I hereby give notice that an ordinary meeting of the Howick Local Board will be held on:

 

Date:

Time:

Meeting Room:

Venue:

 

Monday, 18 July 2022

6.00pm

Howick Local Board Meeting Room
Pakuranga Library Complex
7 Aylesbury Street
Pakuranga

 

Howick Local Board

 

OPEN ADDENDUM AGENDA

 

 

 

 

MEMBERSHIP

 

Chairperson

Adele White

 

Deputy Chairperson

John Spiller

 

Members

Katrina Bungard

 

 

Bo Burns

 

 

David Collings

 

 

Bruce Kendall

 

 

Mike Turinsky

 

 

Bob Wichman

 

 

Peter Young, JP

 

 

(Quorum 5 members)

 

 

 

Matt Fletcher

Democracy Advisor

 

13 July 2022

 

Contact Telephone: 027 226 0530

Email: matt.fletcher@aucklandcouncil.govt.nz

Website: www.aucklandcouncil.govt.nz

 

 


ITEM   TABLE OF CONTENTS            PAGE

 

16        Water Services Entities Bill - Local Board Feedback                                                               5

 


Water Services Entities Bill - Local Board Feedback

File No.: CP2022/10202

 

  

 

Te take mō te pūrongo

Purpose of the report

1.       To seek feedback from elected members on the Water Services Entities Bill and to highlight changes to the Bill since the exposure draft was released in December 2021 ahead of the council making a submission on the Bill.

Whakarāpopototanga matua

Executive summary

2.       The Water Services Entities Bill was introduced to Parliament on 2 June and referred to the Finance and Expenditure Select Committee on 9 June. Submissions close 22 July.

3.       The introduction of the Bill follows release of the exposure draft in December 2021 to support the work of the Representation, Governance and Accountability Working Group. The Government has responded to recommendations of this Working Group and this response is reflected in the Bill introduced in early June.

4.       The Bill establishes the Northern Water Services Entity that includes Auckland Council, Far North District Council, Kaipara District Council and Whangārei District Council. It also establishes three other entities to provide services across the rest of the country.

5.       There are a number of changes in the final Bill which include provisions for:

a)   the allocation of population-based shares to territorial authority owners – however these do not come with decision-making rights and cannot be sold so do not provide the typical ownership that shareholding normally brings

b)   a divestment proposal requiring unanimous support from territorial authority owners to proceed to a public poll

c)   the Water Services Entity (WSE) to fund the work of the Regional Representatives Group (RRG), regional advisory panels, territorial authority owners and mana whenua

d)   the introduction of regional advisory panels to provide advice to the RRG

e)   a single constitution that applies to the RRG, the regional advisory panels and the WSE board

f)    the Statement of Strategic and Performance Expectations to set out how it expects the WSE Board to  give effect to Te Mana o Te Wai

g)   the strategic elements of the Statement of Intent to be approved by the RRG

h)   an individual iwi or hapū or group of iwi or hapū providing Te Mana o Te Wai statements that may relate to one or more freshwater bodies

i)    the Minister to consult with the RRG and Taumata Arowai in the preparation of a Government policy statement

j)    each local government organisation to provide the Department of Internal Affairs with information about intended decisions during transition that relate to the provision of water services

k)   review of governance and accountability arrangements after five years and legislation after 10 years.

6.       A council group submission is being prepared. A draft will be shared with local boards on 15 July 2022. Local board feedback is due on 19 July 2022.

 

 

 

 

 

Ngā tūtohunga

Recommendation/s

That the Howick Local Board:

a)      provide feedback on the Water Services Entities Bill to inform the council’s draft submission.

 

Horopaki

Context

7.       The Three Waters reform programme has two prongs:

a)   a new regulatory framework encompassing human health, environment and economic aspects

b)   a new service delivery model that includes the establishment of four publicly-owned entities to take responsibility for drinking water, wastewater and stormwater infrastructure across Aotearoa New Zealand.

8.       There has been a range of engagement by the Government with the local government sector and iwi/Māori over the last three to four years. Targeted consultation during 2021 focused on the Government’s service delivery proposals.

