Almost one-third of the 900 billion litres of water which the Prime Minister, Julia Gillard, and the Water Minister, Penny Wong, have said will be returned to the rivers of the Murray-Darling Basin does not exist, according to official figures.
At least 270 billion litres which the government claims to have bought as part of the $1.4 billion spent so far will never assist one stressed river because of the type of water rights purchased, a federal Department of Environment, Water, Heritage and the Arts analysis shows.
It is water known among irrigators as ''phantom water'', ''virtual water'' or ''airspace in the dam''.
A statement by Ms Gillard and Senator Wong posted on their party's website on Tuesday said: ''Since the government started buybacks in February 2008, federal Labor has bought back one out of every 20 litres of the Murray-Darling Basin's irrigation water and returned it to the rivers - some 900 billion litres of water entitlement.
''This is nearly five times Adelaide's yearly water supply.''
However, the statement fudges the difference between the entitlements the government has bought and the amount of water that will actually be allocated each year.
The amount of water the federal government will be able to give the environment to help it recover is much less than 900 billion litres in any given year because much of it is in the form of entitlements which would only deliver the full amount during flood events.
These entitlements are classed as ''general security'' water in NSW and Queensland or ''low reliability'' water in Victoria.
State authorities decide every year how much water can be allocated and they only allow this type of water to be released for use when there are good rains and high snow-melt.
During dry years such as those southern Australia has suffered for most of the past decade, only small amounts of water or none at all are allocated for use by entitlement-holders.
The proportion of water which the federal government will be able to use for the environment is lowest in NSW, where it has spent most of its buyback kitty.
It spent almost $745 million up to June 30 buying 568 billion litres, but only 40 per cent of that is set to reach the rivers in any year, the department's figures show.
In NSW, in particular, the federal government has bought only modest amounts of high security water, which guarantees water will be available every year. This type of water right was originally devised to ensure that horticulturalists would get enough to keep crops alive.
The chairman of Riverina Citrus, Frank Battistel, said the federal government and distressed farmers had missed out because the buyback has included little high security water from areas such as the Murrumbidgee, which regularly gets a 95 per cent allocation yearly.
''High security is very expensive, but you actually get real water,'' he said. Over the past five years because of drought, it had represented double the value of lower security water, he said. If climate change means a drier long-term outlook, it will become even more valuable, he said.
Taking future dry years into account, the federal water department has calculated the ''long-term average annual water yield'' it expects to get out of the entitlements totalling 863 billion litres which the government had purchased by the beginning of last month will be 591 billion litres.
Due to drought and the slowness of water entitlements being transferred by state authorities, comparatively little water has been returned to the environment so far. Last financial year, 165 billion litres was ''made available for use'' at 30 rivers, wetlands and floodplains across the Murray-Darling Basin, according to the department.
The federal government chose to buy a mix of entitlements ''to reflect the identified environmental need'', a department spokeswoman said.
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