Three Waters Reform

Kaikōura District Council has invested heavily in its water infrastructure, and we are actually in a better place than many other Councils throughout New Zealand. Before the earthquake we increased the capacity of our water and wastewater, and then, because of damage sustained in the 2016 earthquake we replaced or renewed most of our water infrastructure.

We have provided information on our water infrastructure and services to Government, but in the recent public release their future projections do not stack up. Our Long Term Plan Infrastructure Strategy invests $27.2 million over the next thirty years for growth and enhancement of our water infrastructure, however, the Government is indicating that we need to spend $280 million over the next thirty years. That’s a spend of $9.3 million each year - on our water infrastructure which is valued at $57 million. 

Kaikōura District Council, along with other councils nationwide, signed a Memorandum of Understanding (MoU) with the Government in August 2020, committing it to the first stage of the water reform programme to access an $1.8m share of the stimulus package. This funding is being used to upgrade Three Waters Services in the district (see below) these projects are completed or in progress.
Please note that signing the stage one MoU does not commit Kaikōura District Council to anything beyond stage one.

• Seismic upgrading of Kaikōura township water supply treatment
• Water supply treatment upgrading Kincaid, East Coast, Suburban and Fernleigh
• Inflow control and infiltration of wastewater network
• Spare pumps for main and local wastewater pump stations 
• Standby generator for Kaikōura township water supply treatment and site fencing
• Standby generators for mobile wastewater network 
• Odour control of wastewater network 
• Flow metering of Kaikōura township water supply
• Desludging of wastewater treatment pond 
• Improvements to Kincaid water supply
• Improvements made to asset management plans 
• Screen replacement for wastewater treatment 

The government has a financial support package on the table to support local government transition through the reforms to New Zealand’s drinking water, wastewater and stormwater services. $6.2M has been allocated to Kaikōura District Council if we decide to opt in to the Three Waters Reform, but first we need to find out what these reforms mean for our community. You can read more about this financial package here.

• Currently most of these services in New Zealand are delivered by 67 local councils and are paid for by rates. Government is proposing that responsibility for providing these services is removed from local councils and transferred to 4 large multi-regional entities.
• Under this proposal Three Waters services in the Kaikoura District would be delivered by a new entity that covers most of the South Island (covering the Ngāi Tahu takiwā), serving around 900,000 people.
• Central government considers that such a change is required because some communities currently face very substantial challenges to renew their infrastructure, provide and maintain Three Waters services to the higher health and environmental standards that government believes people want.

• The Three Waters Reform proposal is based on a belief that having much larger organisations deliver these services will substantially improve efficiency and resilience, enabling higher standards to be consistently provided for relatively little additional cost.

Whilst the concept of the reform proposition is relatively simple, the underlying technical detail is very complex and in some cases uncertain. We currently have many questions for which reliable answers do not appear to readily available, these include:

• What exactly are the higher health and environmental standards for water that the government is proposing, and what would a move to those standards mean at a local level?
• How could local communities retain a strong say or influence in respect of how their water services are provided under a single entity that covered nearly all of the South Island?
• How confident can we be that the new entity will achieve the suggested large cost efficiency improvements?
• If the new entity can’t achieve the suggested cost efficiency improvement, will people be willing to meet the much higher costs required to achieve any higher health and environmental standards being proposed by government?
• What assurance is there that smaller communities won’t receive poorer service from an entity that may be strongly focused on the larger towns?
•  Where are the additional skilled personnel required for the new entity going to come from when there are already severe skills shortages in NZ?
•  To what extent will particular communities be required to subsidise other communities through charges for water?
• What absolute assurance is there that the new large water entities would not be privatised at some time in the future, recognising that governments can change laws?
• How has the Department of Internal Affairs come up with such high estimated costs for growth and enhancement of our water infrastructure when so much of our Three Waters infrastructure has been renewed already?