9.       Initially councils were offered an opt-in approach to the reforms. In October 2021, Minister Mahuta confirmed the reforms were mandatory, and that councils would be required to take part. At the same time, the Minister established three independent working groups to refine elements of the Three Waters programme and to inform the proposals in the Bill:

a)   Representation, Governance and Accountability (reported to Minister March 2022)

b)   Planning Technical Working Group (in progress)

c)   Rural Supplies Technical Working Group (reported to Minister May 2022).

10.     An exposure draft of the Water Services Entities Bill was released in December 2021 to inform the work of the Representation, Governance and Accountability Working Group.

11.     This Working Group comprised representatives from local government and iwi/Māori, and considered how representation, governance, and accountability arrangements for water services entities could be strengthened. The Mayor was a member of this Working Group and released a minority report. The Working Group made 47 recommendations to the Minister in March 2022 - the Government’s response to these recommendations can be found at https://www.dia.govt.nz/diawebsite.nsf/Files/Three-waters-reform-programme-2022/$file/Summary-Table-of-Working-Group-recommendations-and-Government-response-2022.pdf   

12.     The work of the Planning Technical Working Group is continuing and will inform the detailed implementation elements which will be contained in the second bill. Auckland Council staff are represented on this working group.

13.     The Bill can be found here: https://www.legislation.govt.nz/bill/government/2022/0136/latest/whole.html#LMS534587  

14.     The Bill is one component of the legislative package needed to implement the reforms. It will be followed by further legislation to provide for:

a)   detailed implementation arrangements including transfer of assets and liabilities

b)   specific powers, functions and responsibilities of the new entities and pricing and charging arrangements

c)   economic regulation and consumer protection regimes

d)   any changes to Treaty settlement legislation that are required

e)   detailed changes to the Local Government Act 2002, the Water Services Act 2021 and other legislation.

 

Tātaritanga me ngā tohutohu

Analysis and advice

Summary of Water Services Entities Bill

Purpose

15.     The Bill establishes Northern Water Services Entity’s service area as the districts of Auckland Council, Far North District Council, Kaipara District Council and Whangārei District Council.

16.     The entities will commence delivery of services on 1 July 2024.

Legal form and ownership by territorial authorities

17.     The exposure draft described the WSEs as “owned collectively” by their territorial owners.

18.     The final Bill defines the entities as “co-owned” by the territorial authorities in their service area and in shares allocated to a territorial authority owner based on the population of its district:

a)   one share will be assigned per 50,000 people in the territorial authority’s district (or one share if fewer than 50,000 people)

b)   the shares cannot be sold or transferred and do not carry any financial interest.

19.     The allocation of shares is intended to strengthen community ownership of the new entities and add a layer of protection against privatisation (Clause 15(2)). However, the shares cannot be sold and the constitution cannot confer decision-making rights weighted by shares (Clause 93(2)(b)).

 

Key elements retained (Clauses 15-16)

A water services entity:

·    is a body corporate, a legal entity separate from board members, employees, the Crown, the Regional Representative Group, the territorial authority owners

·    is not a council organisation or a council-controlled organisation.

 

 

Divestment proposals

20.     A new step has been included in the Bill whereby the territorial authority owners rather than the RRG may refer a divestment proposal to a poll of electors. This resolution must be unanimous and gives every territorial owner a veto over divestment with respect to their WSE.

21.     Prior to this step, the RRG must achieve a 75 per cent majority vote to refer the proposal to the territorial authority owners in the first place. A divestment proposal must not be implemented unless 75 per cent of the votes cast in the poll are in favour of the proposal (Schedule 4: clause 4(1-3)).

 

Key elements retained (Schedule 4: clauses 1-14)

·    Water services entity must refer any divestment proposal to RRG.

·    RRG must consult territorial authority owners, mana whenua and the Minister.

·    On a majority vote of 75 per cent, RRG may refer proposal to territorial authority owners.

·    [New requirement]: A unanimous decision of territorial authority owners is required to refer proposal to a public poll.

·    Proposal must not be implemented unless greater than 75 per cent of votes of a poll of electors are in favour.

