Crazy water audit plans

I don't want to be too scathing, because ABC Online news reports rarely provide sufficient context to get a proper idea of what they're about - but this plan from a Professor of water policy sounds crazy to me:

The author of a new book on ways to better manage water says all users should have to account for the way they use the resource.

John Pigram, a Professor of water policy at the University of New England in New South Wales, says farmers have already been forced to improve their efficiency to make the most of low commodity prices.

He is calling for a national audit system to force users to justify their water allocations.

"Whether that be for irrigation, for industry, for a wetland, or a brewery, [they have] ... to be accountable for its use," he said.

"They have to specify what they want the water for, how they're going to use it and manage it and eventually audit their performance, and if it doesn't come up to scratch they either lose the water or they have to adjust their management protocols."

Is he for real? He wants someone (ie, the government) to check on every single water user to check if they're using it properly, efficiently, and really truly need the water they're using?

Here's an idea - how about we just charge people appropriately for water and let them figure out themselves how much to use and how to use it? The farmers who he states "have been forced to improve their efficiency" weren't forced because they submitted detailed water plans to government and government came up with some great ideas on how they could all make their water use more efficient. They were forced to, as Pigram himself suggests, because the financial pressure from "low commodity prices" made them figure out their own ways of saving water (and therefore money). How about we just stop subsidising water, let people pay the price for it that reflects its increasing scarcity, and let them figure this stuff out themselves?