Local Water Done Well

What is Local Water Done Well?

Local Water Done Well (LWDW) is the coalition government's approach to improving the management of drinking water, wastewater, and storm water (the "three waters") services replacing Labour’s previous "Affordable Water" model (sometimes called “Three Waters”).

It is intended to ensure people pay cost-reflective prices for water services, that those services are delivered to an acceptable quality, and that water services providers are investing sufficiently in three-waters infrastructure.

The changes under LWDW will affect how water services are delivered, maintained, and regulated with councils needing to make important decisions about their water infrastructure, service models, and whether to partner with other councils.

What needs to happen?

LWDW legislation requires councils to develop a Water Services Delivery Plan (WSDP) by September 2025 that must outline how water services will be managed, meet new regulatory standards, and be financially sustainable. The WSDP can be developed either alone or jointly with other councils.

The WSDP needs to cover a minimum ten-year timeframe (but can be up to 30-years) with detailed information provided on the first three-years.

The aim of the WSDP is to serve as the primary planning and decision-making tool around the delivery of water services both now and in the future while ensuring compliance with future health, environmental, and economic regulations.

A key part of developing a WSDP is that we need to consult on options for a Water Services Delivery Model for providing water services.

Choice of Water Services Delivery Model (WSDM)

The government approved five different Water Services Delivery Model (WSDM) options councils can adopt given they are able to meet financial sustainability and other legislative requirements.

1. In-house business unit (our current delivery model)
2. Single council-owned council-controlled organisation (CCO)
3. A multi-council-controlled organisation (CCO) owned by the council and one or more of our neighbours.
4. Mixed council / consumer trust – a consumer trust established as the majority shareholder with one or more councils owning a minority of shares
5. Consumer trust – council assets would transfer to a consumer-trust owned organisation.

The key issues driving Council's option considerations are:

• The requirement for financial sustainability - that the Water Services Delivery Model has the debt capacity and ability to fund the required work programme.
• The need for maximum scale and efficiencies (highest number of councils possible).
• Willingness of other councils to join with Ruapehu.

Commitment to work with other councils: Council has decided in principle that we should work with other councils on a Water Services Delivery Plan (WSDP). Without the involvement of other councils to provide economies of scale we would not meet the government's financial sustainability and other key requirements.

Community consultation on a WSDM

We are required to undertake community consultation on our Water Services Delivery Model options. This is targeted for March 2025.

Councils are required to consult on our proposed model or arrangements for delivering water services providing an analysis of at least two options (including the proposed arrangements/model)

Alongside this analysis we must outline the potential impacts of proceeding or not proceeding with the proposal, including on rates, debt, levels of service, and any charges for water services. We must also outline the implications for communities, if the proposal involves establishing, joining, or amending a joint water services CCO or a joint local government arrangement.

Potential WSDM options (at this stage)

We have been evaluating all the government approved options seeking to maximise scale, efficiency, and financial capacity to deliver the best, lowest cost model for Ruapehu water users. This in-depth analysis including discussions with neighbouring councils has indicated that the optimum Water Services Delivery Model is a multi-council-controlled organisation (CCO) owned by the Council and one or more of our neighbours. The potential CCO variations are:

1. Regional Council-Controlled Organisation (CCO): A partnership with Horizons councils to leverage economies of scale, align with natural water catchments, and support iwi/hapū preferences.
2. Sub-Regional CCO: A collaboration with Ruapehu, Rangitīkei, and Whanganui District Councils, offering strong alignment with regional relationships and catchments.
3. Waikato Regional CCO: A larger-scale option outside Ruapehu’s natural water catchment but with greater scale.

Note: There are still a number of things that need to come together for these CCO variations to be open to Ruapehu. These include Council workshopping the analysis and adopting a proposed model or arrangements to consult on (scheduled for February 2025), and significantly the decisions of other councils.

Consultation is targeted for March 2025.

Legislative stages

LWDW is being implemented through three key legislative stages being:

1. Stage 1: Repeal of Previous Water Services Legislation - Water Services Acts Repeal Act.
   - completed February 2024
2. Stage 2: Establish Framework & Preliminary Arrangements for New Water Entities - Local Government (Water Services Preliminary Arrangements) Act 2024 - Enacted: 2 September 2024
3. Stage 3: Establish Enduring Settings - Local Government Water Services Bill- Introduced to Parliament December 2024 – Expected to be enacted mid-2025.

Click here for more detail on the legislative process.

Timeline