FAQs about Local Water Done Well and water reform

Currently, each council in the region owns the infrastructure (pipes and other facilities) within their city or area. For example, Wellington City Council owns the pipes underneath Wellington, as well as Moa Point Wastewater Treatment Plant. Each council is also responsible for funding the maintenance and development of water infrastructure and does this by collecting rates. They are also responsible for the debt taken on to fund maintenance and improvement of the water network.

Service delivery (the actual work of maintaining the pipes, supplying drinking water, treating wastewater, managing stormwater and improving the water network), is managed by Wellington Water Limited, an organisation jointly owned and funded by six councils (Wellington City Council, Hutt City Council, Porirua City Council, Upper Hutt City Council, Greater Wellington Regional Council, and South Wairarapa District Council).

Wellington Water receives funding from each council, but that funding is to be spent only on that council's own pipes, rather than across the whole water system. Because Wellington Water relies on money from councils, their work programme is restricted by how much they receive and the most immediate needs of each area, making them more reactive than proactive. Also, because money from each council must be spent only in that council’s area, they are constrained in being able to plan a work programme that enables efficient and effective management and improvement of the whole system.

Wellington Water’s reliance on council funding means they need to regularly request further funding to do the work required.

While Wellington Water manage the day-to-day water supply on behalf of shareholding councils, Greater Wellington Regional Council (Greater Wellington) is still ultimately responsible for collecting, treating and distributing safe and healthy drinking water to Wellington, Hutt, Upper Hutt and Porirua City councils.

Greater Wellington owns the assets associated with supplying this water – that’s 187km of distribution pipework, four treatment plants, 9km of tunnels, three water storage dams, 15 pump stations, 45km of roads and tracks, 2,688 raw water intakes and wells, 18 aquifer wells, plus all the catchment lands (land where water collects and drains into bodies of water like rivers). The water provided by Greater Wellington goes to reservoirs owned by each city. From there, the water moves from the reservoir to local homes and businesses through council-owned pipes.

This large network of water collection areas, treatment plants, pumping stations, and pipelines that supply drinking water to the whole region is referred to as bulk water supply. Providing the water to the city councils involves managing a network of infrastructure, ensuring safe, high-quality, secure, and reliable water sources, and ensuring that our freshwater is sustainable. The councils fund Greater Wellington’s supply of these water services through a charge (called the bulk water levy) which is calculated based on each city or district’s water usage.

>>You can read more about Greater Wellington's role and take part in their consultation about water www.gw.govt.nz

Much of New Zealand has significantly underinvested in water infrastructure and water services over several decades. Councils around the country and in the Wellington region now face stark challenges to meet the investment needed to ensure safe and reliable drinking water, wastewater and stormwater infrastructure.

The level of investment required to improve the water network is high. The financial constraints all councils are working within means that the current issues will continue and could worsen if greater investments are not made. The Government’s water reforms have provided councils with a financial model that helps to address decades of underinvestment.

Under the Government’s Local Water Done Well reforms, there are five delivery model options for Councils to choose from. Over the last 12 months, all councils have been working through the options, considering the advantages and disadvantages for ratepayers. The five partner councils have determined that the preferred option is best placed to deliver the long-term outcomes needed – a safe, reliable and affordable water network.

• Read about the five delivery model options: https://www.dia.govt.nz/diawebsite.nsf/Files/Water-Services-Policy/$file/LWDW-guidance-Water-services-delivery-models-(updated-December-2024).pdf
• Read about the recommended regional approach to a joint Water Services Delivery Plan and delivery model:
  https://storage.googleapis.com/pcc-wagtail-media/documents/WRWSDP_Regional_Report_041024.pdf
• Read about Porirua City Council and  Local Water Done Well: https://poriruacity.govt.nz/your-council/reforms/three-waters-reform/