 

 

Strengthening Te Tiriti o Waitangi

22.     In order to recognise and respect the Crown’s responsibility to give effect to the principles of Te Tiriti o Waitangi, all persons performing or exercising duties, functions and powers under this Act must give effect to the principles of Te Tiriti o Waitangi.

23.     Where there is inconsistency between the legislation and a Treaty settlement obligation, the Treaty settlement obligation prevails.

 

 

Functions, objectives and operating principals

24.     The function of a water services entity is to provide safe, reliable, and efficient drinking water, wastewater, and stormwater services.

25.     There are six objectives for the WSE proposed in the Bill. A seventh objective in the exposure draft – to give effect to te Mana o te Wai – has been moved and the requirement is now incorporated under Clause 4 that requires every person who exercises a function, power, or duty under the Act to give effect to Te Mana o Te Wai.

26.     The operating principles for a WSE remain the same as those contained in the exposure draft.

27.     New provision (Clause 14) has been made in the Bill for the WSE to fund the RRG, regional advisory panel, territorial authority owners and mana whenua for remuneration, expenses or costs for carrying out their role.

 

Key elements retained (Clauses 10 – 13)

Objectives:

·    deliver water services and related infrastructure in an efficient and financially sustainable manner

·    protect and promote public health and the environment

·    support and enable housing and urban development

·    operate in accordance with best commercial and business practices

·    act in the best interests of present and future consumers and communities

·    thriving communities deliver water services in a sustainable and resilient manner that seeks to mitigate the effects of climate change and natural hazards.

 

Operating principles:

·    developing and sharing capability and technical expertise with other water services entities and across the water services sector

·    being innovative in the design and delivery of water services and infrastructure

·    being open and transparent, including in relation to calculation and setting of prices, determining levels of service delivery to consumers and communities, and reporting on performance

·    partnering and engaging early and meaningfully with Māori, including to inform how the water services entity can give effect to Te Mana o te Wai, and understand, support and enable the exercise of mātauranga, tikanga, and kaitiakitanga

·    giving effect to Treaty settlement obligations, to the extent that the obligations apply to the duties and functions of an entity

·    partnering and engaging early and meaningfully with territorial authorities and their communities

·    co-operating with, and supporting, other water services entities, infrastructure providers, local authorities, and the transport sector.

 

 

28.     The proposal for membership of regional representative groups has changed since the exposure draft. Each RRG consists of no fewer than 12 and no more than 14 regional representatives (Clause 27). The exposure draft provided for no fewer than six and no more than twice the number of territorial owners of the entity.

29.     A significant change to the operation of the RRG is the new requirement which encourages consensus decision making and, if that is not possible, decision made by 75 per cent of the regional representatives present and voting (Clause 30).

30.     The Representation, Governance and Accountability Working Group recommended bespoke arrangements for Entity A (Northern Waters) RRG:

a)   14 members with 50:50 council and iwi/hapū composition

b)   the 14 members comprised of 4 Auckland Council representatives, 4 Tāmaki Makaurau iwi/hapū representatives, one representative each from the Northland councils and three iwi/hapū representatives from Te Tai Tokerau.

31.     Each regional representative group will have a binding constitution that includes how appointment of representatives will occur and the maximum number of its members. The first constitution will be set out in regulations. Any subsequent amendments must be approved by the Minister.

32.     The Minister of Local Government has agreed that the first constitution for Entity A will provide for the Working Group’s proposed representative arrangements as stated above. This arrangement is therefore not specified in the Bill.

33.     In a new addition, the Bill provides for the constitution to include the appointment of co-chairpersons and deputy co-chairpersons to an RRG. If included in the constitution, one co-chairperson and deputy must be elected or appointed by the group’s territorial authority representatives and one by the group’s mana whenua representatives.

34.     If the provision for co-chairpersons and deputy co-chairpersons is not included in the constitution, the RRG elects or appoints its own chair and deputy chairperson (Clauses 41 – 42).

35.     The Bill also provides for the constitution to include the establishment of one or more regional advisory panels (Clause 45). These must be based on regional or geographic areas with equal representation from mana whenua and councils in the geographic area. This change arises from a recommendation of the Representation, Governance and Accountability Working Group.

