Comment: Brian Hanna on safeguarding our essential water services

Whau Valley Dam in Whangārei. Modelling projects that all communities, including Whangārei, would be better off under the Government's reform proposals. Photo / Michael Cunningham

The problems facing New Zealand's water infrastructure and services have been recognised and talked about by various governments over the past 30 years. Finally, there are proposals, based on sound research, to fix this, writes Brian Hanna.

Four years of focused research, modelling and analysis from a range of international and local expertise by the current Government, through the Three Waters Reform Programme, confirms that we face very significant funding challenges in renewing and maintaining our three waters infrastructure and delivering these essential services.

Almost everyone in central and local government and the wider water and infrastructure industries agrees that current arrangements are not fit for purpose.

Finally, there are proposals on the table to ensure that communities all around the country can have safe and affordable drinking water and wastewater and stormwater services that don't pollute our rivers, lakes and beaches – not just for now but for generations to come.

These proposals involve major reform – essentially combining 67 council-owned water services into four public bodies – so it is important that there is public scrutiny and debate about it. But it needs to be fair and balanced.

The joint Central/Local Government Steering Committee, of which I am the independent chair, was set up in June last year. It includes mayors, council chief executives, Local Government New Zealand and Taituarā (formerly the Society of Local Government Managers) representatives as well as officials from the Department of Internal Affairs and the Treasury. The committee's brief is to test reform policy and offer a full range of local government perspectives on Government proposals.

Parts of Northland have some of the most pressing water infrastructure and service delivery issues in the country. It has very low connection rates to water services, some communities without supplies of running water, persistent boil-water notices in places, some areas fail to meet the Ministry of Health's drinking water standards, others have pollution issues with sewage and stormwater flows into some water bodies, and the district as whole suffers intermittent droughts which compound the challenges. It also has a relatively low ratepayer base with which to fund the necessary upgrades.

The reforms aim to make water services safe. Photo / File

Extensive peer-reviewed modelling projects that all communities, including Whangārei, would be better off under the Government's reform proposals. For low population density, largely rural areas such as the Far North district and Kaipara, it predicts that average household water services costs would be substantially less with reform than without it. It suggests that without urgent action, in 30 years' time, these services will likely be unaffordable for some districts.

A larger number of more regionally based models was explored by the steering committee, but this option would likely see large differences in customer costs and variability of service levels across different parts of the country. Some regions, such as the West Coast and Otago/Southland commissioned reports to consider regional scale solutions. These generally reached conclusions on affordability similar to the Government's work.

After careful consideration of these factors and other research and expertise, the committee endorsed four large public water entities as being the optimal number.

The Government's proposed arrangements will allow more flexible and cost-effective funding to meet the intergenerational infrastructure investment needs of communities free from the borrowing constraints that most councils face; costs will be spread across larger populations and over longer periods of time; and the scale of the new water providers will deliver significant efficiencies while retaining local water-related expertise.

The reforms aim to make water services safe, affordable and environmentally sound for generations to come and keep them in the ownership and service of the communities that have contributed to them over decades.

Alongside this, the new water providers would be able to build and maintain a sustainable water-related workforce, meaning more local jobs, and ensure that water consumers have real influence on the quality of services they receive. The reforms would also encourage genuine discussions with mana whenua on water services but there would be no ownership by Māori, nor any overriding powers of veto. Without having to invest in pipes and very costly water treatment plants, councils would be able to focus on making their communities better places to live, work and play.

The steering committee has received several analytical reports carried out by various consultants. This includes one from Castalia, which has just released a report attacking the Government's reform programme modelling, led by the internationally regarded Water Industry Commission for Scotland (WICS).

We're very familiar with Castalia's perspective, which is why the committee commissioned two further companies, Farrierswier and Beca New Zealand, to conduct independent reviews of the WICS approach. Within the bounds of some inevitable uncertainty when modelling out over 30 years, these peer reviews confirmed the general reliability of the WICS approach. Reform in Australia, Europe, the United Kingdom has also clearly shown the benefits that come from aggregating small water suppliers into large entities.

Our role as a steering committee in the Three Waters Reforms is to be critical voice. I am comfortable that we have rigorously carried out that task and that the research and analysis supporting the Government's reform proposals is sound.

I am convinced that without reform, in the long term we will be unable to afford basic infrastructure on which our communities depend. And if we can't ensure a sustainable future for these critical services, we will not be able to guarantee the healthy, thriving lifestyles to which we all aspire.

• Brian Hanna is the independent chair of the joint Central/Local Government Three Waters Steering Committee. He is a farmer, businessman and former three-term Mayor of Waitomo. For more information go to: threewaters.govt.nz or Three Waters Reform Programme - dia.govt.nz