Federal Member for Nicholls Damian Drum plans to break from party policy with a proposal to shift water from the environment to productive agriculture.
Mr Drum has thrown his support behind Nationals colleague Perin Davey, who plans to present a private senator's bill to Federal Parliament that would release water back on to the market.
The "flexible approach" for farmers and the environment would see the Commonwealth Environmental Water Holder release half of its water held for consumptive use in severe drought years.
This would contradict Nationals party policy, which has supported rules about preserving water for the environment.
Senator Davey said the bill would be a win-win for both the environment and farmers.
“This in turn can provide an income to the CEWH that they can then use for environmental projects or to purchase allocation in a better season when it can be used for better impact,” she said.
“This is what John Howard always envisaged when he announced his National Plan for Water Security in 2007.
“At that time, he said water acquired by efficiency or purchase can provide ‘greater security for water users in dry years and provide substantially greater environmental flows in later years’.”
Mr Drum said the bill had the "blessing" of the Nationals but was not supported by Federal Environment Minister Sussan Ley.
He said she argued there were numerous legalities that would prevent the bill from functioning.
Mr Drum said the aim was to present the bill early next year.
“The best way to do this is to put it into the Senate and then they have the opportunity for some committees to have the legalities checked out,” Mr Drum said.
“We're still awaiting further legal advice on this bill.
“If they are problems, we look at other ways around them.
“There might be jurisdictional problems because we could be interfering with the rights of the state, so we have to work out those issues.”
Senator Davey and Mr Drum are supported by Federal Member for Mallee Anne Webster.