Reducing red tape for Irrigation Trusts

About

This engagement has now closed

We are seeking feedback on plans to reduce red tape and respond to market barriers for irrigation trusts under the existing Irrigation Act 2009.

What is being decided?

An amendment to the Irrigation Act 2009 has been requested by industry to reduce red tape and respond to market barriers under the existing legislative scheme.

The proposed amendment will provide a greater level of flexibility for a trust to pursue investment opportunities or restructure its business model to operate as an entity other than a trust (e.g. such as a corporation, association and co-operative) should it wish to do so.

This proposal is intended to facilitate new pathways for investment, and promote greater business efficiency and growth in South Australia’s critical irrigated agriculture sector. Read more about this here.

The Department of Environment, Water and Natural Resources is now seeking feedback on the draft amendment (PDF 35KB) by COB Friday 30 June 2017.

How can your input influence the decision?

The proposed amendment has been drafted to achieve the outcomes sought by industry.

Consultation is important to ensure that the amendment will achieve the outcomes sought and will not result in any unforeseen or undesired consequences for the agriculture industry.

Your input will be presented to the Minister for Water and the River Murray for consideration in finalising and settling the draft amendment before it is sought to bring the changes into effect. This amendment may be of particular relevance to irrigation trusts, potential investors and/or industry groups.

Have your say and submit your feedback by:

Completing the survey, joining the discussion, sending in a submission to yvette.colton@sa.gov.au or:

Yvette Colton
Senior Policy Officer
Department of Environment, Water and Natural Resources
Level 5 81-95 Waymouth Street
Adelaide 5001

In providing feedback, please consider whether the amendment will provide the desired level of flexibility for a trust to pursue investment opportunities should it wish to do so.

Information about what we heard and what changed as a result will be available on this page following closure of the consultation period.

Background

The Irrigation Act 2009 provides a common set of laws and governance regime under which thirty-four irrigation trusts currently manage and operate shared infrastructure for irrigation or drainage purposes in South Australia. An irrigation trust is an entity that conducts business in primary production, and manages and operates shared infrastructure to deliver water or drain land for the benefit of its members.

In 2015, government was requested to address limitations under the Act that were hindering irrigation trusts from pursuing investment opportunities or restructuring their business. In particular, relevant provisions meant that an investor would be required to operate as an irrigation trust rather than under a business governance model determined by the investor.

The amendment will not require irrigation trusts to take any action and they can continue to operate as business as usual. The amendment will simply offer a greater level of flexibility for a trust to pursue investment opportunities or restructure its business model to operate as an entity other than a trust (e.g. as a corporation, association and co-operative) should it wish to do so. Any such change would be voluntarily initiated by resolution of a majority of members of a trust if the trust determined that structural business changes are desirable at a given point in time.

In all other respects, the current processes for trust dissolution and property disposal on dissolution remain unchanged. In particular, if a trust seeks to dissolve, an application to the Minister for Water and the River Murray is required and, if the Minister is satisfied that an appropriate application has been made, the Minister may then give effect to the dissolution and enable the assets and liabilities of a trust to pass to a new party. The Government provides a last resort “guarantee” so that, if it is not possible for the assets and liabilities to pass to a new party, these may revert to Government.