There is still no federal funding available for one of the most expensive water security projects in New South Wales.
The proposed expansion of Wyangala Dam near Cowra in the state's Central West has been in the pipeline for three and a half years.
When it was announced, the federal and NSW governments agreed to share the cost, which was estimated at $650 million.
But the latest federal budget does not include any money for the project.
It states that $19.1 million from 2026–27 for the Wyangala Dam Wall Raising and another water project will be deferred.
The government said a final decision on these projects would be made once planning was completed.
"In one way it's not a surprise that they're cutting it, but it's a bit of shock," said Tom Green from irrigators' group Lachlan Valley Water.
"Wouldn't we at least go through the planning hoops to see if the project stacks up as we believe it does?
"If we're not going to fund the planning we're never going to get the answer.
"We can only surmise that it's been pushed back to the New South Wales government to make a decision."
Federal Labor first revealed in its "mini budget" in October 2022 that it was deferring any Commonwealth funding for the project.
At the time, the government said it would reconsider any contribution once a business case was completed.
It had been due to be finished in 2021 and the timeline for its completion has been repeatedly pushed back.
The delays have been caused in part by COVID-19 and major flooding, which occurred along the Lachlan River in 2022.
Business case completed
The ABC can now reveal the NSW government will begin reviewing the final business case this month.
"That's great that it's been submitted and we look forward to hearing from the New South Wales government in their deliberations on that project," Mr Green said.
"But it makes it hard that the federal government is deferring funding."
The Riverina electorate of Nationals MP Michael McCormack covers Wyangala Dam and a significant stretch of the Lachlan River to Forbes, which experienced major flooding in late 2022.
He said he was concerned the project would never become a reality.
"Under Labor, I don't see a future for it at all," Mr McCormack said.
"When you get a federal Labor government that's looking to scrimp and save and we've got the Infrastructure Minister Catherine King who's wanting to put a review over every one of the projects under the $120 billion investment pipeline that we had in place."
Dam scrapped
The federal government has withdrawn its share of hundreds of millions of dollars in funding for the proposed new Dungowan Dam in north-west NSW.
The budget papers indicated the project's business case did not provide "sufficient support" for the storage's construction, and scrapping the project would save the government $595 million over seven years.
The projected $1.3 billion dam was promised by the previous state and federal Coalition governments, which agreed to split the cost.
The new NSW Labor Government also confirmed today it would not proceed with the project.
"All the work that so many people in the city of Tamworth and the New England have done over so many years to fight for this has now come to nought, and that's a terrible shame," federal Member for New England Barnaby Joyce said.
"We have to try and get back into government and reinstall the money."
But Graham Carter from the Tamworth Water Security Alliance said he was excited by the decision to scrap the project.
"We want action, we don't want pie in the sky ideas, and to suggest that the only way Tamworth will have water security is to vote the Nationals back in, I think we're more intelligent than that," he said.
"He was in government for ten years and they've done nothing to help Tamworth's water security. Why not address the simple issues that could've been done such as changing the water sharing plan? Why not invest in water recycling?"
Flood warnings
The federal budget does include some hope for towns like Eugowra, which experienced what has been described by residents as an "inland tsunami" in November 2022.
The Commonwealth will provide $236 million over 10 years to remediate high-priority flood warning infrastructure.
The Bureau of Meteorology will upgrade and integrate local and state government-owned rain and river gauges into its existing flood warning network.
Eugowra residents have expressed their dissatisfaction and anger that they were given no warning that they would be hit by a "wall of water".
Local independent MP Andrew Gee said these communities deserved better.
"I think it has been triggered by disasters like Eugowra, in particular, and Cudal, also Lismore as well," Mr Gee said.
"I think that a lot of people are struggling to understand how Eugowra could be almost wiped off the map without any prior warning."
