Proposals to increase the cost of water to grow food and fibre by as much as 245 per cent over the next five years will drive farmers out of business and drive up the prices of Australian food at the checkout.
NSW Irrigators' Council CEO Claire Miller said Australian farmers are already struggling to compete against the rising tide of cheap imported fruit and vegetables, dairy, meat and cereals.
"Food imports have surged by $7 billion in two years to almost $40 billion in 2023-24," Ms Miller said.
"Our farmers operate to costly high environmental and health standards, and are under financial pressure with rising input costs in interest rates, fuel, insurance, machinery, wages and energy, and higher water allocation prices due to State and Commonwealth environmental water recovery.
"The Premier has already intervened on behalf of Sydney and Newcastle households to ask that IPART limit urban water bills increases.
"If the NSW Government wants NSW households to eat local and support our farmers, then it also must intervene on behalf of rural water customers or risk exorbitant water bills proving the final straw.
"These proposed increases aren't just about farmers. All WaterNSW customers who have a water licence could be impacted, meaning surging costs for councils, sport, processing and food manufacturing.
"There seems to be an assumption from government that farmers will just keep absorbing costs – but they can't – and increased costs end up with the consumer. If the farmer can't pass costs on, then they go out of business. It's lose-lose," Ms Miller said.
"The water pricing model is broken and in need of review in the IPART determination currently underway if farmers are not to be priced out of business."
Price increases of this magnitude threaten the viability of small and medium family farms, which has flow-on impacts to rural communities through closure of businesses, lost employment, and decline of industries critical to the economic and social wellbeing of regional communities.
Rural water customers are being expected to shoulder a large proportion of ballooning departmental costs to deliver a crowded water management and planning reform agenda, most of which involves public good environmental, recreation and Aboriginal programs.
"Rural water customers should not be expected to shoulder the costs of delivering public good reforms that benefit the whole community," Ms Miller said.
NSWIC has made a submission to the IPART determination which can be found here.