• The proposed new multi-council-owned water organisation would own all of the pipes and facilities in the region covered by Porirua, Upper Hutt, Hutt and Wellington City councils and be able to generate its own income and manage its own debt.
• Wellington Water is a management-only council-controlled organisation – it does not own the water assets and is reliant upon the councils for strategic direction and resources.
• Wellington Water currently takes direction from six different councils, meaning it is responding to issues within each area and is limited by council funding and funding cycles.
• The new water organisation would be able to view the network as a whole and be more proactive in planning for the long term, resulting in more efficient investment and a more reliable water network.
• The proposed new water organisation would have the resources, the autonomy, and the region-wide perspective to effectively manage and improve our water network, for current and future communities, rather than being limited by council funding and funding cycles.
• Because Wellington Water relies on money from councils, their work programme is restricted by how much they receive and the most immediate needs of each area, making them more reactive than proactive. Also, because money from each council must be spent only in that council’s area, they are constrained in being able to plan a work programme that enables efficient and effective management and improvement of the whole system.
• Wellington Water’s reliance on council funding means they need to regularly request further funding to do the work required.
• While it would have much more autonomy than the current joint council-owned Wellington Water, the new water organisation is required by law to operate in a much more regulated environment, which will provide a strong focus on water and service quality, customer-focused delivery and value for money.

• The preferred option of a multi-council-owned water organisation will own all water assets (pipes, reservoirs and treatment plants), generate revenue through customer charges, be responsible for debt, and have the authority to manage their investment plans and work programme.
• The proposed new water organisation will operate in a much more regulated environment, which will provide a strong focus on assurance, quality, delivery and value for money. The primary relationship of the organisation will be with its customers, not its shareholders (or owners). Council direction and oversight would be less than under the current Wellington Water model, giving the new organisation the independence and accountability to deliver. A skills-based board with a clear set of competencies is at the heart of the recommended governance model.
• The new organisation will have an increased ability to borrow money, compared to a council, and it will be able to deliver their investment programme more efficiently.
• It is the service delivery option that was considered ‘best for region’ – which makes a lot of sense as our water network is an interconnected regional network rather than contained self-sufficient networks within each council area.

The issues with water services have been known for many years, and the need for significant change is now overdue. The Government has given all councils in New Zealand a deadline to submit water service delivery plans that demonstrate commitment to deliver water services and meet regulatory requirements. These plans must be submitted to the Government by 3 September 2025 and councils must start delivering on the plans as soon as they are submitted.

Under the proposal for a new multi-council-owned water organisation, Wellington Water would be disestablished following transition of staff, operations, work in progress, facilities, plant and equipment and contracts to the new water organisation.

Wellington Water is not responsible for the establishment of the new water organisation – they do however have an integral role supporting and advising councils with the development of the water services delivery plan and would support with the establishment of the proposed water organisation.

Yes. The proposed water organisation would have a direct relationship with customers. Property owners will no longer pay for water services in council rates bills and instead the new water organisation will invoice property owners directly, much like gas, phone or power companies do.

Yes. Under any delivery model, your council rates would no longer include payment for drinking water, stormwater and wastewater services.

Under any delivery model, water bills will need to increase to meet the needs of our ageing network. The key thing is that we adopt a water service delivery model that allows for increasing investment into the network in a manageable and sustainable way, while also balancing affordability for the community.

Water meters are highly likely under all possible future models of water services delivery as they are already being investigated by councils and Wellington Water. Water meters are critical to helping identify where water loss is occurring (currently around 40% of water is lost to leaks in our region’s network).

The Government has signalled, via proposed legislation, that in future water charges will have to be based on levels of use rather than being based on property values (as they generally are now) and water meters help to identify usage.

Under the preferred option of a multi-council-owned water organisation, water would be managed with the whole network in mind, as opposed to just focusing on individual city’s needs. Our water network is connected, investments made in one area positively impact another.

The proposed law, (Local Government (Water Services) Bill) provides a new approach to the management of stormwater services.

City councils will retain responsibility for ensuring that stormwater services are provided in their district but can choose the delivery arrangements that best suit their circumstances.

