal blooms on USACE operations

The United States Army Engineers Research and Development Center

Medium ► A conservative estimate places the economic and financial impacts of harmful algae blooms in excess US1 billion (2009 dollars) in the United States over the past decade, average around $US82 per year.

► The prevalence of outbreaks are increasing, requiring authorities to devote more time and resources to address the issue. Are multi-government agencies in Australia readily equipped to deal with the short to long term effects of algae outbreaks?

These articles are discussed in more detail in Sections 2.1.1 to Section 2.1.9 below.


Australian Publications 2.1.1 Costs of algal blooms – Murray-Darling Basin Commission (2000)

The purpose of this report was to identify the principal water users affected by freshwater algal blooms in the Murray Darling Basin, quantify the direct and indirect costs associated with algal blooms on these water users and identify opportunities where data can be collected more effectively, with a particular focus on the Murray River.

Principal water uses that are adversely affected by algal blooms

There is a clear distinction between extractive and non-extractive uses of fresh water. Extractive uses are defined as drinking water, water for commercial and industrial enterprises, and water for aquaculture, stock watering and irrigation of pastures and crops. Non-extractive uses include the recreational use of water bodies by residents and tourists (swimming, boating etc), amenity use (riverside walks), recreational fishing and non-use values (natural state of the flora and fauna).

Order of magnitude estimate of the total costs currently incurred

There is a difficulty in assessing and measuring many of the significant costs that are incurred, particularly damage to non-use values and others costs incurred by non-extractive users. In addition, there are short, medium and long term measures to assess the response to algal bloom occurrences.

► Short-term include:

► Import drinking water;

► Erect warning signs;

► Treat farm dams with algaecide;

► Medium-term measures include:

► Develop groundwater resources;

► Improve water treatment;

► Relocate production; and

► Long term measures include:

► Restore river flows;

► Establish effluent reuse schemes; and

► Rehabilitate riparian land.

The current situation in Australia is that there are many short to medium term measures that have been implemented but there is still a long way to go in respect of longer-term investments in environmental protection. We should expect the total costs of algal blooms to fall significantly over time as the longer-term measures are adopted. For example:

► The costs of water treatment will fall as raw water sources improve;

► Tourists will return to preferred recreational sites; and

► Non-use values will be restored as the incidence of algal blooms decline.

The benefits of future investment protection measures take the form of reduction in costs that are currently being incurred, therefore, cost estimation can take place in a two stage process.


Firstly, the estimated costs of the planned environmental protection measures that can be attributed to algal blooms. The following financial tally is an annual estimate ($AUD in year 2000) of the costs associated with algal blooms for planned environmental protection:

► Additional costs for sewage and stormwater management - $43 million per year;

► Additional costs of agriculture and industrial wastewater management - $33 million per year; and

► Additional costs of rehabilitating land and water resources - $45 million per year.

Elements of these measures have already been implemented and have already delivered some benefit. However, for the most part, these expenditures lie in the future or have yet to deliver substantial benefits.

The second stage is to allow for the fact that the costs currently incurred are necessarily much larger than the anticipated costs of environment protection. Typically, there is no investment in environmental protection unless there is a prospect of reducing costs that are currently incurred. Furthermore, since the anticipated investments in environmental protection will not eliminate algal blooms, some of the costs that are currently incurred will still remain when those measures have been implemented.

The total cost of algal blooms can be reasonably put at twice the anticipated costs of environment protection, with a multiplier put at a very conservative 1.5. Having estimated the anticipated costs of environmental protection of $120 million per year, the current total cost of algal blooms is therefore estimated at between $180 and $240 million per year. This is illustrated in Table 3 below.

There are two reasons to expect the current cost of algae blooms exceeds $120 million. First, the anticipated investments in environmental protection will generate net benefits in the form of reduced incidence and cost of blooms. Secondly, whatever environmental protection activities are actually undertaken, they will not totally eliminate algal blooms, with both extractive and non-extractive users continuing to bear costs that cannot be fully reversed.

Table 3: Estimated costs of algal blooms

Type of cost - $/millions (in 2000 dollars)

Joint management costs $9 Rural Water suppliers Stock and domestic water from farm dams Stock and domestic water from rivers etc Irrigation water supply Cost stock, domestic and irrigation Total Costs to extraction users

$30 $15 $15

$35 $60

$95 Costs to non-extractive users $76-$136 Total $180 - $240

2.1.2 The economic value of improved environmental health in Victorian rivers : J Bennett et al - Australian Journal of Environmental Management – Vol. 15 (2008)

The quantification of benefits associated with improvements in the health of Victorian rivers arising from policy initiatives and projects enables the use of cost-benefit analysis to assess the viability of investment options. The non-market valuation technique known as choice modelling was used to generate benefit estimates, with monetary values estimated against four attributes of environmental improvements:

► The percentage of pre-settlement fish species and populations;

► The percentage of river length with healthy vegetation on both banks;


► The number of native wildlife with sustainable populations; and

► The percentage of river suitable for recreation without threat to public health.

The outbreak and spread of blue-green algal blooms threatens the four categories above, and therefore threatens the environmental health of Victorian Rivers.

At the time of publication, 32% of Victorian Rivers were of ‘poor to very poor’ condition, while only 21% were in a ‘good to excellent’ category.

Choice modelling was used to estimate the benefits associated with the improvements in environmental health of rivers in the selected areas of Goulburn, Broken and Corangamite catchments to define a set of river health attributes outcomes of management activities and to establish communities’ value of these attributes.

The Survey

In November 2005, a survey was undertaken to assess the public’s estimation of the monetary value they would place on certain criteria of river health attributes. Six samples of 1,000 respondents were drawn at random on the basis of address postcodes for the geographical location required. Three sub-samples were drawn from the Melbourne population, two from the Gellibrand catchment area, and one from the Moorabool catchment area. Each sample area was randomly split five ways for distribution of the five versions of each questionnaire.

Of the 6,000 surveys distributed, the response rate was 17% and 20% for the survey and sub-sample questionnaire, respectively. It is possible to conclude that only those with a real interest in river management responded to the survey. As 17% of the sample population responded to the survey, the remaining 83% were assumed to hold zero willingness to pay for improvements in river health.

Implicit prices

Implicit prices are defined as the amount, on average, that the respondents are willing to pay (per household) to enjoy an increase of one unit in a river health attribute. Table 4 outlines the implicit prices for each category at each survey location.

Table 4: Implicit prices (year 2004 $AUD)

Moorabool/ in-catchment

Moorabool/ Melbourne

Gellibrand/ in-catchment

Goulburn / Hellibrand

Goulburn/ in-catchment

Goulburn/ Melbourne

Fish $4.95* $5.34* $2.19* $5.56* $4.39* $4.47* Vegetation $5.56* $5.33* $2.91* $4.65* $3.56* $5.53* Wildlife $22.07* $18.19* $17.33* $3.04* $3.90* $3.35* Water quality $0.09 $0.34 -$0.05 -$0.59 $2.12* $1.64* * Significant at the 5% level. Differences may arise due to rounding.

Survey results

Interestingly, only the in-catchment and Melbourne respondents are willing to pay for improvements in water quality in the Goulburn River. Both these sub-samples were willing to pay approximately $2 for a 1% increase of primary recreation.

Fish health was consistently valued by respondents at between $2 and $5 for a 1% increase in species and population levels.

Willingness to pay for improvements in riverside vegetation ranged between $3 and $6 per 1% of improvements.

Moorabool in-catchment respondents were willing to pay over $20 for each additional native species of waterbird or other native animal that can be re-introduced into the riverine area. In contrast, the marginal valued expressed by Gellibrand catchment was around $3.


Household values can be estimated for in-catchment residents, rural out-of catchment residents and Melbourne residents. Substituting these implicit price estimates into a value equation with a multiplier results in the following (year 2004 $AUD):

► Value/household (in catchment) - $32.97;

► Value/household (rural out-of catchment) - $40.14; and

► Value/household (Melbourne) - $36.76.

The next step in the estimation involves the extrapolation of the per household values to the relevant population. Using ABS data and assuming 2.2 people per household yields household estimates of 2.2 million household (1.6 million in Melbourne and 0.6 million in regional Victoria). The in-catchment population for the river of interest at 50,000 households, the out of catchment regional household number is 550,000. Therefore, the extrapolated value for in catchment areas is $329,700, with a regional out-of catchment value of $3,311,500 and a Melbourne value of $8,882,400.

In total across the state of the environmental health improvements generated by say a proposed riparian zone fencing project costing $12,500,000, the logic of cost-benefit analysis suggests that if the costs of fencing is less than $12,500,000, then the project should be undertaken.

Conclusions

River management presents decision makers with a set of trade-offs between competing uses. For example decision makers should be aware of the biodiversity and environmental health of a river against various river management strategies, such as permitting water extractions or excluding stock from river banks.

Information on the values that the community holds for the predicted outcomes of the alternative management strategies is important. These benefited values are to be enjoyed by the community through, for example, the extraction of water from the river for agricultural or domestic purposes and the benefits of improving the condition of the river achieved by restoring water flows or investing in land management options. This information is only useful if it can be assessed. Estimating values associated with extraction values are comparatively straightforward because there are goods and services that are sold and traded as a result. However, estimating the values of the improved environmental outcomes is more difficult because the goods and services are not marketed.

Estimates of the respondents’ willingness to pay for improved numbers of native fish species, length of river with healthy native vegetation, and the number of native waterbirds and other animals proved to be significant from zero, showing that people do value the environmental conditions of rivers. Location of respondents did not affect their values; although, it is clear that differences in respondents’ income, age, and education do influences their preference for river condition attributes.

The value estimates derived in this study will be useful not only in assessments of river management strategies in the Goulburn, Gellibrand and Moorabool Rivers, but, with due care; will also be useful as indicators of values arising in similar river systems in Victoria and throughout Australia. The omission of these values can lead to serious under-estimation of the returns to investment in the river.

2.1.3 Destination Visitor Survey: Murray River region – Department of Resources, Energy and Tourism (2010)

The Murray River region of NSW, Victoria and South Australia has long been a popular regional tourism destination. In 2008, there were 3.9 million day visitors and 2.8 million overnight visitors to the region, generating direct expenditure of $1.41 billion (year 2008 $AUD). The Murray River region represents a sizable tourism destination in South Australia,


capturing 17% of total regional tourism, where in Victoria and NSW, it represents 12% and 3% respectably,

The ongoing drought in Australia has had the following effects on tourism behaviour throughout the Murray River Region (year 2008 $AUD):

► Overnight visits between 1999-2008 have declined on average 1.3% per annum;

► Around 20% of survey respondents indicated the drought has affected their tourism patterns, with 9% returning less, 5% reducing their stay, 5 % reducing expenditures and 2% not returning;

► Economic modelling carried out for the study resulted in a direct fall in tourism expenditure of $69.9 million in 2008, while over the course of the drought it has been estimated that there has been a reduction in expenditure of $351.4 million;

► If the drought had not occurred, tourism expenditures would be 5.1% higher in 2008;

► Gross Regional Product (‘GRP’) is $91.4 million lower in 2008 relative to a hypothetical ‘no drought’ scenario; and

► Between 1999/2008, the total reduction in GRP is estimated to be $461 million, or 596 fewer FTEs in the region. Forecasts anticipate this reduction to increase to $1.5 billion of GRP in the period 2009-2018, or 1,919 fewer FTE in the Murray River region.

It is likely that blue-green algal blooms will negatively impact these visitor numbers.

2.1.4 Value of Returns to Land and Water and Costs of Degradation: Estimating non-market values – CSIRO Land and Water (2002)

This study aimed to estimate the non-market values associated with possible changes to the way Australia’s land and water resources are used. The technique used to estimate these values was Choice Modelling, a ‘stated preference’ method, by which a sample of people are asked to make choices between alternative future resource management options. Through a series of workshops, the environmental and social attributes found to be most important to people in selecting between potential resource management options were:

► The number of species protected – the number of native species protected from extinction;

► Land aesthetics – the area of farmland repaired or bushland protected (ha);

► Waterway health – the length of waterways restored for fishing or swimming (km); and

► Social impact – the net loss of people from country towns each year.

The results of the national questionnaire demonstrated that respondent households, drawn from the national population, value improvements in each of the environmental attributes and perceive rural depopulations as a cost. The following attribute prices were estimated (year 2002 dollars):

► 68 cents per household each year for every additional species protected;

► 7 cents per household each year for every additional 10,000 ha of bushland protected or farmland restored;


► 8 cents per household each year for every additional 10 km of waterway restored for fishing or swimming; and

► Negative 9 cents per household each year for every 10 persons leaving country communities.

