Big Australia incompatible with nation’s scarce water supplies

Yesterday I reported on a draft strategy on Sydney’s future water supply, which warned that the city faces acute water shortages as its population swells on the back of mass immigration:

Sydney population projection

This draft strategy followed similar warnings from the Productivity Commission that our cities face chronic water shortages in the decades ahead as their populations swell by a projected 11 million people.

Yesterday, The SMH reported that recycled sewerage could be one possible solution to Sydney’s water woes:

“We need to plan now for how our growing city and region will use water wisely as Sydney’s population is set to grow to 7.1 million by 2041,” [NSW Water Minister Melinda Pavey] said.

“Our analysis shows that we will need to invest in additional water supply in the next five to 10 years, then again around 2040 and once more by 2060.”

Asked about the report’s support for the use of purified recycled water for drinking, Ms Pavey said, “The review highlighted a range of options, and we’re eager to hear what options the community wish to further explore”…

“Our preliminary analysis shows that, over the past 30 years, average inflows to Sydney’s dams have been half the long-term average since records began in 1910, while significant flooding events have also occurred,” [the report] said. “Future climate risks and extreme events mean we cannot meet our water needs by only using traditional water supply approaches.”

One things for certain, any technological solution to boost Sydney’s (or any other city’s) water supply – be it desalination or sewerage recycling – will be incredibly expensive compared to traditional sources, with the increased costs borne by the incumbent population:

High cost of new water supplies

As a result, household water bills will rise dramatically, which will adversely impact lower income households in particular.

In fact, modelling by Infrastructure Australia in 2017 projected that household water bills would more than quadruple in real terms because of population growth and climate change, rising from $1,226 in 2017 to $6,000 in 2067. The report also warned that “the impact of these changes on household affordability could be substantial… and could lead to significant hardship”:

Here is another example of how running a mass immigration ‘Big Australia’ policy wrecks living standards of the working class.

Recall that the Australian Treasury’s latest Intergenerational Report (IGR) projects that Australia’s population will grow by a whopping 13.1 million people (~50%) over the next 40 years to 38.8 million people. This is the equivalent to adding another Sydney, Melbourne and Brisbane to Australia’s existing population:

Australia's projected population growth

74% of this population growth will come directly from net overseas migration (NOM), which has been projected to increase to 235,000 annually from 2025-26 onwards versus 215,000 per year in the 2015 IGR:

NOM projection

These additional 13.1 million people projected by the IGR will massively increase water demand at the same time as supply is reduced from lower rainfall and rising evapotranspiration rates due to climate change.

Therefore, the best and cheapest thing our policy makers can do to safeguard the nation’s water supplies is ensure that immigration does not return to its manic pre-COVID level, nor is raised to the insane (235,000 annual) levels projected by the IGR.

Let’s cut the bullshit: Australia’s mass immigration policy is now a key threat to Australia’s water security.

Unconventional Economist
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  1. Not here in regional Victoria. Since this climate change thing started iv never seen so much rain. Places that are normally dry are green and beautiful.

      • Weather systems changed a lot soon after China covid lockdown. A lot wetter around Victoria. Apart from reduced China emissions, emissions due to tourist and general travel and jet aircraft were cut a lot

        • Seems right. Imagine that. The best way to stop climate change is to stop overseas travel. See how your average 20yo climate change warrior handles that one.

      • I recon this almost permanent lock down in Melbourne might succeed, not just with immigrants either. With a clear eyed vision in the future of an ever evolving covid who in the right mind would ever want to live in an extreme built up area. Well I guess between the ages of 18 to 35 might.

        • Covids awesome. The only people it hurts are those profiteering off house prices.

          Bring it on.

          If you own one house then its all relative. If your house is cheaper to sell then so is the other one you could potentially buy.

          If you own 20 houses, then yes, covid is a bloody tragidy for you.

          Too bad, I reckon.

  2. I'll have anotherMEMBER

    Good article Leith.

    Economists have a unique background to analyse natural resource usage and we need more economists to share their thoughts on the use of our natural resources.

  3. Once again, the government and the Treasury simply couldn’t care less. The driest continent will just have to rain more, and if it doesn’t, they can always ration supply by extending the rural water “market” into the cities. Also, restrict on-site water delivery to private companies and the ultra rich, with the peasants queueing for the leftovers at the communal pumps.

  4. TheLambKingMEMBER

    Whilst I agree with you – growing our population is not in the interests of Australians. I also think water shortages will be a short’ish term (0-20 years) problem. I agree with most of the premise of the RethinkX think tank ( – power will be so abundant and cheap (reducing cost of solar+wind+batteries) we will be finding usage for excess power during the middle of the day. And high energy tasks like desalination and sewage treatment will become common practice around the world. A desal plant can be a reverse battery – build solar+wind for it and it stops production with high energy demand.

    • I’m wondering how the RethinkX mob are accounting for the fast dwindling supplies of resources required for renewable energy products, and how we decouple from oil consumption while stupidly trying to perpetuate infinite economic growth (which requires ever growing resource consumption)

  5. Time for federal treasury going to take these costs of new desal plants into account when determining their mass immigration intake.

