THERE is a strange disconnect in the way Australian government treat water and other natural resources. With few exceptions, state and federal governments accept that companies should pay royalties (or resource rent taxes) if they exploit petroleum or mineral deposits that ultimately belong to the Australian community. When governments provide rail and port facilities, they usually charge the mining companies more than enough cover the capital and operating costs. Efforts to recover the cost of the environmental damage caused by resource extraction are also improving.

It’s vastly different story with water, although it too is a community-owned natural resource…