Mahuta NanaiaWATER SERVICES ENTITIES BILLSecond ReadingHon NANAIA MAHUTA (Minister of Local Government): I present a legislative statement on the Water Services Entities 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 NANAIA MAHUTA: Thank you Madam Speaker. I move That the Water Services Entities Bill be now read a second time. Ko te koru ko te wai ko te wai ko te puāwai te mātāpuna o te ora. Tēnā tātou katoa.[From the spring comes water from water the blossom the source of all physical and spiritual sustenance. Greetings one and all.]In June 2000 the Parliamentary Commissioner for the Environment in a report titled Ageing pipes and murky waters predicted the crisis we are now facing when they said While our water systems have been evolving over the years I believe industry and community evidence indicates that the 'model' has now reach the end of its design life. Further incremental tinkering with the current systems … will simply mean the necessary changes will be harder to achieve and more costly at some time in the future. It is also likely that they will be crisis driven". That future has arrived and we must not let this issue be kicked down the road when we can act and fix a broken water network system. There is a well-known expression that the best time to plant a tree is 20 years ago and the next-best time is today. For too long New Zealand has not addressed serious under-investment in infrastructure such as our water network.We need to take this crisis seriously. We need to act with urgency. I do not use the word "crisis" lightly but when an estimated 34000 New Zealanders get sick from drinking water each year that is a crisis. Too many communities experience boiled water notices and too many of all our kids are growing up with no-swim notices at their local beaches. It's unacceptable. When over half of suppliers included in the Ministry of Health's 2020-21 annual report on drinking water quality failed to meet the drinking-water standards that is a crisis. When 25 percent of waste-water plants across the country are running on expired consents and the country experienced 2754 dry weather waste-water overflows in 2020-21 that is a crisis. When 5000 people in the town of Havelock North became sick from drinking their tap water that is a crisis. When New Zealanders face thousands of dollars' worth of rates increases to solve this problem that is a crisis.Given the scale of the problem and the irrefutable case for change it would be irresponsible for us as a Government to sit on our hands and do nothing. We will not take an irresponsible path. We are committed to act and fix the problem. We're committed to ensuring that everyone's drinking water is clean boiled water notices are minimised sewerage leaks get fixed and pipes are put in the ground to build new homes and in the most cost-effective and affordable way possible for our ratepayers. This reform is complex and it is therefore unsurprising that it has generated significant debate both in the local government sector and in the community but let's face it: it's time for the "do-ey".I would like to take a moment to thank all of those who submitted on the bill: councils mana whenua interest groups water suppliers and individuals all took the time to express their views on this piece of legislation. I'd also like to thank the Finance and Expenditure Committee for their dedicated work over the past six months. In addition to considering the 88000 written submissions the committee heard 227 oral submissions travelling to Auckland Hamilton Hawke's Bay Nelson Christchurch and Dunedin as well as holding hearings in Wellington and via Zoom to ensure as many people as possible who wanted to present had the opportunity to do so. The committee also invited experts to present their views on the bill. As the result of this work more than 130 amendments have been recommended. The changes ensure that the new water entities are more accountable to communities and help keep a lid on rising rates. At a time when the cost of living challenges confronting households are real these reforms help lessen the burden of vital water infrastructure investment on ratepayers.We all agree: we need to fix water networks and keep costs down. We also want safe drinking water and better environmental outcomes. The amendments will improve local voice strengthen representation increase transparency and ensure that we can continue to find a solution—again more "do-ey". They will also improve certainty for councils and those working in the water sector. Some submitters questioned the Government's fundamentals in particular the need for balance-sheet separation. Getting water services off council balance sheets enables us to create a sustainable and affordable water system while keeping a lid on rates increases to help address cost of living pressures for all New Zealanders.Let's take a look at some of the proposed changes. One of the key areas of concerns we heard was that local voice would be lost. Rural councils in particular were concerned that their voices would be drowned out by larger metropolitan centres. At the request of councils the bill now includes a provision which requires a mix of rural provincial and metropolitan councils to be present on the regional representative group. This will make each of the water services entities accountable to those interests as it is represented on that group. Further to this we're requiring the entities to establish an annual shareholders' meeting. This was a direct request from multiple submitters and will improve territorial oversight over the entities. We also heard concerns from submitters that the entities would not be as accountable as the current system. This included a submission from the Auditor-General outlining concerns about the accountability measures in the bill. Officials have worked with the Office of the Auditor-General to improve those measures. Proposed amendments include strengthened reporting lines and obligations and increased audit scrutiny along with a raft of other changes resulting from the submission.We've also increased transparency—for example both the entity boards and any annual shareholders' meetings will be subject to the Local Government Official Information and Meetings Act. This means all meetings will be required to be held in public. This is not currently a requirement for the boards of council-controlled organisations although Watercare made the decision to hold all its board meetings in public. We are therefore confident that legislating this as a requirement is a positive thing for public accountability.Another key concern for local government was what role the entities would play in the local planning system. They had a clear message: the entities should be plan-takers not plan-makers. We're therefore including a requirement for the entities to support and enable planning processes and growth. This gives councils and communities certainty that they will still be in the driving seat when it comes to planning and development.I want to take a moment to acknowledge staff working in the water sector. I understand that this is a time of uncertainty. To limit this uncertainty we've made several key changes to the staff transfer provisions. This includes giving staff the option of transferring to water services entities on their existing contracts ensuring any benefits they currently have will go with them. We've also provided further detail to ensure that staff know they will not be required to move to a new location as a result of this reform. Staff and services will stay where they are. Officials have developed staff transition guidelines to give further certainty for staff including those who are not covered by the legislation. For those water staff I encourage you to engage with these guidelines. This reform is an opportunity for your sector and I hope you see it as such.At the time the Parliamentary Commissioner for the Environment released his 2000 report it was estimated around $5 billion worth of investment was required over 20 years to upgrade drinking-water waste-water and stormwater infrastructure—around $8.5 billion in today's currency. Compare that to $125 billion to $180 billion required over the next 30 years to upgrade those same services. We cannot afford to stop the reform. If we do our children our mokopuna will be lumped with the cost and we are burdening them for the future because people on that side of the House want to do nothing.It is for that reason I am proud to stand here today and read the Water Services Entities Bill for a second time. I am proud that this Government is taking on an issue that has been languishing in the too-hard basket because people on that side of the House want to kick it down the road—20 years of under-investment if not longer. I am proud that in 20 years' time when we look back on these significant changes our children and mokopuna will be able to swim at their local beaches have the assurance of safe drinking water and be assured that we have a resilient waters infrastructure that underpins a quality of life second to none.Today we're taking a significant step forward in improving service delivery to Aotearoa. Can I once again acknowledge the select committee departmental officials and select committee staff for their hard work. I commend the bill to this House. E tau ana.[I end here.]ASSISTANT SPEAKER (Hon Jenny Salesa): The question is that the motion be agreed to."