The federal government has announced today that its water purchase program in the Murray-Darling Basin received a big boost from a new study which showed that the $1.5 billion water buybacks models implemented so far had actually released many irrigators from financial pressures.

Water Minister Penny Wong told the ABC that the Australian Bureau of Agricultural and Resource Economics (ABARE) report showed that lost production from water purchases was very minimal as compared to the drought's effects, and prepared irrigators for the lower limits on water usage as sanctioned by the Murray-Darling Basin plan.

Senator Wong said that the ABARE report effectively debunked critics who claimed that buybacks would hurt the agricultural sector and regional economies, stressing otherwise that the scheme aided the environment and irrigators by replenishing rivers and wetlands.

She said that water purchase has given irrigators more options to cope with the drought, retire debts, invest in farm upgrades and diversify production or even get out of irrigation, adding that the same program is now the best and fastest way to refill the Murray-Darling Basin.

Senator Wong said that the government is fully aware that "our rivers need water, and we are absolutely committed to continuing our purchase program."

Critics had earlier argued that the government jumped too soon in acquiring water entitlements without first studying its value for money, yet the water minister said that the ABARE study clearly pointed to the drought as the main reason of lost production in the Murray-Darling Basin.

Senator Wong also gave assurances that any foreseen long-term impact from water buybacks has been largely neutralised by the government's investment in infrastructure, which has so far amounted to $5.8 billion.

She stressed the need to focus at this time on becoming more productive amidst the drought and having to harvest more crops for every drop of water, as she revealed that the third round of water purchases in 2010 under $120 million will commence in May.

Senator Wong has indicated that the new round of buyback will focus on offers coming from farmers in South Australia and Victoria as the 60-gigalitre purchase quota from NSW has been already breached during the January and March tender offerings.