Mark Vincent: Opportunities in Three Waters reforms

The Government proposes putting drinking water, wastewater and stormwater functions into the care of centralised entities to maximise economies of scale. Photo / Tania Whyte, File

Opinion

OPINION

The people in Wellington say that the local government approach to maintaining the three waters (drinking water, stormwater and sewerage) has failed and propose setting up four separate entities across the country that will each be able to borrow enough money to right the deficiencies now apparent.

Certainly they will be able to borrow truckloads more money than councils (via their ratepayers) could afford under current arrangements, without it showing up on the central government books.

Contributing Northlanders will make up 8 per cent of the numbers of the mooted new northern entity. The closest the three waters setup gets to local democracy is the opportunity for Auckland-Northland combined to contribute five or six seats on a co-governance board with iwi representatives; that board gets to select the members of an independent board that will then select the board that will actually be in charge of the entity. Democracy in action? Co-governance in action? Yeah, right.

A chronically inappropriate funding model (property rates) has resulted in a build-up of unmet needs for renewal and upgrading of waters infrastructure nationally; it is challenging to provide for the needs of the future while attending to the demands of the present.

Something needs to change all right. I have always said it is the local government funding model that is stuffed, not local government, so it's good to have an alternative. However, the consequence of the approach, whether deliberate or incidental (apart from aggregation of power and control more to the centre), will be the reaming out of local government, particularly small rural units like ours.

It has been said that those closest to an issue are best placed to make decisions about it. This has been used to justify decisions on local issues being made by local government rather than from the lofty towers. I'm not so sure.

On the one hand, centralisation risks losing the benefit of local knowledge and perspectives; on the other hand, local government is constrained from investing in maintenance and renewal of infrastructure by the impact on ratepayers' pockets. It has historically been difficult to achieve more than meeting just immediate needs rather than taking a longer-term strategic approach. This is the failed funding model (property rates) again.

Localism enables people most affected by decisions to influence them; the best localism relies on judgment informed by observation and experience of the operating environment (of course the worst of localism is based on short-sighted parochialism). The centralised model being now promoted by central government in relation to health, education, regional planning (RMA) and three waters risks excluding local people from contributing to good decisions for their communities.

It is difficult to counter the "idiot factor"; local government has its share, but the electoral process tends to provide a counterbalance. Experts can be idiots too and, if in places of influence in larger organisations, the consequences of their idiocy are so much greater.

Former KDC commissioner and current mayor of Waitomo District John Robertson has suggested following the structure used for the public roading network, with a central funding agency to support local authorities roading budgets based on a formula that follows a range of criteria. I imagine the problem with this for central government is a substantial entry on central government's debt ledger, and this could affect its credit rating. This can be overcome by the proposed reforms because the new entities will be able to borrow independently of Government.

Mark Vincent. Photo / Supplied

So here's my idea – meld together the best of localism with the best of what a centralised approach can make. Charles Handy refers to this as the "big but small" of "twin citizenship". In other words, a central agency/ies to provide funding and local authorities (in whatever form they may take after 2024) to deliver the services.

The funding agency may need to own the assets to have something to borrow against; so be it if the structure works for the benefit of its users. In addition to finance, my idealised central structure would also use its scale for purchasing, staff training and innovation/research.

This would support better local service delivery, making best use of local knowledge and, importantly, providing local accountability.

• Mark Vincent is an elected member of the Kaipara District Council.