The public is being asked whether or not the Hawke's Bay Regional Council should spend $37 million on an agreement to buy water from the proposed Ruataniwha dam.

The council's public consultation process for the 2016-17 annual plan opened this week with the big ticket item being this change to its long term plan.

This consultation comes after the council initially decided not to consult with the public about the expenditure, but then did an about face following advice from Audit NZ that it should do so.

As such the auditor general will be monitoring this process.


"As the council has since decided that they need to amend their long-term plan, which will require public consultation. We will not be inquiring into the council's original decision," a spokesman from auditor general's office said.

"We will, however, continue to monitor the council's progress with the proposed long-term plan amendment."

It is a move that has been welcomed by councillor Rick Barker - who along with three other councillors wrote a letter to the office of the Auditor General alerting it to the initial lack of public consultation.

Following the period of indecision surrounding public consultation on the matter, council has singled out the amendment due to the significant amount of money and the fact that this decision was not covered in its 2015-2025 long term plan.

In the amendment documents, the council has presented three options for the public to choose from.

The first option gives the council 34 million m3 water free for seven years and then the requirement to purchase 4million m3 per year for environmental flows at a preset price. This would amount to a total cost of $36.9 million over 35 years and it is the council's preferred option.

The council says the advantage of this option would be that as a foundation water user, it would receive the best price for the water over the life of the agreement, including discounts.

"The public will be asked to make a commitment before the precise projects are fully identified and prioritised," the council cited as a disadvantage of this option. "The public will, however, have opportunity at a later date to submit on prioritising projects nearer to the time of implementation."

The second option offered was that the council purchases additional water in future at market rates, to satisfy environmental flows, at an unknown cost, which would not commit the council to a water user agreement.

"Disadvantages of this approach [are] future needs would be met by purchasing water at market rates from 2019-20 and in subsequent years."

It says this option could come at a higher cost to the council than the first option and that securing additional water would be subject to the uncertainty of annual funding and consultation decisions being required.

The final option is for the council not to enter into a water user agreement, with no cost to ratepayers. "Disadvantages of this approach [are] this would be a lost opportunity to access flows for environmental enhancement."

The council wants to know what option the public prefers. Visit