Source: Department of Internal Affairs
There will be four publicly owned, multi-region entities with a singular focus on delivering safe, reliable and affordable water services to communities.
Each entity’s Regional Representative Group, made up of council and mana whenua representatives will set priorities for these entities and hold them to account. The water entities will have to directly consult with their customers, businesses and residents on their strategic direction, investment priorities and prices and charges.
Here in Hawke’s Bay, ownership of all the water infrastructure and networks that supply your drinking water, wastewater and storm water services will transfer from your council to a new entity, at the moment, called ‘Entity C’, shown here.
The water services entities will be collectively owned by councils, meaning water services remain in public ownership.
Entity C will be owned by the 21 councils in the area shown on the map, on behalf of their communities.
Council ownership will be via a non-financial shareholding based on population, with at least one share for every council. Here in Hawke’s Bay, councils’ shareholdings in Entity C will be as shown below.
Ownership shareholding will not give direct influence over decision-making in the new entity.
Each new water services entity will be financially separate from councils.
COUNCIL NON-FINANCIAL SHAREHOLDING IN 'ENTITY C' | |
---|---|
Council | Shareholding |
Central Hawke's Bay District Council | One share |
Hastings District Council | Two shares |
Napier City Council | Two shares |
Wairoa District Council | One share |
Governance, representation and accountability
Source: Department of Internal Affairs
This diagram explains how the new entities will be structured and run.
Responsibility for oversight and governance will be provided through a Regional Representative Group (RRG) that will have 12 to 14 members drawn 50/50 from councils and mana whenua. For the ‘Entity C’ RRG, there will be 6 to 7 council members representing the 21 councils in the entity’s service area and 6 to 7 mana whenua representatives representing all iwi across the East Coast of the North Island, the top of the South Island and the Chatham Islands. This means it is possible that Hawke’s Bay’s councils and mana whenua may have no direct representation on Entity C’s RRG.
The RRG will be able to appoint Regional Advisory Panels (RAP) or committees, with equal representative from mana whenua and councils. The role of a RAP will be to provide advice to the Regional Representative Group (RRG) about how to perform or exercise its duties, functions, and powers. RAPs or committees will be able to feed more localised input to the RRG. All decisions made by the RRG and RAP must be made by consensus.
The RRG will be co-chaired by one council and one mana whenua representative, appointed by the RRG.
The RRG will appoint an Independent Selection Panel (ISP) to appoint the entity’s Board members and consider the findings of an annual review of board performance carried out by the ISP.
The water services entity will have a competency-based board of between 6 to 10 members who will oversee the day-to-day management of water services, oversee the maintenance and renewal of the water networks and infrastructure and make investment decisions.
The board will be accountable to the RRG and will need to provide a funding and pricing plan and an infrastructure strategy to them at least once every three years.
The board will need to have competence in the delivery of infrastructure and have an understanding of the principles of the Treaty of Waitangi, mātauranga Māori, tikanga Māori, and te ao Māori.
Mana whenua (including any individual, iwi or hapu or group of iwi or hapu) whose rohe or takiwā includes a fresh water body in the entity’s service area will be able to provide the entity with a Te Mana o te Wai statement for water services and the entity would need to provide a plan setting out how it would give effect to Te Mana o te Wai.
Each council’s ownership shareholding in the new entity means the entity is publicly owned.
When it comes to having a say in the entity’s strategic direction, investment priorities and pricing and charging, the Regional Representative Group (RRG) will have responsibility on behalf of all the councils and mana whenua in the service area.
For the Water Services ‘Entity C’ RRG, there will be 6 to 7 council representatives representing 21 councils and 6 to 7 mana whenua representatives representing all iwi across the East Coast of the North Island, the top of the South Island and the Chatham Islands. This means it is possible that Hawke’s Bay’s councils and mana whenua may have no direct representation on Entity C’s RRG.
Regional Advisory Panels (RAP) provide advice to the Regional Representative Group (RRG) about how to perform or exercise its duties, functions, and powers. Sub-regional advisory groups or committees will be able to feed more localised input to the RRG.
The water services entity’s Regional Representative Group (RRG) will have responsibility for representing the views of local communities.
For the Water Services ‘Entity C’ RRG, there will be 6 to 7 council representatives representing 21 councils and 6 to 7 mana whenua representatives representing all iwi across the East Coast of the North Island, the top of the South Island and the Chatham Islands. This means it is possible that Hawke’s Bay’s councils and mana whenua may have no direct representation on Entity C’s RRG.
The water entities will be required to directly consult with their customers, residents and businesses on their investment priorities, prices and charges through their council and through other consumer and community interest forums.
Public ownership of water services is one reason for establishing the new water services entities in law, and safeguards against future privatisation are also built in through council ownership of the entities. Councils cannot sell or transfer their shares for any reason.
As well, for any future privatisation to go ahead, there will need to be a 75% vote in a public referendum. There will also be restrictions on the sale or transfer of assets held by the new entities.
Each council’s water assets, revenue, liabilities (debts) and staff will all transfer to the new water services entity.
Government has introduced a funding package to support councils through the transition to the new arrangements and to cover the costs and financial impacts that councils will incur because of the reforms.
The support package is made up of two key components:
Here in Hawke’s Bay, the funding support looks like this.
SUPPORT PACKAGE FUNDING | ||
---|---|---|
Council | Better-off component | No-worse-off component |
Central Hawke's Bay District Council | $11m | $1m |
Hastings District Council | $35m | $5m |
Napier City Council | $26m | $4m |
Wairoa District Council | $19m | $1m |
The new water services entities will be required to reimburse the Crown (Government) for any expenses or capital expenditure incurred in establishing the entities.
The water services entity Board will need to submit a funding and pricing plan to the RRG at least once every three years.
Beyond that, Government has given no indication how water services will be priced.
A water watchdog in the form of an economic regulation regime will require that appropriate investment in three waters services is maintained and that water users pay fair and reasonable prices for them.
The economic regulation regime and consumer protection mechanisms will be introduced through the next stage of legislation.
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