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More water for Gippsland with start of Phase 2 of Macalister Irrigation District project

 The Australian and Victorian governments have announced the start of work on Phase 2 of the Macalister Irrigation District modernisation project following the signing of a construction milestone funding agreement.

Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development Michael McCormack said the Macalister Irrigation Modernisation Phase 2 Project would build on previous investments across the Macalister Irrigation District.

“We want to increase water security across Australia and funding projects such as the modernisation of the Macalister Irrigation District is getting that job done,” Mr McCormack said.

“We have committed to build the next generation of water infrastructure to create jobs and contributing to regional economic recovery.

Irrigators are already seeing benefits of the modernisation project, allowing significant on-farm investment and improved irrigation practices.

The completion of Phase 1 will result in a saving of up to 22 gigalitres of water. Phase 2 will increase water availability and security through the generation of around 10,300 megalitres of water savings and will improve water delivery efficiency to support increased agricultural output.

Victorian Minister for Water Lisa Neville said Victoria had led the way in modernising the Macalister Irrigation District to deliver benefits for both Gippsland farmers and the environment.

“The Victorian Government is proud to have invested more than $46 million in the Macalister Modernisation through Southern Rural Water – and locals are already seeing the benefits,” she said.

“The project delivers water savings and increased efficiency for irrigators, while supporting the health of the environment including the Gippsland Lakes.”

Federal Member for Gippsland Darren Chester said Phase 2 of the project would complete the transformation of the Macalister Irrigation District’s ageing assets into a highly automated, efficient, modern water delivery system.

“This project is supporting hundreds of local jobs, protecting the environment and building on a world-class agricultural region to make it sustainable for the next 50 years,” Mr Chester said.

“It complements the other water projects being constructed in Gippsland, such as the $10 million Lindenow Valley Water Security Scheme.”

Jane Garrett, MLC for Eastern Victoria, said the Macalister Irrigation District was an important economic driver for Gippsland.

“These upgrades create work in construction and secure the prosperity of the region for future generations,” Ms Garrett said.

The $62.6 million Phase 2 project is jointly funded by the Australian Government providing $31.3 million, the Victorian Government $10.4 million and Southern Rural Water $20.9 million.

The previous $60 million Phase 1B project was also jointly funded by the Australian Government, the Victorian Government and Southern Rural Water with $20 million each.

The Australian Government is investing $3.5 billion towards a 10-year rolling program of water infrastructure projects that, in partnership with states and territories, will help supply billions of litres of water for productive use each year and deliver the National Water Grid.

This investment will grow Australian agriculture, increase water security, build resilience to drought and support regional prosperity.

For information about the National Water Grid visit

 Chairman and MD welcome the milestone announcement

Southern Rural Water Chairman Diane James AM and Managing Director, Cameron FitzGerald welcomed the milestone announcement. 

“We join the Australian and Victorian Governments in celebrating the transformation of the MID through this once-in-a-generation investment program that delivers water security and underpins a thriving regional economy,” said Ms James.

Mr FitzGerald said: “We are proud to help deliver the benefits that flow beyond our customers’ businesses, to the markets they supply, the communities they live in, the jobs created during and after construction, and to the environment.”

The funding will complete a total of $160m in MID2030 modernisation program since 2015, which has included channel upgrades, new pipeline, automated outlets, a balancing storage and reconfiguration of much of the 100-year-old system.

Mr FitzGerald said that the commitment to the MID2030 modernisation program from both state and federal governments, recognises the $500m in value that the dairy, beef and horticulture businesses in the MID bring to the Victorian economy annually, and unlocks the value for rural businesses to expand.

The Phase 1B project has replaced ageing channels with 38km of pipeline throughout the Tinamba and Mewburn Park area and has upgraded a further 28km of channels in the Riverslea area. 

“Modernised supply through the Phase 1A and 1B projects since 2015 has enabled MID farmers to invest in new on-farm infrastructure, update irrigation practices and improve productivity. Farmers have reported the benefits of more reliable delivery, faster flow rates and reduced waste, which has allowed them to expand their businesses,” he said.