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Labour’s Hefty Carrot-And-Stick For Water

Written By: - Date published: 8:37 am, August 31st, 2020 - 16 comments
Categories: auckland supercity, local government, phil goff, supercity, uncategorized, water - Tags:

New Zealand’s local and regional councils were given until August 31 2020 to sign up to a ginormous fund that would help them improve their water, wastewater, and stormwater systems.

It’s a truly massive carrot paired with a sizeable regulatory+governance stick.

Part of it is a regional funding package to strongly encourage (ahem) cooperation between local councils and regional councils.

Now before you all cry out ‘what about me’, each authority’s national allocation is based on:

  • Population in the relevant Council area as a proxy for number of water connections serviced by a territorial authority
  • Land area covered by a local authority excluding national parks, as a proxy for the higher costs per connection of providing water services in areas with low population density.

You can see the whole big Three Waters Reform package on the Department of Internal Affairs site here.

Starting in the Havelock North water outbreak in 2016, which left four people dead and 5,500 pretty sick, the work is also going to keep more regional jobs.

Now, here comes the stick. All Councils – which own and manage most treatment plants and 90% of NZ’s drinking water – are set to be stripped of their roles. Water provision will be taken over by a small number of publicly-owned super-regional entities. We’d heard murmurings of this from Minister Mahuta early in the term. The Productivity Commission had similar recommendations last year.

Now, the agreements bind Councils to take the money and agree (no sign-up = no money), but their stuff-ups now have to face a water quality regulator:

Particularly in the provinces, there has been a systemic failure of water suppliers to meet the standards of safe water supply to New Zealanders: 34,000 people across the country become ill from drinking their water every year.

But there’s more to do.

We also need a water pricing regulator, as I called for a couple of years ago.

Then there’s Auckland. I haven’t seen Auckland try to sign Watercare up to this yet. It must be sorely testing Ministerial patience not to nationalise Watercare, integrate Northland (which has about the collective water demand of two Auckland suburbs Henderson and Massey), and further expand its management of the Waikato system, to ensure we don’t get the crisis in Auckland’s water that we now face going into summer 2010-21.

A move on Watercare would strip about a third of Auckland Council’s asset base, so it’s up to Auckland’s council to really make effective governance moves on Watercare rather than the very mild CCO review they are running. Watercare’s exec team and Board need ‘assistance’, sure, but actually it’s Mayor Goff that’s in very deep water trouble.

The high level politics of water has a clear pattern. I see odds on of NZ maybe 6 water suppliers within next term: that’s their mega pattern in health and tertiary education as well, and NZTA are already the transport masters of all our councils. Minister Mahuta also appears to have kicked Treaty of Waitangi Article 2 considerations into next term, at least.

There’s also national environmental standards for wastewater discharges. Regional Councils such as Canterbury and Southland will be in the government’s cross hairs next term if the groundwater and river nutrient pollution levels don’t markedly improve. Neither Parker nor Mahuta have any patience left with them.

So this is not the last hard discipline from Labour to Councils: they are tired of waiting for regional councils in particular to get it together, so they have brought the cash, but they are now carrying a large stick as well.

16 comments on “Labour’s Hefty Carrot-And-Stick For Water ”

  1. Patricia Bremner 1

    Good. As they seem to react to dollars when all else fails.

    I seem to remember an article that mentioned "2 farms used more water than Auckland city."…. I may have that wrong… someone more clever may find it.

    Rotorua has just brokered a waste water deal with all interested parties. That took years. Many years ago I caught Giardia twice from untreated Lynmore supply.

  2. RedLogix 2

    Particularly in the provinces, there has been a systemic failure of water suppliers to meet the standards of safe water supply to New Zealanders:

    A little unfair. The staff involved are almost invariably good people doing their best with inadequate resources. But yes, the contrast between the big city suppliers and the small provincial ones was always quite stark.

    These days water supply is a reasonably demanding technical task, with quite a lot of aspects to manage and balance against always constrained budgets. And this is one area in which economy of scale applies very strongly. For instance you could quite easily on paper save a lot of money by having one single control and telemetry platform for all the supply systems across the entire country. In reality you'd never get to roll it out all at once, all at the same revision, but there is a lot to be gained in heading in that direction.

    The same would apply to a lot of the vendors, pumps, instruments, electrical components, and so on would all see big productivity gains if there was a measure of standardisation and harmonisation everywhere. Staffing, training, spares and asset lifecycle would all become far more efficient. The same would apply at the operations level, with maybe a handful of large centralised control centres monitoring supplies remotely across the whole nation. The entire thing could easily be networked and given layers of redundancy to cope with natural disasters. Challenging issues of cyber-security could be effectively managed by a relatively small number of specialists in a manner that’s very hard to do with the highly fragmented systems we have now.

    And with highly integrated systems like this, any shortfall in standards of supply and safety would always be a lot more visible, managed and accounted for.

    So technically there is a lot to be gained. But as I'm typing this there is another more difficult question that wants to be asked. If local councils (who essentially represent all New Zealanders) are to stripped of ownership, and control shifts to these new 'super-regional' organisations … who becomes the new owner? Back in the days of Douglas this would have raised immediate fears of privatisation. But in 2020 the question now being begged, is who will put their hand up as the true owners of water in this country?

    • Draco T Bastard 2.1

      But in 2020 the question now being begged, is who will put their hand up as the true owners of water in this country?