36.     The role of a regional advisory panel is to provide advice to the RRG. In doing so, the panel must consider all communities in the entity’s service area.

37.     The Bill provides that a regional representative, a regional advisory panel member or a member of a territorial authority may not be a member of the WSE board (Clause 97(3)).

38.     A new part of the legislation sets out the review of the governance and accountability arrangements which must be carried out after five years (Clause 95). The review must consider:

a)   governance structures

b)   interaction of the RRG with the WSE board, territorial authority owners, mana whenua and communities

c)   interaction of the WSE with territorial authority owners, mana whenua and communities

d)   each WSE’s relationships with financiers and financing arrangements

e)   accountability, strategic direction, or planning or reporting mechanisms including the GPS, the RRG’s statement of strategic and performance expectations, Te Mana o Te Wai statements, statement of intent

f)    the WSE’s constitution.

 

Key elements retained (Clauses 27 – 44)

RRG established for each water services entity that:

·    includes equal number of territorial authority representatives and mana whenua representatives

·    appoints and removes the entity's board members and approves remuneration and appointment policy (through its board appointment committee) participates in setting the entity’s strategic direction and performance expectations and reviewing the entity’s performance.

 

Appointments to the RRG are made by:

·    territorial authority owners – representatives must be elected members or chief executives or senior managers

·    mana whenua whose rohe or takiwā are within the service area.

 

Constitutions of water services entities

39.     The Bill provides for a single constitution for each WSE that addresses the composition and internal procedures of the RRG, the regional advisory panels and the WSE board. The constitution will also set out the funding and remuneration arrangements for the RRG and any regional advisory panels.

40.     The exposure draft provided for a constitution that addressed matters relating to the RRG only.

41.     The first constitution is set in regulations. In making the regulations, the Minister must first engage with the territorial authority owners and mana whenua of the service area.

42.     The RRG may amend that constitution or adopt a new constitution. This would require the Minister’s approval.

 

Key elements retained (Clauses 90 – 96)

Most of this section is new

·    Sets out the composition and procedures for the RRG, the Regional Advisory Panel, and the WSE’s board.

·    First constitution for model constitution is set in regulations.

·    RRG can propose an amendment which must be approved by the Minister.

 

 

Statement of strategic and performance expectations

43.     The regional representative group must issue a statement of strategic and performance expectations for the entity that relates to at least three financial years, and must review the statement at least once every year. The water services entity board must give effect to this statement.

44.     The Bill adds a further matter that must be included: how the RRG expects the WSE to give effect to Te Mana o Te Wai (Clause 136(2)(a)(iv)).

 

Key elements retained (Clauses 135 – 139)

·    Statement of strategic and performance expectations:

·    purpose is to state the RRG’s objectives and priorities for the WSE and to inform and guide decisions and actions of the board

·    must include expected outcomes, how the RRG expects the WSE to meet its objectives and give effect to te Mana o te Wai

·    must require the WSE to give effect to objectives in efficient and financially sustainable manner

·    Board must give effect to the statement.

 

 

Te Mana o te Wai

45.     All persons performing or exercising duties, functions and powers under the legislation must give effect to Te Mana o te Wai to the extent it applies.

46.     Mana whenua whose rohe or takiwā includes a freshwater body in the service area of a WSE may provide the WSE with a Te Mana o te Wai statement for water services. Mana whenua includes an individual iwi or hapū or group of iwi or hapū. The statement may relate to one or multiple freshwater bodies.

47.     The WSE must respond to the statement and include a plan that sets out how the entity intends to give effect to Te Mana o te Wai.

48.     A Te Mana o te Wai statement may be reviewed and replaced at any time and expires after 10 years.

49.     Te Mana o te Wai encompasses the interconnection with, and the health and wellbeing of, all water bodies affected by the three waters system. The Government is carrying out further work as part of the second bill (expected later this year) to identify how a whole of system view can be achieved. This includes:

a)   ensuring new relationships between the National Policy Statement for Freshwater Management and any new concepts in the resource management reforms (for example, Te Oranga o Te Taio) and the water services legislation is aligned

b)   ensuring integration of new concepts with the Water Services Act 2021 and Taumata Arowai

c)   considering any intersections with the National Adaptation Plan and the Emissions Reduction Plan.