Councils will be able to:

• continue to deliver stormwater services directly (in-house) or;
• transfer all or some aspects of stormwater service provision to a water organisation (this might include stormwater network assets); and/or
• contract a water organisation (or potentially another third party) to provide all or some aspects of stormwater service delivery.

Under our preferred option of a multi-council-owned water organisation, most aspects of stormwater service provision would be transferred to the new water organisation. The new water organisation would own most water assets, including urban stormwater pipes and pumps.  The revenues and liabilities pertaining to these stormwater assets would also transfer.

City councils would retain accountability for overland stormwater flow paths, that is, any flow path taken by stormwater on the surface of public land eg, on roads and through parks. Private landowners would also retain similar accountability for stormwater paths on their land.

This approach is recommended for three key reasons:

• the urban piped stormwater system has many interconnections with the wastewater system – so investment and delivery has to be coordinated 
• most councils do not have stormwater capability as this is currently managed by Wellington Water
• addressing stormwater issues helps deliver on broader outcomes including te mana o te wai.

While city councils under our preferred delivery model will transfer the delivery of stormwater services to the new water organisation, they will continue to have a strong influence on stormwater outcomes in their city or district via transfer and service agreements, statement of expectations and water services strategies.

These changes maintain the responsibility of city councils to consider how they will align land use planning, stormwater services and investment to support the management of stormwater services, and continue to leverage councils’ existing networks with their communities.

For more information, the Department of Internal Affairs factsheet provides an overview of future arrangements for urban stormwater, and mechanisms to improve the management of overland flow paths and watercourses in urban areas:

Read the factsheet:
https://www.dia.govt.nz/diawebsite.nsf/Files/Water-Services-Policy/$file/LWDW-Bill-3-factsheet-Future-arrangements-for-stormwater.pdf

The approach for the proposed new organisation has been developed jointly by the five councils working in partnership with our iwi / Māori partners Ngāti Toa Rangatira and Taranaki Whānui ki Te Upoko o Te Ika.  

Ngāti Toa Rangatira and Taranaki Whānui ki Te Upoko o Te Ika have confirmed a joint council-owned water organisation as their preferred option. The primary drivers for this are that water sources across Wellington are connected and for Māori are considered as one, from the water source of Te Awa Kairangi / Hutt River through to Te Whanganui-a-Tara / Wellington Harbour, Te Awarua-o-Porirua Harbour and the south coast.

The water organisation will have a range of relationships with mana whenua which will be confirmed through foundational documents such as the constitution and shareholders’ agreement. The board would also need to have suitable competencies and skills in relation to te ao Māori and the Treaty of Waitangi.

No. Under Local Water Done Well the Government has committed that water services will remain in public ownership. Councils and water organisations will not be able to privatise water services. The Local Government (Water Services) Bill states that a water organisation must be owned by a council (or councils) and/or a consumer trust.

Additionally, the Bill introduces a range of restrictions against privatisation. For example, it is proposed that a water service provider may not use water assets as security on a loan.

If, following public consultation, a council does not adopt the currently preferred service delivery option, the remaining councils will continue to work towards a joint water service delivery plan. This would require recalculation of a range of things, including of the levels of investment needed to ensure a financially sustainable plan. Because our region has a connected water network, the exit of one council would also require the development of arrangements and agreements around shared or interconnected infrastructure.

It would require a significant reworking of the water services delivery plan, and it is highly likely the remaining councils would need to seek an extension from the Government for submitting the joint Water Service Delivery Plan. It would also likely delay the establishment of the proposed water organisation.

Wellington, Hutt, Upper Hutt, and Porirua City councils, as well as Greater Wellington, are consulting on Local Water Done Well reform options around the same time. These five councils have each identified a multi-council-owned water organisation as the preferred option for how water services are delivered.

Government legislation requires each council to consult with their communities on the planned changes to water services delivery. It is critical that consultation is carried out in line with legislated requirements to ensure the Government’s key date of 3 September 2025 can be achieved.