The choice modelling allows the estimation of aggregate values for an array of potential policy options. For instance, a 20-year national program involving:

► the protection of an additional 50 species;

► improving 2 million hectares (‘ha’) of bushland or farmland;

► restoring 1,500 kilometres (‘km’) of waterways; and

► the loss of an additional 5,000 people per year from rural areas.

This produces an aggregated welfare benefit of $3.1 to $6.3 billion (2002 dollars) in present value terms, or a best-bet value of $4.6 billion. However, if the same environmental improvements could be achieved while reversing the decline in rural communities by 10,000 people per year, the best estimate increases to $6.7 billion.

Table 5 outlines a summary of implicit prices calculated in the study. It found that people were willing to pay a monetary value for each of the four categories for a stated level of improvement.

Table 5: National estimated used to calculate implicit prices to value each attributes

Attribute National implicit prices (including scaling)

Species protection $1.36 Per species Land Aesthetics $1.40 per 10,000 ha Waterway Health $1.60 per 10 kms Social Impact -$0.54 per 10 persons leaving rural area

Based on the assumption that the NSW population is 4 million and the number of persons per household is 2.5 (2002 statistics), the aggregation factor of 45% was applied. Therefore the best estimate of annual value would be $21.44 million per annum for 20 years (2002 dollars).

It is likely to assume the associated costs of algae blooms would increase the overall costs in the 4 attribute categories. However, with the increase in the willingness to pay for these 4 attributes, there may be a decrease in the occurrence and severity of algae outbreaks.

2.1.5 A preliminary consideration of use and non-use values circumscribing the Lake Hume Water and Foreshore Management Plan: Lin Crase and Rob Gillespie (2006)

Australian policy makers have raised significant concern over the past decade about the excessive extraction of water for productive pursuits and the consequent deterioration in the quantity and quality of the resource available for other users. The National Water Initiative has a strong focus on allocating additional water to achieve environmental amenity.

Lake Hume is located upstream of Albury and is the major regulating structure on the Murray River. Constructed as a dam in 1919, with new storage capacity increased in 1924 and 1961, Lake Hume now has a capacity of 3,038 gigalitres (‘gL’). The dam typically fills in winter and spring with the average inflows being approximately equal to storage capacity. The lake is heavily used by recreational users (non-users), who provide a consumer surplus to the region by spending money on tourism activities. The lake also ensures constant water supply to the Murray River system with its outflows. Table 6 estimates the consumer surplus


by non-users on Lake Hume when the lake is at full capacity, at 50% and 10% capacity and when there is an outbreak of algae.

Table 6: Consumer surplus estimates

Scenario Annual consumer surplus Consumer surplus per visit

Base $3,304,254 $33 50% $2,042,103 $20 10% $1,638,803 $16 Algal alert $1,993,998 $20

The modelling data points to recreational values of about $3 million per annum when the lake is near capacity. The diminution of water levels reduces the consumer surplus benefit by one third and half, when storage falls to 50% and 10% respectably. In times of algal alerts, the consumer surplus diminished by a third.

2.1.6 A brief history of the development of rivers for irrigation in the Murray-Darling Basin and the environmental consequences today – Stuart Blanch (2000)

The Murray-Darling Basin is Australia’s primary food and fibre growing region. Water extraction from the Basin’s rivers generates around AUD$22 billion annually from industry and agriculture, and supports three quarters of Australia’s irrigation, much of which comes from the Murray River region. Two million people live in the region and another 1.5 million rely upon its waters outside the basin. Many of the former uses of the rivers and wetlands have been reduced or lost. Graziers who relied upon the frequent flooding have seen their livelihood affected resulting in a loss of economic, social and the cultural goods that were once supplied. Salinity levels in the lower basin have increased and the occurrence of drought has increased affecting the flows in low lying areas.

It is estimated that the financial costs of rehabilitating the Basin’s rivers and wetlands are in the billions of dollars. The cost of simply purchasing enough water from the irrigators to return to the river flows to previous levels exceeds approximately AUD$3-4 billion.

The management and importance of the long-term environmental protection of the Murray-Darling basin rivers came into the national spotlight in 1991, when an outbreak on the Murray River affected extractive users and recreational users alike. Blue-green algae prevented people who live on the river using the water for a number of weeks. The bloom was linked to pollution and excessive regulation of river flows from irrigators. In 2009, the importance of river management came into the national headlines as another algal bloom affected a 1,000 kilometre stretch of the river for 4 weeks.

The Murray-Darling Basin was largely developed in ignorance. Many of the decisions about damming the river and encouragement of irrigated agriculture were made when there was insufficient information regarding the potential impacts on the river health and people who use rivers for other purposes. Although the economic prosperity of the river generates tens of billions of dollars to the Australian economy annually, the costs – economic, environmental and social have been and will continue to be enormous. River wetland health has declined greatly and the future generations face a repair bill of many billions of dollars. Even then, many rivers and wetlands will continue to suffer from moderate to severe degradation.


2.1.7 The Murray River Algal Bloom: evaluation and recommendations for the future management of major outbreaks – NSW Office of Water (2009)

The Office, and its predecessors, have managed and coordinated a whole of government response to the occurrence of blue-green algal blooms in the State’s rivers and storages. The establishment of the NSW Algal Management Strategy in 1992 by the Blue-Green Algal Task Force was a direct result of the blue-green algal bloom in the Darling River system of 1991. This five year strategy included nine inter-agency Regional Algal Coordinating Committees, nutrient control programs, education programs and the stock and domestic bore subsidy. Since that time, the NSW Government, through the Office, has continued to provide the framework for the coordinated regional risk management response of algal blooms through the nine Regional Algal Coordinating Committees (‘RACC’).

In March 2009 a blue-green algal bloom was detected in Lake Hume, and in addition some 100kms downstream. Further algal blooms were detected including Gulpa Creek, Edward and Wakool Rivers. Lake Hume has historically shown to present with increased likelihood of algal bloom when storage levels in the lake drop below six per cent, as this was the case in March 2009.

Weekly sampling occurs along the Murray, with a two week lag between sampling and testing processes. The current sampling methods used are:

► Water quality and algal sampling;

► Toxicity sampling; and

► Aerial imagery.

There are a number of factors responsible for the outbreak of blue-green algal in the Murray River in 2009. Firstly, the ongoing drought in NSW and Victoria was a major factor. Furthermore, stored water was less than 10 per cent of full capacity. Another major factor could have been physico-chemical factors such as nutrient concentrations and water temperature. However, there are initial indications that water temperatures were sufficiently warm enough to support rapid algal growth.

In recent years, there has been a shift towards the implementation of water sharing plans and meeting Federal program requirements, such as the National Water Initiative. The recent blue-green algal bloom in the Murray River in early 2009 highlighted the importance of the NSW Algal Management Strategy in managing the risk posed to the community by blue-green algal blooms.

Conclusion

Overall, it would appear the efforts of multi-state coordination were effective in addressing the blue-green algal bloom on the Murray River during 2009. Data gathering across multiple states worked efficiently, however, more needs to be done to reduce the lag time of data with more efficient analytical processes.

2.1.8 Water for a Healthy Country: Valuing recreation in the Murray – Australian Bureau of Agriculture and Resource Economics (2007)

This report provides the results of a survey of recreational visitors to the Coorong (South Australia) and Barmah Forest (Victoria) during 2006. The first step of the survey provided descriptive information about the visitors of the regions. The second step was an exploratory economic analysis of the values in monetary terms that visitors hold for their recreational experience. The outcomes and information generated from this study can


provide quantitative input into management decisions for the Coorong and Barmah sites. It can also inform overall system-wide management of the Murray River Basin.

Key visitor profile

► More than 40% of respondents indicated they had visited the region more than 18 times before;

► The main reason for visiting the Murray River was to enjoy water activities;

► Respondents to the survey understood there was a link between environmental condition, management efforts and the quality of their recreational experience;

► The majority expressed an opinion that environmental improvements do not have to come at the expense of declines in agriculture; and

► 80% of visitors would like the Murray River mouth to remain open.

Valuing recreational experience

The approach taken to estimate the value of recreational use was to estimate the non-market benefits associated with the recreational visits. Values are expressed in terms of consumer surplus and are detailed in Table 7.

Three approaches were used to estimate the value of recreation:

► Travel cost method (TCM);

► Contingent valuation method (CVM); and

► Contingency behaviour (CB).

The TCM and CVM were used to estimate the consumer surplus of recreation trips, while the CB approach was used to estimate the responsiveness of visits in access as well as to estimate the change in value caused by changes in access.

Table 7: Estimated consumer surplus of recreational trip (year 2006 $AUD)

Barmah Forest Coorong

Expenditure

Reported costs, all visitors ($/adult/day) 22.36 37.68

Non-market values Travel cost method ($/adult/day) 153 217

95% confidence interval ($) 103-314 182-268 Travel costs method (reported values, single destination only) ($/adult/day)

134 218

95% confidence interval ($) 91-254 172-303 Contingent valuation method (single destination visitors only) ($/adult/day)

126 101

95% confidence interval ($) 79-188 87-123

Total value per adult per trip Travel costs method ($/adult/trip) 529 503

Contingent behaviour Change in value for each 1% change in access ($/adult/trip) 3.21 11.83

Publicly available information at the time indicates that there may be approximately 25,000 adult trips to Barmah and 112,500 to Coorong annually.

Using the TCM, the total non-market recreational trip value of $529 per adult for Barmah Forest implies an estimate of total value of recreation of $13 million per annum. The


corresponding estimate for Coorong per recreational trip was $503 per adult, which equated to $57 million per annum.

The contingent behaviour questions were used in the survey to ascertain how recreational users might adjust their visit rate if access conditions changed. Examples in the survey included the reduction in time the Murray Mouth is open at Coorong and the extent of land that is made available for camping at Barmah Forrest. Users where then asked to predict their visit rate for the next two years under different levels of access. The result identified a change in non-market recreational trip value of $3.21 and $11.83 for each 1% change in the level of access at Barmah Forrest and Coorong respectively.

International Publications 2.1.9 Estimated Annual Economic Impacts from Harmful Algal Blooms in

the Unites States – Woods Hole Oceanographic Institute (2000)

Harmful Algal Blooms (‘HABs’) have increased steadily in both species complexity and geographical extent over the last several decades. In turn, the range of harmful effects and magnitude of the economic costs have also widened.

Economic impacts are defined broadly to mean either lost gross revenues in the relevant product or factor markets, expenditures for environmental monitoring and management, or other costs what would not have been incurred in the absence of HABs. Economic multipliers are often used to approximate the full ramifications of costs or losses as they are transferred through a local economy, and have not been used in this estimation.

Economic impacts are grouped into four categories. The following table estimates annual economic impacts from harmful algal blooms for between 1987 and 1992 (reported in 2000 $US) for the four categories.

Table 8: Economic impacts of the four categories from between 1987 – 1990 (2000 $US)

Low High Average % of total

Public Health $18,493,825 $24,912,544 $22,202,957 47% Commercial Fishery $13,400,691 $25,265,895 $18,407,948 37% Recreation/ Tourism - $29,304,357 $6,630,415 13% Monitoring/ Management $2,209,955 $2,124,307 $2,088,885 4% TOTAL $33,924,741 $81,607,104 $49,329,845 100%

15 year Cap impacts (7% discount) $307,981,612 $743,270,485 $449,291,987

The total costs average $49 million per year, ranging from $34 million to $82 million (year 2000 $US). Over the past several decades, cumulative impacts approach $1 billion. Public health impacts are the largest component, representing more than 45% of total average impacts. Commercial fishing impacts are the next largest component, representing 37% of the total. Recreation/tourism accounts for 13%, and monitoring/management impacts represent the remaining 4 %. It is important to note that expenditures made to improve monitoring and management will likely result in decreases in impacts in the other categories.

These estimates are highly conservative and reflect the difficulties in compiling and assessing the impacts of phenomena for which economic studies are rare. The above table does not include the effects of economic multipliers, which would increase the estimates several-fold.

Furthermore, there have been some instances whereby outbreaks of blooms have caused such severe economic impacts that they exceed the annual averages. For example, the 1976 New Jersey red tide caused losses estimated at more than $1 billion (2000 $US) and


the 1997 Pfisteria outbreak in the Chesapeake Bay in the United States, which had an estimated economic loss of $46 million.

2.1.10 The Impact of Harmful Algal Blooms on USACE Operations – US Army Engineer Research and Development Center, and Coastal Hydraulics Laboratory (2009)

The impact of harmful algal blooms (‘HABs’) on the U.S. Army Corps of Engineers (‘USACE’) in recent years has attracted significant attention due to their human and ecological effects. Under favourable conditions, algae multiply rapidly and accumulate in large numbers, creating an event referred to as an algal bloom. To assess the importance of these algae blooms in USACE operations, an interview process was undertaken with six USACE personnel into the evolution of HABs in their own district in recent years.