  6. I wonder if the time will ever come when there’ll be mass demonstrations against mass immigration. If there is, it will be triggered during a time when there’s a sudden dip in living standards, caused by something like our dams drying up, as Leith hit upon in his article. Unfortunately, a gradual decline in living standards for the average Australian, as we’ve been experiencing over the past 40 plus years, has gone by fairly unnoticed – except, I guess, for those trying to put a roof over their heads. The reason it’s gone unnoticed, is primarily because the younger generations have been born into it. They weren’t around when living standards were better. You have to be 70 or older to have noticed what’s been happening.

    It’s shameful on behalf of Australian government leadership when you consider the wealth under our feet, the valuable lessons both the LNP and the ALP could have learned from their many past mistakes – and of course, the huge technological advancements governments have had at their fingertips. There’s really zero excuses for our slow slide towards ‘banana republicism’. Quality of life in Australia should have been steadily heading north – and that’s for everybody, not just the privileged one percent.

    • There won’t be. In fact there will be calls to boost it higher to bring more of their families over as the Australia culture becomes more mixed (i.e. less special/unique). Many cultures are easier to control than one with a shared history most of the time believe it or not. There’s less common standards and principles to unite people against anything.

      Anecdotally its no coincidence that the people I’ve met who want open borders and to live with COVID the most are:

      – The migrants who have family overseas and want to earn the wealth here but travel “home” at least on a yearly basis. Their heart isn’t here so have less vested interest in the outcome of this country. High house prices are good for them if/when many of them decide to return (and some do).
      – People who fit well into the new global world (e.g. tech, finance, etc). Note due to human nature this isn’t most people and as these jobs get more competitive less and less people will qualify here. They don’t want to “limit” themselves here which creates a chicken and egg problem. Its too easy to go overseas, which encourages less opportunities to start here.
      – Workers that are naturally protected and can therefore still live under the “old rules” before globalisation (e.g. tradies). This is the group that has the most “envy” in Australia because it shows people used to earn decent money, could support a family and not participate in the knowledge “arms race” the second group has to. These people like open borders because they get to “have their cake and eat it” – travel but work under previous rules.

      Most other people powerless will face the consequences of open borders/high immigration just as the powerless always do.

      Some of the Gen X and Y know it Aliart. They see it in the older movies, the way their parents lived and their attitude, and the amount of things they have to think about now vs the “set way” previous generations had. The next generation however won’t.

      • Thanks for the reply AK, your reasoning is both logical and thought provoking. I guess at the end of the day, not many things stay the same forever. Change happens. I think the important thing, from my perspective anyway, is that change should be for the betterment of the planet and the majority of its inhabitants. In regards to the ‘big Australia’ debate, in conjunction with ‘globalisation’, I often ask myself – is it the right thing to do, to create a more even spread of people across the world, by providing a better quality of life for the immigrants at the expense of reducing the quality of life for the majority of the host nation.? In a perfect world, I guess the answer could be yes. But the world’s human inhabitants are far from being perfect. Particularly the majority of the one’s calling the shots under the guise of democracy and the never-questioned, self-serving voting systems – all protected by dodgy constitutions.

        There’s not too many people on the planet who want to exist within a deteriorating environment, knowing that the quality of life for their children and grandchildren will very likely be far worse. Then there’s the growing anger caused by the popular assumption that the principal driver behind ‘big Australia’, is the top end of town – the 1%. Enter your explanation – that as the new arrivals grow in numbers, what used to be the Australian culture, becomes more diluted with each plane-load of immigrants. It’s not difficult to comprehend how governments, their elite donors and the new arrivals enjoy a win, win, win situation. The ‘happy’ migrants will vote for the parties that promote open borders and ‘big Australia’ – the LNP, the ALP and now the Greens – and ‘happy days’ for the big end of town’s elite donors.

        The irony, is that the ultimate losers are the fast diminishing Aussie cultured citizens who exist under a supposedly democratic political system. Citizens, who governments have forever kept weakened via ‘divide and conquer’ – LNP vs ALP. I think we’re about to reach the fork in the road, AK . I sometimes used to think there was actually something morally right about a big Australia. Your thought provoking reply has all but snuffed that out.

  7. Two data issues, the ABS’s forecast of the ‘nebulous’ NOM is unlikely when it is mostly dependent upon international education, especially students from China (peak population has arrived) and India (peak is arriving within generation); backgrounded by declining fertility rates in Asia which inevitably stalls population (growth) with increased ageing.

    Further, the UNPD (which ‘designed’ the NOM formula) which publishes data forecasts leading to 10+ billion global population end of century. This global population forecast has been called out by credible demographers e.g. the Austrian Wittgenstein Centre and even Jorgen Randers (Club of Rome and ‘limits to growth’ fame) as it is based upon unexplained drop then rise in Chinese and Indian fertility rates?

    Most credible demographers do not see population growth but a peak mid century then (possibly precipitous) decline whether Bricker & Ibbitson ‘Empty Planet’, Fred Pearce ‘The Coming Population Crash’, former Deutsche Bank demographer Sanjeev Sanyal or recently Nikkei Asia in ‘The New Population Bomb’ (based on grounded data analysis which contradicts Paul ‘Population Bomb’ Ehrlich catastrophic pronouncements of high population growth).

    As the late but great Prof. Hans Rosling said, increased headline numbers reflect past high fertility rates and now increasing longevity, but will inevitably decline.