Hunter Water Board (Corporatisation) Amendment Bill

Debate resumed from 14th October.

Mr GAUDRY (Newcastle) [4.5]: The Hunter Water Board (Corporatisation) Amendment Bill, introduced by the Government, will have the effect of amending section 61(3) of the Hunter Water Board (Corporatisation) Act. I agree with the Government that section 61 of that Act is bad law. First, it empowers the Hunter Water Corporation to dump its sewage sludge down mine shafts that pass beneath private property in the suburb of Merewether. This legislation is unprecedented. It will give the corporation a power that no other government department or private corporation has. The proposed legislation has led to fear in the community that it could create a precedent, not only for the Hunter Water Corporation area, but for other areas of the State, for the disposal of other wastes in other mine shafts declared vacant by the Minister. I remind the House that prior to the matter being attacked and the decision revoked, in the past attempts have been made to dump polychlorinated biphenyl wastes in mine shafts in the Wollongong area. Second, and more importantly, proposed section 61(3) will take away the rights of ordinary citizens to take common law action to recover damages from the Hunter Water Corporation for any loss or damage arising from the depositing of waste products from its sewage treatment works in the disused underground mine workings. This is an unprecedented and deliberate attack on the civil rights of the people of Merewether. I do not accept the following statement of the Minister in his second reading speech:

Existing subsection (3), however, has the further unintended consequence of giving the Hunter Water Corporation immunity from any claims or actions that may otherwise have arisen in relation to the sludge disposal process.

Section 61 was a deliberate piece of legislative drafting. It could not be said to have unintended consequences. Honourable members may remember that the Hunter Water Corporation is extremely proud of this ground-breaking legislation and it went through a complex drafting process. It seems inconceivable that section 61 drifted into the legislation and had an unintended consequence. In a letter on this matter to the shadow minister for the environment, the General Manager of the Hunter Water Corporation, Mr Paul Broad, said:


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I will firstly address the matters you raise in relation to Section 61 of the Hunter Water's legislation, which has a threefold purpose:-

Sub-section (1) simply provides a mechanism by which there is formal acknowledgment that a mine working is disused.

That was a deliberate piece of legislative drafting. The letter continued:

Sub-section (2) provides statutory power to enable the disposal of sludge into a disused mine working. The wording is restrictive in that the Corporation:-

- must comply with the requirements of the Environmental Planning and Assessment Act;

- must comply with all necessary statutory approvals;

- must only deposit waste from its sewerage treatment plant; and

- must have obtained and published the order of the Minister as required by Sub-section (1).

Proposed subsection (3) will protect the corporation from legal proceedings in relation to mine disposal of sludge.

Section 61 was written into the Hunter Water Corporation Act to provide the corporation with a failsafe mechanism to deal with a major difficulty it faced in its upgrading program at the Burwood Beach waste water treatment plant. This works takes domestic, commercial and industrial waste from the Newcastle, Charlestown, Lambton and Mayfield areas. It is the largest of the corporation's 28 waste water treatment plants, accounts for 40 per cent of the total waste water flow, and is of enormous importance to the corporation and to people living in that catchment area. Prior to the upgrading, primary treated sewage was disposed at sea via the Burwood Beach surface outfall. That 1930s solution was no longer acceptable to the Newcastle community, the State Pollution Control Commission or the Hunter Water Board. It was recognised that as a result of longstanding community opposition to pollution of the beaches, upgrading should take place.

I pay tribute to the Clean Oceans Committee, a group of concerned citizens in Newcastle who, under the leadership of June Ebrill, lobbied the board, the State Government and local politicians over a period of time for an environmentally safe treatment scheme at Burwood Beach. In the early 1980s the board developed and displayed four upgrading proposals, including a range of treatment and disposal options. Though community and environmental groups favoured the more costly but environmentally friendly tertiary treatment and land-based disposal option, the board settled on a $50 million ocean disposal system. That proposal was approved in 1984 and included construction of an extended ocean outfall discharging about 1,500 metres offshore. That project was completed in May 1989. A new pumping station with millescreens and a grit removal facility was completed in December 1989. A secondary treatment plant was completed in June 1992. On completion of that plant and introduction of offshore disposal of effluent, beaches at Newcastle and baths in the vicinity were greatly upgraded, registering coliform readings far below levels that cause concern in the community.

