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Three Waters Reforms: Government Threats and Compulsion

Minister Nanaia Mahuta

Bryce Edwards
Victoria University Of Wellington – Te Herenga Waka
democracyproject.nz

Dr Bryce Edwards is Political Analyst in Residence at Victoria University of Wellington. He is the director of the Democracy Project.

An article by Thomas Coughlan focuses on the Government’s problem that many councils are unconvinced by the proposals, with some indicating that they won’t voluntarily hand over their water assets, debts and responsibilities. Coughlan suggests this unwillingness is hardly surprising:

“Water is one of the main things councils actually do, forcing them to give it up to four faceless entities is, for many councils, effectively stripping them of what their organisations exist to do: local services.”

He predicts a war between central and local government is looming over the issue, and it’s not yet clear what local government minister Nanaia Mahuta will do if they refuse:

“The Government started the water reforms promising they would be voluntary; councils could choose to be in or out. But in recent months, Mahuta’s language has hardened. She’s talking about having a “conversation” with councils, but she’s very explicitly not ruled out forcing them into the reforms if they won’t come of their own volition. She might need to do so. In Parliament, she acknowledged that a patchwork of councils in and out of the water reforms wouldn’t work. It’s all (or at least most) councils, or none at all.”

An Otago Daily Times editorial this week commented on this aspect, but believes that there “is an air of inevitability” about the proposals regardless of any local government refuseniks, and Mahuta may “have to wave a big stick and make participation mandatory. It is clear the efficiencies sought would be difficult to achieve if some big players opt out” – see: Water reform progress. But the possibility of some carrots, or “preferential treatment” for the likes of Christchurch, might be offered to ensure their involvement.

A Stuff newspaper editorial points out that the proposals are “voluntary with a very small v” and predicts that councils will be pushed one way or another into the scheme – see: Unfamiliar waters need careful scrutiny. Here’s the main point:

“Those councils that don’t opt in will find the new, necessarily stricter, standards and penalties for water delivery increasingly hard to live with. Any sense that splendid isolation will empower an extension of the status quo is almost certainly illusory.”

Both the National and Green parties believe it is inevitable the Government will make the proposals compulsory for local government – RNZ reports on this here: Three Waters too big to fail? National, Greens predict councils will be forced to join.

The comments of Government minister James Shaw are particularly pertinent: “There is a risk with the opt-out model that you end up with entities that have holes in them and then you start to lose the benefits of scale and of combining them, and so I think that there are some merits to simply the government going with that mandated structure.”

Concerns about the Government’s reform process

Regardless of what needs to happen to the water sector in New Zealand, is the Government’s reform process a good one? The criticisms are starting to mount. Of particular note are the criticisms of economist Julia Talbot-Jones – in the article above – who questions whether a good outcome can come from such a bad reform process.

She is particularly critical of the Government’s $3.5m advertising campaign, which is aimed at convincing the public that local councils are mismanaging water. Although such a campaign is intended to “nudge voters towards pressurising their local representatives to adopt the new framework, the campaign risks leading to a loss of trust in central government on the part of some local authorities and a further rescinding of voluntary engagement in the reform process. This approach to advancing the water reform agenda is surprising from a local government minister. Nanaia Mahuta should know trust in local government is already low, and destabilising local processes does little to recalibrate the balance.”

Former minister Peter Dunne is also critical of the water reform process, suggesting the majority Labour Government, as with the 1980s Rogernomics administration, is just bulldozing through with a “political blitzkrieg” that risks getting things wrong and creating poor implementation – see: Govt should slow down on health, education and water or hit the skids.

Here’s Dunne’s main point:

“with many Mayors, including the former Labour MP Mayors of Auckland and Christchurch, already speaking out against aspects of the reform proposal, the government is unlikely to find it easy to implement its plans over the next couple of years. This government’s reputation is already of one that talks a big game, but whose policy implementation constantly falls well short of that. Therefore, the last thing that it should want now is a drawn-out battle with local government over water reform”.

Similarly, Herald business journalist Fran O’Sullivan complains this major reorganisation of the state and the Constitution is occurring without enough debate and analysis, calling this “a radical reinvention of the State’s role in New Zealand” – see: Labour takes revolutionary road towards State control (paywalled). O’Sullivan takes particular issue with the creation of entities such as the Regional Representative Groups that will control the water entities and be half appointed by mana whenua. She argues such constitutional changes require a more thorough and transparent reform process than the Government is allowing.

Finally, for a strident criticism of the latest “puerile” newspaper and television ads promoting the water reforms, see Karl du Fresne’s Funding our own indoctrination.

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