Environmental conditions leading to HABs

The environmental factors thought to contribute to the formation and proliferation of HABs can be summarised into two primary categories: physical and chemical as outlined in Table 9.

Table 9: Categories leading to algal blooms

Physical Chemical

► Residence ► pH ► Stratification ► Nitrogen ► Shading ► Phosphorous ► Temperature ► Salinity and trace element inputs

Generally, physical factors can be better utilised than chemical factors to control HABs as many actions directly relate to the way water is managed. In some instances, water can be managed to alter water flow to decrease residence time, increase shear forces and enhance mixing. The influencing of chemical factors are typically a result of human activity, i.e. farm runoff and lawn fertilizers, therefore a reduction and awareness of these chemical inputs can lessen the number of severe algal bloom events.

Environment and economic effects of HABs

During the process of the interview stage of six USACE personnel the following conclusions are drawn from six sample area districts in the USA;

► Algal blooms peak in summer lasting between 2 to 3 weeks;

► The break out of blooms are increasing, resulting in the closing of beaches and lakes;

► On Lake Texoma in Oklahoma in 2004, for example, a golden algae bloom killed 500,000 fish and reduced the bass fishing on the lake, which is a $US40 million/year economic asset; and

► Increased public concern is affecting the public’s faith in the quality of their water supply.


Conclusions

In the USA, HABs are an important research and management priority for more than nine federal agencies due to complex patterns of formation and largely unexplained mechanisms of progression. The economic and financial impacts of HABs have been estimated to exceed $US1 billion over the past decade. Due to these impacts, the USA Congress enacted the Harmful Algal Bloom and Hypoxia Research and Control Act 1998, which mandated that Federal agencies complete a scientific assessment and plan for successful management of HABs. However, responding to algal blooms is often a complicated, multi-agency process involving government departments and health advisory bodies, whom are unclear of their responsibilities in monitoring or dealing with algal bloom outbreaks.

The effective solutions for algal blooms lie in the long term, where management activities can be taken to reduce the occurrences of blooms by trying to control factors that promote algal growth. This includes upstream management practices that lead to reduced nutrient influx to downstream lakes and reservoirs.

Most often, short-term management actions are taken to keep people away from algal blooms once they occur, and due to increased occurrences in recent years, local authorities are spending approximately 10 times more of their time addressing the issue of algal blooms than they were 5 years ago. One interviewee indicated that the outbreak of algal blooms in their district had required 20% more of his time in just 3 years.

2.1.11 Public Perception of Blue-Algae Bloom Risk in Hongze Lake of China – School of Environment, Nanjing University, China (2009)

This study used surveys to characterise the public perception of the ecological risk of blue-algae blooms in Hongze Lake, China.

Two surveys were undertaken. The first survey was undertaken in May 2008, with 156 respondents to the questionnaire from Sihong Country, adjacent to Hongze Lake. The second survey was undertaken in July 2008, with 318 respondents to the questionnaire.

The results were used to explore:

► Local respondents’ degree of concern regarding ecological changes to Hongze Lake from 1998 to 2008; and

► Explore the public perception of blue green algae blooms compared with:

► earthquakes;

► nuclear power; and

► public traffic.

T-test was used to examine the difference of risk perception in these four hazards over time.

The study also used demographic analysis and non-parametic statistical tests to predict the different groups of respondents’ willingness to accept (WTA) risk of blue-algae blooms in two surveys.

Using multiple linear regression analysis, the risk perception model explained 28.3% of variance in the WTA blue-algae bloom risk. The variables which were significantly correlated with WTA were:


► Knowledge;

► Social effect;

► Benefit;

► Controllability; and

► Trust.

This implied that these variables were the main influencing factors explaining the respondents’ WTA risk.

2.1.12 Economic Impacts of Harmful Algal Blooms – National Centers for Coastal Ocean Science (2006)

The National Centres for Coastal Ocean Science (‘NCCOS’) in the United States undertook an assessment into the economic impacts of harmful algal blooms. Harmful algae produce potent toxins which cause illness or death in humans, marine animals and wildlife. Coastal harmful algal blooms have been estimated to have economic impacts in the United States of at least $82 million per year with the majority in public health and commercial fisheries sectors. This estimate is conservative due, in part, to a lack of information about individual events, unquantified economic effect of environmental impacts, and a lack of documentation of socio-cultural impacts. In addition, unreported illness, reductions in property values, lost seafood sales due to unfounded consumer fears, and lost revenue from some untapped fisheries are just a few examples of economic effects not accounted for in this estimate.

The breakdown of the economic impact of harmful algal blooms in the United States per year is presented in Table 10.

Table 10: Economic impact of algal bloom (year 2005 $US)

Sector Impact per year

Commercial Fisheries Impact $38 million Public Health Costs of Illness $37 million Recreation and Tourism $4 million Costal Monitoring and Management $3 million Total $82 million


2.2 Media review 2.2.1 Process The purpose of this section is to demonstrate our approach into the research process of media and published press coverage of the effects of blue-green algal outbreaks in communities and the on environment in the Murray River region. Our research and analysis included, but was not limited to, the following sources:

► Dow Jones Factiva;

► Ernst & Young Publications Library;

► Murray Darling Basin Authority;

► NSW Office of Water (‘the Office’);

► Google News; and

► Google Scholar.

In addition, an example of a press release from Murray Regional Algal Co-ordinating Committee (RACC) is presented in Appendix B.

2.2.2 Potentially Toxic algae bloom threatens Murray-Darling (ABC publication, 28 March 2009)

In late March 2009, the Australian Broadcasting Corporation (ABC) reported on the outbreak of algae on the Murray River which was affecting 600kms of the river from Lake Hume to Barham with the extent of the situation increasing by the day.

The outbreak can be attributed to less than 5% water storage in Lake Hume near Albury-Wodonga. With levels so low, nutrients on the bottom of the lake are close enough to the surface to create blue-green algae.

Deputy Director David Harriss of the NSW Department of Water said, “It is potentially toxic, in that it can cause skin and eye irritations on contact, and we certainly don’t recommend it for washing, or for cooking, or for drinking”. Furthermore, Mr Harris stated it is one of the most severe outbreaks the middle Murray has ever seen, and there is not enough water to flush it out.

Kevin Downey, the part owner of Lake Hume Tourist Park, described blue green algae as a fact of life and he used to “ski at Hazelwood, where the algae was that thick you could walk across it, so he wasn’t worried about the bit that was up here.”

Gary Poidevin of Corowa Council told the ABC that “our filtration systems here in our town have got a charcoal filter system that we’ve installed to try and take out all the blue-green algae to keep the drinking water in the area clean.”

Dr Darren Baldwin, from the Murray Darling Freshwater Research Centre, said the reach of this algae bloom is the latest sign that the Murray’s water level is critically low. “Traditionally in Lake Hume, a water storage lake at the top of the Murray, there has only been three blue-green algae blooms recorded prior to 2000. And the latest two coincided with periods of drought.”

Dr Baldwin says “river communities west of Lake Hume may have to get used to the water being off limits. While the conditions are such they haven’t got water to keep in Lake Hume, the long-term prospect is for continued algae blooms, potentially becoming an annual issue.”


2.2.3 Algae takes the bloom off river holiday (The Age, 6 March 2010)

The Age published an article on ways to minimise the effect of algal blooms on the Murray tourism industry.

Victoria’s Tourism Industry Council stated that the Murray River should be flushed before long weekend and peak holidays to protect the struggling tourism sector. VTIC spokesman Wayne Kayler-Taylor said “it was time to look at new ways to protect the industry. If it’s possible to mitigate the potential for algal blooms then we should encourage planning and action to be taken accordingly. Warm water is the ideal incubator for the algal blooms, experts believe management of the river for farming is making blooms occur more often.

Environment Victoria spokeswoman Juliet Le Feuvre said that the outbreak would be considered a ‘national emergency’ if it were happening in Port Phillip Bay or Sydney Harbour, and governments need to get more water flowing down the river. “The Federal Government will open a new round of water buybacks for the Murray on Tuesday as part of its $3.1 billion plan to improve flows”.

2.2.4 Holiday makers warned on toxic blue-green algae (The Daily Telegraph, 8 April 2009)

Health fears have emerged from one of the most severe toxic algal blooms to ever hit the Murray-Darling River, currently choking about 800kms of the river between Albury-Wodonga and west of Swan Hill on Victorian side of the boarder.

NSW Department of Water deputy Director-General David Harriss issued a red alert on the algae levels. He said “our primary concerns is public safety”

Water Minister Phil Costa said “water suppliers have put in place treatment systems to manage risks from blue-green algae toxins to drinking water supplies ... conditions for algae include warm weather, clear water, high nutrient levels and low water flows... flows that could flush out the river are unlikely to occur after 8 years of drought. The Hume Dam was at 4 per cent capacity yesterday. It would normally be at least 40 per cent.”

2.2.5 Murray-Darling Basin inflows slow to a trickle (The Australian, 8 April 2009)

The Murray-Darling basin made an appalling start to 2009, reporting the lowest three months of water inflows on record and promoting the basin authority to warn that water for critical human needs could not be guaranteed forever.

Murray-Darling Basin Authority chief executive Rob Freeman said “the extreme mix of minimal rainfall, depleted dams and a grim climate outlook for autumn was unprecedented. I’d be loath to say that critical human needs will always be secured. Only 140 gL of water flowed into the nation’s food bowl from January to last month, breaking the previous record low over the same period two years ago.”

Furthermore, Mr Freeman said “algal blooms, caused by warm temperatures and the lack of fresh inflows, are threatening what reserves of water remain.”

Andrew Watkins of the Bureau of Meteorology the “the news was particularly bleak for irrigators, who rate below critical human needs in priority for water allocations, and who have received a fraction of their allowable allocation for years. In the year till from June 2008, the Murray-Darling inflows have totalled 1720gL – less than a quarter of what would have been expected, based on long-term averages”.


Opposition spokesman Greg Hunt challenged Federal Minister Penny Wong to release more money for farmers to build water saving infrastructure, predicting the investment could save 600 billion litres of water a year. However, Mr Hunt said “Canberra has focused its efforts so far on buying back water for the environment in the stressed river system.

2.3 Stakeholder consultation In order to most accurately identify the impact of the 2009 and 2010 blue-green algae bloom outbreaks, and likely impacts of future outbreaks, stakeholder consultation was undertaken with:

► Murray Darling Basin Authority (MDBA):

► Victorian Recreational Fishing Body (VR Fish);

► Victorian Department of Industry and Investment;

► Goulburn Murray Water;

► NSW State Water;

► Victorian Department of Sustainability and Environment (DSE);

► NSW Department of Health;

► Murray Shire Council; and

► Albury City Council.

EY also sought to speak to:

► Lower Murray Darling Catchment Management Authority; and

► Victorian Department of Human Services.

