"Three waters reform by any other name would smell as sweet"
The Government touted it as a “major shakeup” to its three water reforms, but has much changed? Even the supposed name change to “Affordable Water Reforms” appears to be itself a piece of political rebranding seemingly limited to MP and Ministerial talking points, with the Department of Internal Affairs still referring to it as the Water Services Reform Programme.
So what has changed?
10 water service entities instead of the previously planned four.
A reduction in the estimated possible cost savings for households of between $2,770-$5,400 per year by 2054, versus a previous maximum saving (using the best and worst case scenarios) of more than $8,200 by 2051.
Removal of the second tranche of the “Better Off” funding, totalling some $1.5 billion that was due to be transferred to councils in July 2024.
A shifting back of the start date of the reforms from July 2024 to July 2026.
In essence, the only actual change was the shift from four to 10 entities, and everything else has flowed out from that. The reduction in projected savings is due to a reduction in the economies of scale the Government believes the smaller entities will deliver.
The removal of the second tranche of the “Better Off” funding (the $500 million first tranche of “No Worse Off” funding will still be paid) is a result of the new entities being smaller, and thus possibly not having the balance sheets to borrow this money to pay to councils.
Finally, the shifting back of the start date is because they believe setting up six additional entities will require more time, though more realistically it is probably a reflection of the fact that the original July 2024 start date was going to be in name only, with all practical changes coming much latter anyway.
The rest of the reform is fundamentally the same as it was before the announcement, with many of the same pain points for some communities remaining.
The complex governance structures remain with an equal number of mana whenua representatives to council representatives on the Regional Representative Group. Though the issue of some councils not being on these groupings from the larger entities does get resolved by the increased number and smaller geographical scope of the 10 entities allowing councils to all get seats. But the Regional Representative Group appointing a Water Services Entity board to create a big enough separation between council’s ownership and the corporate governance of the new entities remains.
So are the reforms different? The fundamental principles of the reform remain the same, it’s now just occurring mostly at a regional-level rather than a multi-regional level, with the subsequent reduction in projected savings, loss of $1.5 billion in “Better off” funding, and improvements to council representation on the regional governance groups.
Even the formal name remains the same, with the official website still calling them the Water Services Reform Programme, making the Beehive’s “Affordable Water Reforms” little more than a marketing slogan.
Would a rose by any other name smell as sweet? Over the coming months we’ll be sure to find out.