The upgrading proposal included discharge of waste-activated sludge into the ocean by two separate pipelines that were installed in the base of the tunnel at a cost of $900,000. Waste-activated sludge is a by-product of biological secondary treatment of waste water. It contains organic matter but may also contain heavy metals, pesticides and
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pathogenic organisms. Waste-activated sludge is 99 per cent water and 1 per cent solids. I pay tribute also to the Hunter Water Corporation for its approach to licensing and controlling industrial disposal of wastes into its sewage treatment system, and for acknowledging levels of heavy metals and pesticides and the possibility of pathogenic organisms entering the system through that sewage treatment plant. The major problem that confronted the board was that between approval in 1984 and completion of the secondary treatment plant in 1992 the SPCC outlawed ocean disposal of sewage sludge. What had been the cheap solution suddenly became a rather expensive option. The secondary treatment plant was not able to be commissioned unless a satisfactory alternative sludge treatment and disposal method were made available.

In view of this change, in 1989 the board reviewed its sludge management options. These included a range of methods involving digestion and dewatering of sludge and using it for landfill, composting and land rehabilitation composting - an option that the Sydney Water Board is committed to and one that all water treatment authorities regard as the proper option. The Hunter Water Corporation views that course as a long-term option and regards the present system of disposal down mine shafts as an interim measure. Nevertheless, the corporation is using a method that is not environmentally guaranteed and is putting off the day when it will have to invest in processes that can handle sludge with land-based methods. The corporation did not adopt the more expensive land-based options but rejected them in favour of the mine disposal option. The corporation estimated the cost of that method at $400,000 plus $50,000 annual operating costs. That cost - after opposition to, and refinement and upgrading of the monitoring proposals - escalated to $150,000 per annum. Costs that were not recognised in the initial proposal are being built in.

This option is not guaranteed to be environmentally safe, though the Hunter Water Corporation sees no problems with it. The corporation also saw no problems with the secondary treatment process, which was supposed to be a failsafe mechanism based on best practice overseas technology from the United States. People in Newcastle were assured that process would not create any problems. Yet when the secondary treatment plant was commissioned in June and started in July with the commissioning of the sludge disposal process, almost immediately the local community were appalled by an unholy stink emanating from the process. A micro-organism had developed in the bio-filter - which was not supposed to develop any problems - and one of the by-products was a very noxious gas. By now the Hunter Water Corporation must have received many hundreds of complaints from residents of the Newcastle and Merewether areas asking for action. The corporation has to do something; the process has to be improved in some way. At first it was thought that the problem with the bio-filter could be avoided and that less material would be put through it. However, I understand problems also arise with that process.

The Hunter Water Corporation is facing a review of its methods and may have to cap the bio-filter tower and scrub the gases before releasing them to the environment. Technologically feasible methods are not always failsafe or acceptable to the community. The sludge disposal scheme involves injecting waste-activated sludge under pressure into the abandoned workings of the Newcastle Coal Mining Company. The mine worked the Borehole seam between 40 and 60 metres below sea level. The Minister said in his second reading speech that the seam is 60 metres below sea level. Under the suburb of Merewether it is a little over 40 metres below sea level in some cases. One would hope sludge would not move in the direction of Merewether, but that is not guaranteed. The workings of the Newcastle Coal Company underlie the treatment works as well as the suburb of Merewether. The mine was abandoned in 1921 and its voids were filled with saline water.


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The citizens of Merewether and the Newcastle City Council have consistently opposed the scheme since it was put up by the Hunter Water Corporation. The corporation, through its engineering ingenuity, proposes to monitor the operation and retain the pressure balances in the mine by extracting an amount of saline water equal to the sludge injected into the shaft. Nevertheless, the residents did not feel easy; they were concerned about this untried process. The Hunter Water Board, as the determining authority, did not go through an environmental impact statement process and there could be no guarantee that environmental damage would not occur. The fears were not allayed by the board's public consultation process and the technical appraisal of the proposal undertaken by consultants Dames and Moore. I repeat that the appraisal was not an environmental impact statement but a technical evaluation of the feasibility of the scheme and any possible difficulties so that the board could be advised as to mechanisms it should put in place to ensure that no damage would occur, or that damage would be minimal.

