Liberal frontbencher Simon Birmingham has confirmed the Abbott government is considering the future of the National Water Commission.
Senator Birmingham, the parliamentary secretary to Environment Minister Greg Hunt, would not confirm the Commission's fate in an interview with ABC Radio on Monday.
"As everyone appreciates, the government has a huge budget challenge to bring the budget back into a sustainable shape, and we've made it very clear that all areas of government are under review for efficiency opportunities, and of course, across the water portfolio we're looking at that," Senator Birmingham said.
The ABC reported on Monday the abolition of the Commission was likely to save the government about $30 million over four years.
The Commission is an independent statutory authority that provides advice to the Council of Australian Governments and the Australian Government on national water issues and audits progress in implementing the Murray-Darling basin plan, which has now been agreed to by all relevant states and the ACT.
Senator Birmingham said the Commission performed "some very valuable work,'' but the government received advice on water policy from a number of sources, including the Murray-Darling Basin Authority, the federal environment department and the Australian Bureau of Agricultural and Resource Economics and Sciences.
"Everything is being considered and looked at carefully to ensure that we give taxpayers best value for their money," Senator Birmingham said.
Senator Birmingham said the review did not "in any way undermine our commitment to deliver on key policy promises - especially promises like delivering on the Murray-Darling basin plan - in full and on time".