These stakeholders however were not available to consult in the short timeframe of this project. The main findings of the stakeholder consultation are presented in Table 11 below. Table 11: Stakeholder consultation findings

Stakeholder Key points raised relating to blue-green algae (BGA)

MDBA ► Biggest concern is for tourism ► Also concern for livestock (cattle and sheep) who drink water from Murray River

and South Australia as use Murray River water for drinking ► Not a problem for irrigation and other industries ► Have noticed no change in water diversion patterns as a result of BGA –

individuals make own judgment call on risks VR Fish ► Two major impacts:

► Area avoidance – recreational fishers will spend money elsewhere due to smell, visual impacts and fact that they realise BGA is sometimes toxic and hence less fish available to catch (only some types of BGA produce toxins)

► Environmental impact – compost of BGA on bottom of river impacts flow regime and causes fish deaths

► Recreational fishers need a few days to catch fish on the Murray and therefore camp on the river – as a result, camping grounds also significantly affected

► Blooms typically last a long time. Water skiing etc is also stopped ► Impact is generally from Goulburn to Mildura ► Native animals are used to BGA blooms – have evolved to not be impacted ► SA drink Murray River water

DII (Vic) ► Recommended levels for livestock BGA intake exceeded during blooms ► More stringent regulations and guidelines for food crops (vegetables and fruit)



were developed by Livestock Health and Pest Authority (LHPA) ► Not a lot of alternatives to Murray River water – groundwater best option – which

involves carting in water. LHPA provide a subsidy for water cartage. ► Impact on food crops is through sprinkler systems, not floodplains ► No impact on plant production e.g. rice ► No major impacts on other industries

Goulburn Murray Water

► Communities and industries used to BGA blooms – have contingencies in place ► Communities and industries expect BGA blooms and therefore secure supplies ► Water treatment costs increase for Local Government Water Authorities. Not

major costs ► BGA doesn’t impact on irrigators – impact is lack of water, not BGA blooms ► Given blooms don’t take full impact until February, tourism not as badly as

affected as could be – school summer holidays over ► Believed most tourists still come but don’t use the river for recreation –

undertake other recreational activities in area ► Most tourism on the Murray is out of Melbourne ► Whilst blooms in last 2 years were bad, not at all likely to be as extreme as

Darling River outbreak 20 years ago as water still moves through – not slow / stagnant enough

► No commercial fishing on the Murray. ► Fish farming is off-river. Not impacted as lower pumps deeper into river, where

no BGA – BGA rises to top of river ► Not thought to be major impacts on other industries

State Water ► BGA does not create any major additional work for infrastructure, operations or maintenance

► Only additional work is for staff monitoring and analysis – sampling increases and staff fielding public enquiries relating to boating and swimming

► Most dams and structures can be operated at variable level intakes so can counteract impacts of BGA. Hume however does not operate like this

► LGAs treat water when BGA outbreaks occur. This has cost implications for LGA, however cost is not significant

► Tourism and agricultural industries DSE ► Management framework in place via RACCs to manage BGA blooms

► DSE undertake stakeholder consultation and are a main point of contact for stakeholders wanting information relating to BGA blooms

► DSE refer media enquiries to RACCs and media officers at the Office Tourism NSW ► Most popular times to visit the Murray are Christmas and Easter. Tourism

industry in the Murray region is geared toward making money during the Christmas and Easter periods

► BGA blooms occur during the peak Easter season ► There is a perception that unless water is clean, the Murray River is not a good

place to be ► Negative press publicity occurs through media through emotive words such as

‘toxic blooms’ ► Need to develop more effective more effective communication strategies to

ensure message of blooms ending is circulated through the media – not nearly as much coverage as start of blooms

► People still come, but go to wineries, play golf etc ► Not sure of long-term impact – those who experienced may not return as did not

enjoy ► The Office put out a map which shows impacted areas ► Inconsistent messages are sometimes projected through different sources ► Some Local Governments are particularly good at keeping people informed on

outbreaks ► Visitor centres get up to 300 calls per day during outbreaks. Costs associated as

visitor centre numbers are 1800 numbers ► Volunteers work at visitor centres and are often confused by mixed messages

from different sources ► Impacts on supermarket and petrol station takings, boat repair businesses

DoH ► Provides advice relating to health impacts of BGA blooms for households only ► Liaise with state agencies, including food authorities, The Office and public

health units ► Concerned with blooms that generate toxins ► Towns optimise treatments when blooms occur and monitor to check

effectiveness ► People can become ill if water-skiing or through repeated exposure. Symptoms

can include gastro, rashes and severe cases impact on liver. ► Even if BGA do not contain toxins, 10% - 15% of population are sensitive to cell-



skin material ► Use of water from the Murray River in kidney dialysis is prohibited around

Murray as BGA blooms can cause death to dialysis patients Murray Shire Council ► Blooms start at Hume Dam

► Tourism is probably impacted, but the impact is not substantial, e.g. caravan parks

► No other industries majorly impacted Albury City Council ► Outbreaks are usually late Feb – early March.

► A few complaints from smell, but no major impacts to council ► No impact on other industries in area ► Council powder-activated carbon treatments are in place (cost approximately

$30k - $40k per annum) to counteract BGA and it is known when to activate them so BGA blooms to not impact on water users.

► Only additional work for council is additional samples of water are taken – only seconds of staff time as already required to collect a number of samples

► Visitors to parks and gardens that back on to Murray River not thought to be impacted


3. The Murray River region

The LGAs in the NSW and Victorian Murray River region have varying socio-demographic indicators. As can be expected, the economic indicators are stronger for the more regional LGAs, with rural LGA socio-economic indicators being broadly similar.

For NSW, these socio-demographic indicators include:

► Average wage and salary incomes range from $28,908 to $37,678 (2007);

► Total population for the LGAs identified was 101,164, with the population for individual LGAs ranging from 2,448 to 49,779 (2008);

► Unemployment rates range from 2.8% to 7.4% (2008);

► Value of agricultural production ranges from $83.1 million to $169.6 million (2006), although data was unavailable for Albury and the Greater Hume.

For Victoria, these socio-demographic indicators include:



► Unemployment rates range from 2.2% to 7.3% (2008); and

► Value of agricultural production ranges from $9.7 million to $470.7 million (2006).

3.1 Socio-Demographic Assessment of Murray River region LGAs

The Australian Bureau of Statistics (‘ABS’) data was compiled for each of the Local Government Authorities (‘LGAs’) in the NSW and Victorian Murray River region, as identified in Section 1.3. These LGAs, and their associated Murray subregions for NSW LGAs, are presented in Table 12.

Table 12: NSW and Victorian LGAs in the Murray River region

NSW Victoria

Wentworth (Lower Murray subregion) Mildura Balranald (Lower Murray subregion) Swan Hill Wakool (Central Murray subregion) Gannawarra Murray (Central Murray subregion) Campaspe Berrigan (Central Murray subregion) Moira Corowa (Upper Murray subregion) Indigo Albury (Upper Murray subregion) Wodonga Greater Hume (Upper Murray subregion) Towong

These LGAs are the NSW and Victorian LGAs that immediately surround the Murray River. Based on the stakeholder consultation, the socio-economic impacts of the blue-green algae do not extend further the LGAs which immediately surround the Murray River, and therefore no additional LGAs were required to be considered.


This data was compiled to provide a broad socio-demographic assessment of the region. Information was obtained for:

► Land area;

► Population;

► Economic indicators;

► Industry; and

► The environment.

The most recent data by LGA is presented in summarised in Section 3.2, and presented in more detail in Sections 3.3 and 3.4. Given however that the ABS collects data for different categories at different time intervals, not all information is presented for the same year. Rather, the most recent data for the above categories range from 2006 to 2008.

3.2 Summary of key LGA socio-demographic indicators Table 13: Summary of LGA socio-demographic profiles

State LGA Land area (km2)

Population (people)

Average wage & salary

income ($)

Unemployment rate (%)

Gross value of agricultural production

($m)

Year 2008 2008 2007 2008 2006

NSW

Wentworth 26,269 7,159 31,473 7.4 136.0 Balranald 21,700 2,488 30,686 3.2 83.1 Wakool 7,520 4,414 28,908 2.8 169.6 Murray 4,345 7,076 32,286 3.6 98.4 Berrigan 2,067 8,494 30,893 3.7 137.0 Corowa 2,328 11,481 34,108 3.0 159.3 Albury 306 49,779 37,678 4.8 n/a Greater Hume 5,749 10,273 31,429 2.9 n/a

Total 70,282 101,164.0 32,182.6 (average)

3.9 (average) 783.4

Victoria

Mildura 22,086 53,122 32,780 7.3 470.7 Swan Hill 6,116 21,765 29,879 5.4 343.3 Gannawarra 3,732 11,630 28,946 4.1 226.3 Campaspe 4,519 38,339 32,777 3.6 450.0 Moira 4,045 28,752 31,899 3.8 439.1 Indigo 2,043 15,710 36,440 2.7 65.5 Wodonga 432 35,064 36,723 3.9 9.7 Towong 6,673 6,273 32,873 2.2 77.9

Total 49,646 210,655 32,642.6 (average)

4.11 (average) 2,082.5


3.3 Detailed socio-demographic indicators for NSW LGAs in the Murray River region

Sections 3.3.1 to 3.3.8 provide a more detailed breakdown of socio-demographic indicators for Murray River region LGAs in NSW.

Like the summary of key LGA socio-demographic indicators, all data has been sourced from ABS.

No industry or environment data was available for Albury or the Greater Hume. This is due to the fact that the industry and environment data was produced on 2006 geographic boundaries (ASGC 2006). The current profiles present all data based on 2008 geographic boundaries, which have changed for Albury and the Greater Hume between 2006 and 2008. As a result ABS has not included industry profiles for those regions as it does not accurately reflect the true profiles of the current LGA geographic boundaries. Should Stage 2 of this project proceed, further work would be undertaken to determine this information in the current LGA geographic boundaries for Albury and the Greater Hume.


3.3.1 Wentworth Table 14: Wentworth LGA socio-demographic profiles

Regional profile category Units Value Year

Land area Km2 26,268.6 2008 Population Total population No. 7,159 2008

Population aged 0–9 % 13.2 2008

Population aged 10-19 % 14.8 2008







Population aged 80 and over % 3.7 2008

School Education Year 12 No. 1,353 2006

Year 11 No. 796 2006

Year 10 and below No. 2,606 2006

Higher Education Postgraduate No. 27 2006

Graduate Diploma No. 43 2006

Bachelor Degree No. 324 2006

Advanced Diploma No. 249 2006

Certificates No. 880 2006

Economy Average wage & salary income $ 31,473 2007 Wage & salary earners No. 2,993 2007 Female wage & salary earners (of total) % 46.6 2007 Male wage & salary earners (of total) % 53.4 2007 Unemployment % 7.4 2008

Industry Gross value of Agricultural Production

Gross value of crops $m 124.0 2006 Gross value of livestock slaughterings $m 4.4 2006 Gross value of livestock products $m 7.6 2006 Total gross value of agricultural production $m 136.0 2006

Agricultural commodities Area of holding ha 2,583,176.9 2006 Cereals for grain ha 58,255.0 2006

Vegetables for human consumption ha 319.0 2006

Orchard trees (including nuts) ha 3,080.6 2006

All fruit (excluding grapes) ha 3,086.4 2006

Non-cereal broadacre crops ha 307.2 2006

Total number Sheep and lambs no. 338,992 2006 Milk cattle (excluding house cows) no. 0 2006 Meat cattle no. 7,926 2006 Pigs no. 39 2006

The environment Water use on Australian farms

Area of agricultural land ha '000

2,583 2006

Area irrigated ha '000

11 2006

Irrigation volume applied ML 68,026 2006

Other agricultural uses ML 1,463 2006

Total water use ML 69,489 2006

Area irrigated as % of agricultural land % 0.4 2006


3.3.2 Balranald Table 15: Balranald LGA socio-demographic profiles












School Education Year 12 No. 491 2006 Year 11 No. 215 2006 Year 10 and below No. 980 2006

Higher Education Postgraduate No. 8 2006 Graduate Diploma No. 15 2006 Bachelor Degree No. 88 2006 Advanced Diploma No. 68 2006 Certificates No. 240 2006

Economy Average wage & salary income $ 30,686 2007 Wage & salary earners No. 994 2007 Female wage & salary earners (of total) % 46.6 2007 Male wage & salary earners (of total) % 53.4 2007 Unemployment rate % 3.2 2008



Agricultural commodities Area of holding ha 1,726,970.4 2006 Cereals for grain ha 55,581.6 2006


Orchard trees (including nuts) ha 147.3 2006

All fruit (excluding grapes) ha 147.3 2006



The environment Water use on Australian farms Area of agricultural land ha

'000 1,727 2006


8 2006


Other agricultural uses ML 1 675 2006




3.3.3 Wakool Table 16: Wakool LGA socio-demographic profiles












School Education Year 12 No. 855 2006 Year 11 No. 537 2006 Year 10 and below No. 1,664 2006

Higher Education Postgraduate No. 7 2006 Graduate Diploma No. 39 2006 Bachelor Degree No. 221 2006 Advanced Diploma No. 145 2006 Certificates No. 584 2006

Economy Average wage & salary income $ 28,908 2007 Wage & salary earners No. 1,611 2007 Female wage & salary earners (of total) % 47.9 2007 Male wage & salary earners (of total) % 52.1 2007 Unemployment rate % 2.8 2008



Agricultural commodities Area of holding ha 620,909.3 2006 Cereals for grain ha 102,294.1 2006




Non-cereal broadacre crops ha 5 801.3 2006

Total number Sheep and lambs no. 490,505 2006 Milk cattle (excluding house cows) no. 11,315 2006 Meat cattle no. 46,255 2006 Pigs no. 47,272 2006



621 2006


74 2006






3.3.4 Murray Table 17: Murray LGA socio-demographic profiles



Population aged 0–9 % 11.2 2008 Population aged 10-19 % 12.2 2008 Population aged 20-29 % 9.2 2008 Population aged 30-39 % 10.8 2008 Population aged 40-49 % 13.5 2008 Population aged 50-59 % 14.5 2008 Population aged 60-69 % 14.4 2008 Population aged 70-79 % 9.4 2008 Population aged 80 and over % 4.8 2008

School Education Year 12 No. 1,336 2006 Year 11 No. 859 2006 Year 10 and below No. 2,425 2006

Higher Education Postgraduate No. 15 2006 Graduate Diploma No. 47 2006 Bachelor Degree No. 290 2006 Advanced Diploma No. 251 2006 Certificates No. 1,005 2006




