The $13 billion Murray-Darling Basin plan is "a fraud on the environment" that may be unlawful, the South Australian royal commission into the basin has heard on its first day of hearings.

Richard Beasley, SC, the counsel assisting Commissioner Bret Walker, said the plan and its related water act had been set up "to fix a dying system that has had too much water taken from it and ... has suffered environmental degradation".

Water short: Ibis fly over the dairy herd of Daryl Hoey near Katunga in Victoria. Credit:Nick Moir

However, the setting of water savings at 2750 billion litres a year - itself at the low end of scientists' estimates of what was needed - had been cut by supply measures that would not kick in for perhaps six years or longer, if at all, Mr Beasley said. Water savings, though, would take effect now.

"That, in my submission, commissioner, is a policy that's a fraud on the environment," he said, adding it was "a fraud in a policy sense" rather than a criminal one, because the river was deprived of the water it needed.