Dames and Moore identified 50 uncertainties inherent in the project associated with the consultants not being able at the time to do a survey of the mine without incurring great expense. The consultants extrapolated their information from a comprehensive survey they had done of the Burwood mine workings, which are workings in the Borehole seam close to the Newcastle Coal Company workings. But there was no guarantee that those workings would have exactly the same geology. A comprehensive survey was not done of the subsurface geology; information was extrapolated. Some boreholes were made into the mine workings but the consultants said that they could not guarantee the homogeneity, if I may put it that way, of the workings. They could not even specify the exact boundary of the workings because they were not able to survey them and there was no guarantee as to the accuracy of previous surveys of the mine workings. There was no guarantee that the subsurface strata had not been involved in various fracture mechanisms. After listing the 50 uncertainties Dames and Moore made the following statement:

Although this list is incomplete, it is clear the uncertainties are many and often interrelated. Obviously these uncertainties make it very difficult to make realistic predictions and therefore monitoring is essential. This report presents a qualified attempt to resolve which of all the variables are key issues upon which to establish a realistic set of monitoring guidelines. It should be appreciated that some uncertainties will probably have to be resolved as the project progresses.

They could not be resolved at the time. So the report shows that there is no guarantee that the system is failsafe environmentally or in its impact on the amenity of residents above the mine workings. In considering the uncertainties relating to mining, the geology of the scene, the geology of the strata, the geology of the soils, the chemistry of the mine waters, the hydraulics and the field logistics, the Newcastle City Council had two areas of major concern. On the risk of contaminated sludge migration, there is no accurate calculation as to the extent that the sludge will spread, however it is expected that within the second year of operation the sludge will be in excess of 1.5 kilometres from the injection point. After legal discussions between the Hunter Water Board and the council and a review of the processes, the Hunter Water Corporation has assured me that the take off point will be placed on the corporation's own land rather than under the suburb of Merewether. It will also ensure that its sludge does not move outside Hunter Water Corporation land within 20 years. That is what the corporation has said but it cannot guarantee that.

The second major concern of the council about the Dames and Moore report was the risk of gas migration. The consultants said that, with possible gas generation in a worst case situation there was potential for large quantities of methane and carbon dioxide to be generated from the sludge digestion and the gas could migrate through the strata and
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the surface cracks. Once again, information on the strata and the surface cracks was extrapolated rather than defined by the Dames and Moore study. So there is the potential of sludge migration and gas migration. There is no guarantee those problems could not occur. The council said in its appraisal that sludge should be disposed of in a secure location, which may mean dewatering. A secure location is a specially designed landfill where particular strategies have been implemented to contain the material and to monitor it regularly. If at a later stage the material is found to be harmful, its location will be known and further treatment could be implemented. Alternatively, should technology show that the product may be useful, the material could be reclaimed. There were grave doubts about both of those prospects. The council went on to say:

The placing of a waste material in a location where it is not contained in a controlled area is contrary to environmental safeguards. It is considered that the consultant has been unable to definitely give assurances that the sludge will be contained and will not produce emissions caused by the decomposition processes.

Though the board publicly stated that it would monitor the situation over the period involved, the council was still concerned about those two points. The council believed that alternatives for sludge disposal might be more appropriate, even if more costly. So council remains opposed to the scheme. In fact, the council sought advice on whether to seek an injunction against the Hunter Water Corporation to prevent the project proceeding. After consultation with legal advisers a council paper of 14th July, 1992, stated:

The Hunter Water Corporation sought legal advice in regard to whether or not it should do an environmental impact statement and such advice indicated that the corporation could successfully resist any legal challenge to it, whereas council's legal advice provides contrary opinion.

However, it was felt that if the council challenged the proposal the result would still be that the corporation would gain approval to undertake a two-year trial, which is what the corporation is doing. The two-year trial of the proposal still leaves the risks to which I have referred, in relation to which no one can give guarantees. The assessment did not stop there. The Hunter Water Corporation sought independent expert advice from the TUNRA organisation, The University of Newcastle Research Associates. That organisation was of the opinion that the proposal had gone through a whole process of evaluation and that the two-year trial was satisfactory so long as it was monitored. I should like to read from one of that organisation's preliminary reports because this information was not contained in its main report. In its preliminary report, the organisation's conclusions were:

1. The report by Dames and Moore constitutes a thorough and balanced investigation of the proposal to dispose of sewage sludge in underground coal mine workings.

