Board Update - Murray Irrigation Board Meeting - 30 April 2026

Murray Irrigation Limited (Company) held a Board meeting on Thursday 30 April 2026. The purpose of this meeting was to decide whether the Company will proceed with the proposed fee restructure or maintain the current fee structure.
 
In this regard, the Board has resolved to proceed with the proposed fee restructure. The new fee structure will come into effect on and from 1 July 2026. It will:

• remove fixed fees associated with Delivery Entitlements (DEs),
• increase the variable water delivery fee based on volume used, and
• align outlet fees to cost recovery.

This change in fee structure will simplify the Company’s fee structure and reduce or maintain average cost for around 80% of customers. CPI will be applied to this new fee structure annually.
 
A priority consideration when making this decision was the financial risk this change could potentially place on the Company. While we acknowledge there is increased risk to the Company, the Board considered the need to address the inequity in the current fee structure as materially important to the future of the business. The Company has also implemented measures to mitigate these risks. This is in line with the Company’s strategic plan released in May 2025. Having reviewed: extensive independent modelling; long-term budgets under a variety of scenarios; and the detailed customer feedback, the Board has determined that the financial risk was one that the Company can manage to underpin a modern and equitable fee structure that aligns with actual water use. 

Throughout the engagement period, a common question asked by customers has been: ‘Why is this decision not being put to a constitutional vote?’. The division of decision-making power between the Board Directors and the shareholders is ruled by the Corporations Act 2001 (Cth) (Corporations Act) and the Company's Constitution. Under these rules, matters relating to operations, management or customer matters are to be decided by the Board of Directors. This includes the fee structure of the Company. Matters to be determined by shareholders include resolutions electing Member Directors and ratifying the appointment of non-Member Directors. Further information on this topic is available on the Company’s website.
 
Further detail regarding the comprehensive consideration and discussion during the Board meeting is summarised below.
 
Customer engagement feedback
 
As previously noted, the Board has taken into account multiple considerations to help reach its final decision, including customer feedback.
 
The Company undertook an extensive communication and engagement program between 23 March and 17 April. The engagement process undertaken aligns with the internationally recognised Independent Association of Public Participation Community Engagement Framework.
 
This engagement process consisted of:

• Every customer being mailed a hard copy of the initial Company announcement and fact sheet with details on where to find more information on 23 March 2026.
• The Company published detailed information on its website, which included the Fact Sheet and detailed Frequently Asked Questions. Since being launched on 23 March 2026, the Company’s Fee Structure Review webpage has had more than 1,700 visits.
• The Company developed a simple on-line calculator that provided customers detailed information on the current vs proposed fee structure based on their current profile (e.g. DEs and WEs held) against their past actual water use or nominated water use.
• The Company held nine face to face meetings and three webinars, which were attended by more than 150 customers.
• The Company’s customer experience team have made around 650 outbound phone calls to customers and received around 120 inbound phone calls.

Results from the customer feedback survey demonstrated a clear mandate to proceed with the proposal, with 55 per cent of survey respondents in favour of the proposal and 16 per cent neither for nor against the proposal. 29 per cent of survey respondents indicated they were not in favour of the proposal. 

Further to this: 64 per cent of survey respondents said the proposed change will make the Company’s fee structure more equitable; 69 per cent of respondents indicated that the implementation of the proposed fee structure would not change their water use; 14 per cent indicated that they would increase their water use; and 17 per cent indicated they would decrease their water use.
 
The Company’s feedback survey recorded a participation rate of approximately 27 per cent of irrigation customers in the footprint. Responses comprised a cross section of customers including those with low and high water use, low and high DEs and WEs, and small and large properties. The participation rate of 27 per cent is considered by the Board as statistically significant for demonstrating the views of customers, and sufficient to provide credible insight into customer sentiment, particularly where all affected parties have been invited to participate.
 
Risk management and budgeting
 
The Board considered extensive independent expert advice and thorough multi-year budgeting based on a variety of scenarios before making its decision, including a review of risks raised internally and through the customer engagement process.
 
The Board is confident the Company will be able to manage all of the risks raised, including the expected income variability resulting from this change on behalf of customers by using ‘off setting’ revenue from the commercial sale of water. The revenue generated as variable fee revenue is normally counter-cyclical to the revenue generated by water sales. Managed carefully, these two revenue streams will operate to smooth the revenue variability being taken on by the Company for customers. This has been tested, based on modelling past water volumes and water prices. For example, in dry seasons the Company’s delivery revenue will be lower, but water sale revenue should be higher given higher water prices (and vice versa).
 
Resource Management Policy 
 
Changes to the new fee structure will require updates to the Company's Resource Management Policy and Resource Management Strategy. These were also discussed at the Board meeting. As communicated through the engagement process, these changes align to the continuation of the 5% Water Users Credit based on water use at a 1% general security announcement (or earlier if announced by the Company), and the retention of Company water to be commercialised to recover around 50% of the reduced revenue from the decrease in overall customer fees.
 

For completeness, under the new fee structure:

• Following the commencement of the 2026/27 water year, as discussed with customers during the engagement period, up to 80GL of Sustainability Product will be available via expression of interest (EOI) as per previous years. Delayed payment options will again be made available to eligible customers who participate in the EOI. Details on the timing of the Sustainability Product release will be made available early in the new water year.
• Following a 1% general security announcement, a 5% Water Users Credit will be applied to every megalitre used on farm through a compliant outlet to eligible water using customers. This credit will be applied to customer water allocation accounts daily, based on imported meter readings.
• There will no longer be any Allocation Advance or Resource Distribution products.

 
Delivery Entitlement Moratorium 
 
To give customers comfort and to allow the Board to carefully consider the management of DEs moving forward, a temporary moratorium on the termination of DEs will be implemented from 1 May 2026 to 30 June 2027. Further to this, a temporary moratorium on the transfer of DEs will be implemented from 1 July 2026 to 30 June 2027. This will allow the Board to complete a comprehensive review of DEs and their management moving forward without placing any pressure on customers. This will be accompanied by a legally binding commitment (via deed poll) from the Company not to reintroduce termination fees for DEs during the moratorium period. The Company has no current intention to reintroduce fixed fees attached to DEs. There will be exceptions to these moratoria to allow for customers to conduct certain transactions where DEs are incidentally involved, for example disconnections or property sales. A copy of the deed poll given for the benefit of customers is available here.
 
From 1 July 2026, DEs will continue to perform several functions for customers. These include defining a right to the delivery of water and qualifying a person to hold shares and vote.
 
Next steps
 
With the Board’s decision to implement the new fee structure, Management will now undertake a number of steps including the review and update of policies and procedures, and the development of the process for customers who wish to remove outlets. Customers can expect to receive further communication from the Company prior to 30 June 2026 in relation to these matters.
 
The Company’s Q1 invoices, distributed in October 2026, will incorporate the new fee structure.
 
The Board will be undertaking its first official review of the new fee structure in May 2028 and monitoring the structure on an ongoing basis.
 
The Board of Directors would like to thank all customers who engaged with the Company during this period and provided your feedback. While we understand not all will agree with the decision to change the fee structure, and some customers will see an increase to their annual average costs, the Board is confident that the new structure will improve cost alignment across customers and reward water use, ensure the fee structure is more equitable, while also allowing the Company to maintain its financial stability.

If shareholders have any questions in the meantime, please contact the Company Secretary on:
 
T. 1300 138 265
E. companysecretary@murrayirrigation.com.au
 
Murray Irrigation Board of Directors
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