Simmonds Penny; Mahuta NanaiaPENNY SIMMONDS (National—Invercargill): Thank you Madam Chair. I want to return to clause 166 in this Part 4 of the Water Services Entities Bill because you know—I guess I think of myself as a practical pragmatic person. I know that this has been a source of concern for a number of people. So I'd like the Minister of Local Government to give us a very clear answer on how this clause makes any sense.If we can just go through it clause 166(1): A territorial authority owner"—and we'll go straight to (a)—"has no right title or interest (legal or equitable) in the assets security debts or liabilities of a water services entity".I have to relate it back to things that I know. I own a house but I've got no right to it I've got no title to it I've got no interest in the assets I've got no security no debts—how do I own it? That's the simple question that people keep asking me so here I am again. Gore District Council; it's not in my electorate but it's a neighbouring electorate and I went to school there so it's dear to my heart. Gore District Council: a small district council people have paid rates for years to pay for the services that they've got over decades—and those assets can be taken off them without any recompense. So they're taken off them but somehow the Gore District Council is still the owner of them but can't—probably won't—have anyone on the representative body to have any say in what happens with them but they own them.Look I just can't understand how you own something but you don't have any rights. I'd really really like the Minister to answer clearly on the opposite of it of the positive of "Yes local authorities you own it and this is what you have for being the owner. This is what you are entitled to. This is what being an owner means." because it feels like—and I know this was a change in the legislation early on when people got very upset about losing the ownership. There'll be a few old enough in the Chamber to know what I'm talking about it feels like a Clayton's ownership—the ownership you have when you haven't got the ownership. So what actually does ownership when you have no rights title interest security debts—what on the flipside is the positive of being the owner in this instance?I know that there are an awful lot of members of the public who may be listening to this that have engaged in dialogue with all of us as electorate MPs about how this can be. How can you have an asset it gets taken from you you're still the owner of it but you've got no rights and don't appear to have any control over it? That I believe has made people very very suspicious and very cynical and very concerned about this piece of legislation.I guess it then makes people think "Well what else in this is bizarre and how could it possibly work if we can't understand how this very simple notion of owning something but having no rights and no ability to have any say over it?" So please Minister just give us the positive side of what it actually gives the owner. Thank you Madam Chair.Hon NANAIA MAHUTA (Minister of Local Government): I thank the member for the question and will try and simplify my answer to the degree that I'm mindful that people are listening to the debate and they'll be probably asking a similar question.In its simple form this is the point at which we: (1) enable the ability to transfer assets debt and liability of the 67 councils to the four water service entities to be able to aggregate up those interests and leverage from that for the benefit of a bigger region. That's one part of it.But in terms of having an ownership interest that does not derive a dividend there's a couple of things about that. It will mean that we separate balance sheets so that territorial authorities from transferring their assets debts and liabilities to the water service entities—in many ways that will free up headroom. Many councils have reached the debt-ceiling limits and that's a constraint. That's why there's been a continual compromise over decades around what they fund and how they fund according to the aspirations of their local community.You can have an ownership interest and exercise that through the way that we're proposing in the bill in terms of ensuring through the regional representative group the way in which you develop the statement of intent the asset management plans the funding and pricing plans and the integrated management plans—those are all areas where you exercise your interest to be able to guide the water service entity. That's as simple as I can put it."