After three years of mounting legislation, regulations and compliance obligations, the Auditor-General has found the Minns Labor Government cannot demonstrate whether its water reforms are delivering meaningful benefits.
A report by the Auditor-General has found the Department of Climate Change, Energy, the Environment and Water (DCCEEW) has not adequately assessed the cumulative impact of water reforms introduced since 2017, and cannot demonstrate whether compliance and enforcement measures have improved the sustainable management of non-urban water use across NSW.
Rather than simplifying the system, the Auditor-General found that successive reforms have contributed to a regulatory framework so complex that staff across all three water agencies – DCCEEW, the Natural Resources Access Regulator (NRAR) and WaterNSW – have struggled to consistently interpret and apply water rules.
NRAR itself reported that most instances of non-compliance are the result of water users misunderstanding increasingly complex water laws.
The report also identified significant deficiencies in the data and information systems underpinning water regulation, finding that outdated systems, poor data quality and limited access to critical information continue to impede enforcement efforts.
Importantly, the Auditor-General found these deficiencies limit agencies’ ability to identify risks, detect breaches, monitor compliance and evaluate the effectiveness of the broader water management framework.
Shadow Minister for Water Steph Cooke said the findings validate concerns repeatedly raised by the NSW Nationals and stakeholders across the irrigation sector.
“For the past three years, the Minns Labor Government has continued to introduce new legislation, new regulations, new reporting requirements and tougher penalties, yet this report makes clear they cannot demonstrate whether any of it is actually working,” Ms Cooke said.
“Instead of fixing the underlying problems in the system, Labor has added layer upon layer of complexity to a framework that was already difficult to navigate.
“The Auditor-General has found that even government agencies are struggling to consistently interpret and apply the rules.”
Ms Cooke said if regulators can’t navigate the system with confidence, how can the government expect water users to do so?
The report was equally critical of NRAR’s ability to demonstrate its effectiveness, finding the regulator lacks adequate performance measurement and reporting frameworks and has poor governance over key compliance and enforcement data.
“The findings were particularly concerning given Labor’s decision to significantly increase penalties under the Water Management Legislation Amendment (Stronger Enforcement and Penalties) Act 2025,” Ms Cooke said.
“While Labor has focused on increasing penalties and expanding regulatory powers, it has failed to address the fundamental issues identified by the Auditor-General.
“The people of regional NSW deserve a water management system that is accountable and transparent, not an ever-growing maze of red tape.”
Ms Cooke called on the Minns Labor Government to implement the Auditor-General’s recommendations, including a comprehensive review of the cumulative impact of water reforms and action to address long-standing deficiencies in water data and IT systems.
“The government must stop measuring success by the volume of legislation it passes and start demonstrating real outcomes for irrigators, regional communities and the environment,” she said.
