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Is the Three Waters reform the solution or the issue,   Selva Selvarajah asks.

The Three Waters reform proposal by the Government, based on advice from the Water Industry Commission for Scotland (WICS) (water economic regulator in Scotland) and numerous consultancies, pledges to provide fit for purpose Three Waters services to deliver future affordable and sustainable outcomes by replacing local government ownership and management with four entities governed from the distance by the district/city councils and iwi.

The proposal draws heavily on the Scotland water and wastewater model administered by the single entity Scottish Water.

A new drinking water regulator, Taumata Arowai, similar to the Scottish Drinking Water Quality Regulator (DWQR) has already been established to replace the Ministry of Health as regulator.

The economic regulator equivalent to that in Scotland is yet to be formed and its functions are not yet clear, but water pricing and promoting water use efficiency and consumer protection will be its primary role. There are numerous differences between the proposed model and that of Scotland, but the main differences are the sole Scotland environmental regulator, the Scottish Environment Protection Agency (SEPA), compared with the multi-agency system of 16 regional councils and central government.

The proposal in principle is the largest collaborative project between the Government and local government and is well overdue and highly commendable. While the intent has been welcomed by most councils, I understand many are not satisfied with the process and the proposal, with four entities not directly governed by the councils, zero compensation to well-run systems and the overall loss of ratepayer ownership of the assets.

General flaws in the process

From all angles and from the outset the process has been the worst compared with other reforms. It has been reckless and fast-tracked as a stand-alone reform without integrating with other impacting and milestone reforms such as of the Resource Management Act and Local Government Act. The short timeframe accorded to the local government consultation coupled with overwhelming information prohibits any sensible council consultation with their ratepayers who own and run the systems.

Given the taxpayer footing of much of the proposal Bill, there is no request for submission from the wider community. If so, I am not sure of the purpose of the TV campaign by the taxpayer-funded exorbitant and controversial advertisement on the proposal. It has been patronising, factually wrong, and a national embarrassment to all New Zealanders and the communities who own and manage their Three Waters systems to serve their needs. I hope the purposeless advert is removed from the air as soon as possible.

The proposal, developed before the national policy statement for freshwater management 2020, is already outdated. The national policy statement’s sole objective is based on Te Mana o te Wai, which prioritises the health and wellbeing of water bodies and freshwater ecosystems above all things, including human drinking water.

The collation of information and mostly foreign-based technical advice preceding the proposal has failed to involve Maori at the outset and incorporate the principles of Te Mana o te Wai.

Wastewater and water

Given many catchments are fully allocated, it is not clear whether the Scottish advice considered water conservation and large-scale water storage in their estimates. Regional councils are yet to respond to the national policy statement for freshwater management and set catchment-based water quality limits integrating the principles of Te Mana o te Wai, which will determine the quality of consented wastewater and stormwater discharges and water allocation. The Government’s Farrierswier review of the Scottish advice has highlighted many such deficiencies which have not been resolved before the proposal was notified.

The information collated by the Government on the expenditure required to upgrade 186 wastewater treatment plants is already outdated and faulty since it was based on the outdated and inappropriate national water quality limits.


The Scottish advice on stormwater is not rigorous or useful in managing our stormwater system. Effective and consistent stormwater management deserve national environmental standards using the principles of avoidance, minimisation, treatment and discharge. Climate change and flooding are critical to stormwater management to provide managed flood pathways and to manage building permits. I understand the Scotland stormwater conveyance is based on a one-in-30-year flow with risks assessed for one-in-200-year flows. Should our pipes be designed to accommodate one-in-100-year flow?

The above issues combined with Government’s lack of clear brief on a robust stormwater management system for New Zealand has failed to give confidence in the information collated on stormwater-related assets and expenditure.

Environmental outcome process

Unlike Scotland, in the absence of single environmental entity and with little or no national direction it is not clear how the proposed four entities will manage and comply with varying discharge standards, water allocation policies, consenting requirements and compliance monitoring systems set by several regional councils within each entity.

Next steps

The reform proposal has the correct intent and outcomes. However, it has been ill-prepared, poorly proposed and rushed, and as such must be abandoned or mothballed. Realistically, to return with a robust reform acceptable to the community, taxpayers, Maori and the councils will require at least three to four years. In the meantime, the milestone reforms affected Three Waters, such as the Resource Management Act and the Local Government Act reforms, would have been determined.

Using the available timeframe, the Government must promote robust, nationally acceptable and consistent asset management programme for the Three Waters systems which will yield sensible and accurate data to refine the reform proposal. The similar period would have provided Taumata Arowai opportunity to regulate drinking water supplies, which would have yielded robust data on the actual status of the drinking water supplies and any remedies required.

The Government must develop stormwater management national environmental standards. It must also develop nationally consistent guidance on wastewater discharge limits, consent process and compliance monitoring. The above two steps will have significant and beneficial bearings on any future Three Waters reform.

It is also crucial that any future reform proposal must not be single-option. There must be several options open for sensible participation and consultation. Until the next proposal, the Government must appoint a temporary entity involving Maori partnership to collaborate with Taumata Arowai, to fund the most urgently needed drinking water quality improvement. This will lay the foundation for true partnership in the approach to the future reform by the Government and local government. I hope future proposals and processes promote true partnership and mutual respect to foster the spirit of the local and central government partnership.

  • Dr Selva Selvarajah is a specialist in wastewater, water and the RMA and the founder of Enviroknowledge Ltd.


This is an excellent and informative opinion piece and appears from my limited understanding of the issues to be unbiased.
From my perspective I am convinced that our existing model of Local Authorities managing our water supplies is ultimately non sustainable. Change is required. The question is: what form should that change take.
From our experience with the dismal outcome of Max Bradford's reforms of the Electricity generation distribution and supply of power we should avoid anything that even remotely seeks to copy that model.
Permanent retention of public ownership is paramount in my mind. We should not go down the Corporate privatisation route. I do not accept that public bodies cannot operate a utility business on the basis that it generates enough revenue to cover actual costs and future development and expansion. Instead of paying massive bonuses for making massive profits, pay massive bonuses for hitting break even targets.
I agree that the current push for making this change seems ill timed and poorly presented to the public. It appears rushed and the Govt gives the appearance of bullying the existing authorities to participate.
This change should be more open.