People have been avoiding Dubbo because they believe there is no water in the city, NSW opposition leader Jodi McKay claimed on Tuesday.
"We know that visitors are not coming to Dubbo because they believe there is no water here."
The Labor leader accused Water Minister Melinda Pavey of "firing a broadside" at Dubbo Regional Council in a Sydney newspaper last month, after it published details of private correspondence between the Minister and council, in which she urged the council to increase water restrictions.
Advice to the government from the Office of Local Government was also published in the media. That advice suggested the council was not working quickly enough to respond to the water crisis.
"This has caused significant reputational damage to Dubbo," Ms McKay said.
"If there is an issue that she [the Minister] has with council she needs to come here, she needs to sit down with the mayor and the councillors and explain why she believes restrictions should have been introduced earlier.
"Dubbo is suffering, the community is confused."
To give the community a chance to get more information about the water crisis, Ms McKay suggested the Minister should convene a public meeting and attend it along with government agencies and council representatives.
When the Daily Liberal asked if Labor had any proposals to deal with water crisis or alternative policies, Ms McKay failed to name any.
Ms Pavey declined to respond to Ms McKay's claims, but said she would visit Narromine on Wednesday to make an announcement about water security.
"Dubbo Regional Council is responsible for town water," Ms Pavey said.
"The state government has invested over $40 million for immediate water security infrastructure to help secure the dwindling water supply in Dubbo," she said.
"The advice that came to my office was that council had not done any work on the $30 million for the bore field project announced in June this year.
"Dubbo will now have to run their water on the smell of an oily rag, until the work is complete."
Ms Pavey said she wrote to all NSW councils in June to urge them onto water restrictions and to ask what the state could do to help them secure water for the community.
"Dubbo Regional Council did not respond," she said.
"Since we raised concerns over the past two weeks, our water commissioner is more confident that Dubbo is now on track.
"This is largely due to the good will of the Dubbo community, especially farmers, who have donated their own water to the town supply.
"Over the past two years the Macquarie River System experienced 6.7 per cent of the average inflows - 97 gigalitres, instead of the average 1448 gigalitres."
This was 40 per cent lower than the millennium drought inflows, Ms Pavey said.
"Tough decisions need to be made and I'm not afraid of those decisions if it means keeping Dubbo open for business," she said.
Dubbo Regional Council's chief executive officer Michael McMahon confirmed the council and mayor received letters from Minister Pavey.
"Council did receive a letter from Minister Pavey's office in June and responded to the relevant government agencies," he said.
"Additionally, mayor of the Dubbo Region, councillor Ben Shields, did receive a letter last month from the Minister where she raised a number of issues that directly affected the region which the mayor responded to on the same day."
The Minister will meet with the council on Wednesday to discuss the water crisis, Mr McMahon confirmed.
He said the council had spent all of 2019 working to address the "rapidly evolving water crisis".
"This work has been further enhanced by the funding support from the NSW government's $30 million grant to the region to address the crisis," Mr McMahon said.
"This has included investigating additional bore options within a number of potential aquifers, water recycling and use of treated effluent to reduce reliance on potable supplies, stormwater harvesting and managed aquifer storage to name a few."