O'Connor DamienWATER SERVICES LEGISLATION BILLSecond ReadingHon DAMIEN O'CONNOR (Minister of Agriculture) on behalf of the Minister of Local Government: I present a legislative statement on the Water Services Legislation Bill.ASSISTANT SPEAKER (Hon Jenny Salesa): That legislative statement is published under the authority of the House and can be found on the Parliament website.Hon DAMIEN O'CONNOR: I move That the Water Services Legislation Bill be now read a second time.I present a legislative statement on the Water Services Legislation Bill. As I said I move that it be read a second time. I'm pleased to speak on the bill today—Hon Member: No you're not.Hon DAMIEN O'CONNOR: —on behalf of the Minister of Local Government—I'm thrilled to speak on the bill actually. Forming part of the water reform suite of legislation it will help to optimise New Zealand's water system to help us better manage new challenges and to provide water infrastructure services that are safe reliable resilient and affordable—because they are not now. It's another key step towards ensuring New Zealand will have the water infrastructure and services we need to support better health and environmental outcomes and healthy prosperous and growing communities—now and into the future which is something this Government is concerned about.This bill is a step towards ensuring that New Zealand has water infrastructure and services that deliver safe and affordable drinking water. It is a step towards ensuring that our water network is resilient to extreme weather events. It will help to support new housing and urban development and it will ensure that our water infrastructure and services operate sustainably within our environment.As mentioned this bill is part of a suite of legislation that will reform the delivery of New Zealand's drinking-water waste-water and stormwater services. For those who didn't notice it did have an impact in Auckland—some of those storms. The Water Services Entities Act which passed in December 2022 enabled the reform and set the framework for establishing the water services entities.This bill sets out the function of those entities and provides them with the tools they need to carry out these functions. It enables modern regulatory and service delivery arrangements that will replace existing powers under existing local government legislation.I'd like to briefly remind the House of the most important components of the Water Services Legislation Bill. This bill contains the regulatory functions and powers for the entities. It enables the entities to make secondary legislation to effectively manage water services infrastructure deliver safe drinking water and protect the environment among other objectives. For example this includes stormwater management strategies which will comprehensively set out the entities approach to managing the impacts of stormwater. This is of course important in the country's work to develop solutions to challenges around the changing climate. The entities will have their own modernised compliance and enforcement regime to enforce these functions. This is a major step forward as the Local Government Act which was passed in 2002 is no longer fit for this purpose. New Zealanders need to be sure their drinking water arrangements are appropriately protected.The bill also establishes charging mechanisms to provide fair transparent equitable and affordable charges to households and businesses for water services. It sets out the path for transitioning to the new system and integrates the water services entities into wider regulatory frameworks—for example the resource management system.I'd like to thank the Finance and Expenditure Committee who considered more than 460 submissions on this bill. I'd also like to thank the local government sector and other interested groups and individuals who made submissions on the bill. In particular I'd like to acknowledge the work of councils and other water sector specialists in this respect who engaged deeply with the bill and provided specific technical recommendations that assisted the committee's work and ultimately provided more practical workable legislation—the Government does listen always. As a result of this work by submitters and the committee we now have in our hands a further optimised piece of legislation along with amendments that will ensure the legislation is workable for the water services entities and the communities that they serve.Let's look at some of the key areas of change recommended by the committee. The bill provides for relationship agreements which will be critical in supporting the important links between the entities and other parties including councils. These agreements set out how the entities and other parties will engage with each other and work together. For example they set out how territorial authorities regional councils and water service entities will work together to effectively plan under the resource management system. Relationship agreements ensure that there is an ability to reflect the unique circumstances of different regions around the country and ensure that entities and councils have the flexibility to agree on day-to-day operational arrangements that work for them. The committee has strengthened the relationship agreements by making them binding on the parties with a statutory disputes resolution process. The committee also recommended that relationship agreements will need to be entered into three months before the entities' go-live date to ensure that they are in place before each entity does go live.Secondly under the affordable water reforms around 75 council owned mixed-use rural water supplies will transfer to the water services entities. These supplies provide water for agricultural or horticultural purposes along with drinking water for households. The Government has listened to rural communities' concerns about this change in arrangements for these schemes and recognises their importance. That is why this bill allows for the users of these schemes to work together with water service entities to transfer ownership and management of these supplies back to the communities they serve. In addition the committee has introduced rural supply plans in this bill which the entity must have for each small mixed-use rural water supply in its service area that remains under its ownership. The rural supply plan will provide better recognition of the special nature of these schemes and ensure that farming communities can continue to be involved in their management.Thirdly there is a change with regard to the bill looking to the challenges we are facing as a result of changing climate with new mechanisms to support the comprehensive management of stormwater. The committee has recommended that stormwater management plans and rules will be integrated into a single instrument: the stormwater management strategy. This will provide a system-based approach to stormwater networks and their regulation. The bill also provides for stormwater risk management plans. These seek to identify risks and hazards relating to watercourses on land not owned by the entities. There is a new requirement that the entity must work collaboratively with landowners to ensure that the risk is managed controlled monitored or eliminated if a—Madam Speaker sorry. If a collaborative approach cannot be agreed upon or is not implemented the entity must implement a solution.The Government has also listened to councils' concerns about the transfer provisions for councilcontrolled organisations. These will now only apply to a council-controlled organisation whose predominant purpose is to support territorial authorities in their management and operation of water services. The predominant purpose" is defined in the bill as 85 percent or more of revenue from provision of water-related services.Christchurch's Citycare is now exempt from the transfer provisions due to the special nature of the contracting work it does for councils across New Zealand. The bill as reported back from the committee also provides that council-controlled organisations can be excluded from the transfer arrangements in the future if it is determined that they also have special characteristics that mean a transfer would be undesirable.By-laws are an important and complex area for councils and entities. Existing by-laws will continue either until an entity makes an equivalent water services or until the end of the transitional period. The water services entities will have the compliance and enforcement powers in relation to by-laws. Water service entities will be required to enter into relationship agreements relating to bylaws.The committee also made amendments to ensure that the integrity intent and effect of the Treaty settlements are upheld by the entities. These changes represent a holding pattern until such time that the Crown and iwi have completed discussions on the changes required to Treaty settlements in greater depth and provide a process for amending Treaty settlement Acts that are impacted by the water services reform.In addition to the improvements I have mentioned I have tabled a Supplementary Order Paper to make a number of minor and technical amendments to the bill in order to ensure the legislative regime is consistent and workable across water services legislation and the new resource management system. This includes changes relating to establishment dates for the entities that result from the move to a staggered approach in the now amended Water Services Entities Act. The Supplementary Order Paper includes a few other—ASSISTANT SPEAKER (Hon Jenny Salesa): Order! Order! Unfortunately the member's time is up. The question is that the motion be agreed to."