The amendments to the Murray-Darling Basin Plan have raised concerns among Border farmers, who believe it will lead to food insecurity and heightened flood risks.
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However, Victoria has chosen not to sign the agreement.
Victoria premier Daniel Andrews was asked on Thursday whether his decision not to sign was predicated on his upbringing in Wangaratta.
"I'd say to you [that] everything that I do was informed by where I grew up, everything," the premier said.
"I'm proudly the son of a beef farmer and a small business person who worked in a smallgoods industry for decades, and was very successful.
"I am the product of my environment. I'm the product of the way I was brought up. And everything that I do is informed by that."
The states will have until the end of 2026 to deliver their 605 gigalitres of water-saving infrastructure projects and the end of 2027 to recover 450Gl of environmental water.
The extended deadlines will be paired with more funding to deliver the projects and more options to recover the environmental water, including buybacks.
Bungowannah farmer Andrew Watson said the plan would mean disaster for irrigators.
"If we keep going down this path, we'll have to import all our food from overseas because we're discouraging people to grow food and fibre," he said.
"Buybacks just don't work - they wreck communities.
"No matter what compensation you pay, once you take the water away, you take away the only avenue farmers have for production and it just doesn't work."
Environment and water minister, Tanya Plibersek, said the amendments aimed to protect the environment from future emergencies.
"The Murray-Darling pumps life into the heartland of our country," she said.
"If we don't act now to preserve it, our Basin towns will be unprepared for drought, our native animals will face the threat of extinction, our river ecosystems will risk environmental collapse, and our food and fibre production will be insecure and unsustainable."
Chair of the Speak Up campaign and Albury resident, Shelley Scoullar, hit back and said the plan's "focus is not on achieving environmental outcomes, but political ones".
"Less water for growing food not only severely impacts the economies of our rural communities, less food means increased prices at the supermarket, further exacerbating the cost of living crisis," she said.
"It's hard to determine whether Ms Plibersek and her government do not know the consequences of their actions, or do not care."
Murray River Action Group chair and Border farmer, Richard Sargood, questioned the government's ability to deliver more water given its existing struggles.
"I don't know how much water this environment wants," he said.
"They've already got 4500Gl of environmental water that they already own - they can't deliver that, they won't be able to deliver this 450Gl extra.
"The elephant in the room here is that they cannot deliver this 450Gl without significant social and economic third-party impacts."
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Flooding will be another unforeseen impact, Splitters Creek farmer John Fowler says.
"Probably over half the water in Hume and Dartmouth (dams) is for the environment already, and this will just add to more of it," he said.
"So there'll be less water for production of food and fibre and then we'll be exposed to more environmental flooding."
Mr Fowler said the money should be used elsewhere.
"You have to remember Australia is in a massive debt because of the COVID outbreak," he said.
"So to spend a heap of money on water buybacks when hospitals, roads, and many other things are struggling to get financed is just insanity."
Deputy opposition leader Sussan Ley described the plan as "a kick in the guts to rural communities".
"No consultation, no visiting, no understanding by either the Labor Premier or the Labor Water Minister," she said.
"But the biggest insult of all is we're taking your water. Yes, we'll pay you for it, and that's OK for the people who sell their water.
"But it's not OK for the communities that are left behind because they lose the critical mass of agricultural production.
"They've just gone ahead and they're trading off our rural communities for outcomes that satisfy the Greens that don't even improve the environment."
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