 

Consumer and community engagement

50.     A WSE will have certain obligations in relation to consumer and community engagement. This includes:

a)   a requirement to establish one or more consumer forums

b)   prepare an annual consumer stocktake to capture feedback on performance

c)   engage with consumers and communities on the entity’s asset management plan, funding and pricing plan, and infrastructure strategy

51.     Engagement will be guided by a set of principles.

 

Reporting and accountability

52.     The WSE board will be required to prepare and adopt an annual statement of intent that sets out how the WSE intends to give effect to the statement of strategic and performance expectations and the Government policy statement.

53.     Although the same requirements were included in the exposure draft, the final Bill distinguishes between the strategic, operational and financial elements of the statement of intent (Clause 145).

54.     The strategic elements must be approved by the RRG, with or without changes agreed with the WSE’s board (Schedule 3: clause 2). The Board must consider any comments made by the RRG.

55.     The exposure draft set out the requirement for the Board to prepare an asset management plan, a funding and pricing plan, and a 30-year infrastructure strategy every three years.

56.     In addition to the consumer and community engagement indicated in the exposure draft, the Bill introduces a requirement for the WSE to engage with territorial authority owners on proposals to adopt all three documents (Schedule 3: clauses 7,13, 20).

57.     Other changes from the exposure draft include the requirement for the infrastructure strategy to give effect to te Mana o te Wai to the extent it applies to the entity’s duties, functions and powers. The asset management plan must set out how the plan relates to any actions the WSE intends to take a part of its response to a Te Mana o te Wai statement (Clause 148(d) and 154(3)).

 

Key elements retained

Statement of intent (Clauses 143 – 146)

·    sets out WSE’s strategic intentions and provide a base for assessment of performance

·    issued annually for the following three financial years

·    includes strategic, operational and financial elements.

 

 

Financial independence

58.     The Bill sets out that a territorial authority owner, a RRG, or a regional representative has no rights or interests in the assets, security, debts or liabilities of a WSE, and must not receive any equity (including profits, distributions or other benefits) from a WSE. They must not give any financial support or capital, lend money or provide credit to a WSE.

 

Crown monitoring and intervention

59.     The role of the Minister is to oversee and manage the Crown’s interests in and relationships with the WSEs. There is no significant change from the exposure draft. The Bill provides for the Minister to appoint a department as a Crown monitor and include a Crown intervention framework based on a graduated risk regime. The Minister’s powers of intervention are based on existing powers in the Local Government Act 2002 and include the appointment of a Crown review team, a Crown observer or, as a last resort, a Crown manager.

60.     Clause 196 includes provision for a review of water services legislation within 10 years of the establishment date.

 

Transition and establishment arrangements

61.     The Bill contains a number of transition and establishment arrangements including the Minister appointing establishment boards, statutory oversight powers of the national transition unit, and provisions relating to employment of the water services workforce. An establishment chief executive will be appointed for a period of two years.

62.     The WSE establishment chief executive must prepare an allocation schedule that specifies assets, liabilities and other matters that either wholly or partly relate to the provision of water services by relevant local government organisations. The allocation schedule must specify assets or liabilities that should not transfer to the entity.

63.     This schedule should not be inconsistent with the water services plan the Department chief executive may also produce. In approving the establishment water services plan, the Department chief executive must consult with the WSE.

64.     The Bill also provides the Department of Internal Affairs with oversight powers. During the establishment period, each local government organisation must provide the Department of Internal Affairs with information about intended decisions that relate to or may affect the provision of water services. This includes a decision to adopt an annual plan, amend a long-term plan, or any policy or plan required under the Local Government Act 2002, or to purchase or dispose of assets with a material impact on the provision of water services or the financial wellbeing of the organisation. The chief executive of a local government organisation must ensure that, before implementing a decision, the Department has confirmed the decision in writing.

 

Key submission themes

65.     The Governing Body and the Environment and Community Committee have passed resolutions on the Three Waters reform at key points in the reform programme since 2018 (Attachment A). Resolutions from the Governing Body meeting of 23 September 2021 were communicated directly to the Minister of Local Government.

