What does the Government's reform aim to achieve?

The three waters reform programme sets out to improve the health and wellbeing of all New Zealanders. It will improve the safety, quality, and environmental performance of water, wastewater and stormwater services in a way that is considerably more affordable per household than what is projected without reform.

Why does Government think change is needed?

Local councils provide three waters services to the majority (85%) of New Zealanders. Expert reports show New Zealand needs to invest between $120 billion to $185 billion over the next 30 years to meet drinking water and environmental standards and provide for future population growth. Under the current system these costs will be shared unevenly among New Zealand households. For rural communities, this equates to an increase of up to 13 times present costs, eight times higher for provincial areas and up to seven times higher for many metropolitan households.

With reform, the cost of providing these critical services to our communities is likely to reduce substantially.

How will this impact public safety?

Local councils provide three waters services to the majority (85%) of New Zealanders. This includes the infrastructure needed for the collection, storage, treatment, and reticulation of water to homes and businesses. The infrastructure is under extreme pressure and needs systematic reform to meet communities needs and expectations now and into the future. Government notes the current structures and management have led to issues such as those identified in Havelock North where a waterborne gastroenteritis outbreak made 5500 people sick, saw 45 residents hospitalised, and contributed to three fatalities in 2016. This reinforces the need for reform of three waters governance.

What will the proposed reform mean?

This reform will bring together three waters services, currently delivered by 67 different councils across New Zealand, into four competency-based water services entities. These entities will remain firmly in public ownership (by the communities they serve).

The reform will improve our ability to address contamination of urban streams, lakes and coastal environments through sewer overflows and other unauthorised discharges and stormwater run-off.

Reform will also improve transparency about, and accountability for, the delivery and costs of these services and uphold the Crown's Treaty of Waitangi obligations to iwi/Māori.

Will Hamilton be better off?

Government has put a funding package together and stated no Councils is worse off through the reforms and all communities are better off. Funding is provided to support Councils through any transition process, and to ensure the financial impacts of reform will be managed. A further fund has been announced for Councils to support the three waters service reform, and focus on other local wellbeing outcomes associated with climate change and resilience, housing and urban design and planning, and community wellbeing. Hamilton's share of this fund would be $58 million.

What entity region would Hamilton be in?

Hamilton would be part of a central North Island entity involving 22 councils in the greater Waikato, Bay of Plenty, Taranaki, and parts of Manawatu-Whanganui. Government says four entities strikes the right balance between economies of scale and the needs and interests of local communities. Research shows entities that deliver services to at least 600,000 to 800,000 connections can achieve significant efficiency gains.

Who owns and runs the entities?

Councils are the 'owners' of the entity, on behalf of their communities – this is a 'no shareholding' ownership with no financial recognition of ownership.

A Regional Representative Group made up of local authority members and mana whenua will set expectations for the entity and select an independent panel to appoint the entity board. 

These board members will govern the entity and appoint a CE who will manage the staff for the entity.

Is Hamilton doing a good job to deliver its water services?

Hamilton City Council waters staff do a brilliant job and consistently deliver water services to a high level for our city. At a national level Hamilton stacks up very well and exceeds expectations in terms of our three waters performance. However, expert research and international experience shows a different national structure will allow us to do even better. Like most areas in New Zealand, we also need to invest a lot more, and meet new compliance and environmental levels in the future. The reform programme is designed to significantly reduce future costs to ratepayers.

Why isn't Government buying the waters assets from Councils?

This would create a new and pointless cost for households. Transferring the assets to the new entities means the Councils still collectively own them, and the communities which paid for them would still be serviced by those assets. Charging the new entities for them would mean these entities would have to recover the costs from their consumers. Effectively this would mean communities being asked to pay again for assets they already own.

Will this mean I pay less for water services?

It is unlikely costs will be lower than now, but they will be substantially lower than what they would be without reform. A very large investment is needed to provide improved and sustainable three water services. This means increased costs to consumers. The reform efficiencies will reduce this increase substantially.

Is this a step toward privatisation?

No. In fact, further safeguards against future privatisation are being developed, making it more difficult to privatise than it is now. Continued public ownership of three waters water services and infrastructure is a bottom line for the Government. Legislation will be developed specifying that local authorities that constitute each water services entity would be the owners of the entity and that any serious future privatisation proposal be put to a referendum.

Will regional entities reduce the service levels we get now?

The reform programme includes new oversight and reporting provisions which will give communities more security about service levels than the current services. This will include an Ombudsman, an economic regulator, and new compliance standards. Each entity will be required to engage with communities in a meaningful and effective manner on key documents. The entities will be required to publish these, to report on how consumer and community feedback was incorporated into decision-making, and set up a forum to assist with effective and meaningful engagement.

What will happen to Council's waters staff?

All staff who work primarily on water will be guaranteed a role at the new water service entities that retains key features of their current role, salary, location, leave and hours/days of work. A more bespoke approach is required for senior executives, other staff and contractors.

When will the public be consulted?

The reform programme is led by Government, not by councils. Councils are still receiving information on the reform proposals and have not yet been asked to make any final decision. At the moment we are in a pre-engagement phase, informing our communities of progress on a comprehensive and complex Government programme, and seeking further detail.

As with any project, before we can effectively consult with our communities, we need to understand the final proposal and what decision Councils are being asked to make. Between August and the end of September 2021 councils are clarifying the Government's proposals, analysing the information provided and providing feedback through Local Government New Zealand. After October 1 we expect further information from Government to let us plan how best to engage with our communities.

Where can I get more information?

We will be updating this page and the links to further information as it comes to hand. The latest Government information and releases is uploaded to the Department of Internal Affairs website here: https://www.dia.govt.nz/Three-Waters-Reform-Programme

Page reviewed: 26 Aug 2021 11:28am