2. It is a novel -

I like the word "novel":

- relatively economic and efficient method of sludge disposal. It has a low level of potential harm to human health or the environment in the vicinity of the operation.

The organisation did not refer to no level of harm but to a low level of harm:

3. The report advises caution, noting that the method is untried in Australia and perhaps anywhere.

4. The report lists as the two main potential problems the production of gases and the migration of heavy metals into the environment.

That may occur as a result of percolation into ground waters:

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This is a matter that remains a concern to environmentalists in the area.

The Hunter Water Corporation has recognised that. It has stated that if it intends to proceed beyond the two-year period, it will carry out an environmental impact statement. So it recognises the risk factor. The fifth point in the preliminary report reads:

5. The report strongly advises an ongoing program of monitoring of bore holes, soils, ground water and the environment generally.

That has been done. The report continues:

In addition we consider the board should undertake a preliminary investigation into the status of the mine workings by a process of air pressurisation and associated monitoring for surface leaks.

I am not sure whether the board has done that. I hope it has. That all leads to the conclusion, as I said at the beginning of my contribution, that the House is dealing with a government authority which does not have to comply with the ordinary standards imposed upon business corporations or other government departments. The authority is quarantined from civil action for loss or damage. The relevant section in the Act reads:

No action for trespass to land, nuisance or other proceedings lie, or are to be allowed by, or in favour of, any persons against the corporation or any director or officer of the Corporation or other person acting under the direction of the Corporation in relation to the deposit and leaving of the waste products in disused underground mine workings under this section.

That is the inadvertent provision that was inserted into the Hunter Water Corporation Act. I ask the Minister to note that. The drafting does not appear to be inadvertent. To the Government's credit it has recognised - after a certain amount of pressure from the community, the Hunter Water Corporation itself, the Newcastle City Council and, I might say, without any great sense of pride, from myself - the need to delete that section. The Government has introduced a bill which, in my opinion and in the opinion of those who have examined the legislation with me, still limits people's rights and still recognises the Hunter Water Corporation as the pre-eminent body. In the Committee stages of the bill I intend to move an amendment, and I want to put the Government on notice of the clauses of the bill that I believe water down - to use a pun, perhaps sludge down - the rights of people to take common law action against the corporation. Proposed new section 61(3) reads:

(3) The exercise by the Corporation of a power conferred on it by this section does not constitute a trespass to land unless it results in damage to the owner or occupier of the land:

The paragraph which I believe deliberately narrows and waters down people's rights reads:

(a) of a substantial (that is, more than nominal) character; and

Any loss or damage to one's land arising from the deposit by the corporation of sludge underneath it without one's express permission should not involve long or drawn-out arguments about the legal meaning of "substantial" and "nominal". If there is damage or loss, the Hunter Water Corporation should make good that loss. It has said it will do so. In correspondence the corporation has said it is well insured and that it is well covered against actions for loss or nuisance. If that is so, why is this double failsafe method needed? Let the corporation make good its claim and let people take action if they wish for loss or damage arising from the corporation's use of these sewage sludge disposal methods.

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In relation to the general principle of depositing sewage sludge down mine shafts, I am still concerned about both the potential for environmental damage and the fact that this method of disposal is a short-cut approach to what the Environment Protection Authority, the Hunter Water Corporation, the Sydney Water Board and the former Minister for the Environment, Tim Moore, and, I am sure the present Minister for the Environment believe is a potential resource that should be utilised wherever possible. Utilisation of that potential resource should not be delayed merely because of a want of $5.8 million. I am concerned also that one cannot take action for damage unless the damage manifests itself in some way at the surface of the land. I intend to seek to have that provision removed.

Despite the fact that no percentage of chance is put on it, it is possible that the sludge could percolate into the ground waters and cause environmental damage that may not exhibit itself on the surface of the land, at least not in the short term. At some time staff of the Hunter Water Corporation may have to go underneath someone's property to quantify or rectify a problem that has not manifested itself at the surface. The removal of those provisions will ensure that people's rights are given full rein. Let the Hunter Water Corporation stand by its claim that there will be no environmental damage, that sewage sludge will be contained within its own land, and that it will work towards a more acceptable method of sewage sludge disposal that is both environmentally friendly and, hopefully, a potential resource to the community.