      It can only be the state and thus ownership is retained in the hands of all NZers.

      They would need to set up excellent channels of communication with locals so that issues can be dealt with quickly and efficiently.

  3. Dennis Frank 3

    Sounds good, but I see no description of enforcement mechanisms. Agreeing with the restructure design to secure funding makes sense as inducement, but explanation of how the stick gets wielded against nonperformers would give people more confidence in the new system.

    Also no promise to stop pumping more immigrants into Auckland, so the inability of neoliberals to comprehend the causal relation between supply & demand is still likely to cripple infrastructure development.

    Experimenting with restructure has had a checkered history in Aotearoa the past 30 years. This design seems a likely improvement however. What's missing? Something that gives us more than a wish & a hope.

    Resilience is achieved in natural systems via negative feedback cycles, composed of info & energy flows. In regulatory design we ought to be able to see human copying of that process, to correct malfunctions. Public relations ought to inform us accordingly.

  4. Stuart Munro 4

    Treasury oversight by a fellow called Dryburgh not being ominous at all at all.

  5. Tiger Mountain 5

    Who could object to Three Waters Reform apart from parochial Councils, Auckland CCOs and South Island polluters? There is someone else…a number of provincial small private water suppliers who run micro town supplies and others who top up rain water tanks from bores. Some of these people will want to guard their dungheaps and not be keen on reform. As may be detected I am not keen on small private suppliers–“Water Wars” can be a spinoff in tiny communities.

    But the big fish of course are the likes of Watercare. Water Supply should generally be in public ownership where it is for public use.

    In the 21st Century there is obviously the technical means to have safe affordable water for the overwhelming majority of citizens. It is interesting that a historical labyrinth of District/Regional Council operations and others outlined in the post are the major impediment to this happening.

  6. Dean Reynolds 6

    We need to ensure that the proposed Water Authorities are not privatised at a future date by a Right wing government. One way to ensure this is for Labour & the Greens to state categorically, that any attempted future privatisation will be reversed by an incoming Labour – Green Government. This would destroy any attempt to float the privatisation shares on the stock exchange, (& is something that Labour should have had the balls to do when Key privatised power).

    • RedBaronCV 6.1

      No we need to ensure by whatever means possible that this cannot be privatised. Keep the ownership with councils and set it up under the companies Act that says each and everyone one of us is a shareholder – that means we would all have to vote on any privatisation. Otherwise we are going to get the power companies again – a huge bunch of selling companies plus the producers so there is a multi billion industry living off the backs of all of us.

      BTW the sign up date is today? I’d expect my rates to go down too…

      • Draco T Bastard 6.1.1

        Keep the ownership with councils and set it up under the companies Act that says each and everyone one of us is a shareholder – that means we would all have to vote on any privatisation.

        That's what happened with the power companies. They all gave their shares out to subscribers and most of those subscribers immediately sold off their shares.

        Better just to keep it in government ownership and only allow a sale through referenda.

        That should apply to all state assets.

  7. Draco T Bastard 7

    Water provision will be taken over by a small number of publicly-owned super-regional entities. We’d heard murmurings of this from Minister Mahuta early in the term.

    Hopefully Labour has the foresight to list them as strategic assets so that they can't be sold to private owners. If they don't then I can see the whole of NZ being held over a barrel.

  8. tc 8

    "Hopefully Labour has the foresight to list them as strategic assets.." How is that possible when any govt can simple rewrite the rules, retrospectively if they want to.

    Nats did that under urgency regularly to 'fix' something. It’s our cycle so how do we break it or prevent this when govt’s do as they please.

    I’d love to see the power industry return to the public as an example but how do you keep it there for the ages.

    • Draco T Bastard 8.1

      That is the question.

      Our government certainly needs some restraints added to it that it cannot undo without asking the population but no government we've had yet has even considered doing that and, IIRC, they get really antsi when its mentioned. They always come back to the non-argument that they need to be able to do what they need to do and not be restrained by the wishes of the populace.

      Time, I think, that we changed that. Time to remind parliament that they're not our masters, they are our servants.

  9. PsyclingLeft.Always 9

    Well….here is a "prime" example of the kind of scheisskopf (maga hat owner and framed picture displayer) on Regional councils. Farmers/and or deniers/rednecks. Fark…!!


  10. PsyclingLeft.Always 10

    Farmers be getting ..activated (well really, aint they always been? Fed Farmers…militant Union an all : )


    Gotta laugh at this bit…

    "There are tons of people in regional councils who call themselves ecologists but who have a very different view of the management of high country. "

    Refer my previous comment re Regional Councils… also anyone with a strong enough mind…should try listening to The Country radio with Jamie McKay and Rowena Duncum ( I kid you not : ) Fair warning you might need some swear words…


    And I do know good Farmers…SUSTAINABLE Farmers..maybe Regenerative Farming?


    Country Calendar ( I was surprised : ) has had some great episodes…of What Could Be..

  11. PsyclingLeft.Always 11

    Regulatory general manager Richard Saunders said staff were keen to assist farmers to understand and implement the changes.

    "We will be taking an ‘education first’ approach to helping people implement the changes, and we’re working proactively with the community to ensure everyone understands the new requirements.”


    Fark….(I could use more words : (. Why I am I not surprised? ORC just keepn on keepn on. Meanwhile Rivers, Streams,Wetlands are full of cowshite. Bit like ORC

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