“The feedback has been overwhelmingly clear that our water infrastructure deficit needs to be addressed now if we’re to save households from ballooning bills that will make water unaffordable. But also that the reform programme must be led at a regional level - we have listened closely and absolutely agree.”
Mayor of Central Hawke’s Bay, Alex Walker, said she is is relieved to see the new proposal.
“It is very pleasing to see that community feedback and the views of our council and our region about the risks of such drastic centralisation have been taken seriously.
“The work we have done together as Hawke’s Bay has had a credible impact on government’s thinking and resulted in one regional entity across Hawke’s Bay and Tairāwhiti (Gisborne) being part of the new model instead of competing across the huge Entity C.
“We have always acknowledged that the status quo for the supply of the three waters services is not sustainable for councils and ultimately householders, especially in Central Hawke Bay where we have such huge infrastructure need across a small population resulting in unaffordable rating mechanisms.
“The changes proposed will still have a significant impact on our council and our ability to continue to provide good local service on all other activities unless there is a serious re-think from government on other funding mechanisms across local government. I continue to push for more serious consideration of the changing but important role of local democracy and delivery for local communities.”
Minister McAnulty said “The cost of meeting the upgrades needed for our water systems is projected to be up to $185 billion over the next 30 years. Local councils cannot afford this on their own, and households in some areas could see rates rise up to $9730 per year by 2054 if we do nothing.
“The projected costs have been peer-reviewed by both Farrierswier Consulting (an expert Australian regulatory economic specialist) and Beca (a leading international engineering firm) and make for pretty grim reading. Leaving councils to deal with this themselves will lead to unaffordable rate rises. It would be setting councils up to fail and I can’t in good conscience do that.
“Under our proposal to establish 10 entities New Zealand households will still make big savings, projected at $2770 - $5400 a year by 2054 on average within each region.
“By extending the number of publicly owned water entities to 10, every district council in the country will have a say and representation over their local water services entities through regional representative groups, forming a partnership between council representatives and iwi/Māori that will provide strategic oversight and direction to the entities.
“These groups will continue to sit below the governance board, in which each member will be appointed on merit and qualification, but by increasing the number of entities we will be able to ensure the needs of every community, especially small rural towns, are heard and met.
“Our reform proposals will respond to long-running problems that have resulted in rapidly rising rates, poor health and environmental outcomes for many communities, deteriorating infrastructure due to sustained underinvestment, and wide variation in service quality.
“The need for investment is only getting greater. The recent flooding and cyclone is a taste of the extreme weather events to come, and our water infrastructure needs to be ready.
“I have seen first-hand the impact of the devastating floods and extreme weather events. These events have highlighted the criticality of waters services, especially stormwater, for community adaptation and resilience. They have also shown the fragility of critical water infrastructure in some areas,” McAnulty said.
The water services entities will start delivering water services from July 1, 2026 at the latest. Entities are able to proceed before this if ready.
“These are once-in-a-generation reforms, and it’s important that we get it right, we landed on this by working with councils and will continue to do so to ensure a smooth transition,” McAnulty said.
The 10 new entities will be owned by local councils on behalf of the public, and entity borders will be based on existing regional areas.
Each entity is to be run by a professional board, with members appointed on competency and skill.
Strategic oversight and direction will be provided by local representative groups, with every local council in the country as well as mana whenua getting a seat at the table.
