The New South Wales Government has watered down changes to laws governing the Murray-Darling river system that were proposed in the wake of the water theft and corruption investigations, according to Labor and the Greens.

Key points: Labor and the Greens will oppose bill that aims to tighten regulation of water use from the Murray-Darling river system

Labor and the Greens will oppose bill that aims to tighten regulation of water use from the Murray-Darling river system The Greens' Jeremy Buckingham says the bill is a "recipe for killing the Darling River"

The Greens' Jeremy Buckingham says the bill is a "recipe for killing the Darling River" Water Minister Niall Blair says the bill aims to encourage a culture of compliance

In March, the Government released a draft bill that included a raft of measures to tighten regulation of water use.

The changes were triggered by allegations of water theft and mismanagement aired on the ABC's Four Corners program in July 2017.

The story led to an independent inquiry headed by former water bureaucrat Ken Matthews, who was asked to investigate claims of corruption, misconduct and maladministration in water management and compliance.

Mr Matthews's two "flagship recommendations" were that all pumping from the system should be metered, and measures to improve transparency of water use.

He also called for the NSW Government to provide assurances it was committed to the Murray-Darling Basin Plan.

Following community consultation, last week the Government released a final version of the bill.

That final bill has a number of differences to the draft bill, including giving the minister the power to pull NSW out of the Murray-Darling Basin Plan, by opting out of the federal Water Act 2007.

It also creates exceptions to a "no meter, no pump" rule, and leaves details of the key transparency measure — a one-stop public register — to be completed at a later date.

Labor and the Greens are opposing the bill, which is likely to pass both houses this week, with support from the crossbench.

Labor's spokesman for water Chris Minns told the ABC he was "appalled" by some of the proposals in the bill.

"This purports to give effect to the Matthews inquiry recommendations," he said.

"But in reality it does none of those things.

"It's entirely possible that this bill will pass and we'll have another era of soft-touch regulation and some irrigators getting away with murder.

"And it's important to remember this comes at the expense of other water users."

Greens NSW water spokesman Jeremy Buckingham said the bill was a "recipe for killing the Darling River".

Bill allows minister to create exceptions to 'no meter, no pump' rule

Both Labor and the Greens pointed to a number of parts of the bill they said would undermine attempts to fix the river system.

Despite the Matthews inquiry and the Murray-Darling Basin Water Compliance Review recommending a policy of "no meter, no pump", the tabled bill allows the minister to create exceptions to this in regulations.

In its submission to the draft exposure bill, the NSW Irrigators Council said such a rule, if treated literally, would not be fair.

"Such an approach would clearly impose unacceptable costs and complexities on the state's smallest water users and potentially result in perverse outcomes (eg the handing back of water licences)," they wrote.

A spokeswoman for the Minister for Regional Water, Niall Blair, told the ABC the recommendations for "no meter no pump" did not necessarily mean universal metering.

In his second reading speech, Mr Blair said they intended to capture 95 per cent of water extraction by the rule, but "avoid undue cost burdens on the smallest users".

But Mr Minns said leaving those exceptions at the discretion of the minister was unacceptable.

"Given seven years of maladministration by the National Party we can't take them on trust when it comes to water management. There needs to be specific provisions in the bill," he said.

'There are massive holes in this legislation'

Mr Buckingham pointed to changes that have taken place after consultation on the draft bill.

"There are massive holes in this legislation and considerable differences between the Public Consultation Draft … and the bill introduced into Parliament last week," Mr Buckingham said.

"Most of these differences favour irrigators and effectively create loopholes that will see over extraction and mismanagement of water continue in NSW."

In particular, Mr Buckingham pointed to the exceptions to the "no meter, no pump" rule, the privatisation of water metering, and the delay in creating limits to how much irrigators can extract in a single day, both of which were called for by the NSW Irrigators Council in a submission.

"The bill should be the chance to fix water management and compliance in NSW," Mr Buckingham said.

"Instead the Government has caved to the big irrigators and created loopholes that will haunt us into the future and result in the death of the Darling River."

The spokeswoman for Mr Blair said the bill had been strengthened in response to feedback from both water users and other members of the community.

"One example is the inclusion of additional compliance and enforcement tools for the NRAR and increased penalties for non-compliance," she said.

She also said the bill's proposal to allow NSW to opt out of aspects of federal water law was simply implementing provisions in the federal Water Act that allow for that.

The NSW Irrigators Council declined to respond to the ABC's questions.