In the past, the growing demand for water was accommodated by increases in supply. New dams and transfer schemes have been built to make these increases possible. However, the most easily accessible water sources will soon all have been fully utilised, and it will be necessary to go ever further afield to find new ones. In the future, unless demand patterns are dramatically altered, it will become necessary to import water from neighbouring countries if they are agreeable, or to resort to the desalinisation of sea water. These new supplies will be expensive, and their rising costs will have to be borne by all water users.

There are essentially two ways in which the increasing gap between the demand for and supply of water can be closed. The first involves supply-side management, which simply means continuing to expand supply to meet ever-increasing demand. We have suggested above, however, that this would result in significant increases in the cost of water as less favourable sources further afield have to be developed. These rising costs would ultimately have to fall on all water users.

Before these costs are incurred, it is important to make sure that the water that is already available is used efficiently and not wasted. This is best achieved by introducing demand-side measures to manage our water resources. By encouraging all water sectors to use water more efficiently, demand management provides a more sustainable long-term solution to the problem of water scarcity than do supply-side measures, because it takes into account the value of water in relation to its cost of provision, thereby treating it more like a commodity.

It is important to note that the focus on water demand management does not imply that important supply-side initiatives, such as catchment management (and dealing with unaccounted-for-water), will be neglected in the new approach to water resources management. It also does not imply that infrastructure options will not be considered, where necessary. The optimal solution to address the problem is to apply integrated water resource management, involving supply-side as well as demand-side measures. Both demand and supply-side options need to be compared on the basis of cost per option.