The objectives of government in relation to natural resource management in agriculture have changed significantly over time. Similarly, the process that government employs to develop natural resource management policy has also evolved. In the past, policy has been developed centrally, while more recently there has been greater effort to involve the community in this process. There are clear linkages between changes in natural resource management objectives and changes in the policy development process. The implementation of the NSW Government’s Water Reforms is used as a case study to consider these linkages and to examine the advantages and disadvantages of moving to a more community based approach to natural resource management. The implications of this approach for economists, in terms of their ability to contribute to the policy process, are also explored.