In Chapter 4 I consider the limited recognition of traditional, cultural water rights in Australian law. In the Australian model, property rights in water and water markets accompany government oversight and planning. Australian water law has undergone drastic reforms since the early 1990s, yet little has been done to provide indigenous peoples with the right to use water on their lands for commercial and productive purposes. Native title rights to water have been interpreted narrowly by the courts according to traditional and cultural uses, and are usually accounted for as in-stream cultural and conservation values in water catchments, distinguishing them from the consumptive rights held by other users. Yet indigenous Australians continue to make up the most disadvantaged sector of Australian society and Australian governments have committed to reducing that disadvantage, including by supporting the productive use of indigenous lands. The Australian experience demonstrates the difficulties inherent in recognising historical indigenous rights to land and resources, as indigenous water practices change over time and conflict with other uses. The study highlights the need for an allocative model, enabling both the reservation of water for indigenous allocation and the redistribution of water rights in fully allocated catchments.

Chapter 7 examines indigenous water rights recognition and distribution in Chile. In this chapter I discuss the recognition of the ancestral water rights of indigenous peoples under the Indigenous Law and the creation of an Indigenous Land and Water Fund for the acquisition of rights in the market. I argue in this chapter that the recognition of ancestral water rights an incomplete response to the ongoing exclusion indigenous peoples experience from rights allocated within water law frameworks, because it continues to exclude groups that have lost water access to other users.The Fund, by contrast, specifically responds to the situation where indigenous peoples have been unable to continue to exercise their water rights. In the case of water resources already fully allocated to others, the Fund finances the purchase of water use rights in markets for redistribution to indigenous landholders.An interesting lesson from the Chilean experience is that market mechanisms may in some situations be a ‘creative’ response to the injustice in water rights distribution.However, by setting aside a share of water use rights before water resources are already fully allocated, governments reduce the cost of buying-back water use rights for allocation to indigenous peoples in the future.