If Govt reform doesn’t proceed, Three Waters will go into a political too-hard basket

Water assets must stay in community ownership with the strongest possible protections against privatisation.

On Friday, the Government announced its reaction to 47 recommendations from a local government/iwi working group. It was a relief to see support for a public shareholding model.

This change increases protection against privatisation because every single council would have to agree. If a water services entity is owned by say 10 councils, each of those 10 councils would have to say yes to privatisation, and they would have to consult their communities first.

You could easily argue that protections against privatisation will be much stronger than they are now. This change also makes it crystal clear that the assets stay in community ownership – they are not being transferred to the Government.

The Working Group recommendations matter because they’re another round of improvements to the Government’s model. Today’s model bears little resemblance to what was first proposed two years ago, thanks to feedback from the local government sector.

And while disagreements around the model persist, the sector is united on the need for reform of some kind. Even people implacably opposed to the Government’s model are advocating for change. But we’ve been having conversations about the need for change for decades. It’s time for less talk.

LGNZ will keep pushing for improvements to the proposed model, but let’s not be naive: if this Government’s reform doesn’t proceed, Three Waters will go back in the political toohard basket and our communities will be the losers.

A perfect storm of higher costs approaches, with stricter enforcement from new regulator Taumata Arowai, the unknown condition of many underground pipes, and the impacts of climate change.

Costs are already increasing ahead of inflation. Water New Zealand’s 2020/21 National Performance Review, which covers 38 councils and 87% of New Zealand’s population, showed the average residential water charge increased by 7% last year to $471 and the average wastewater charge by 8% to $522.

In this year’s much more inflationary environment, where everyone’s being hit in the pocket, it’s hard for voters to support significant spending on infrastructure they can’t see, especially when we all take turning on the tap or flushing the toilet for granted. While many councils have dramatically increased their investment in water services since the Havelock North tragedy, memories can be short when purse strings tighten.

As well as things like pipe degradation, which we all know about, climate change will generate massive – and as yet unquantified – bills for Three Waters infrastructure. Three years ago, LGNZ produced a report showing that $2.7 billion of roading, Three Waters and building infrastructure would be at risk if there was as little as a 0.5 metre rise in sea levels. The figure would be substantially higher today.

Severe weather events are also taking their toll. Heavy rain has hit Taira¯ whiti so many times this year that talking about 1-in100-year floods feels increasingly meaningless.

That doesn’t mean councils aren’t doing the best job they can in incredibly difficult operating environments. Our people working in water services are unsung heroes. They deserve certainty about our commitment to better water services.

The writing has long been on the wall for our current water services delivery system. That’s why LGNZ supports the Government’s objectives for its Three Waters reform. We have continually and consistently pointed out how the actual model can be improved – and it has been. It’s not perfect, and our critique will continue.

But I am very clear that to prevent escalating costs for ratepayers and deliver firstworld water services to New Zealanders, water reform must go ahead. New Zealanders deserve affordable, safe and sustainable water. The time for action is now.

I am very clear that to prevent escalating costs for ratepayers and deliver firstworld water services to New Zealanders, water reform must go ahead.