In brief

• PM Hipkins has rebranded Three Waters as the Affordable Water reforms. The name suggests savings, but that is deceitful.
• Iwi still have effective control of the nation’s fresh water through “co-governance”, but the number of entities has been increased from 4 to 10.
• Expect water service reforms to remain a contentious issue come election time. 

Bottom line: co-governance stays, costs go up, but marketing now focussed on false savings

Prime Minister Chris Hipkins and Minister for Local Government Kieran McAnulty have introduced a rebrand of the unpopular Three Waters reforms called The Affordable Water reforms.

Instead of four mega Water Service Entities (WSEs) there are now ten. The implementation is being pushed back to 2026. The central government is also cancelling a $1.6bn payment to local councils that was scheduled to go through under the previous reforms. 

However, they still have the co-governance aspects baked in, which effectively give control of the nation’s water to iwi. Iwi will have half the seats of the Regional Representative Groups which appoint the boards of the WSEs. Also remaining are the even more controversial Te Mana o Te Wai statements, which are binding orders exclusive to Māori, by virtue of their ethnicity, allowing them control over their local WSEs. Finally, all non Maori seats have to be filled by people sympathetic to the government’s pro Māori interpretation of the Treaty.

What does Labour mean by “savings”? 

The Government’s narrative is somewhat confused as the purpose of the four WSEs was to take advantage of the cost savings that come with amalgamation. By the Government’s own admission ten is not as efficient as four.

Also how those “savings” are determined in the first place is questionable.

Labour’s plan is to allow the WSEs to run up larger debts(circa $40b extra) than councils currently can to reduce current charges to ratepayers. Think a long term credit card or a mortgage. That’s what they call “savings”. However, the costs ignore paying the money back.

Even then Labour says projections show households will save several thousands of dollars per year by 2054. More than three decades from now.

How can the Government calculate savings decades into the future, considering co-governance is an unprecedented measure in delivering public services and will add an unknown cost to operations? This is especially true given the right of Māori to issue Te Mana o Te Wai statements.

Labour has no record of actually producing real savings in the form of cutting Government spending and producing cost effectiveness through efficient operations. 

The debate continues

Thomas Coughlan, writing for the NZ Herald and downplaying concerns for the undermining of democracy, said the issue “has stirred up a level of paranoia” and called the debate around Three Waters toxic and tinged with unpleasant racism.

Local governments are unlikely to be pleased with the changes unless they involve scrapping co-governance entirely. Manawatū mayor Helen Worboys, who leads the opposing group of 30 councils, said it’s not about the number of WSEs, but about the loss of local decision-making.

Opposition party leaders Chris Luxon and David Seymour have dismissed the newly rebranded reforms. Luxon called the Government’s reforms “a disaster” and Seymour has doubts the savings will be realised as Labour has promised.

National, ACT and NZ First have all previously vowed to scrap the Government’s reforms, previously called Three Waters, after the next election. 

Without co-governance removed from the delivery of water services, expect it to be an election issue.