I pay tribute to the corporation for the fact that it is using sewage sludge in a manner beneficial to tree growth in the upper Hunter areas. I am not talking about economically viable situations with regard to the Hunter Water Corporation at Burwood Beach at the moment, but there is potential so far as land care is concerned. The reprehensible section 61(3) should be removed but only in a way that guarantees maximum rights to the people of Merewether to recover losses that may occur as a result of that process.

Mr HUMPHERSON (Davidson) [4.40]: I was pleased to note from the address of the honourable member for Newcastle the bipartisan approach that has been taken by the Opposition to the proposed legislation. It was satisfying to hear him give credit to the Government - credit that I believe is due to it. The Hunter Water Board (Corporatisation) Amendment Bill will remedy an inequitable provision in the Hunter Water Board Corporatisation Act 1991. Subsections (1) and (2) of section 61 of that legislation provide the legal basis for the Hunter Water Corporation to dispose of sludge from its Burwood Beach waste water treatment plant to underground mine workings. The amendment proposed by the Government will repeal subsection (3) of section 61, which had the unintended consequence of denying residents and landowners a basic common law right of action, and will insert new provisions. It is important to note that, on identification of the unintended oversight, the Government moved promptly to remedy it in the interests of the local community and the rights of residents.

The new provisions clearly outline that if an individual suffers tangible damage at the surface of the land, action can be taken against the corporation. I believe this needs to be put into context, and in doing so I will examine some of the background. When physical and biological processes are used to treat sewage, one of the by-products is sludge. The problem of finding the most effective, efficient and environmentally sound method of sludge management confronts all organisations in the water industry. The innovative sludge management method to be adopted by the Hunter Water Corporation as part of its upgrading of the Burwood Beach treatment plant is to pump the sludge into the flooded workings of a Newcastle colliery which runs some 60 metres beneath the
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treatment plant and privately owned land. A two-year trial period for that process commenced four months ago on 15th July. The Hunter Water Corporation anticipates that, during that two-year trial period, the sludge will not pass beneath that privately owned land to which I referred.

As mentioned by the honourable member for Newcastle, the proposal has been exhaustively investigated by the corporation and by independent experts. Following a thorough investigation of the proposal, geotechnical consultants Dames and Moore found that it was operationally and environmentally sound and should proceed on a trial basis. An independent review of those findings, carried out by the research arm of the University of Newcastle, Tunnura, also supported the proposal. In addition, a review of environmental factors concluded that the proposal should proceed, and all relevant government departments have approved the process. Monitoring of the conditions in the mine, including raw sewage, water level, water quality, gas and pressure, will continue during the two-year trial period and for at least a further five years after cessation of the disposal process. It is important to note that, to date, monitoring results have shown no change in water level or gas concentrations in the mine, and that water quality has not changed other than for some increase in fecal coliform bacteria, which is to be expected.

It is worth noting that an independent committee comprising community representatives and representatives of other relevant organisations has been established to oversight the monitoring process. The raw sewage monitoring will be for heavy metals, organochlorines and other material. Monitoring of water from spearpoints in private dwellings in the surrounding area likewise has detected no change. The mines have provided a unique, environmentally safe, and cost-effective option. Because sludge disposal to the ocean is no longer an option, utilising disused mine workings will result in Newcastle's beaches and waterways being among the best of any coastal city. The Hunter Water Corporation has every confidence that conditions in the mine will continue to behave as expected, and that there will be no impact on residents as a result of the disposal process.

In any action taken, every consideration has and should be given to the interests of the local community. The alternatives were carefully examined and a number of options rejected because the corporation considered they would have placed far greater strains on the immediate community than would be appropriate. For example, if the liquid sludge had to be tankered to another disposal site, 40 tankers would be required each day, with the resultant transportation and disposal costs. In a densely populated urban area such as that surrounding the Burwood Beach plant, such a proposal was considered most undesirable. The corporation has sought to find an optimal solution. Additionally, it should be noted that the alternatives involved unnecessarily higher capital and operating costs which it was considered could be more effectively utilised in upgrading some other treatment plants. Clearly, it is appropriate for the corporation to exercise its powers under section 61 and discharge sludge to the mine workings. However, in doing so, the corporation should not be immune to any claims for damages which could be attributed to that process. As indicated previously, the Hunter Water Board (Corporatisation) Amendment Bill provides that if a resident or landowner suffers physical damage at the surface of the land from this process, an action for trespass can be taken against the corporation. Of course, individuals retain their right to seek action for nuisance and other common law remedies.

