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Bruce Smith

Three Waters Update – December 2021

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Hello Coasters,

This is my fourth update on three waters and the last this year where I share my journey with the Government’s proposed three waters reforms.

An observation. Councils that have engaged with their ratepayers are indicating a 91/98% rejection of the Government’s proposed three waters reforms.

They believe each asset owner has the right to determine how best to meet water requirements and that there are a number of alternative and viable delivery models that could be supported by ratepayers across New Zealand.

Councils that did not engage with ratepayers are frustrated that they were mislead by government saying give us feedback by sept the 30th and we will then consider and advise before Christmas the government’s position. In reality government had not even received the feedback from Councils before Cabinet made its decision to mandate.

A complete betrayal.

What are ratepayers around the county saying?

What we all have in common is that we agree that quality drinking water and better environmental outcomes are essential. That’s why New Zealand is often ranked in the top five suppliers of drinking water in the world.

What we don’t accept is that there is only one way to continue to improve these outcomes.

We supported the establishment of a new regulator and welcome the new regulations after consultation is complete.

There are a number of proven alternative models that could be supported by ratepayers across New Zealand.

Forced and rushed reform won’t benefit anyone and is a recipe for failure.

Kiwis will not support the loss of local control.

They will not support having the three waters assets owned by Councils placed into a large corporate entity with 50% of the governance Councils and 50% Iwi. They are saying its undemocratic as we are one people not two tribes.

Government has consistently maintained that councils will continue to own their water assets and that’s been proven to be a real porkie.

Through a Statement of Claim filed in the High Court three councils are asking the Court to provide a legal affirmation of their council’s position and its ownership of assets.

This will provide legal framework of a shared understanding for all parties going ahead on the key issues of council asset ownership and its democratic responsibilities. This will assist both parties to understand the parameters of ownership.

The case for increased investment was made and proven year after year by councils with how its funded being the focus.

However, the case for change has not been made as claimed by Government.

One size does not fit all, and local input is a must as another bottom line.

Confiscation of assets paid for and built up over generations with no compensation has no public support and is strongly resisted across the country.

We believe that the Government has misunderstood and devalued the democratic role and ownership rights of local councils, and that this flawed reasoning could be applied to other council assets – and God, forbid, your assets as well.

The borrowing of up to $160 billion by the new proposed entities using the assets stolen from our councils and paid for by generations of New Zealanders as security along with a government guarantee is not supported.

The time frames being urgently pursued by this Government suggest this is not about three waters.

In my opinion the main objective is to transfer joint governance of all water assets to Maori who make up 16.7% of our population as set out clearly in the He Paupua report.

Now Government can’t do that unless they own and control the three water assets hence the urgency as its already clear this will not be supported.

National, Act, NZ First, and I understand the Greens opposed the mandate. National have gone further and said when it’s reversed there will be no compensation. Any financier will need to consider the risk which has been well signalled.

The major political parties have put a line in the sand and advised they will repeal the legislation.

Grey Power, Federated Farmers, Groundswell and 60 out of the 67 councils in the country oppose the mandated approach.

Concurrently there is a wider group of 30 Mayors across New Zealand seeking to meet with the PM to express their concerns and seek a way forward which is better for our communities.

All Mayors were asked to sign the letter to the PM. The Mayors of these councils signed the letter. Is your council on the list – and if not, why not?

The letter is asking for a meeting with the PM, and seems reasonable.

If your council is not on the list, contact your Mayor and he/she will be able to explain.

Those that signed:

