The decision-making process for deciding how to best provide drinking water, wastewater treatment and stormwater management in Hawke’s Bay seems to be stuck in the mud, despite wheels spinning.
Our four territorial authorities (TAs) have until 3 September to submit to Government – as a group or individually – their plans on how to furnish and fund upgraded water infrastructure and then manage ongoing water services delivery.
Labour’s ‘3 Waters’ has become National’s ‘Local Water Done Well’, but both with the same fundamental intent – consolidate the services, e.g. regionally, and get the hugely expensive debt financing off the books of councils into new management entities, with presumed cost efficiencies, equivalent service to all residents wherever they live, and separate financing capabilities.
So, our councils have been beavering away, producing estimates of their water infrastructure funding needs for the next ten years (in some cases beyond that) and modeling what the ratepayer loads would be in the two basic options – each council continuing to go it alone versus a regional entity.
However, this financial assessment is stymied because the Government is yet to provide definitive guidance on how much debt would be allowable against ‘free funds from operations’ (essentially cash flow) in regional versus ‘status quo’ options. This ratio will be embedded in a water bill not expected to pass until July. Without knowing this, the ultimate cost to ratepayers (however charged) of different scenarios can’t be compared.
Once the financial scenarios are clear, then our TAs – if they wish to proceed with a regional option they deem financially compelling – need to make some politically ‘challenging’ decisions …
Do they agree with each other’s estimated funding requirements and therefore the size of the total pot to be financed? No gold-plating anyone!
Even more challenging – to what degree will ‘richer’ TAs subsidise the requirements of ‘poorer’ TAs? What’s fair for ratepayers whose water infrastructure might already be in better shape?
And then, of all the water service investments that are needed across the region, which ones get addressed first and how is that prioritisation embedded in the planning of the supposedly non-political, independent water services entity?
These decisions represent the guts of any collective plan and will need to be addressed — at least with winks and nods — during the official local body election window, when councillors supposedly are not allowed to make such big decisions!
And capping off the process, whatever option councils choose, they must put their recommendation to public consultation. Could there be a scenario where one or two councils (or their publics) choose not to go regional; will a mayoral ‘understanding’ establish the regional participation ‘quorum’?
While each TA must be prepared with its own plan (in case a regional approach is discarded), NCC has been charged with drafting the plan, including financial analysis, for what a regional approach would look like. The HB Regional Recovery Agency’s role is to facilitate the collaboration that must occur amongst the councils on the tricky political matters involved.
Big choices to grapple with by 3 September. The Government should be ashamed of itself for making such a hash of such an important decision-making process … Local Water, Done Very Poorly.
There’s not one entity that can sit back and say ‘we’ve done a good job’ on water. Possibly HDC comes closest but that was forced on them by Havelock’s problems a few years back – still they have done a lot of work. Napier’s has been on the books for decades with nothing done while the successive councils have crowed about not having debt – conveniently forgetting it’s all hidden under deferred maintenance. CHB and Wairoa are small and don’t have the ratepayer base to adequately sort out their problems individually. Time to get some decisions and action sorted.
National’s plan is to allow councils to borrow well past their means, get into financial strife, and then privatisation of water will be presented as the only solution. Our councils will no doubt fall into this trap.
Won’t be that long away in council’s pipeline, before we’ll end up paying for what supposed potable water comes in and what soiled water / stormwater goes out!
Under the catch phrase: “User Pays”
Conservation! The cost of meters won’t be a problem.