Steven Joyce: Three Waters ‘reform’? It’s like arguing that black is white

This Government is so busy pretending to change its spots that it never gets around to actually doing so, writes Steven Joyce. Photo / NZME

OPINION:

We have seen again over the last week that this Government possesses an unshakeable belief in the power of its own rhetoric. On both Three Waters and the economy, ministers are clearly of the opinion that if they repeat anything often enough and with enough conviction, the voters will in turn believe it to be true.

They are likely to be wrong.

Whoever thought up the idea of re-labelling the unpalatable Three Waters reforms as “affordable water reform” should hang their heads in shame. And so should the ministers who had sufficient contempt for the public that they thought simply re-badging something this contentious would achieve a positive reappraisal of the reforms. To say nothing of the Prime Minister denying Three Waters even included co-governance “as it is traditionally understood” at the announcement of the grand relabelling.

It had been assumed by many that the Government’s willingness to argue that black is white had been quietly shelved with the departure of former Prime Minister Ardern, but we have now been treated to a masterclass in sophistry courtesy of new Prime Minister Chris Hipkins.

The proposed Three Waters changes are transparent window dressing. Sure, the number of entities going from four to 10 is a small step forward for local accountability, but still the people of Northland will be tagged on as an afterthought to the big dog that is Watercare in Auckland, the people of Invercargill will have their water services run from Dunedin, and those of Timaru, Oamaru and the Waitaki River basin will have their access to water controlled from Christchurch. Given the unhappy history of Environment Canterbury, the latter alone is a recipe for disappointment and frustration.

The water assets will still be confiscated from local councils and placed in organisations over which they will have only a figleaf of influence. The water organisations will still be co-governed, with an unelected Mana Whenua Group given 50 per cent control, and veto power over the appointment of directors for each entity. Iwi and the Mana Whenua groups will still be able to issue guiding statements to the water companies which they “must respond to”, and the denuded councils will still not be able to do the same. Local government will be further weakened by the reforms, which continue an ongoing power grab by central government that stretches across health, the polytechs and local government.

The much-heralded savings from the reforms are as unlikely as before, albeit apparently reduced as a result of the increased number of water organisations.

Let’s be clear. The investments in new infrastructure will be paid for by ratepayers and consumers, no matter who builds them. You can pay through your rates, through your taxes or through water levies. But you will pay.

Also, the idea that the new entities will be able to borrow more cheaply is also largely bunkum. The Local Government Funding Agency already packages up local government debt to obtain the lowest possible interest rate for all councils. Whatever money is to be saved from sharing equipment and filtration plants could be easily done another way, without all the fishhooks in these reforms.

The current reforms are a recipe for discord and disharmony. When more people work out that their access to water is effectively controlled by one part of society who have the right whakapapa, then the proverbial will truly hit the fan. Also, nobody knows how a water services organisation will be required to respond when the first mana whenua group declares, for example, that Auckland should take no more water from the Waikato River. That ambiguity allows people to assume the worst.

All this could easily have been avoided. It would be entirely possible to recognise the rights and interests of Māori in water without excluding the rights of all others, if it was done carefully and with respect towards everyone affected. However, I fear that opportunity has been lost as the debate becomes increasingly polarised.

Just like the previous Labour Government with its flip-flopping from one extreme to the other on the foreshore and seabed, this one has recklessly put the interests of Māori on a collision course with those of everyone else, and unnecessarily inflamed race relations in this country.

Last time, it took patient stewardship from the likes of John Key, Bill English, Chris Finlayson, Tariana Turia and Pita Sharples to heal things again and get us all moving forward. Sadly, the pattern is repeating. Given the performance of the last 10 days it will be up to the next Government to come up with a workable compromise that everyone can live with, so we can go back to getting along again.

Of course, it’s not just the water reforms where the Government is continually trying to pull the wool over voters’ eyes. Ministers are fond of declaring all the inflation-fuelling expenditure they have overseen in the last six years is completely justified. They even defend the money spent on failed restructurings and, somewhat ironically, the explosion of government spin doctors.

Chris Hipkins and Grant Robertson can’t see anything they would do differently with the economy despite food inflation running at 12 per cent, CPI inflation stubbornly staying up around 7 per cent, an eye-watering current account deficit and an emerging international consensus that New Zealand is becoming one of the worst economic performers in the OECD. Instead, they are rumoured to be planning to fire up a debate on tax in the Budget to distract everyone from their economic record.

After what seemed to be a positive start to the new regime, it will now be dawning on the public that even with a tiggerish new Prime Minister, the overall Government policy direction and its attitude to voters remains unchanged. In that respect, the re-badging of the Government may turn out to be as unsuccessful as the re-branding of Three Waters.

New Zealanders who want a genuinely new approach to the economy, inflation, Three Waters and race relations are starting to realise they will have to vote for it rather than relying on this lot changing their tune. The current lot are prepared to pretend to change, but then carry on regardless.

- Steven Joyce is a former National Minister of Finance. He is director at Joyce Advisory.