A $650 million promise to raise the Wyangala Dam wall by 10 metres and increase its capacity by 650 Gigalitres has been funded.
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The Federal Government and the New South Wales State Government announced on Sunday they would together deliver a promised upgrade, in a 50-50 funding partnership.
Member for Riverina and Deputy Prime Minister Michael McCormack said the project was a significant investment for the future.
"What we are doing here with the Wyangala Dam is increasing the inland water storage to go to security for towns in the Lachlan River Catchment, such as Cowra, Forbes and Parkes," he said.
"Essentially, this means when it rains again we will have 650 Gigalitres more in capacity to store water and help to prevent flood events, as well as having more water available when the next drought occurs."
Mr McCormack said the construction would also deliver many jobs to the region.
"As this drought continues, it is important to ensure our local communities can continue to thrive," he said.
"This project will certainly create many jobs and provide a much-needed injection into the local economy."
We do need projects that help secure future water supplies for communities and food and fibre production
- NSW Farmers president James Jackson
Mr McCormack said the funding would prioritise all necessary business case development and design works.
NSW Farmers marked the investment as "critical for long-term water security".
"We do need projects that help secure future water supplies for communities and food and fibre production," president James Jackson said.
"Today's announcement ... is welcome news, but for the long term.
"There is a need for water now and we call on both governments to continue to work collaboratively with and provide funding to local shires who are building pipelines and trucking in water at significant cost."
Formalised agreements between the Federal and NSW governments outlining the timeframes will be finalised shortly, with Gladys Berejiklian hopeful construction would begin in 2020 and be complete by 2025.
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