  • Mayor Neill Brown Ashburton District Council
  • Deputy Mayor Andrew Turner Christchurch City Council signed for canterbury as the mayor was conflicted.
  • Hon John Carter QSO Mayor, Far North District Council
  • Mayor Tania Gibson Grey District Council
  • Mayor Marie Black Hurunui District Council
  • Sir Tim Shadbolt Mayor, Invercargill City Council
  • Mayor Craig Mackle Kaikoura District Council
  • Dr Jason Smith Mayor, Kaipara District Council
  • Mayor Malcolm Campbell Kawerau District Council
  • Mayor Graham Smith Mackenzie District Council
  • Mayor Helen Worboys Manawatu District Council
  • Mayor John Leggett Marlborough District Council
  • Mayor Ash Tanner Matamata-Piako District Council
  • Mayor Kirsten Wise Napier City Council
  • Mayor Lyn Riesterer Opotiki District Council
  • Mayor Andy Watson Rangitikei District Council
  • Mayor Phil Nixon South Taranaki District Council
  • Mayor Jennifer Shattock QSM JP South Waikato District Council
  • Mayor Alex Beijen South Wairarapa District Council
  • Mayor Tracey Collis Tararua District Council
  • Mayor David Trewavas Taupo District Council
  • Mayor Sandra Goudie Thames-Coromandel District Council
  • Mayor Nigel Bowen Timaru District Council
  • Allan Sanson Waikato District Council
  • Mayor Dan Gordon Waimakariri District Council
  • Mayor Craig Rowley Waimate District Council
  • Mayor Jim Mylchreest Waipa District Council
  • Mayor Craig Little Wairoa District Council
  • Mayor Bruce Smith Westland District Council
  • Mayor Sheryl Mai Whangarei District Council

If one of these Mayors is yours, let them know you appreciate the efforts they are making on your behalf.

Following what can only be described as a disaster for Local Government New Zealand (LGNZ), where a heads of agreement now breached by government was signed by LGNZ without any consultation with members, a group of mayors made the decision that LGNZ, was unable to act in their interests and the interests of their ratepayers having signed the Memorandum of Understanding (MOU), and started a process to seek government to pause the three waters reforms and consider alternatives.

The filing of legal proceedings is aimed at clarifying councils’ asset ownership and its democratic responsibilities. This will help both Local and Central Government understand the parameters of ownership.

It’s a formal step in a campaign to help persuade the Government to listen to Local Government and their communities, pause the reform process, and work collaboratively with the sector to identify and investigate and agree on alternative delivery models.

Three Councils have lodged a Statement of Claim with the High Court, seeking a legal declaration on two fronts:

  • Affirming the rights and obligations of local Councils, in regards to ownership of assets;
  • And that it would be unlawful for the Government’s public education campaign to contain incorrect or misleading information in regard to each council’s rights, obligations and duties under the Local Government Act and performance, management, and provision of water services.

We have significant concerns that the Government is proceeding on the basis of a fundamental misunderstanding of the democratic importance of its definitions of Local Government and asset ownership, and feel that this process will offer us a clear and shared understanding of our rights and obligations for future negotiations.

Timaru, Whangarei, and Waimakariri District Councils are the applicants in this filing.

Their Spokesperson, Mayor Nigel Bowen is a natural leader who gets to the core of a problem very quickly.

In the first part of the claim:

  • It is noted that Local Government is an important and longstanding component of the democratic governance of New Zealand.
  • Important and longstanding principles and features of the democratic governance of New Zealand at local community level include the following:
    • local infrastructure assets are owned and/or controlled, and related services are provided, by local Councils.
    • local councils are responsive and democratically accountable to their communities for their ownership, stewardship and decision-making in relation to local infrastructure assets and related services;
    • local councils owe fiduciary-like obligations to their communities; and
    • local government infrastructure assets have generally been wholly or materially funded as a result of rates or charges or rentals paid by generations of persons (including businesses) located in their communities.

The Councils’ rights of ownership in relation to infrastructure assets include the following:

  • The exclusive ability to prevent others from interfering with such assets;
  • The exclusive possession or control of such assets;
  • The exclusive ability to manage and operate, and/or enter into contracts in relation to, such assets;
  • The exclusive ability to modify or replace the assets (and to dispose of redundant or surplus assets);
  • The exclusive ability to use such assets as security for borrowing; and
  • The exclusive entitlement to receive full, fair, and objectively and independently assessed compensation for any infrastructure assets removed by legislation from the ownership (in particular, the rights of ownership of such assets).

The Second Cause of Action seeks a declaration about the public education Campaign and the three Councils seek declarations that:

  • In preparing and implementing the Campaign, the Secretary and the DIA are obliged to act lawfully.
  • It would be unlawful for the Campaign to include the publication of incorrect or misleading information in relation to:
  • The rights and obligations of local authorities under the law, including the LGA and as a quasi-fiduciary;
  • The LGA principles of local democracy;
  • The democratic accountability of local authorities; or
  • The Councils’ prudent management of their Water Assets, and their provision of associated good quality services.

