Summarised by Centrist
Local Government Minister Simon Watts says building New Zealand’s water infrastructure over the next decade will be a “mammoth challenge”.
He said the government’s Local Water Done Well reforms are aimed at making water entities financially sustainable and able to deliver services.
Te Waihanga chief executive Geoff Cooper said water service delivery plans point to about $49 billion in spending over the next 10 years. He said that is roughly equal to what New Zealand has spent on water services since 1885.
Watts said costs are hard to estimate because some pipes are 50 to 80 years old, but investment is likely to be “in the region of $4 billion per annum over the next 10 years”.
Asked who will pay, Watts said “ratepayers first and foremost”.
He said the government is changing funding and financing rules so borrowing better matches the long life of water assets, which can last 50 to 100 years.
Watts said more regions may face water charges. He noted Auckland already has water charging and said regulators are looking at whether charges are needed elsewhere.
He said some councils will use debt, and argued debt is not always bad because future generations will also benefit from the infrastructure.
Watts said water entities must collect enough revenue to cover costs and service debt. He said the Commerce Commission, not politicians, will assess financial sustainability.
The minister said infrastructure deficits vary by region, but the government believes its model can deliver the required reform and investment.
Image: Xuthoria