Agricultural commodities Area of holding ha 385,665.2 2006 Cereals for grain ha 90,156.3 2006 Vegetables for human consumption ha 0.0 2006 Orchard trees (including nuts) ha 82.7 2006 All fruit (excluding grapes) ha 82.7 2006 Non-cereal broadacre crops ha 4,601.5 2006

Total number Sheep and lambs no. 320,251 2006 Milk cattle (excluding house cows) no. 5,544 2006 Meat cattle no. 42,168 2006 Pigs no. 0 2006



386 2006 Area irrigated ha

'000 54 2006

Irrigation volume applied ML 181,821 2006 Other agricultural uses ML 2,922 2006 Total water use ML 184,743 2006 Area irrigated as % of agricultural land % 14.0 2006


3.3.5 Berrigan Table 18: Berrigan LGA socio-demographic profiles













187 2006 Area irrigated ha

'000 58 2006

Irrigation volume applied ML 205,337 2006 Other agricultural uses ML 2,998 2006 Total water use ML 208,334 2006 Area irrigated as % of agricultural land % 31.0 2006


3.3.6 Corowa Table 19: Corowa LGA socio-demographic profiles


Land area Km2 2 328.2 2008 Population Total population No. 11,481 2008


School Education Year 12 No. 2,209 2006 Year 11 No. 1,174 2006 Year 10 and below No. 4,654 2006








Area of agricultural land ha '000 215 2006 Area irrigated ha '000 12 2006 Irrigation volume applied ML 34,903 2006 Other agricultural uses ML 2,572 2006 Total water use ML 37,476 2006 Area irrigated as % of agricultural land % 5.6 2006


3.3.7 Albury Table 20: Albury LGA socio-demographic profiles


Land area Km2 305.5 2008 Population Total population No. 49,779 2008


School Education Year 12 No. 13,064 2006 Year 11 No. 3,995 2006 Year 10 and below No. 16,305 2006

Higher Education Postgraduate No. 456 2006 Graduate Diploma No. 469 2006 Bachelor Degree No. 3,351 2006 Advanced Diploma No. 2,372 2006 Certificates No. 7,380 2006



3.3.8 Greater Hume Table 21: Greater Hume LGA socio-demographic profiles


Land area Km2 5 748.9 2008 Population Total population No. 10,273 2008





3.4 Detailed socio-demographic indicators for Victorian LGAs in the Murray River region

Sections 3.4.1 to 3.4.8 provide a more detailed breakdown of socio-demographic indicators for Murray River region LGAs in Victoria.

Like the detailed socio-demographic indicators for NSW in the Murray River region and the summary of key LGA socio-demographic indicators, all data has been sourced from ABS.


3.4.1 Mildura Table 22: Mildura LGA socio-demographic profiles













Year 11 No. 6,280 2006




Bachelor Degree No. 2,477 2006

Advanced Diploma No. 1,867 2006

Certificates No. 6,322 2006

Economy Average wage & salary income $ 32,780 2007 Wage & salary earners No. 701.2 2007 Female wage & salary earners (of total) % 48.6 2007 Male wage & salary earners (of total) % 51.4 2007 Unemployment % 7.3 2008







Non-cereal broadacre crops ha 6,107.2 2006

Total number Sheep and lambs no. 315,272 2006 Milk cattle (excluding house cows) no. 0 2006 Meat cattle no. 7,589 2006 Pigs no. 1,722 2006



938 2006


23 2006






3.4.2 Swan Hill Table 23: Swan Hill LGA socio-demographic profiles













Year 11 No. 2,612 2006











Vegetables for human consumption ha 1,554.9 2006







488 2006


35 2006






3.4.3 Gannawarra Table 24: Gannawarra LGA socio-demographic profiles













Year 11 No. 1,655 2006


















329 2006


84 2006






3.4.4 Campaspe Table 25: Campaspe LGA socio-demographic profiles













Year 11 No. 5,152 2006











Vegetables for human consumption ha 1,946.2 2006







327 2006


106 2006






3.4.5 Moira Table 26: Moira LGA socio-demographic profiles













Year 11 No. 3,607 2006


















317 2006


87 2006






3.4.6 Indigo Table 27: Indigo LGA socio-demographic profiles













Year 11 No. 1,975 2006















Total number Sheep and lambs no. 101,388 2006 Milk cattle (excluding house cows) no. 13,585 2006 Meat cattle no. 54,675 2006 Pigs no. 962 2006



113 2006


3 2006






3.4.7 Wodonga Table 28: Wodonga LGA socio-demographic profiles


Land area Km2 432.8 2008 Population Total population No. 35,064 2008











Year 11 No. 4,146 2006










Agricultural commodities Area of holding ha 25,454.7 2006 Cereals for grain ha 36.0 2006








25 2006


0 2006

Irrigation volume applied ML 574 2006

Other agricultural uses ML 418 2006

Total water use ML 992 2006



3.4.8 Towong Table 29: Towong LGA socio-demographic profiles













Year 11 No. 805 2006










Agricultural commodities Area of holding ha 170,360.3 2006 Cereals for grain ha 157.7 2006








170 2006


3 2006






3.5 Summary The LGAs in the NSW Murray River region have varying socio-demographic indicators. As can be expected, the economic indicators are stronger for the more regional LGAs such as Albury, with rural LGA socio-economic indicators being broadly similar.

Key NSW Murray River regional indicators are:



► The most common age bracket is 50 – 59 for all but one LGA, where the most common age bracket is 40 - 49 (2008);


► Value of agricultural production ranges from $83.1 million to $169.6 million (2006), although data was unavailable for Albury and the Greater Hume; and

► Area of agricultural land varies from 0.2 million to 2.6 million hectares (2006) although, like the value of agricultural production, data was unavailable for Albury and the Greater Hume.

As with NSW LGAs, the LGAs in the Victorian Murray River region have varying socio-demographic indicators. As with NSW, the economic indicators for Victoria are stronger for the more regional LGAs such as Wodonga. Key Victorian Murray River regional indicators are:



► The most common age bracket is 10-19 for all but three LGAs, where the second most common age bracket was 50-59 for two LGAs and 20-29 for the remainder LGAs (2008);


► Value of agricultural production ranges from $9.7 million to $470.7 million (2006); and

► Area of agricultural land varies from 0.3 million to 0.9 million hectares (2006).


4. Major industry sectors in the Murray River region

The most recent Australian Bureau of Statistics (ABS) industry breakdowns by Murray River region Local Government Authorities (LGAs) showed that 4,566 businesses existed in the NSW Murray River region, excluding businesses in Albury and the Greater Hume LGAs, as the LGA, and 21,615 businesses existed in the Victorian Murray River region.

Of the 4,566 NSW businesses (excluding Albury and the Greater Hume):

► 2,124, equating to 47% of total NSW Murray River region businesses, were in the agriculture, forestry and fishing category. This was the most common type of business in the NSW Murray River region; and

► 456, or 10% of total NSW Murray River region businesses, were classified as retail, accommodation, cafes, and restaurants or cultural and recreational services, which are the tourism-related industries.

Given that the number of businesses excludes Albury and the Greater Hume, the true number of businesses in the NSW Murray River region is expected to be much higher than 4,566, especially considering that Albury is a large regional area and hence likely to include numerous businesses.

Of the 21,615 Victorian businesses:

► 7,926, equating to 37% of total Victorian Murray River region businesses, were in the agriculture, forestry and fishing category. This was the most common type of business in the Victorian Murray River region; and

► 3,186, or 15% of total Victorian Murray River region businesses, were classified as the tourism-related industries presented in the NSW analysis above.

These are two categories of businesses which have been identified as being most negatively impacted upon by the blue-green algae blooms.

In addition, local governments face the cost of filtering the outbreaks if and when blue-green algae blooms occur, and the health sector could be impacted if people become unwell through exposure to the blooms.

The value of the impact of blue-green algae blooms on industry will be determined in Stage 2 of this project. Given the much larger number of businesses in Victoria, it is expected that the impact of blue-green algae blooms will be much larger in Victoria.

4.1 Approach The major industry sectors in the NSW and Victorian Murray River regions, and the likely impact of blue-green algal blooms on these industries, have been identified.

The approach was to identify the broad industries of the region as a whole, and by LGA, and then, based on the results of the stakeholder consultation and literature review, determine which of the industries were likely to realise negative impacts by blue-green algal blooms.


4.2 Industry in the NSW Murray River region The Murray region hosts a diverse range of enterprises, from traditional broadacre agriculture, specialist horticultural crops to manufacturing, engineering, computer technology and specialist service industries and an active tourism industry. In particular, the NSW Murray River region has a large and varied food processing industry and a strong agricultural heritage.

The NSW Region’s major competitive advantages include:

► its skilled agricultural and manufacturing workforce;

► that most major Australian marketplaces are easily accessible; and

► its developed infrastructure.

An overview of the key industries is provided in Table 30. Table 30: Industries in the NSW Murray River region

Industry Description

Food processing The Murray is home to a thriving food processing industry that produces foodstuffs as diverse as dairy products, wine, bread and pet foods.

Agriculture Agriculture is the traditional staple of the region’s industry. Large tracts of fertile land and a sophisticated irrigation system sustain a large and diverse range of agricultural activity.

Due to its close proximity to major domestic markets and an infrastructure suited to large-scale export, many of Australia’s leading food companies source product from the NSW Murray River region. In a normal year over half of Australia’s rice crop is produced in the NSW Murray River region and the region is a traditional home for cereals, dairy farming, fruits and vegetables and wool.

Forestry The Murray also boasts significant timber resources that have led to the creation of a thriving wood products industry centred on mills such as the Norske Skog Newsprint Mill.

Research and early plantings of eucalypt plantations are being undertaken in the irrigation area to develop a timber industry and control rising water tables.

The agriculture and forestry sector accounts for approximately 18 per cent of the area’s Gross Regional Product, 20% of its employment and 34% of its exports.

Tourism Tourism's importance to the region is increasing. Natural landmarks like Lake Mungo National Park, numerous historic pioneering towns and nearby ski slopes draw tourists to the area.

The many lakes and rivers of the region make the Murray a paradise for fishing and water sport enthusiasts.

Manufacturing Manufacturing and value-adding industries include paper, plastics, specialist engineering (motor vehicle transmissions) and wool processing. The manufacturing sector accounts for 21% of the area’s Gross Regional Product, 12% of its employment and 58% of its exports.

Source: NSW Industry and Investment

The region’s industry is assisted by its7:

► Transport - the Region has extensive highway links into NSW, Victoria and South Australia, and good roads link all regional townships. The new Ettamogah transport hub, ten minutes north of Albury, enhances access to these links. There is a direct link to the Victorian and NSW rail networks, and air service to national and State capitals from Albury;

► Major educational facilities - The NSW Murray River region has excellent education and training facilities, with courses which support the region's economic activity and interests. The major educational facilities include:

► Charles Sturt University, Albury;

7 NSW Industry and Investment


► Riverina Institute of TAFE; and

► LaTrobe University and Wodonga TAFE; and

► Labour force - The NSW Murray River region's laid-back lifestyle has attracted a large and skilled labour force, which is strongly skilled in agriculture and manufacturing. Along with sustaining existing industries, the labour force has attracted exciting new manufacturing ventures to the region including plastics, farm machinery and high technology.

4.3 Industry in The NSW Murray River region by LGA In order to more accurately determine the likely regions in NSW in which communities and businesses would be impacted by blue-green algal blooms, a breakdown by industry using ABS data for industries by NSW LGA was sourced. This data is presented in Sections 4.3.2 to 4.3.7, with a summary of total businesses by LGA in NSW provided in Section 4.3.1. Albury and Greater Hume are not presented as ABS did not provide the industry breakdown for these LGAs.

4.3.1 Industries by NSW LGA Table 31: Industries by NSW LGA

LGA Number of businesses

% of total businesses in NSW Murray River

region

Wentworth 816 17.9% Balranald 372 8.1% Wakool 537 11.8% Murray 639 14.0% Berrigan 1,077 23.6% Corowa 1,125 24.6% Albury n/a n/a Greater Hume n/a n/a Total 4,566 100.0%

This breakdown of businesses by NSW LGA is shown graphically in Figure 3.

No industry data was available for Albury or the Greater Hume. This is due to the fact that the industry data was produced on 2006 geographic boundaries (ASGC 2006). The current industry profiles present all data based on 2008 geographic boundaries, which have changed for Albury and the Greater Hume between 2006 and 2008. As a result ABS has not included data for the old profiles in these profiles for those regions as it does not accurately reflect the true profiles of the current LGA geographic boundaries. Should Stage 2 of this project proceed, further work would be undertaken to determine this information in the current LGA geographic boundaries for Albury and the Greater Hume.

