Thursday, April 25, 2024

Three Waters to proceed

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The Government will push ahead with its Three Waters reforms that will create four publicly-owned water entities.
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Local Government Minister Nanaia Mahuta says a working group will work through the design of the four new water entities and look at the governance and accountability arrangements, as well as provide an opportunity for public participation and consultation.

The Government will push ahead with its Three Waters reforms that will create four publicly-owned water entities.

But it will establish a working group of local government, iwi and water industry experts to work through elements of entity design.

Local Government Minister Nanaia Mahuta says it is a bottom line for the Government that the entities remain in public ownership.

“We will continue to work with councils and ensure that local participation is evident in the critical next phase,” Mahuta said.

Mahuta says the group will work through the enhancements to entity design and look at the governance and accountability arrangements of the entities, as well as provide an opportunity for public participation and consultation.

She says the case for change is too compelling to ignore.

“It is clear that without the establishment of these publicly-owned entities we will continue to see a frail network and contaminated water in many communities,” she said.

“To delay will only push the problem on, increase future household costs and put livelihoods at risk.”

It is estimated $185 billion is needed to fix, upgrade and maintain New Zealand’s water services over the next 30 years, to ensure that critical water infrastructure is maintained.

“New Zealanders simply cannot afford to follow the status quo facing costs of between $1900 and $9000 over the next 30 years, depending on location,” she said.

“Under reform proposals with four entities those figures significantly reduce to between $800 and $1640, saving each household thousands of dollars.

“It would be irresponsible to pour taxpayers’ money into propping up a broken system, or let households face unprecedented rises in water costs. Currently 43 of the 67 councils do not have the revenue to cover their water services operating expenditures at the moment, let alone once the infrastructure starts failing.

“As we look to next steps, I will be introducing legislation to progress the establishment of the entities. The select committee process will provide an opportunity to get public feedback on the reforms,” she said.

The Cabinet has also tasked the Department of Internal Affairs with establishing a unit to focus on the successful implementation of these reforms. 

This unit will work with the local government sector, iwi, water industry and other stakeholders to ensure a smooth transition to the new arrangements.

Local Government New Zealand (LGNZ) says the Government’s announcement that it will refine its Three Waters proposal in response to the sector’s loud and clear concerns is a good sign.

But it is disappointing that the Government has mandated the reforms.

LGNZ president Stuart Crosby agrees with the need to address the systemic issues in our current three waters system and said local government’s feedback on the proposal clearly supports the need to find better ways of delivering drinking, waste and stormwater in NZ.

However, councils were equally clear that the proposed governance structure of the reform model would dilute accountability to communities, did not allow for local voice, and wasn’t well connected to the planning system.

“The sector has said loud and clear that the model needs significant work,” Crosby said.

“The Government has accepted this feedback and committed to developing workable solutions to these issues with the sector, which has only happened because we’re at the table.”

National’s local government spokesperson Christopher Luxon says the decision is tantamount to state-sanctioned theft of assets that ratepayers have paid for decades to own.

“Ratepayer-owned water assets will be bundled into these mega entities with virtually no accountability,” Luxon said.

“The governance structure will be messy and confused.

“By forcing the Three Waters plans on councils, Labour would be expressly ignoring every mayor who pleaded for a pause and the over 55,000 people who signed National’s petition calling for the plans to be dumped.

Luxon says the announcement shows that all of the minister’s earlier comments about partnership were hollow and her reassurances that councils could continue to opt-out were completely false.

He says National has committed to repealing the entity model and returning water assets to councils, should it form the next Government.

Federated Farmers is calling the announcement a huge call.

“Top of the list for Federated Farmers are issues around governance and accountability,” president Andrew Hoggard said.

“The complexity of rural water scheme ownership and operations has got rural people worried.

“How will the new entities ensure the needs of smaller and rural communities are not crowded out when setting investment priorities and plans?

“The proposed arms-length governance arrangements with directors appointed by panel, which are in turn appointed by yet another panel, weaken the accountability of water service entities to communities.”

There are also serious questions around the robustness of the Government’s estimates of savings and benefits from moving to the new arrangements.

“The select committee process and the public consultation that Minister Mahuta has promised needs to be rigorous,” he said.

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