In his second reading speech the honourable member for Newcastle stated that the Government's legislation will remove the potential for citizens to take injunctive proceedings against the corporation. That is not correct. All the bill attempts to do is
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to slightly narrow the definition of "trespass" to require some surface manifestation of a substantial nature at the surface of the land. Similarly, claims for damages under the Mining Act are restricted to damage at the surface of the land. The bill proposed by the honourable member for Newcastle would have given the occupier the right to an injunction, which would not be available at common law. His proposal provided that, even if damages were an adequate remedy, an injunction could still be granted. Common law, on the other hand, only permits the granting of an injunction if loss or damage is to be sustained and damages alone are not an adequate remedy. The honourable member for Newcastle referred to excerpts from advice on this matter from Mr McClellan, Q.C. The advice makes it clear that it is arguable at law that diminution in property value may be construed as damage under the bill proposed by the honourable member for Newcastle. That would open the way for landowners to seek injunction or compensation on the ground of perceived reductions in property value, even though damage to the surface of the land was not established.

Clearly, the proposed private member's bill is not an adequate solution. However, the Hunter Water Board (Corporatisation) Amendment Bill addresses the concerns of the local community. It is true that the sludge disposal process has been the subject of community debate for some time, and it has been opposed by a small group of residents known as the Residents Against Sludge Under Newcastle. Though it is understandable that there may be some concerns about the nature and unique method of disposal, it is essential that the process be viewed objectively and for discussions to be founded on fact. As the honourable member for Newcastle said, nothing can be guaranteed to be environmentally safe, and, though there are no absolute guarantees, it should be noted that independent studies and early tests have been equally supportive and positive. The disposal of sludge down mines has been comprehensively validated through a review of environmental factors. All factors have been taken into account. The Environment Protection Authority, the Department of Water Resources and the Department of Health have all approved of the process. The proposal will be based on a two-year trial, and an extensive monitoring process involving community representation will take place. In conclusion, this legislation gives back to local residents rights which were inadvertently taken away previously. The Government, through the introduction of this bill, is seeking to remedy those rights, and I am pleased to support the bill.

Mr BOWMAN (Swansea) [4.53]: I am pleased to support the Hunter Water Board (Corporatisation) Amendment Bill. I believe that the original legislation was defective, and was seen to be defective and unsatisfactory by many people in my electorate as well as those immediately concerned in the electorate of Newcastle. After various studies and assessments had been made it was asserted that the proposed method of sludge disposal, after treatment, was perfectly safe, yet the Hunter Water Corporation was to be given immunity against any claim arising from damage caused by that method of disposal. The two proposals did not gel. If, as claimed, the method of disposal was cost effective, and at least in the short term environmentally satisfactory, why was there a need for any immunity for the Hunter Water Corporation? The management of the corporation denied that it needed immunity; rather it was perfectly happy to bear responsibility for its proposed action. The management was confident that the corporation had conscientiously examined the proposal, that nothing would go wrong, and that people would not suffer any damage. Therefore, it was unnecessary for the original legislation to contain a provision that protected the Hunter Water Corporation, which had the effect of making nearby residents feel their interests were not being protected.

The wider community had no confidence in the Hunter Water Corporation. If it was good enough to operate with the autonomy that the Government deemed
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appropriate, there was no need to mollycoddle it or protect it from harm by giving it the seat belt and air bag, so to speak, of immunity. It should be noted, contrary to what the honourable member for Davidson said, that many people objected to this method of sludge disposal. At a public meeting attended by at least 300 residents, many people voiced their objections strenuously. Some people wrote to the newspapers and telephoned radio stations about their objections. In may be said that some of these objectors were organised - that is the kind of excuse that might be used, but the fact is that many were not organised. They felt instinctively that the proposal was dangerous and that at the very least people should have a guarantee of security against any damage that may occur to their properties or to the environment generally.