Given that the number of businesses excludes Albury and the Greater Hume, the true number of businesses in the NSW Murray River region is expected to be much higher than 4,566, especially considering that Albury is a large regional area and hence likely to include numerous businesses.


Figure 3: Businesses by NSW LGA

It should be noted that the breakdown in Figure 3 above excludes the businesses from Albury and Greater Hume where a large number of businesses are likely to be located. As a result, the chart is not 100% representative.

As can be seen, Corowa has the most businesses, followed closely by Berrigan, whilst Balranald has the least.

The breakdown by industry of the businesses in the NSW Murray River regions presented above is shown in Figure 4.

Figure 4: NSW businesses in the Murray River region by industry

As can be seen, for the NSW Murray River region, agriculture, forestry and fishing is the largest industry, and mining and education the smallest.

17.9%

8.1%

11.8%

14.0%

23.6%

24.6%

Wentworth Balranald Wakool Murray Berrigan Corowa

46.5%

0.2%2.9%0.3%10.8%

2.3%

6.1%

6.2%

4.7%

0.5%

2.9%

11.5%

0.2%

1.9% 1.2% 1.6%

Agriculture, forestry and fishing Mining Manufacturing

Electricity, gas and water supply Construction Wholesale trade

Retail trade Accommodation, cafes and restaurants Transport and storage

Communication services Finance and insurance Property and business services

Education Health and community services Cultural and recreational services

Personal and other services


Like Figure 3, Figure 4 above excludes the businesses from Albury and Greater Hume where a large number of businesses are likely to be located, and as a result, the chart is not 100% representative.

A breakdown of these businesses by industry for each of the LGAs in Figure 3 is presented in 4.3.2 to 4.3.7 below.

4.3.2 Wentworth Table 32: Wentworth business

Businesses by industry Number % of total

industries in LGA

Year

Agriculture, forestry and fishing 450 55% 2007 Mining 3 0% 2007 Manufacturing 6 1% 2007 Electricity, gas and water supply 3 0% 2007 Construction 69 8% 2007 Wholesale trade 30 4% 2007 Retail trade 30 4% 2007 Accommodation, cafes and restaurants 48 6% 2007 Transport and storage 24 3% 2007 Communication services 6 1% 2007 Finance and insurance 33 4% 2007 Property and business services 87 11% 2007 Education 0 0% 2007 Health and community services 3 0% 2007 Cultural and recreational services 12 1% 2007 Personal and other services 12 1% 2007 Total businesses 816 100 % 2007

4.3.3 Balranald Table 33: Balranald business


industries in LGA

Year

Agriculture, forestry and fishing 231 62% 2007 Mining 3 1% 2007 Manufacturing 9 2% 2007 Electricity, gas and water supply 0 0% 2007 Construction 30 8% 2007 Wholesale trade 0 0% 2007 Retail trade 33 9% 2007 Accommodation, cafes and restaurants 12 3% 2007 Transport and storage 21 6% 2007 Communication services 0 0% 2007 Finance and insurance 3 1% 2007 Property and business services 18 5% 2007 Education 0 0% 2007 Health and community services 3 1% 2007 Cultural and recreational services 6 2% 2007 Personal and other services 3 1% 2007 Total businesses 372 100% 2007


4.3.4 Wakool Table 34: Wakool business


industries in LGA

Year


4.3.5 Murray Table 35: Murray business


industries in LGA

Year



4.3.6 Berrigan Table 36: Berrigan business


industries in LGA

Year

Agriculture, forestry and fishing 537 50% 2007 Mining 0 0% 2007 Manufacturing 42 4% 2007 Electricity, gas and water supply 0 0% 2007 Construction 81 8% 2007 Wholesale trade 33 3% 2007 Retail trade 72 7% 2007 Accommodation, cafes and restaurants 48 4% 2007 Transport and storage 78 7% 2007 Communication services 0 0% 2007 Finance and insurance 12 1% 2007 Property and business services 129 12% 2007 Education 0 0% 2007 Health and community services 24 2% 2007 Cultural and recreational services 6 1% 2007 Personal and other services 15 1% 2007 Total businesses 1,077 100% 2007

4.3.7 Corowa Table 37: Corowa business


industries in LGA

Year



4.3.8 Summary of ABS breakdown of LGAs’ industries The most recent ABS industry breakdowns by LGA (excluding Albury and the Greater Hume which were unavailable), showed that in 2007, 4,566 businesses existed across the NSW Murray River region.

2,124 of the total 4,566 businesses, equating to 47% of total businesses, were in the agriculture, forestry and fishing category. This was the most common type of business in the NSW Murray River region.

399 of the businesses, or 9% of total businesses, were classified as either retail or accommodation, cafes and restaurants, which are the tourism-related industries.

4.4 Industry in The Victorian Murray River region by LGA As with industry in the NSW Murray River Region by LGA, in order to more accurately determine the likely regions in Victoria in which communities and businesses would be impacted by blue-green algal blooms, a breakdown by industry using ABS data for industries by Victorian LGA was sourced. This data is presented in Sections 4.4.2 to 4.4.9, with a summary of total businesses by LGA provided in Section 4.4.1.

4.4.1 Industries by Victorian LGA Table 38: Industries by Victorian LGA

LGA Number of businesses

% of total businesses in Victorian Murray

River region

Mildura 4,890 22.6% Swan Hill 2,586 12.0% Gannawarra 1,596 7.4% Campaspe 4,107 19.0% Moira 3,204 14.8% Indigo 1,572 7.3% Wodonga 2,751 12.7% Towong 909 4.2% Total 21,615 100.0%

This breakdown of businesses by Victorian LGA is shown graphically in Figure 5. Figure 5: Businesses by Victorian LGA

22.6%

12.0%

7.4%

19.0%

14.8%

7.3%

12.7%

4.2%

Mildura Swan Hill Gannawarra Campaspe

Moira Indigo Wodonga Towong


As can be seen, Mildura has the most businesses, followed closely by Campaspe, whilst Towong has the least.

The breakdown by industry of the businesses in the Victorian Murray River regions presented above is shown in Figure 6.

Figure 6: Victorian businesses in the Murray River region by industry

As can be seen, for the Victorian Murray River region, agriculture, forestry and fishing is the largest industry, and electricity, gas and water supply the smallest.

A breakdown of these businesses by industry for each of the LGAs in Figure 5 is presented in 4.4.2 to 4.4.9 overleaf.

36.7%

0.2%4.1%

0.1%

13.3%2.9%

10.3%

3.2%

4.8%

0.7%

3.8%

12.8%

0.5%2.6% 1.3% 2.6%

Agriculture, forestry and fishing Mining Manufacturing

Electricity, gas and water supply Construction Wholesale trade

Retail trade Accommodation, cafes and restaurants Transport and storage

Communication services Finance and insurance Property and business services

Education Health and community services Cultural and recreational services

Personal and other services


4.4.2 Mildura Table 39: Mildura business


industries in LGA

Year

Agriculture, forestry and fishing 1,641 34% 2007 Mining 9 0% 2007 Manufacturing 147 3% 2007 Electricity, gas and water supply 9 0% 2007 Construction 669 14% 2007 Wholesale trade 141 3% 2007 Retail trade 510 10% 2007 Accommodation, cafes and restaurants 147 3% 2007 Transport and storage 231 5% 2007 Communication services 30 1% 2007 Finance and insurance 201 4% 2007 Property and business services 765 16% 2007 Education 18 0% 2007 Health and community services 165 3% 2007 Cultural and recreational services 78 2% 2007 Personal and other services 129 3% 2007 Total businesses 4,890 100% 2007

4.4.3 Swan Hill Table 40: Swan Hill business


industries in LGA

Year



4.4.4 Gannawarra Table 41: Gannawarra business


industries in LGA

Year


4.4.5 Campaspe Table 42: Campaspe business


industries in LGA

Year



4.4.6 Moira Table 43: Moira business


industries in LGA

Year


4.4.7 Indigo Table 44: Indigo business


industries in LGA

Year



4.4.8 Wodonga Table 45: Wodonga business


industries in LGA

Year


4.4.9 Towong Table 46: Towong business


industries in LGA

Year


4.5 Effects on industries and users A description of the broad categories of industries in the region as provided by the Office, and the degree of impact of blue-green algae outbreaks on these industries, is shown in Table 47 below. The degree of impact is based primarily on stakeholder consultation.


Table 47: Results of preliminary stakeholder consultation on economic impacts of blue-green algae blooms

Industry ABS Industry Inclusions Example of businesses Impacted by Blue-Green Algae Blooms

Degree of Impact (n/a

/ Low / Medium /

High)1

Tourism industry

► Retail trade ► Cultural &

recreational services

► Accommodation, cafes & restaurants

► Camping / caravan parks and other accommodation

► Waterskiing, sailing, houseboating and other recreational boating rentals, equipment sales and repairs

► Recreational fishing equipment sales

► Cafes and restaurants ► General retail trade (e.g.

supermarkets, petrol stations) ► Golf courses ► Wineries

Yes – tourists cannot undertake river based activities and are impacted by smell. Potential for tourists to not return following years given negative impact of algae blooms. Also perception that the Murray River is not a good place to be during blooms. This is perpetuated through the media.

Medium

Individual landholders

► Agriculture, forestry and fishing

► Cattle stations ► Dairy Farms ► Piggeries ► Chicken Farm ► Slaughter houses ► Fruits & Vegetables ► Wine producers

Yes – livestock face health issues and potential death through consuming water with blue-green algae blooms. Also, one vegetable grower in Victoria had

Low - Medium

Aboriginal communities

► No direct ABS industry inclusion

Yes – one Aboriginal community on the Edwards River required drinking water to be carted in during the Murray River blooms

Low

Stock managers

► Agriculture, forestry & fishing

► Upper Murray Seeds ► Rivalea Australia ► ICM Agribusiness ► Peechela Beef ► Riverina Milk and Cheese ► General/ domestic agricultural

operators

Yes – livestock face health issues and potential death through consuming water with blue-green algae blooms. There was also an issue during the 2009 outbreaks with a farmer who was unable to sell his leafy green vegetables as he had used water from an irrigation channel drawing directly from the Murray that had high BGA concentrations in it.

Low - Medium

Service industries

► Electricity, gas & water supplies

► Transport & storage

► Communication services

► Education

► Johnson MNE ► Smartair ► Virgin Blue, Qantas and Rex air

transportation ► CountryLink Services ► Greyhound coach service ► Wodonga Institute of TAFE ► Charles Sturt University – Albury ► LaTrobe University - Wodonga ► Telstra Country Wide ► Regional High Schools ► Child care centres ► Private colleges

No n/a

Regional industries

► Mining ► Manufacturing ► Construction ► Wholesale trade ► Finance &

insurance ► Property &

business services

► Norsk Skog paper mill ► Joss Group (Construction,

facility management and distribution)

► Harvey Norman Centre at Albury ► Macfab engineering services ► Spitwater Australia design and

manufacturing

No n/a


Industry ABS Industry Inclusions Example of businesses Impacted by Blue-Green Algae Blooms

Degree of Impact (n/a

/ Low / Medium /

High)1

► Focus Engineering and Construction

► Johnson MME ► Geelong Leather ► Beechworth Bakery ► General banking and Credit

Unions ► Leader urban and rural estate

agents ► Leading motor vehicle outlets

Water utilities

► Electricity, gas & water supplies

► Council water supply ► General water companies ► Bore water supply ► Bore drilling companies ► General electricity and gas

companies ► Pumping systems and

associated businesses

Yes – water needs to be treated to be drinkable, however consultation indicates that this can be done at relatively low cost

Low

Aquaculture

► Agriculture, forestry & fishing

► Trout Farms

No – aquaculture industries can lower pumps deep enough that BGA is removed from the

n/a

Health industries

► Health & community services

► Albury Wodonga Private Hospital

► Murray Valley Private Hospital ► Lutheran Aged Care ► Albury Wodonga Health ► Upper Murray Regional Library ► General public hospitals ► Specialist medical practitioners ► General practice doctors ► Nurses ► Royal Flying Doctor service ► Pathology services ► Dental surgeon services ► General medical screening

services ► In-home nursing services ► Meals on wheels services

Yes – potential treatment of patients who fall ill from consumption of water with blue-green algae

Low

Local, state & federal agencies

► Health & community services

► Murray Darling Basin Authority ► Goulburn Murray Water ► Victoria Department of

Sustainability & Environment ► NSW Office of Water ► NSW Tourism ► Local Governments / Councils

Yes – cost of filtration systems to purify water. Potential to be required to increase health service provision.

Low

1 n/a indicates that the specific industry was not identified during preliminary research and consultation as being significantly impacted by the Murray River blue-green algae blooms.

