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Govt needs to consider ratepayer burden in 3 waters policy, Mahuta says

Wednesday 19th September 2018

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The government will have to consider what could be a heavy burden for ratepayers upgrading the nation's three-waters systems, and work on how to deliver that will continue into next year, Local Government Minister Nanaia Mahuta says. 

The Department of Internal Affairs has been reviewing the country's policy on drinking water, wastewater and stormwater for about a year, and was originally intending to have completed options and recommendations by the end of 2018.

The review builds on an independent inquiry into Havelock North's tainted water crisis in August 2017. Work to date estimates upgrading water treatment systems could cost as much as $575 million and improving wastewater infrastructure could be as much as $2.1 billion. 

Mahuta told the Water NZ conference in Hamilton that anecdotal feedback indicated stormwater upgrades would add to that cost, making it even harder for some of the smaller local bodies. 

"The costs of upgrading the system to meet expected standards will fall on already heavily-burdened ratepayers, and will take a very long time to accomplish," she said. "This is something we will need to consider as we consider options for service delivery here. [We must also think about] the need for professional skilled directors in any new options."

Cabinet will likely receive options on a dedicated water regulator and stronger regime before the end of the year, but won't make a decision until 2019. Following that, it will consider options for water services capability, funding, capacity and governance. 

Fixing the regulatory regime is the government review's first priority, but Mahuta said service delivery will have to change to meet those requirements, customer expectations and providing for infrastructure. 

She cited Wellington Water as a leading example and noted local bodies in Hawkes Bay and Manawātu-Whanganui are considering joint approaches to water policy. Mahuta has previously said the government is actively considering whether water services should be merged to achieve economies of scale. 

Mahuta reiterated public ownership remains a bottom line and isn't seen as an obstacle to funding the necessary infrastructure. 


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