Three Waters FAQs

The Government’s Three-Waters Reform proposes transferring ownership and management of drinking water, wastewater and stormwater from 67 independent Councils to four council-owned entities, which would be governed by independent boards.

Council representatives would be joined in their governance oversight by mana whenua. This is similar to what our Hawke’s Bay regional study recommended to our four Councils in 2020 last year, but at a much larger scale.

The Government’s proposal puts Napier’s three waters services in an entity comprising 21 Councils from the East Coast of the North Island, the top of the South Island and including the Chatham Islands.

Central Government modelling says by 2051 Napier costs are estimated to be $2540 per household (not inflated) without reform.  Costs are currently $610 per household.  With reform, Central Government modelling says by 2051 Napier costs are estimated to be $1,260 per household (not inflated).  Costs are increasing due to higher water standards and costs associated with meeting those standards. 

Costs from ‘Day 1’ (July 2024) are not known and a request for this information is included in our Council’s feedback to Government.

Households and businesses connected to the infrastructure would still be responsible for paying for the water services they receive. We don’t yet know how this charging would be structured.

At this point, there is no indication in the current proposal that those not connected to the networks would be involved or expected to pay.

What about local voice in decision making?

The Government has proposed each Entity will have a ‘regional representation’ group of 12 people (six from local councils (there are 21 in Entity C) and six from mana whenua). This group will appoint an ‘independent selection panel’ that will appoint board members for each entity. The ‘board’ is the management structure that will operate the new entity.

The Government has proposed each Entity will have a ‘regional representation’ group of 12 people (six from local councils (there are 21 in Entity C) and six from mana whenua). This group will appoint an ‘independent selection panel’ that will appoint board members for each entity. The ‘board’ is the management structure that will operate the new entity.

A possible drawback is in the level of direct, local control and influence we have on the prioritisation, investment, expansion and outcomes delivered by the larger entity. For example we do not know if Napier would be able to pursue a chlorine-free network.

To ensure a local voice for Napier we would be relying on mechanisms and processes that are different to those we currently have. This is the area where the most unanswered questions lie.

Napier has been involved in both Central and Local Government conversations related to this reform in the preparation of the proposal, however, we do not know how the interests of our community will be protected and empowered in the new structure. We will continue to advocate to Government on the importance of local voice in decision-making around three waters services.

The recent Government announcement allocated funding support to individual councils on the basis of a nationally consistent formula that takes into account population, relative deprivation and land area. For Napier, this grant would be $25.8 million. This is known as the “better off” grant.

The new water service entities would have access to significantly more borrowing capacity due to their size and structure, with aggregation of costs over the population results in lower costs overall.

The five councils of the Hawke’s Bay region have been working together closely for nearly two years on how we could deliver a more affordable and effective three waters service as a region.

An independent report released last year showed this was achievable. We will continue to work together as we analyse the reform information and will include this work in our feedback to the Government.

The Government has provided councils with an opportunity to go back to them with clarifications, questions and feedback on key issues of the Three Waters Reform proposal by 30 September 2021.

This is an important time to analyse the impacts the reform will have on our community and our Council services.

While we’ll be doing this at a local level, we will also continue to work with other Hawke’s Bay councils to do detailed analysis of the reform and how it relates to the previous work we have done together as a region.

The Local Government Act and our Significance & Engagement Policy require us to consult with our community on an issue of this significance.  We are committed to ensuring you will be given the opportunity to have your say on decisions the Government makes on this Reform programme, and we will actively advocate for community voice to be an essential element in the Government’s decision-making process.