As can be seen above, there is a broad range of industries in the NSW and Victorian Murray River region. Given that only a small number of industry categories are expected to be impacted, the overall socio-economic impact is not expected to be significantly large.

It is expected that the impacts of the blue-green algae may be long-term. For example, visitors to the region during blue-green algae blooms may not return in subsequent years due to bad experiences, and recreational fishers may find other spots to fish due to depletion in fish stock through blue-green algae poisoning.


4.6 Summary of major impacts Based on the information available during stage one of the project, a summary of the major impacts of blue-green algae blooms on the Murray River region are provided in Table 48.

Table 48: Summary of impacts of blue-green algae blooms on the Murray River region

Economic impacts Social / community impacts Environmental impacts

► Tourism industry, including: ► Camping / caravan parks and

other accommodation ► Waterskiing, sailing,

houseboating and other recreational boating rentals, equipment sales and repairs



supermarkets, petrol stations) ► Golf courses ► Wineries

► Agricultural industry (death of livestock through consuming water contaminated with blue-green algae)

► Potential lost productivity from workers from becoming ill and away from work as a result of recreational contact with blue-green algae

► Increased cost to Government of

filtration systems to purify water during outbreaks, likely to be passed on to the community through council rates

► Potential to be required to increase health service provision for treatment of people who have become ill after consuming

► Inability to attract people to the region through negative press or first-hand experience of impacts of blue-green algae blooms

► Hardship to residents through reduced tourist numbers

► Reduced river health ► Reduced health of species living in

and around the Murray River ► Death of species living in and around

the Murray River, potentially having long-term impacts on species numbers

► Visual impacts ► Smell impacts

Initial findings suggest that:








► Wineries;

► Livestock that drink water from the Murray River are impacted (health issues and/or death). This impacts most significantly on properties with livestock which are on the Murray River, however may also be create problems for livestock watering and irrigated agriculture from water diverted from the rivers by channels (e.g. Mulwala Main Canal). In addition there is the natural distributary system (Gulpa Creek, Edward River) where water already impacted by blooms from the Murray flows into and impacts on the streams; and



Of the businesses which are likely to be impacted, there are a much greater number in Victoria when compared to NSW, and as such, the socio-economic impact of blue-green algae blooms is expected to be relatively larger in Victoria when compared to NSW.


5. Stage 2 data collection and analysis methodology

The purpose of this section of the report is to develop a draft data collection and analytics process for Stage 2 of the process, on the basis that it was to proceed.

Broadly the process will involve the following steps set out in Figure 7.

Figure 7: Stage 2 study process

5.1 Purpose and approach of the survey At the time of undertaking this report, very little work has been undertaken in estimating the socio-economic costs to industry of blue-green algae blooms on the Murray River. As a result, it is recommended that a survey of the agricultural and tourism industries in addition to Government entities be undertaken to allow an estimate of these costs to be determined.

At this stage, the surveys do not incorporate social and environmental impacts (e.g. the impact on environmental outcomes such as fish species), however can be easily incorporated during Stage 2 if considered appropriate.

In order to be useful and accurately reflect the likely impact an appropriate sample size will be required to ensure the results are statistically significant. Furthermore, regionally diverse responses will be required to determine the variation in socio-economic impact throughout the NSW Murray River region.

5.2 Industries to be covered by the survey process The detailed targeted surveys would focus on those industries in Table 47 identified as potentially impacted by the blue-green algae blooms, namely the:

► Tourism industry;

► Agricultural industry; and

► Potential and current tourists.

Data CollectionProcess

Data Analysis

Future Industry

Socio – EconomicImpacts

• Industry surveys – tourism, agriculture • Tourism & users survey• Industry stakeholder interviews• Determine appropriate sample sizes by type

CurrentIndustry

Socio - Economic Impacts

• Capture revenue and business impact• Calculate user expenditure outputs & changes• Identify regional variations• Extrapolate regional outcomes

• Select appropriate economic impact tool• Run models• Produce current economic and social outcomes

• Forecast fu ture impacts based on survey outcomes• Run models• Produce future economic and social outcomes


The tourism industry survey will focus on businesses including:


► Waterskiing, sailing, houseboating and other recreational boating rentals, equipment sales and repairs;

► Recreational fishing equipment sales;


► Wineries;


► General retail trade (e.g. supermarkets, petrol stations).

The agricultural industry survey will focus on farms whose livestock consume Murray River water, as stakeholder consultation indicated that consumption during blue-green algae blooms had the potential to lead to death of livestock.

The potential and current tourist survey will determine the drivers for tourists choosing holiday destinations, and the impact of actual and/or potential blue-green algae blooms in decision-making surrounding their holiday location preferences now and into the future. The tourist survey will involve a random-selection of people Australia-wide, however the focus will be on Melbourne residents, as this is the usual place of residence for the highest proportion of visitors to the Murray River region.

In addition, targeted interviews will be undertaken with local governments, water utilities and health care providers to determine the cost of filtering the outbreaks if and when blue-green algae blooms occur, and the health sector to determine the impact should people become unwell through exposure to the blooms. Regional workshops will also be undertaken to establish community attitudes and concerns.

5.3 Draft survey design by industry A draft survey design to determine the socio-economic impacts of blue-green algae blooms on the tourism and agricultural industries, and current and potential tourist levels, in the Murray River region is presented below.

These are indicative draft surveys only, and would need to be further developed if Stage 2 proceeds.

5.3.1 Blue-Green Algae Blooms Tourism Industry Survey

Name/Business Name:

Address:

Telephone:

Email:

The purpose of this survey is to gain data to determine the impacts of blue-green algae blooms on the Murray River.

The information produced on the impacts of blue-green algae blooms will be used to inform future planning strategies for blue-green algae blooms in the NSW Murray River region.


Confidentiality of business names and information is ensured.

1. Please indicate which area of the NSW Murray River region your business is based in?

(LGAs – drop down box)

2. What are the key services your business provides?

_________________________________________________________________________________________________________________________________________________________________________________________________________________________________

3. How many people do you currently employ?

4. (Range – drop-down range)

5. What is your annual gross business revenue?

(Insert appropriate turnover ranges – drop-down box)

6. Please provide an approximate percentage breakdown by season of when your revenue is generated

Season %

Spring

Summer

Autumn

Winter

7. Do you believe that the blue-green algae blooms impacted on visitor numbers to the Murray River region in 2009 and 2010?

(yes / no )

If no, proceed to question 9

If yes, proceed to question 8

8. What do you believe was the approximate percentage reduction of visitor numbers as a result of the blue-green algae blooms?

(% ranges – drop-down range)

9. Do you believe that the blue-green algae blooms have the potential to impact on visitor numbers to the Murray River region in the future?

(yes / no )

10. What did you see as the worst impacts of the blue-green algae blooms in 2009 and 2010? (Rank 1 to 8, with 1 being the worst impact)

Smell

Visual impacts

Impacts on fish levels

Impacts on livestock

Impacts on drinking water

Impacts on human health

Impacts on visitor numbers to the Murray River region


Impacts on recreational activities (water skiing, recreational fishing etc)

11. Did the 2009 and 2010 blue-green algae blooms impact on your business revenue?

( yes / no – drop down box)

If no, proceed to Question 13 If yes, proceed to Question 12

12. What was the impact on your business revenue?

(Drop-down menu of dollars OR % annual turnover)

13. Did the 2009 and 2010 blue-green algae blooms impact on employment levels?



14. What was the change in employment levels?

(Drop-down menu of numbers OR % of employees)

15. Do you expect there to be long-term impacts from the blue-green algae in terms of visitor numbers to the NSW Murray River region? (Do you think people will avoid the region for fear of blue-green algae outbreaks?)

16. Do you expect there to be long-term impacts from the blue-green algae in terms of businesses in the NSW Murray River region?

If no, finish If yes, proceed to Question 17

17. Which businesses do you believe will be most significantly impacted?

(Drop-down list – tourism sub-categories and other industries)


5.3.2 Blue-Green Algae Blooms Agriculture Industry Survey

Name/Business Name:

Address:

Telephone:

Email:

The purpose of this survey is to gain data to determine the economic and social impacts of blue-green algae blooms on the Murray River.

The information produced on the impacts of blue-green algae blooms will be used to inform future planning strategies for blue-green algae blooms in the NSW Murray River region.

Confidentiality of business names and information is ensured.

1. Please indicate which area of the Murray River region your farm / property is based in?

(LGAs – drop down box)

2. What livestock or produce do you keep (produce) at your farm / property (type and numbers)?

Fruit & Vegetable produce (Plantable hectares, average volume of production, type)___

Sheep ____

Cattle ____

Pigs ____

Aquaculture ___

Other (please specify) ____

3. How many people do you currently employ?

4. (Range – drop-down range)

5. What is your annual gross revenue?

(insert appropriate turnover ranges – drop-down box)

6. Please provide an approximate percentage breakdown by season of when your revenue is generated

Season %

Spring

Summer

Autumn

Winter



Smell

Visual impacts


Impacts on livestock

Impacts on water for crops/produce

Impacts on aquacultural products



Impacts on visitor numbers to the Murray River region


8. Did the blue-green algae cause death or illness resulting in livestock being able to be used for commercial purposes to any of your livestock?

If no, proceed to question 10

If yes, proceed to question 9

9. Approximately how many of your livestock were affected by death or illness resulting in livestock being able to be used for commercial purposes?

Sheep ____

Cattle ____

Pigs ____

Other (please specify) ____

10. Did those livestock who were ill recover?

(yes / no)

11. Did you undertake any activities to mitigate the impacts of the blue-green algae blooms?



12. What activities did you undertake?

Fencing


Bringing in water from other sources


Medication for livestock


Other (please specify)



13. What was the total annual cost for these mitigation strategies?

$______

14. Were these techniques successful? Why / Why not?

______________________________________________________________________________________________________________________________________________________

15. Did the blue-green algae reduce business revenue?



16. What was the impact on your business revenue?

(Drop-down menu of dollars OR % annual turnover)

17. Did the 2009 and 2010 blue-green algae blooms impact on employment levels?



18. What was the change in employment levels?

(Drop-down menu of numbers OR % of employees)

19. Do you expect there to be long-term impacts on your livestock from the blue-green algae? Why / Why not?

____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

20. Do you expect there to be long-term impacts from the blue-green algae in terms of your revenue? Why / Why not?

____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________


5.3.3 Blue-Green Algae Blooms Tourism User Survey The process for collecting tourism user data would most likely be through a web based survey.

The draft format of the user survey is shown below:

1. Are you:

Male Female

2. In which of the following categories is your current age?

Under 15 years 15 to 24 years 25 to 34 years 35 to 44 years 45 to 54 years 55 to 64 years 65 years or over

3. Which Australian State or Territory do you live in?

New South Wales Victoria Queensland Western Australia South Australia ACT Tasmania Northern Territory

4. Do you live in a metropolitan area (i.e. state capital city/suburbs) or in a regional area?

Metropolitan Regional

5. Have you visited the Murray River region in the last 5 years?

If yes to visiting Murray River in last 5 years, proceed to question 6

If no to visiting Murray River in last 5 years, proceed to question 20

6. Please select which of the following Murray River locations you have ever visited in the past.

Region 1: Corryong, Dartmouth, Tallangatta, Lake Hume, High Country Rail Trail Region 2: Albury-Wodonga, Corowa-Wahgunyah, Lake Mulwala, Rutherglen, Howlong Region 3: Cobram, Tocumwal, Echuca-Moama, Yarrawonga, Berrigan, Barooga, Barmah-Millewa State Forest, Moira State Forest Region 4: Cohuna, Barham, Kerang, Moulamein, Swan Hill, Robinvale, the Perricoota State Forest, Euston, Euston Weir, Koondrook and Koonbrook State Forest, Lake Boga, Boundary Bend and Balranald


Region 5: Mildura, Merbein, Ouyen, Murrayville Mallee Cliffs State Forest, Hattah-Kulkyne National Park, Red Cliffs, Wentworth, Cal Lal. Region 6: Renmark, Berri, Loxton, Barmera, Waikerie, Chowilla Game Reserve, Murray River National Park, Lake Bonney, Kingston On Murray Region 7: Swan Reach, Mannum, Murray Bridge, Morgan, Blanchetown, Walker Flat, Purnong Region 8: Tailem Bend, Goolwa, Lake Alexandrina, Meningie, Lake Albert, Coorong National Park None of the above

If one of the above, continue to question 7 If none of the above, continue to question 15 7. When was your most recent visit to the Murray region?