It is worthy of note that Newcastle City Council, with its expertise, strenuously opposed this method of sludge disposal. Honourable members do not have to accept that Newcastle City Council was necessarily right and that the EPA, the Department of Health, the Department of Water Resources and the Hunter Water Corporation were wrong, but it was an important objection. Newcastle City Council is a representative body and cannot be thought to comprise only a few people. Its elected representatives decided unanimously that the proposal needed to be checked more carefully. Later they were convinced that an environmental impact statement was required to assess the dangers to the environment and to property. Ultimately they sought to prevent the proposal going ahead, and even contemplated taking court action. Even if the council were wrong and the others were right, the council did not lightly undertake that course. In those circumstances it is essential that the Government do all that is possible to give the people a sense of security, and assure them that if something goes wrong they will not be the losers. Last night amending legislation to the Mine Subsidence Compensation Act received bipartisan support. Basically the amendments sought to clarify the provisions of the relevant legislation to give people a greater sense of security, and to give the mining industry community support so that it can operate efficiently, and preserve harmony in the community.

The same sort of principle ought to have been applied in this instance. However, I do not accuse the Government of any ill intent. Nevertheless, the original legislation ought to have been a bit different in that the immunity which was to be conferred upon the Hunter Water Corporation ought not to have been in that legislation, especially having regard to the fact that - as has been confirmed from conversations with various executives from the corporation - it was not insisting upon it. In fact, the executives were quite ready to back up their judgment and put their reputations on the line by saying, "If we are wrong, compensation should be payable, if appropriate. If that means that our reputations are hurt or that our careers do not flourish as we would have expected, that is the responsibility we must bear". They had the right attitude. The Parliament did not act in the best way; it did not take advantage of that reasonable attitude and introduce different legislation. If it had, this amending bill would not have been necessary.

I support the foreshadowed amendment of the honourable member for Newcastle. I wonder at the formulation of the amendment of the Government. For example, line 15, on page 3 refers to "a substantial (that is, more than nominal) character". In other words, it talks about damage to the owner or occupier of the land. It seems to me that if someone wants to sue the Water Board or seek compensation for damage that is nominal, they will receive only nominal damages. It is hardly likely that they would incur the time and expense necessary to prosecute that claim. There is a residual fear that people will make trouble by seeking damages from the Hunter Water Corporation. I think there is an impression that something could go wrong and, therefore, we must spell
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out in a tendentious way that it must be substantial damage before this section will operate in favour of the owner or occupier of the land.

It seems to me that the robust confidence of the Hunter Water Corporation and of the relevant officers who are responsible for the investigations means that it is not necessary to fiddle around with words in such a way. If someone suffers only nominal damage, they suffer damage not worth worrying about. Any reasonable person would accept that. Any reasonable person in the community would accept that nominal damage - that is, damage which is not of any substance - does not need to be compensated. The simpler, clearer style of wording - as presaged by the honourable member for Newcastle - would not put the Hunter Water Corporation or the Government at any greater risk of making compensation payments. But it would have the unfortunate effect of suggesting to people that there might be a difficulty posed for them if they seek damages because they would have to prove that the damage was substantial. The word "substantial" can be interpreted in various ways. The confidence of the Hunter Water Corporation to plan these sorts of exercises needs to be boosted if it is to happily accept doing things about which it may have fears or doubts.

The way to satisfy people and to minimise anxiety is to flatly say that if there is any damage, the Hunter Water Corporation will be responsible and can be sued or action can be taken to compensate people for that damage. A form of words should not be used which suggests that an obstacle or tricky-dick procedure will be applied so that the person might not get compensation. The clearer and simpler the form of words, the greater will be the degree of confidence felt by the people, a number of whom still feel considerable anxiety about the method of disposal. The Government would be well advised to accept the proposed amendment. I cannot see that acceptance of it would create any problem for the Hunter Water Corporation or the Government. Citizens would feel more confident; they would not have to fear that there would be a loss of amenity or damage to their property because of the sludge disposal operation. That would assist morale at the Hunter Water Corporation. There would be happier faces all round. I am pleased that the Government has introduced this legislation in proper form. I ask the Minister, however, to seriously consider accepting the foreshadowed amendment. I believe there will be no loss if it is accepted - rather the corporation, those who will be affected, and the Government, will benefit.

