Critical infrastructure declarations are rare. Recent examples have included the proposed Hunter to Queensland gas pipeline and Sydney's desalination plant.

The dam declaration appeared in the Government Gazette's January 9 issue and has prompted a furious response from dam opponents.

In recent weeks the Rees Government has broken funding undertakings made at the time of the dam's surprise announcement in 2006.

The Government had promised that water sales to the Central Coast (then in drought), developer levies and a division of charges determined by the Independent Pricing and Regulatory Tribunal would finance the dam.

But the Central Coast no longer wants water from the dam, the Government recently declared developers would be exempt from any payments and Water Minister Phil Costa has promised residents of Central Coast marginal seats that they will not have to pay.

Greens MP John Kaye said the Government had landed the whole cost of the $400 million project on "the inescapable mug punter" Hunter Water customers and was now determined to make sure its victims had no chance to escape.

"So far there have been no independent studies into any significant aspect of the Tillegra Dam proposal and this move means now there never will be," Mr Kaye said.

The Herald was unable to obtain comment from Minister for the Hunter Jodi McKay.

Member for the Upper Hunter, George Souris, reiterated a Coalition promise to revoke the controversial laws.

"This dam will have a crushing impact on the economy of the Dungog area," Mr Souris said.

"It will have masses of impacts and no compensation. No wonder they don't want to allow much local input."

A representative of the Dungog-based No Tillegra protest group, Ms Sally Corbett, said she was disgusted.

"This is exactly what we have come to expect from Labor," she said.

"There has been no change from the Iemma-Costa days."