What a disastrous week it was for the lower South Island after the tweaking of Three Waters reforms.
Very little was changed, yet for ratepayers of Otago and Southland everything has altered.
Put bluntly, increasing the number of entities from four to 10 doubles the pace of price increases for the South, compared with the previous proposal.
Unfortunately, we’re talking thousands of dollars in the short to medium term.
Funding destined for community projects will instead be used to establish the additional entities, and uncertainty for council staff and contractors is extended by two years with transition now in July 2026, likely to result in more cost for ratepayers.
Having spent the past three years working to get the best deal possible for the lower South, I find this change disappointing and I am furious. All New Zealanders will pay more. The efficiencies of larger entities have been lost to us all, and for what?
Unfortunately, the underlying imperative that a more sustainable and affordable structure was needed was swamped in misinformation and a desire from some to create confusion, making it challenging to steadfastly remained focused on the big picture of protecting our communities from the full brunt of costs.
The four-entity proposal wasn’t perfect, but having been given the critical data and knowing the fragility of the structure we operate under now, it became obvious it was the best option available.
We have had some big wins along the way, firstly in gaining legal acknowledgement of the differentiation between Rural One Water and Urban Three Waters.
This released rural water schemes from the reforms process and gave mixed-use rural schemes (rural schemes that also supply an urban settlement) a mechanism to determine their own fate. Clutha’s mixed-use rural schemes have worked diligently for months now in preparing for their decision.
We also established a shareholding in the new entities for each council – strengthening our case to ensure there was no future privatisation.
And the biggest thing was that virtually the whole South Island was in Entity D which meant we gained a huge advantage from having Selwyn, Waimakariri and Christchurch in our team (combined they’re virtually half the South Island’s population).
After last week’s announcement that advantage is lost.
The Otago/Southland grouping is now the most expensive entity in the country because it’s a huge landmass with a number of small townships — the worst possible scenario when you’re considering infrastructure and trying to gain synergies between communities. Clutha is an extreme example with 12 wastewater and 16 water plants and only approximately 6000 urban rateable units. Even the people that admitted they hadn’t read the legislation before protesting the reforms should have been able to read these warning signs.
So where to from here? The fight will go on, but please do not underestimate the compromised position we are now all placed in.
There is the possibility for entities to merger, but this takes a 75% approval from all parties which is highly unlikely in this environment.
Inevitably I believe the new proposal is doomed to fail, unfortunately it will be some years before it is that obvious that the Government needs to intervene, and in the interim we are going to endure unnecessary financial pain. I don’t believe I have ever been more disappointed or annoyed.