Mr PRICE (Waratah) [5.8]: I support the bill. I acknowledge the concerns of the honourable member for Newcastle and I support his foreshadowed amendment. In so doing I do not intend to be critical of the Government. I acknowledge the fact that it has recognised this defect in the Hunter Water Corporation Act. I agree with the honourable member for Newcastle that the Act is unnecessarily cluttered. Clearly, deletions are required. A matter of concern to me is the definition referred to in proposed section 3(b), which states:

(b) that manifests itself in some physical way at the surface of the land.

I am not quite sure what that means. Does it have to be a physical effervescence or corrosion? Can a smell be considered a physical problem? I am not suggesting that there is a smell at the moment. An article in the Newcastle Herald of 31st August reported that residents were complaining about a smell at the Burwood Beach treatment works emanating from an open tank. As a result of those complaints the corporation is currently looking at closing that tank. The quality of the sludge - and any odour associated with it - being pumped into mine shafts beneath dwellings is a matter of significant
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concern.

The mine workings in Newcastle, especially under the hill in Merewether, are extensive, old and go back to early settlement. Many of them are unsurveyed, in the real sense of the word, and the ownership of many of the mines, because of the different types of ownership, is unrecorded in the mining records available to the Hunter Water Board and the Mine Subsidence Board. There is genuine concern about where some of the material may end up. I acknowledge that it is 99 per cent water and only 1 per cent solids. In spite of that, I believe that community consultation was too limited. The concern of residents has been expressed on a number of occasions loudly and forcefully, and Newcastle City Council has echoed that concern. It has moved away from formal objection because of legal problems and also the promise by the Managing Director of the Hunter Water Corporation, Mr Paul Broad, who said in the Newcastle Herald on 22nd July that the corporation would seek a repeal of that section when the Act was reviewed in about 18 months. He gave an assurance that the corporation would accept liability in the meantime. Whether the corporation could accept liability given the law as it currently stands, I am not sure, but the Government's action in recognising that after the pressure applied by the honourable member for Newcastle would seem to me to have gone part of the way towards solving the problem. Again, I emphasise that I believe the way the amendment has been written is not entirely satisfactory and could in certain circumstances limit the actions of concerned citizens who are subject to the problem.

I would like to refer briefly in the time available to me to the overseas experience. South Africa has tried such disposal of waste. Sludge was not treated to the same extent as the sludge we are discussing. A town virtually had to be moved as a result of the experiment. There was no way of ridding themselves of the unpleasant odour once the partially treated sewage took hold, soaked into the various strata and eventually came back through the land and rock strata to irritate the local population. I think that has been taken care of, but I wonder whether we are being slightly premature because I understand that New South Wales Agriculture has a fairly comprehensive research program at the University of Western Sydney into sludge treatment and disposal. If that is the case, within a relatively short period the action of the Hunter Water Corporation may become superfluous and other disposal methods will be found. I have seen at the Bayswater power station what the reticulation of treated effluent can do for local afforestation. It is an excellent system, but there is a slight odour associated with it.

It seems that the appropriate action is to conduct the full research experiments and come up with a viable alternative to virtually burying effluent in flooded mines under pressure. If disposal by pipeline or tanker into other areas such as bushland areas is found to be acceptable and healthy, that method should proceed. Bayswater is not to be related to a metropolitan area such as Newcastle and the surrounding suburbs. I hope that the Government takes my remarks into account. They are important for several reasons. One is that Newcastle, indeed the Hunter, seems to be the pilot area for so many things. The Hunter Water Corporation has been used for testing of all sorts of things, including user-pays systems. Whilst we are a fairly tolerant lot, there are some limits. The opportunity to protect oneself through legislation has not been overlooked by the community. The Government has obviously recognised this fault as well on the recommendation of the Hunter Water Corporation and is endeavouring to do something about it. As the debate continues, I hope the Government will consider carefully the amendment my colleague the honourable member for Newcastle will propose and incorporate it into the current amendment before the House.

Mr SPEAKER: Order! It being 5.15 p.m., pursuant to sessional orders the
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debate is interrupted.