Passing the ownership and operation of mixed-use rural water schemes to the proposed new water services entities will mean lower costs for users, a study has found.
The study into the future ownership and operation of about 90 rural water schemes nationwide under the Three Waters reforms has concluded that while community ownership offers greater local knowledge and control by users, costs would significantly increase, individual liability would be high, and operational challenges difficult to meet at individual scheme scale.
It found that ownership by one of the four proposed water services entities would allow for greater operational capability and capacity, greater ability to access sufficient capital for future investment and economic regulation and consumer protection.
The report acknowledged that under the government’s proposed governance arrangements for water, there is a risk of less influence from those currently involved in running the schemes and uncertainty around future pricing and service levels until funding and pricing plans are produced.
The joint study was between the Department of Internal Affairs (DIA), the Clutha District Council and farmers involved in the council’s mixed-use rural water schemes.
Independent management consulting firm Morrison Low was commissioned to undertake the assessment, which provided guidance but no recommendations.
Clutha mayor Bryan Cadogan said the study will help users make a decision about whether to seek ownership of these schemes, but also suggest to the government how water service entities might involve farmers in their future management.
The executive director of the Three Waters programme for the DIA, Hamiora Bowkett, said he supports the conclusions of the Morrison Low report that ownership and operation of mixed-use rural schemes by water service entities will result in lower financial and operating costs for users.
“We also accept the need for ongoing farmer input to the management and operation of the schemes given that their primary purpose is to support farming activity,” he said.
