Australia needs leadership and clear policy objectives if an integrated approach toward urban water management is to succeed, a report has found.

In its latest report, the Productivity Commission found that Australia could derive substantial benefits from managing its water, wastewater and storm water in a holistic manner which caters not only for traditional water services but also for liveability features such as landscapes and open space.

Nevertheless, it says such an approach – known as integrated water cycle management (IWCM) – is being inhibited by barriers in ten areas across the realm of policy environment, water service planning and delivery and regulation.

Most importantly, the Commission described a lack of clear policy objectives in respect of water-related aspects of urban amenity.

Whilst broad government statements support the need for better urban amenity through green space, the Commission said there was a lack of clear, government-endorsed objectives for features of urban amenity which relate specifically to water.

This, the Commission said, has several flow-on consequences.

These include:

• An absence of clear authority for the provision of water for urban amenity purposes. This, in turn, diminished the incentives for water and planning authorities to collaborate about how water might be provided for amenity purposes.
• No clear policy framework to define how benefits of water provision for enhanced urban amenity should be balanced against the costs of providing this when planning greenfield development or significant urban renewal.
• A lack of clarity about roles and responsibilities for water related urban amenity provision or who should pay for the costs to provide water for urban amenity purposes.

Around Australia, the urban water sector faces long term challenges as population projections indicate that our five largest capital cities will need to accommodate around ten million additional residents by 2050 whilst a changing climate drives increased temperatures, lower rainfall, more droughts and more storms.

Simultaneously, a growing emphasis on ‘liveability’ and amenity is driving greater need for provision of water in both urban landscapes and open green space.

As this happens, there is growing recognition of the need to ensure that water resources are managed in a way which accommodates not only water security and public health requirements but also environmental and urban amenity outcomes.

Nevertheless, the Commission says there are several barriers to achieving this.

Apart from the lack of policy objectives referred to above, these include:

• A lack of formal processes for linking statutory land planning with water planning
• Little integration between stormwater management (mostly undertaken by local councils) and general water planning (mostly undertaken by water authorities).
• Policy restrictions and mandates which restrict options which can be considered
• Barriers to collaboration between local government and water utilities as questions about who should lead or where responsibility lies for monitoring, ongoing maintenance and stakeholder engagement are often unclear.
• A lack of transparency and rigour in assessing alternative water management options and decisions about such options not always being informed by robust analysis of net benefits.
• A lack of formal process to facilitate interaction and exchange of information across different water services (water, wastewater and stormwater) and between local and city wide planning
• An excessive focus from environmental regulators on actions instead of outcomes; and
• Cumulative effects of regulation.

Whilst examples of best practice are evident, the Commission said leadership in this area is lacking.

It said the benefits of integrated approaches are substantial.

“None of these impediments are new. In each area, there are examples of best practice. In these cases, governments clearly understand the need for integrated water management and are seeking to enable or facilitate the approach to be taken,” the Commission said in its report.

“Yet they have not provided the leadership required through substantive policy change for IWCM to become the new business‑as‑usual approach for urban water management …”

“… The ten key impediments identified point to where action is needed to progress IWCM towards becoming the new business‑as‑usual way of planning and managing urban water resources.”

“This would assist urban water providers to make better decisions and deliver lower cost solutions for providing the full suite of community water needs in our major cities.”