Savings could flow from three waters proposals

Auckland Council hopes to hold onto control of the city’s water assets in the face of the government’s three waters reforms.

Auckland Mayor Phil Goff has put Council’s view this issue (see Viewpoint).

On the other side of the coin, Local Government Minister Nanaia Mahuta and other proponents of the reforms of the country’s drinking, waste and stormwater, say that handing over that control and amalgamating Auckland’s water services with those of the Far North, Whangarei and Kaipara District Councils will result in significant savings for ratepayers over the next 30 years. 

Government statements focus on this aspect, saying that the cost of maintaining, renewing and upgrading water infrastructure has become impossible for communities. This has the potential to impact public health and environmental outcomes.

The scale of the proposed reforms will mean infrastructure costs are spread across larger populations and over longer periods of time, potentially making water services more affordable for households.

Government has also stated that public ownership will remain, with no privatisation.

Watercare increased its household water and wastewater prices by 7 percent (this year and next) followed by annual price increases of 9.5 percent through to 2029.

This was to keep up with maintenance and upgrades.

A report by the Water Industry Commission stated that increases could be capped at 2.5 percent under the government’s reform proposals.

Watercare put up its prices because borrowing is constrained by Council’s high debt levels.

Councillor John Watson, while he does not support the three waters reform proposals, says another way forward is more prudent management of Council finances as a whole, and the separation out of Watercare’s balance sheet without losing public ownership and control.