66.     As a member of the Representation, Governance and Accountability Working Group established by the Minister, Mayor Goff released a Minority Report (Attachment B).

67.     The key points from these resolutions and the Minority Report are summarised below. It is intended that these points form the basis of the council’s submission on the Bill, together with any further direction from the Governing Body. 

68.     It is important to note that since the September 2021 Governing Body resolutions, the reforms have been made mandatory and an exposure draft of the Bill was released to support the work of the Representation, Governance and Accountability Working Group. This has resulted in some changes to the Bill which partially or fully address some of Auckland Council’s concerns. These areas are noted against the relevant resolution.

69.     In making these changes, the legislation comes closer to the Auckland CCO model than previous government proposals. However, the key issues remain, in particular:

a)   lack of appropriate level of control over Auckland’s assets

b)   lack of representation at a governance level proportionate to investment in assets by Aucklanders

c)   the strong connection between the three waters reform and the resource management reforms and the future for local government review, and the significant risk and unintended consequences of these proceeding without full information as to how they will work together. 

 

Summary of Governing Body resolutions of 23 September 2021

Support:

a)   the need to reform the water sector and lift standards of water supply quality and wastewater treatment across Aotearoa

b)   an economic regulator to help to improve efficiency and productivity and provide appropriate oversight of the new WSE (or to Watercare without amalgamation) [NOTE: legislation on economic regulation is expected later this year]

c)   the need to develop alternative funding and financing arrangements to enable greater investment in water services infrastructure

d)   the need outside Auckland, to achieve greater scale and capability

e)   a WSE model like our current CCO model where real ownership continues to reside with councils and the WSE must give effect to relevant aspects of Auckland Council’s long-term plan and growth strategies

f)    consideration of alternative governance and financial models which will achieve most of the Government’s water reform outcomes

g)   the same accountability mechanisms for WSEs as for Auckland Council’s CCOs (e.g. ability to approve and modify statements of intent and directly appoint and remove directors) [NOTE: The Bill includes the following: the strategic elements of the WSE’s statement of intent must be approved by the RRG; appointments to and removals from the board will be made by a board appointment committee that is part of the RRG].

Do not support:

a)   ownership and governance arrangements which remove democratic accountability and direct control by Auckland Council over the WSE

b)   governance arrangements that do not reflect, through majority control, proportionate investment in assets made by the people of Auckland.

c)   In addition, seek further information and work on integration with other local government reform processes and spatial and local planning processes, the benefits and disbenefits of stormwater integration and the transfer of assets and functions, prioritisation of investment decision making processes, and transition arrangements around workforce, information sharing and due diligence for asset transfers.

Mayor Goff’s Minority report of the Representation, Governance and Accountability Working Group

Support:

a)   the Government’s desire to achieve change in the delivery of water services and in particular the need for water quality and economic regulation to ensure that the goals are achieved

b)   the urgent need to reform the sector, achieve economies of scale outside Auckland and enable increased investment in infrastructure to achieve these outcomes

c)   proportional shareholding model by individual councils which emphasises and entrenches community ownership of assets [The Bill provides for one share per 50,000 people but these shares cannot be sold or transferred and do not carry any financial interest]

d)   retention of our current CCO model (with some refinement) since Auckland has already achieved most of the size, scale and efficiency benefits the reforms are seeking, it has proven to be effective and would provide for our continued control and accountability.

Do not support:

a)   Auckland being a minority voice on the RRG leading to loss of direct accountability and control for Aucklanders through their elected representatives, despite providing 93 per cent of the new water services entity’s assets

b)   Removal of existing accountability to Aucklanders through elected representatives.

Seek:

a)   Deferral on the inclusion of stormwater in the new WSE until further work is undertaken, including the benefits and costs of transferring stormwater functions and the implications of this function being separated from the land use planning function of council.

