Councils criticise how Victoria plans to divvy up $140m to Murray-Darling Basin towns

Victoria is finalising plans to carve up $140 million for communities affected by water buybacks in the Murray-Darling Basin, despite pushback from seven councils over how the funding will be divvied up.

Victorian Water Minister Michaela Settle says the state's share of the Sustainable Communities Program (SCP) will be delivered after consultation with communities, including irrigators.

The Sustainable Communities Program is a federal initiative, providing $300 million over four years to minimise socio-economic impacts on basin communities as a result of water recovery measures.

It has already rolled out in New South Wales and South Australia, but has, to date, been off-limits to Victorians after the state's refusal to sign the Murray-Darling Basin voluntary water buybacks scheme.

Now, the Victorian government says it is negotiating with the Commonwealth to accept $140 million, despite its opposition to the "non-strategic buybacks".

Ms Settle said the allocation of funding would likely be split between Agriculture Victoria, state water projects and individual councils.

Funding 'can help' if done right

Last month, the Murray River Group of Councils — made up of six regional councils — and Greater Shepparton City Council called for the Victorian government to pause the funding and rethink its approach.

The group believes the proposed allocation of funding does not address the individuality of the regions affected by water buybacks.

The current plan for the councils' portion of the funding involves it being delivered through Regional Development Victoria (RDV), which group chair and Swan Hill Mayor Stuart King said adds "another layer of oversight".

The ABC has not been supplied a copy of the plan, but Cr King said only about $10 million of the $140 million was due to be allocated to RDV for distribution between councils.

Gannawarra Shire Mayor Garner Smith said he did not want the money to go to waste.

"There are already plans and strategies lining bookshelves gaining dust and there's no follow-up funding to even make them happen, even if they happen to contain some good ideas," he said.

"I think she's [the minister's] just totally missed the whole point."

Cr King said funds should be allocated to local government directly so it can distribute funds in a way that accurately meets the needs of the community.

"Every one of our communities has been affected differently by water recovery. Each has its own industries, strengths and opportunities," he said.

"[Local government] knows where the opportunities exist, where the chances lie and what investments will deliver meaningful long-term economic and social benefits."

No plans to pause program

When asked if the funding allocation would be changed or postponed until after the state election, Ms Settle said, "Certainly not".

"I'm really keen to get that money out into the community," she said.

"We've had many conversations, the community wants to see that money on the ground and I'm working to get it out as soon as possible so that we can support farmers that are facing issues around their water and irrigation, we can support communities to stay strong through development."

Ms Settle acknowledged there were various views on how the money should be spent, but believed the government had "found the best way forward".

In NSW, councils, businesses, and organisations can apply for a share of $160 million, which is allocated across various grant rounds.

The same process applies in SA, where $20 million was given under the federal initiative.

Consultation with communities

Ms Settle said government had done an "enormous amount of consultation" with community, farmers, councils and local representatives, but Cr King said the councils felt they have not been included.

"We had preliminary meetings late last year in regards to this and we laid out some generic ideas … about how we thought that this funding could support and assist local government, and then we heard crickets," Cr King said.

He said the group wrote to former water minister Harriet Shing before this month's cabinet reshuffle, as well as Ms Settle, with "no response".

"I came face-to-face with the minister at a function in Parliament House last week and reminded her of our request," he said.

"She was aware of it, but still no response."

Political motivations questioned

Last week, Ms Settle suggested political motivation may be involved in the councils' opposition to the program.

Cr Smith was this month announced as the One Nation's candidate for Murray Plains at the upcoming November election.

"We've also consulted a lot with the councils and to be frank, I was a little disappointed," Ms Settle said.

"One wonders if it's politically motivated to come out from the Gannawarra fellow [Cr Smith], because we have been speaking to them about this and we found a place where we can support farmers, we can support communities, and that's through irrigation projects, development projects, and also making sure communities stay strong."

In response, Cr Smith requested the minister meet with the group to discuss the matter.

"Let us discuss our concerns because right now, Gannawarra as a community is probably looking at getting $1 million out of the $150 million sustainable communities fund and I just don't think that's acceptable," he said.

"We've put in the request; she just has to approve it and the ball's in her court."