In the last 3 years In the last 4 - 10 years More than 10 years ago If last 3 years, proceed to question 8 If more than 3 years, proceed to question 20

8. How many trips per year, on average, do you make to the Murray River region?

Average number of trips per annum ___

9. And when was your last visit to the Murray region?

Month: ____ Can’t recall the month Year: ____

10. What was your main purpose of the visit?

To visit family there To visit friends there It was a convenient stop-over point To visit a specific attraction(s) To experience nature To attend a specific event, festival or exhibition It was recommended by friends/travel agent To experience the Murray River It was part of the Capital & Country Touring Route It was part of the Murray River Touring Route It’s a great place for a family holiday It’s a place that is untouched / undeveloped To get away from the city It has good deals on accommodation To play golf


To stay on a houseboat To go camping/ hiking / cycling/ mountain biking or other nature-based experiences To engage in water sports (e.g. waterskiing, kayaking, sailing) To go fishing To experience the region’s wineries To experience the food or local produce There are a variety of things to see and do Other (please specify)

11. How much did you spend in the region? Include all costs – accommodation, fuel, food,

recreational activities (e.g. golf, fishing) etc

$____________

12. How long did you stay?

1 night 2 nights 3 nights 4 nights 5 nights 6 nights 7 nights 8 – 14 nights 15 – 21 nights

21 – 28 nights More than 28 nights 13. Were you impacted by the blue-green algae blooms?

If yes, proceed to question 14 If no, proceed to question 18

14. How did they impact on your holiday?

It has had no impact on my visits to the region I have visited the Murray River region less often I have visited the Murray River region for shorter visits I have visited different regions of the Murray River region than I normally would (i.e. those less affected by drought) I have reduced expenditures on activities as they were not available or were lacking in quality I no longer visit the Murray River region Other (please specify):


15. Did you change your level of spend in the region due to blue-green algae blooms?

Yes, I spent more than I would have (e.g. spent money on activities I would not have usually participated in)

Yes, I spent less than I would have

No, my expenditure would have been the same

If yes, spent more, proceed to question 16 If yes, spent less, proceed to question 17 If no, did not change, proceed to question 20

16. If spent more, how much more did you spend than you would have without the algae blooms?

Proceed to Question 20

17. If spent less, how much less did you spend than you would have without the algae blooms?

18. Did you spend money in other regions that you would have otherwise spent in the Murray River region if blue-green algae blooms were not present?

If yes, proceed to question 19 If no, proceed to question 20

19. How much money did you spend in other regions that you would have otherwise spent

in the Murray River region if blue-green algae blooms were not present?


Smell

Visual impacts





21. After experiencing the blue-green algae blooms, how likely is it that you will return to

the Murray River region for a holiday?

Highly likely Somewhat likely May or may not Somewhat unlikely Highly unlikely


22. If your answer to Question 21 was anything but highly likely, is your likelihood of returning negatively impacted by the media or anecdotal information relating to the 2009 and 2010 algae blooms?

Yes No

If yes, proceed to question 23 If no finish 23. Will you go on holiday elsewhere?

If yes, proceed to question 23 If no, finish


5.3.4 Blue-Green Algae Blooms Water Utilities / Local Governments Focus Group Questions

1. What were the impacts on drinking water of the 2009 and 2010 blue-green algae blooms?

___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________

2. Were you aware of any human / livestock health problems from drinking water that arose from the 2009 or 2010 blue-green algae blooms? If so, what were they?

___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________

3. What, if any, contingency measures did you need to put in place as a result of the 2009 and 2010 algae blooms? E.g. additional monitoring, additional treatment

___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________

4. Did you have to bring in any additional staff or consultants to assist? If so, how many? For what period of time?

___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________

5. What was the annual cost of these contingency measures?

___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________

6. Do you still implement these contingency measures? If so, how frequently, and will they become part of your normal operations?

___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________ ___________________________________________________________________________


5.4 Economic impact study methodology After undertaking the survey, the next step in Stage 2 of the project will involve the production of an economic impact analysis for the impact of blue-green algae blooms in the Murray River region, based primarily on survey results.

In general terms, an economic impact study measures the contribution a major commercial or government activity has on a regional, state or national economy. Moreover, there are two components to an economic impact study – a direct component and an indirect or flow-on component. While the direct employment and economic activity impacts of an industry are usually obvious, the flow-on impacts are not so obvious, referring to the "multiplier effect" of the direct activity.

Some examples of the types of activity usually subject to an economic impact study include:

► entire industries – for example, the economic impact of the horse racing industry;

► major sporting and cultural events – for example, the impact of the Olympic Games, the Formula 1 Grand Prix or a major conference/ convention;

► major projects – for example, the construction of new shopping centre, an industrial or residential development or a new road/seaport/railway line; and

► major facilities or pieces of infrastructure – for example, the economic impact of an Airport or Shipping Port.

5.4.1 Capturing Direct Impacts The direct impacts will be determined based on survey results and stakeholder interviews. Direct impacts need to take into account the effects of:

► Substitution expenditure – simply where demand for one industry’s output is switched to another, therefore providing little net stimulus to an economy; and

► Displacement effects – the implementation of this program may only change the timing for which development of the industry would have occurred anyway.

5.5 Economic modelling options Economic models are used to calculate the indirect or flow on impacts of a policy, project or event. There are a number of models that can be used to determine these indirect or flow on impacts. At a very broad level, when undertaking economic impact assessments, there is a choice between a wide range of possible models including:

► direct impact models;

► static and dynamic ‘micro-simulation’ models;

► static ‘input-output’ models;

► micro-simulation static and dynamic ‘input output’ models; and

► multi-regional ‘computable general equilibrium’ (CGE) models.

Each model has its relative pros and cons, but the debate on model typically comes down to input-output and CGE models. The selection of which model suits which project depends on a range of factors, which are briefly discussed below, including: ► the scale of the input into the economy – is it a large project or major policy spend

which is likely to have big impacts on labour markets and other prices?;


► the geography of the economic inputs– is the impact likely to be largely confined to one region/state or is it spread over multiple regions/states?;

► data availability – quite often, detailed data on projects is limited or expensive to collect (e.g. requiring surveys of multiple users or the general public). CGE models (if they are to deliver on the benefits of more complex modelling) require much more precise input data than input-output models;

► timing – CGE models take a lot longer to set-up and run than input-output models; and

► cost – CGE models (primarily because they take longer to set-up and run) cost a lot more than input-output models.

Where economic impact studies have been done on very large, national, big budget, data rich projects that have the potential to affect prices or run into resource constraints such as assessments of the 2000 Olympics, CGE models are typically used. For smaller projects which are less likely to have national implications for prices and resources and are largely contained to one location, such as assessments of airports or casinos, input-output or static models are typically used.

5.5.1 Indirect Economic Impacts The economic model takes the direct impacts and runs them through the economic impact model to produce the indirect or flow on effects of the industry or investment, or in the case of this project both. The indirect impacts are those that occur downstream of the initial industry expenditure.

Economic Outputs

The typical measures or outputs of an economic impact study, measured over different periods of time include:

► Short term economic impacts:

► Industry output by key sector such as tourism, retailing, manufacturing and construction, accommodation, restaurant and catering, transport and entertainment;

► Employment;

► Household incomes; and

► Gross State Product (value added impact on the economy).

► Long term economic impacts in terms of:

► changes in liveability and economic development from a qualitative perspective;

► potential tourism;

► potential investment attraction; and

► potential for further business development within the region.

In completing the economic impact assessment, we will also seek to confirm the key variables underlying the project outcomes, and will conduct a range of sensitivities using benchmarked or rule of thumb outcomes.


6. Conclusions and next steps

6.1 Conclusions In order to determine the high-level socio-economic impacts of blue-green algae blooms for stage one of the project, information has been sourced from:

► Literature review;

► Media review; and

► Stakeholder consultation.

Based on this information, a summary of the key socio-economic impacts are provided in Table 49.

Table 49: Summary of impacts of blue-green algae blooms on the Murray River region

Economic impacts Social / community impacts Environmental impacts

► Tourism industry, including: ► Camping / caravan parks

and other accommodation ► Waterskiing, sailing,

houseboating and other recreational boating rentals, equipment sales and repairs



supermarkets, petrol stations)

► Golf courses ► Wineries

► Agricultural industry (death of livestock through consuming water contaminated with blue-green algae)

► Potential lost productivity of workers from becoming ill and being away from work as a result of recreational contact with blue-green algae

► Increased cost to Government of filtration systems to purify water during outbreaks, likely to be passed on to the community through council rates

► Potential to be required to increase health service provision for treatment of people who have become ill after consuming

► Inability to attract people to the region through negative press or first-hand experience of impacts of blue-green algae blooms

► Hardship to residents through reduced tourist numbers

► Reduced river health ► Reduced health of species living

in and around the Murray River ► Death of species living in and

around the Murray River, potentially having long-term impacts on species numbers

► Visual impacts ► Smell impacts

Initial findings suggest that:








► Wineries;


► Livestock that drink water from the Murray River are impacted (health issues and/or death). This impacts most significantly on properties with livestock which are on the Murray River, however may also be create problems for livestock watering and irrigated agriculture from water diverted from the rivers by channels (e.g. Mulwala Main Canal). In addition, there is the natural distributary system (Gulpa Creek, Edward River) where water already impacted by blooms from the Murray flows into and impacts on the streams; and


Of the businesses which are likely to be impacted, there are a much greater number in Victoria when compared to NSW, and as such, the socio-economic impact of blue-green algae blooms is expected to be relatively larger in Victoria when compared to NSW.

6.2 Next steps It is recommended that Stage 2 of this project goes ahead to more accurately determine the socio-economic impact to the Murray River region of blue-green algae blooms on the Murray River.

Stage 2 will involve setting up a project steering committee and undertaking a more detailed socio-economic impact assessment of the Murray River algal blooms. This will include quantification of the likely associated economic costs.

Stage 2 will involve sourcing direct cost data of blue-green algae blooms on the Murray River from targeted surveys. This direct cost data will then be used as input to undertake an economic impact analysis to determine the overall socio-economic impact for NSW and Victoria.

This information will be used to assess the requirements for Government to manage the impacts of potential blue-green algae blooms in the future.


Appendix A Reference list

Australian Bureau of Agriculture and Resource Economics (formerly of CSIRO Land and Water) (2007), Water for a Healthy Country – Valuing recreation in the Murray, June.

Australian Bureau of Statistics, Census data, National Regional Profiles, Catalogue 1379.0

Bennett, Dumsday, Howell, Lloyd, Sturgess and Raalte (2008), “The economic value of improved environmental health in Victorian rivers”, Australian Journal of Environmental Management – Volume 15, September.

CSIRO Land and Water (2003), What is the Status of River Health in the Murray-Darling Basin? October.

CSIRO Land and Water (2002), Value of Returns to Land and Water and Costs of Degradation: Estimating non-market values, February.

Department of Environment, Climate Change and Water (2009), Determining an economic value for improved water quality in the Darling River, August.

Department of Resources, Energy and Tourism (2010), Destination Visitor Survey – Strategic Regional Research Murray River Region (NSW, Victoria and South Australia), April 2010.

Huang, Lei et al – School of Environment University of Nanjing, China (2009), Public Perception of Blue-Algae Bloom Risk in Hongze Lake of China, Environmental management Journal.

http://www.business.nsw.gov.au/region/profiles/murray.htm

http://www.factiva.com/hp/printsavws.aspx?ppstype=article


http://murraynow.com.au/

Ker P, 2010, “Algae takes the bloom off river holidays”, The Age, 6 March.

Land and Water Resource Research and Development Corporation, and Murray-Darling Basin Commission (2000), Cost of algal blooms, January.

Lauder S, 2009. “Potential toxic algae bloom threatens Murray-Darling”, ABC, 28 March.

Lin Crase and Rob Gillespie (2006), A preliminary consideration of use and non-use values circumscribing the Lake Hume Water and Foreshore Management Plan, March.

National Centers for Coastal Ocean Science (2005), Economic Impacts of Harmful Algal Blooms, June.

NSW Office of Water (2009), The Murray River Algal Bloom – Evaluation and recommendations for the future management of major outbreaks, December.

Ryan S, 2009, “Murray-Darling basin inflows slow to a trickle”, The Australian, 8 April.

http://www.business.nsw.gov.au/region/profiles/murray.htm

http://www.factiva.com/hp/printsavws.aspx?ppstype=article


http://murraynow.com.au/


Stuart Blanch (2002), “A brief history of the development of rivers for irrigation in the Murray-Darling Basin and the environmental consequences today” Mekong Dialogue Workshop, September.

The United States Army Engineers Research and Development Center (2009), The Impact of Harmful Algal Blooms on USACE Operations, January.

Watson R, 2009, “Holidaymakers warned on toxic blue-green algae”, The Daily Telegraph, 8 April.

Woods Hole Oceanographic Institute (2000), Estimated Annual Economic Impacts from Harmful Algal Blooms (HABs) in the United States, September.


Appendix B RACC Press Release

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