Allegations of water theft upstream in the Murray-Darling Basin (MDB) have prompted South Australian Premier Jay Weatherill to launch a state royal commission to identify any perpetrators.

New South Wales and Queensland were slapped with a scathing assessment of compliance with the MDB Plan on Saturday, after a review found poor levels of enforcement.

The review also found a lack of transparency surrounding the states' water management, along with Victoria's.

Mr Weatherill said the report did not go far enough and announced a royal commission.

"The review that was handed down did not go into detailed findings of who committed water theft and who behaved inappropriately in relation to the river," he said.

"There have been no specific findings in relation to individuals or groups of individuals."

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When asked whether a state royal commission could force bureaucrats from interstate to give evidence, Mr Weatherill said the royal commissioner would be given the powers of compulsion.

"And they will have no choice but to come forward," he said.

"A state-based royal commission does have the capacity to analyse things that touch on other states, provided there is a connection to South Australia.

"That's our very clear legal advice and it's our intention to pursue this royal commission's power to their fullest extent, so we can get to the bottom of this water theft."

'That's a matter for SA': NSW Minister

The Federal Government commissioned yesterday's review after an ABC's Four Corners program earlier this year revealed that some New South Wales irrigators were taking billions of litres of water set aside for the environment.

But New South Wales Regional Water Minister Niall Blair dismissed Mr Weatherill's royal commission and said the NSW Government was committed to the MDB Plan.

He said the state was already implementing changes off the back of its own independent investigation as well as addressing recommendations made in the review released on Saturday.

"We don't know the terms that South Australia is looking at. We don't know if it's going to be a repeat of the things that we've already done," Mr Blair said.

"One thing I do know is that royal commissions take a very long time, and in NSW we're already getting on and addressing some of the shortcomings we've seen, particularly in compliance."

NSW's most senior water bureaucrat, Gavin Hanlon, resigned during September after Four Corners revealed he secretly offered to share government information with irrigators to help them lobby against the MDB Plan.

Federal Government to cooperate with SA 'stunt'

Despite labelling it "just another stunt", the Federal Government said it would cooperate with SA's royal commission.

The Federal Government said it wanted basin states to cooperate with SA's royal commission. ( Barbara Jackson: supplied )

Assistant water resources minister Anne Ruston said the issues in the basin were being addressed but the Commonwealth would not stand in the way of the commission, and neither should NSW or Victoria.

"I'd like to think they'd cooperate, certainly the Commonwealth will cooperate, we haven't got anything to hide," she said.

"We're not going to pay for it. I mean, the poor people of South Australia are going to have to fork out for yet another inquiry that we don't believe is necessary.

"Nobody's moving away from the fact this is serious, and now we are going to act on the recommendations, get it fixed, so we can get on with the delivery of the plan."

Turnbull 'rejected my request' for national royal commission

Mr Weatherill said he originally asked the Federal Government undertake a judicial inquiry and then upgraded the request to a royal commission.

"The Prime Minister yesterday rejected my request so the only step left for me to take is to establish a state-based royal commission," he said.

He said the royal commission would have coercive powers to investigate breaches of the MDB Plan and make recommendations for necessary changes.

"What we need to see is a forensic inquiry into all of the allegations of water theft and of improper dealings and taking the water out of this river that should not have been taken," Mr Weatherill said.

"Until we find out the cause, we won't know what steps need to be taken to remedy it."