Note:

a)   consultation and polling indicate the public strongly supports the council’s position, with more than 80 per cent of those submitting agreeing council should have majority control of a new water entity

b)   we are committed to work in partnership with mana whenua and believe existing accountability to Aucklanders through elected representatives should be retained

c)   Auckland needs to deliver coordinated and timely planning and infrastructure investment – dilution of council’s role will exacerbate piecemeal planning and infrastructure provision and add to the complexity

d)   there is insufficient evidence that establishing the four new entities will deliver the efficiency gains the Government is expecting, due to increasing bureaucracy and compliance, the cost of debt which might act as a deterrent to the WSEs, the lack of benefit to Auckland Council from any increased debt headroom, and a fragmented planning and infrastructure delivery environment

e)   there is a strong connection between the water reform and the reform of the resource management system and the future for local government review, and the potential for unintended consequences in how these reforms work together.

 

 

 

Developing Auckland Council’s submission

70.     The Auckland Plan Strategy & Research Department will lead the development of Auckland Council’s submission, working with staff across the council organisation and the relevant CCOs, including Watercare.

71.     Local boards have an opportunity to provide input into the council’s submission.

72.     A communication has been sent to all iwi entities advising them of the introduction of the legislation and seeking feedback to inform the council’s submission.

 

Timeframe for development of the Water Services Entities Bill submission

Milestone

Date

Bill released

2 June 2022

Report to the Governing Body

23 June 2022

Draft submission available

15 July 2022

Deadline for incorporated feedback

19 July 2022

Deadline for appended feedback

19 July 2022

Consultation period closes

22 July 2022

Tauākī whakaaweawe āhuarangi

Climate impact statement

73.     The decision to delegate approval of the submission does not have direct climate impacts.

74.     One of the six objectives of the new water services entities will be to deliver water services in a sustainable and resilient manner that seeks to mitigate the effects of climate change and natural hazards.

75.     However, there is no hierarchy provided for in the Bill to address potential conflicts across other objectives, for example, supporting and enabling housing and urban development and delivering infrastructure in an efficient and financially sustainable manner.

76.     The Minister may issue a Government policy statement on water services which would state the Government’s overall direction and priorities and inform and guide agencies involved in, and the activities necessary or desirable for, water services. This statement may also include the Government’s expectations in relation to the contribution of water services entities to the outcomes sought by Government in climate change mitigation and adaptation.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

77.     Relevant council departments and CCOs have been identified and contributions will be sought from them in developing the council group’s response to the Bill. A communication has been sent to CCO chairs and chief executives advising them that the legislation has been introduced and inviting their staff to input into the process.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

78.     Local board views are being sought on the draft submission and will be incorporated into the council’s final submission as appropriate. 

79.     Local boards were briefed, and 19 boards provided input into Council’s feedback on the government’s initial engagement with local authorities on the reform proposal in August and September 2021. A further briefing subsequent to the Bill’s introduction was held on 4 July 2022. This highlighted changes to the Bill since the release of the exposure draft in December 2021.

Tauākī whakaaweawe Māori

Māori impact statement

80.     Under the Bill, a water services entity is required to give effect to Te Mana o te Wai to the extent that it applies to the duties and functions of the entity. This is consistent with the approach across all legislation relating to water services, including the Taumata Arowai – the Water Services Regulator Act 2020, and those who perform or exercise functions, powers and duties under the Water Services Act 2021.

81.     Mana whenua whose rohe or takiwā includes a freshwater body in the service area of an entity can make a Te Mana o te Wai statement for water services. The board must respond to the statement within two years, and the response must include a plan for how the entity intends to perform its duty to give effect to Te Mana o te Wai.

82.     To ensure that Treaty settlements are enduring, the Bill provides that where there is inconsistency between the legislation and a Treaty settlement obligation, the Treaty settlement prevails. An operating principle of entities is to give effect to Treaty settlement obligations, to the extent that the obligations apply to the duties and functions of an entity.

83.     The legislation does not create or transfer any proprietary right or interest in water, or extinguish or limit any customary right of interest any iwi or hapū may have in water.

84.     The Tāmaki Makaurau Mana Whenua Forum (TMMWF) provided feedback on the Three Waters reform programme to the Mayor and councillors on 21 September 2021. This feedback was subsequently shared with the Minister and some of the issues raised have now been addressed to a greater or lesser extent in the Bill.