A group of Mayors have joined a group which represents over 30% of the country and is growing has made the decision that LGNZ is so conflicted it is impossible to represent them on the matters of three waters and they have had an MOU prepared and sent to every Mayor in New Zealand to allow other councils around New Zealand to join in the campaign.

Those Councils who have joined are listed below and a number of others are working through the process.’

Those that have signed represent over 33% of all councils in New Zealand and 1.3 million ratepayers and those figures are growing.

As of the 10th of December 2021, 23 Councils had signed an MOU to push back against the current three waters proposal.

They are:

  • Far North
  • Whangarei
  • Kaipara
  • Matamata-Piako
  • Waipa
  • South Waikato
  • Opotiki
  • Kawerau
  • South Taranaki
  • Wairoa
  • Napier City
  • Manawatu
  • Tararua
  • Grey
  • Westland
  • Kaikoura
  • Hurunui
  • Waimakariri
  • Ashburton
  • Timaru
  • Waimate
  • Christchurch city council
  • Central Hawkes Bay

Is your council not on the list – missing in action?

I am amazed now to be informed that not all Councillors have seen the MoU or even been made aware of the group by some Mayors.

It is expected that all important incoming correspondence pertaining to any council assets of Significant Strategic importance as outlined in each council’s Significance & Engagement Policy is a matter for full council.

The following is a quote from Councils Significance and Engagement Policy:

The LGA, section 76 AA (3) requires that the Significance and Engagement Policy must list the assets considered by the local authority to be Strategic Assets.

These assets must be considered to be of high significance and as such corresponding engagement and consultation practices followed by the Council if transfer ownership or control of a strategic asset, or a decision to construct, replace or abandon a strategic asset is proposed.

It expects that ratepayers are expected to be consulted with on this subject and that councillors would be privy to ALL information pertaining to the assets.

It is not the Mayor or Chief Executive’s prerogative to selectively include or exclude information addressed to the council.

This is not BAU – it concerns all of council.

So, in reality, every Councillor across the country should have a copy of the MOU and should have seen it when it was tabled at a formal council meeting.

If you then have further concerns raise the matter with the Office of the Auditor General.

Now to finish off let’s talk about the announcement Minister Mahuta made when she advised there would be no public consultation but that she would establish a further working group with Mayors via LGNZ to consider changes to the governance model.

Here’s how it went.

LGNZ called for nominations.

LGNZ gave a list of 20 to the Department of Internal Affairs – it seems they did not want the responsibility to select a balanced panel.

DIA selected only mayors that were pro the reform or on the early Three Waters Group.

There was only one exception.

The terms of reference for this group are very restrictive. The Mayors, in order to get onto the working group, agreed not to represent their ratepayers.

Mayors agreed that only tinkering with the governance on the four model reform to be mandated was allowed.

They agreed to report back by late March 2022

Then a further bomb shell when DIA released its implementation timetable and legislation comes in before the reporting back by the working group!     

Does this sound familiar?

A twist that perhaps none that signed saw coming.

So, who’s on this working group?

Mayors named by Minister Mahuta to join the group include:

  • Auckland mayor Phil Goff,
  • Kaipara mayor Jason Smith – opposed to the model proposed
  • Western Bay of Plenty mayor Garry Webber,
  • New Plymouth mayor Neil Holdom,
  • Lower Hutt mayor Campbell Barry,
  • Nelson mayor Rachel Reese,
  • Christchurch mayor Lianne Dalziel,
  • Central Otago mayor Tim Cadogan,
  • Masterton mayor Lyn Patterson.

And that’s how this government rolls.

One caller asked me how many of those Councils on the group had engaged with their residents.

We both know the answer to that.

Please be assured most of your mayors will push back on any aspect of the proposals that impact our democracy – and there are many. At the end of the day, can the mandates survive a change of government? NO

My opinion is this government won’t back down as its controlled by its Maori caucus and if Labour MPs push the pause button the crew will mutiny and its TE-Puapua plan will walk the plank.

If they don’t push the pause button the power rests with the people and they are united on this one.

Have a great Christmas and New Year.

Stay safe and let’s keep talking next year – and be assured that those Mayors that make up the group for democracy, who are focused on fresh ideas and better water will be on deck right throughout December and January.

Catch you later,