Water Services Reforms

The Government has proposed that ten regional water entities will take over the water services currently delivered by local councils. Currently, 67 councils across the country are responsible for the day-to-day management and operation of our drinking water networks, wastewater systems and all the infrastructure involved in managing stormwater. Shifting the responsibility for these assets to ten regional entities will be the biggest change to the local government sector in over 30 years.

April 2023 reset

In April 2023, the Government announced some notable changes to the reform framework and timeline. The four water services entities originally proposed in 2021 increased to ten entities to better reflect existing regional collaboration and allow for more local voice in decision making.

The establishment timeline also changed from a national go-live on 1 July 2024, to a staggered establishment approach where the entities go-live between 1 July 2024 and 1 July 2026.

Previously known as the ‘Three Waters Reform’, this reset saw the programme rebranded as the ‘Water Services Reforms’.

With this reset, Napier City Council’s water services will now transfer to Entity F (Tairāwhiti – Gisborne Hawke’s Bay) alongside Gisborne District Council, Wairoa District Council, Hastings District Council and Central Hawke’s Bay District Council. The establishment date is yet to be determined. In the meantime, Napier City Council is continuing to fulfil our obligations and work alongside the National Transition Unit (operating out of the Department of Internal Affairs) to prepare for the transition.

The case for change

Local councils across the country are facing significant challenges when it comes to planning for and managing drinking water, wastewater and stormwater services into the future.

Generally, the assets that make up our urban water networks are aging and will cost a significant amount to replace. In 2021, The Water Industry Commission for Scotland was tasked to look into investment requirements and estimated that New Zealand needs to invest $120 billion to $185 billion in our water services infrastructure over the next 30 years. This investment is crucial to mitigating issues like boil water notices, wastewater overflows (when sewage spills onto streets, properties and into waterways) and drinking water loss (when valuable freshwater leaks out of pipes as it is pumped through the network).

The magnitude of investment that will be required over the next 30 years is potentially beyond councils’ existing ability to fund, given councils have limits on how much they can borrow. The ten entities would be able to borrow more money, and harness economies of scale.

There are other opportunities presented by reform, like the chance to build an expert water workforce and achieve more national consistency in service delivery and technical standards. The changes would treat water services more like a utility business (telecommunications or electricity) and leaves council more scope to focus on community needs.

More information about the rationale for change can be found here.

What does it mean for Napier?

Even though Napier City Council is a member of Communities4LocalDemocracy, we agree that something needs to change.

The Entity F model wouldn’t see many day-to-day changes for households. You would likely pay for water services separately instead of the bill being included in your council rates, and the management of customer service and callouts would sit with the new entity. We’ll make sure we communicate any changes closer to the time so you know who to contact.

The reforms have been centred on the premise that a change in delivery model will ultimately save households money in the long term. This is compared to projected costs if nothing changes, not compared to your current rates bill. More information about projected savings can be found here.

If you collect rainwater or have a private septic tank, these are not impacted by the reforms.

What does it mean for iwi and mana whenua?

Te Tiriti o Waitangi is a central pillar of the water services reform programme. Iwi and hapū will have a greater role in the new water delivery model, including pathways for enhanced participation by whānau, hapū and iwi as they relate to delivery of water services to their communities and as it interacts with their Treaty rights and interests.

The reforms are also built on a founding principle of Te Mana o Te Wai. This is a concept from Te Ao Māori that puts the health and wellbeing of our rivers, lakes, estuaries and aquifers at the centre of the way we manage freshwater. If we protect and enhance the mauri and mana of the water around us, then we can protect the health and wellbeing of our environment and our people. You can find out more about Te Mana o Te Wai here.

Key legislation

There are several important Acts and Bills that set up the new entity framework. A summary of each is as follows: