At first assessment, it could be said that the price based instrument is applicable here. Much of the domestic use could have some form of water taxation applied on them. In the case of water used in factories or for meat and livestock breeding as in the case of the McQuarrie area, a price based MBI is applicable. Land taxation for livestock breeding and deforestation for wood industries in the case of both catchment areas would hence be appropriate under price MBI. Water taxation projects in countries like Netherland as presented by Ecorys (2011) would be applicable here.
In addition, the price element can be introduced in the form of subsidies. Industries such as forest based ones and livestock ones observed in the catchment area can be brought under a subsidy program. The subsidy program for environmental protections would aim at better economic use of water (Roper and Marshall, 1979; Hardie and Bobbi, 2017). This can ensure that impact to water is reduced considerably. Economic use of water can ensure quality by restraining quantity (Raheem and Morenikeji, 2010). This is the appropriate instrument for the catchment area, as people in catchment area already make use of ecosystem services for their economic wellbeing.
Consider the different stakeholders and how they would be impacted as present in the following situations.
Meat industries, such as sheep meat as observed in Macquarie catchment, will pay needed water tax for using so much amount of water. They will pay penalties for overuse of water. They will pay penalty if they release more effluents than what is allowed. They will be given subsidies by the government when they can show they have undertaken environmental friendly ways to production and distributions.
Forest based industries as observed in both catchment areas will pay land tax. They will pay penalty taxation based on any externalities they cause outside permissible limits.
Agriculturalists as seen in the case of the South Esk Catchment must practice crop rotation and for this, they can be payed subsidies. Once again, they will pay water tax or land tax as applicable.