85.     The Forum hoped that the proposed reform programme would offer opportunities to strengthen the Treaty partnership between mana whenua and Kaunihera. The Three Waters Reform is a high priority in the Forum’s Annual Plan (FY22).

86.     The TMMWF agreed that reform is required, including to enable greater investment in water infrastructure to benefit all who reside in Tāmaki Makaurau, and to enable iwi rights and interests.

87.     The Forum raised three key issues.

a)   That the Regional Representative Group proposed falls well short of co-governance and co-ownership and would not provide effective oversight and accountability.

b)   There is not a clear interrelationship between the range of interconnected reform processes currently underway, and that the resulting siloes need to be addressed.

c)   Lack of priority shown by successive Governments on the issue of recognising iwi rights and interests in freshwater including allocation concerns which are fundamental to te mauri and to mana o te wai.

88.     A number of further issues were raised:

a)   appear to be a direct line of influence, in particular there is a concern that WSE responses to Te Mana o te Wai statements will not be meaningful.

b)   Consideration should be given to the consolidation of Te Mana (me te mauri) o te Wai and the statement of intent into a single document.

c)   A monitoring strategy by mana whenua would help to ensure that the outcomes agreed on within the Te Mana o te Wai statements come to fruition.

d)   Equity concerns around iwi/hapū participation across such a large geographic area for the RRG resulting in inadequate representation of Mana Whenua of Entity A; also concerns re the criteria and process for appointment.

e)   Proposed structure disconnects Mana Whenua, Te Mana o te Wai, and the WSE response from the RRG and is not partnership.

f)    Resourcing of Mana Whenua to enable adequate participation in a new model.

g)   If the WSE is run comparable to a company, with its purpose to return the best result to shareholders, then the reliance on economic outcome and ‘balance sheet’ elements will not achieve the bests outcomes for Mana Whenua.

89.     All iwi entities have been contacted to advise them of the introduction of the legislation and seeking feedback to inform the council’s submission

 

Ngā ritenga ā-pūtea

Financial implications

90.     This submission can be developed within existing budget provision and as part of business as usual central government advocacy activity.

91.     It is noted that around 28 per cent of Council’s existing assets are water, wastewater and stormwater assets, and that in the 2021-31 Budget, around 25 per cent of Council’s total funding is going to water, wastewater and stormwater.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

92.     Significant risks and financial implications of the Three Waters reform have been identified in previous advice to the Governing Body in September 2021, including:

a)   strategic direction of Northern Water Services Entity may not reflect Aucklanders’ interests

b)   higher costs and poor community outcomes from fragmented and uncoordinated planning and provision of infrastructure

c)   levels of service determined by an economic regulator or the WSE which could see Auckland deprioritised to meet obligations outside Auckland

d)   insufficient industry capacity to undertake all the investment required

e)   the costs of the reform to council

f)    the decoupling of stormwater and land management functions making developing and implementing efficient and effective responses to big challenges such as climate change, hazards and growth more challenging.

93.     As part of developing the council’s submission, staff will consider whether provisions in the Bill mitigate these risks to any extent. Legislation expected later this year may play a mitigation role. 

Ngā koringa ā-muri

Next steps

94.     Local board resolutions on the Water Services Entities Bill will be included in the Auckland Council submission on this matter.

95.     Below are the key dates for input into the submission:

·    15 July 2022: a draft submission will be shared with local boards

·    19 July 2022: deadline for feedback to be considered in the council’s submission. This deadline is the same as the appended deadline.

·    November 2022 (estimated date): The final submission will be reported retrospectively to the Governing Body and circulated to elected members.

96.     This submission period closes on 22 July 2022.

 

Ngā tāpirihanga

Attachments

No.

Title

Page

a

Previous resolutions of council

19

b

Mayor Goff's minority report

23

      

Ngā kaihaina

Signatories

Authors

Jacob van der Poel - Advisor Operations and Policy

Denise O’Shaughnessy - Manager Strategic Advice

Authorisers

Carol Hayward - Team Leader Operations and Policy

Louise Mason - General Manager Local Board Services

 

 


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