This paper traces the evolving institutional and policy responses to the social, environmental and economic needs of stakeholders in the Murray–Darling Basin. The paper begins by describing four cycles of challenge and response in the basin: the first period (1830–1900) witnessed the state-level development of irrigation and navigation in the basin; the second period (1900–1982) encompassed the construction of the basin's major engineering projects and irrigation infrastructure; the third period (1982–2007) covered the institution of market reforms under a ‘whole Basin’ management approach, in particular, the development of inter-state water trading and the National Water Initiative; and the fourth phase (2007–present), marks the assertion of federal authority over water management with the passing of the Water Act in 2007. The second section of the paper provides background on the basin's natural environment and its infrastructure. This section also describes the increasing centralization of basin management authority by the federal government. The paper's final section presents three key questions for the basin's future: (1) the politically acceptable balance between environmental and economic uses for water in the basin; (2) the appropriate allocation of responsibility between federal and state basin management authorities; and (3) the best way to deliver the desired environmental outcomes.

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