The processes of water regulation that have emerged in Australia, while influenced by international trends across the spectrum from market environmentalism to human rights discourses, exhibit some distinctively Australian characteristics. These patterns reflect the historical and contingent importance of water as a ‘resource’ within Australian society and the economy. In the first phases of the CoAG and NCP national water-reform agenda, urban water issues were clearly eclipsed by concerns over the seemingly intractable decline of rural water resources. Water reforms were first sparked several decades ago by heightened concerns over salinity, together with a growing acceptance of the long-term adjustments occurring across rural industries, which traditionally relied on extensive water use. Severe water shortages over the last few years in traditional urban water supply in south-eastern capital cities and in Perth, have refocused government and community attention on water in, and for, cities. Governments, which in the past had enthusiastically embraced a hydraulic model of water supply (Bakker 2005) largely predicated upon high levels of technological infrastructure development, were seemingly uncomfortable with stringent demand-side measures, such as staged urban water restrictions. While such demand-related measures were instituted (see, for example, D part 3 division 1A Water Industry Act 1994 Vic), governments across all states seem to find long-term restrictions on water use for urban communities unpalatable. In a reversion to earlier dependencies on water-resource development models characterised by high levels of technological complexity, many governments have instituted infrastructure-based supply-side ‘solutions’ under the rubric of ensuring water security for urban areas.

In this context, arguably, what has occurred is that despite a purported reliance on market mechanisms to institute behavioural and structural change in water use, the neo-liberal reform agenda has been amalgamated with earlier models of state-based infrastructure development to form a hybridised model of state control, privatisation and market forces. While the potential for transactional-based market ‘efficiency’ approaches still exists, many recent policy choices privilege water-supply infrastructure development, albeit in concert with market mechanisms such as water trading. New species of water ‘rights’ are being advocated, such as the right of access by prospective businesses to public water-infrastructure development either as ‘third-party rights of access’ to existing infrastructure or through private ‘participation’ in new projects for water-infrastructure development. Such approaches have direct ramifications for the balance between state ‘ownership’ and control, and private ‘property’ in urban water. As Gray and Gardner (this volume, Chapter 7) note in regard to urban sewer mining and wastewater treatment: ‘The recycling of human wastewater is being reinvented as both an environmental and commercial opportunity that can be facilitated by giving “third-party” access to established public-sector infrastructure and — importantly — to the sewage!!’

Third-party access issues and the associated implications for conceiving property in urban wastewater are dealt with extensively in Chapter 7. Therefore this chapter does not canvass those points. Rather, the chapter addresses the manner in which recent policy decisions and emerging legal frameworks for urban water reinscribe but also transform earlier legal patterns of water-supply resource development within Australia. Models of state resource development and access have been modified, but not displaced, by market mechanisms and trends to privatisation. Water regulation exhibits an accretion of various layers of regulation and law rather than a situation where one model of law and regulation is sequentially replaced by another; notwithstanding the extensive law-reform processes that have been initiated in recent decades. To understand this accretion process it is necessary to understand how rural and urban areas were integrated, but separately regulated, under the earlier resource-oriented modes of water law and policy. Arguably, current models of water-resource development founded on technological infrastructure reinstitute interdependency between rural and urban — a factor which remains only partially acknowledged in emerging policy and legal frameworks.

Within Australia, historical patterns of water use, post colonisation, were linked to prevailing land-use settlement patterns. Urban development was strongly influenced by a colonial, and then national, agenda of primary production, and an export economy funnelled through the major port and infrastructure nodes represented now by the major metropolitan capital cities. The patterns of production introduced under the colonial enterprise whereby Australia, together with many other parts of the colonised world, supplied food and fibre to a rapidly industrialising Europe were premised upon the ‘colonial earth’ and its resources largely being treated as ‘free goods’. This was accompanied by economies of scale in the infrastructure development under the increasingly sophisticated regime of land and resource administration and utilisation (Godden 1997).

Integral to such an emerging administration system and resource-exploitation program that produced the ‘classic’ nineteenth-century colonial model of centre-periphery governance focused upon the colonial capital cities was the necessity to dispense with the riparian doctrine of water rights. Key aspects of the doctrine initially centred upon allowing ‘use’ of water by upstream users so long as there was not undue interference with the ‘economic utilisation of water’ by downstream users. At its very basis, it is an appropriation model that adopts a very simplistic instigation of individual rights and associated allocation principles over a common resource.

Within Australia from the late nineteenth century onward, there was a progressive move to replace riparian doctrines with a statutory framework for water regulation, predominately to promote inland settlement based around the implementation of irrigation schemes, largely but not exclusively in the Murray-Darling system (Clark 2003). In urban areas, too, the force and influence of bureaucracies grew and a corresponding statutory and institutional basis for water-supply provision was progressively implemented (Powell 1989; Davison: this volume Chapter 3). Trends to institute statutory forms of water governance and associated public utilities required an articulation of the legal foundation for such governmental control in the statutory vesting of water resources, which occurred in concert with a move from smaller, private sources of water supply.