A new NSW Government policy on floodwater harvesting amounts to the retrospective legalisation of Murray-Darling Basin environmental theft, critics say.
No new structures that allow farmers to harvest flood flows will be approved, as the State Government promises to crack down on water theft in the Murray-Darling Basin.
Farmers diverting flood water and storing it is a widespread but largely unregulated practice.
Under the new policy, a cap will be set on the amount of floodwater that can be taken and those already taking it can seek approval for the floodwater harvesting infrastructure they have.
They will also have to get a licence for the amount of floodwater they store.
The policy will not affect farmers' harvestable right, which allows them to capture and store 10pc of the rainfall run-off on their property without a licence.
"We are certainly not banning hillside farm dams," said the NSW Water Minister, Nathan Rees.
"But the days of unrestricted capturing of floodwaters … are over.
"This is a resource that should be shared fairly and in a balanced way between the environment, legitimate users and the communities along our rivers.
"From today, no new works such as levees, dams and channels that capture passing floodwaters will be considered for approval."
Mr Rees and the Environment Minister, Verity Firth, visited the Macquarie Marshes in north-western NSW to make the announcement yesterday.
It comes in the wake of evidence that a maze of levee banks, channels and dams is stealing water from NSW flood plains, threatening to undermine the $10 billion Murray-Darling Basin rescue plan.
A study by Celine Steinfeld and Richard Kingsford from the University of NSW said the environmental water stolen on the flood plain that is home to the marshes had savaged bird breeding and killed reed beds and river redgums.
Professor Kingsford said earthworks that diverted water from the environment "are widespread on the rivers of the Murray-Darling Basin".
"Growth has largely come because of lack of government policies, regulations or enforcement," Professor Kingsford said.
Andrew Gregson, chief executive of the NSW Irrigators' Council, said floodwater harvesting was particularly crucial in north-western river valleys and it was vital that farmers be compensated if they were forced to stop the practice.
Mr Rees said there would be no compensation for any structures that were not approved or licensed.
But once a farmer had a licence it could be traded and would attract compensation if the government wanted to cancel it.
"Not all existing works will be authorised," he said.
A marshes grazier, Dugald Bucknell, said the policy would help rivers that still had light development, such as the Warrego, but was "40 years too late" to help the Macquarie.
A marshes activist, Sue Jones, said she doubted the new rules would be properly policed.
Terry Korn, co-ordinator of the Australian Floodplain Association, said that if it came to "paying compensation for water people effectively got for nothing; that's a travesty. It's another nail in the coffin for the environment and another cost to the government."
However, Mr Korn said it was positive that NSW finally had a flood plain policy.
Ms Firth promised more auditing and surveillance to ensure the policy was adhered to.
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