Three Waters reform expert responds to criticisms

Source: Q and A

The man whose report influenced the Government's Three Waters reform programme says amalgamation means water services can be improved in New Zealand.


Twenty years ago, Alan Sutherland presented a report to Scotland's parliament which led to the Scottish version of the Three Waters reforms.

As CEO of the Water Industry Commission of Scotland, Sutherland and his colleagues produced an economic analysis of amalgamating New Zealand's water.

In May last year, their report estimated that over the next three decades, between $120 and $185 billion, without taking into account inflation since 2020, was needed to address the water infrastructure deficit. RNZ reported some councils disputed the figure.

Responding to some of the criticism over those figures, Sutherland told Q+A: "If you take the $120 billion end of it, all that it's doing is holding a mirror up to council management plans… and what they say about their assets and totalling the numbers up. That gets you to the $120 billion.

"The $180 billion is if you want to improve significantly, then that's how you'll get to that number."

READ MORE: First Three Waters bill passes first reading in Parliament

Opponents to the Three Waters reform cite the lack of more direct control over their assets under the reform programme's creation of four regional water entities and its co-governance model. Whangārei District Council, Timaru District Council and Waimakariri District Council were also taking legal action against Three Waters.

When asked why amalgamation was the solution, Sutherland said it was part of the answer to improving water quality, but that it wasn't everything.

"What it's about is having sufficient scale that you can have a good quality asset manager, you can have a professional hydrologist.

"You can have a finance professional… you've got the senior management that can be lead and be credible going to markets and asking for large amounts of capital in order to deliver a huge investment programme.

"So, it's about that credibility."

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Keeping the existing structure in managing water wouldn't be enough because simply giving them more money to upgrade their infrastructure wasn't enough, he added.

Sutherland said it was about delivering an investment programme effectively.

"And you really do need to have the skills in place to define what you're going to do, to scope it out in detail, to procure it, to manage the delivery of it, and learn the lessons about what you could have done a little bit better going forward.

"So, money is only part of the issue. It's not the issue. It's the professionalisation and that requires a degree of scale."

The Three Waters reform project was triggered by an outbreak of waterborne disease gastroenteritis in Havelock North in 2016. It led to the death of four people and made thousands more seriously ill.

A report following the incident found district council-run public drinking water systems were potentially unsafe because of long-term under investment.

In April, 1News exclusively revealed more than 1 million New Zealanders were receiving drinking water that did not meet all of the Ministry of Health's standards,