4. Question No. 4—Local GovernmentTANGI UTIKERE (Labour—Palmerston North) to the Minister of Local GovernmentQuestion No. 4—Local Government4. TANGI UTIKERE (Labour—Palmerston North) to the Minister of Local Government: What steps has the Government taken to ensure that the Three Waters Reform proposals are well understood by councils?Hon NANAIA MAHUTA (Minister of Local Government): Right from the beginning I've worked closely with local government. We've established a steering group with Local Government New Zealand (LGNZ) and Taituarā  and the subsequent technical working group to address specific areas of the work programme. Prior to the local government conference the Government released detailed information on the case for change the reform objectives and proposed design features. The Government and LGNZ technical advisers have provided councils with a variety of tools to help them understand their individual positions with and without reform. Officials from the Department of Internal Affairs and members from LGNZ and Taituarā have undertaken an extensive period of engagement with local government during August and September to ensure the reform proposals and the impact on councils and ratepayers are well understood. LGNZ and officials are continuing to hold one-on-one discussions with councils at their request as we would expect.Tangi Utikere: What feedback has she received from councils in relation to the proposed changes?Hon NANAIA MAHUTA: At the request of LGNZ the Government entered into an eight-week period over August and September to enable councils time to consider the reform proposals understand the implications for their communities and provide feedback on those proposals. I thank councils who have engaged and provided feedback. I'm hearing some clear themes that include consideration of how the entity governance planning interface and iwi and community input will be achieved in the new system and how they might be strengthened according to local preferences. I'm committed to working in partnership with local government iwi and Māori throughout the reform journey and I have indicated that right from the beginning. I'm also aware that there's some public discussion about the Government's modelling in particular that undertaken by the Water Industry Commission for Scotland using data provided by each council. This Government has confidence in the modelling undertaken for us by a reputable international expert organisation. It's been independently assessed and proven to be robust.Tangi Utikere: What does she say in response to suggestions that pausing the reform will help the challenges faced by councils?Hon NANAIA MAHUTA: Pausing the reform discussion will not help to respond to the significant challenges facing councils. Many of New Zealand's communities are dealing with rising costs and unacceptable outcomes from their three waters services; that's not good for the health of people or the environment. The case for change is strong well canvassed and generally accepted by most. These challenges have been discussed for more than two decades and it's time to do something about them.Tangi Utikere: With regards to the issues raised by councils is there room to consider their concerns within the context of the proposed reforms?Hon NANAIA MAHUTA: We've given councils eight weeks—until 1 October—to provide feedback on the water reform proposals. As I've already noted prior work and feedback through this period has identified potential refinements to the current policy design. I'm willing to work in partnership with local government and iwi to ensure the reforms meet the needs of communities; that's very important. We've already considered and ruled out alternatives to reform such as regulation-only models and further central government funding of local government infrastructure for an inefficient network. There are inherent challenges that create a cost burden either way on ratepayers or taxpayers. Our reforms—the ones that I'm proposing—are designed to improve public health and environmental outcomes improve efficiency of service delivery support a financially sustainable system improve infrastructure delivery and decision making while upholding the rights and interests of iwi through Te Mana o Te Wai.Hon Eugenie Sage: Is the Minister still actively considering making it mandatory for councils to become part of the four regional water entities if too many councils decide to opt out; if so why?Hon NANAIA MAHUTA: Thank you for the question. As I've said the case for change is compelling well understood and needs to be addressed. We've undertaken about 30 different sets of modelling to see whether or not there is any significant alternative that would enable a financially sustainable model to invest in the significant costs facing councils. The issue is now for councils to consider the proposal in a way that they will continue to own the assets—albeit within the reform that's being proposed—and have greater oversight in the way in which efficient governance of those assets can deliver community benefits; that is the proposal in front of councils. We've shifted significantly the discussion into a space where I believe even councils cannot ignore the opportunity they have ahead of them.