11. Question No. 11—Local GovernmentSIMON WATTS (National—North Shore) to the Minister of Local GovernmentQuestion No. 11—Local Government11. SIMON WATTS (National—North Shore) to the Minister of Local Government: Does she agree with the Prime Minister's statement on Three Waters reform that The ownership of these entities sits with local bodies and government so it is not changing the ownership structures" and does she believe those reforms will actually maintain true local government ownership of water assets?Hon KIERAN McANULTY (Associate Minister of Local Government) on behalf of the Minister of Local Government: On behalf of the Minister yes because under the reforms territorial authorities would be the owners of the water services entities. The water services entities will be owned by territorial authorities in the services area. Each territorial authority will receive an ownership share in the relevant entity based on the population in the district. Territorial authorities will be the only shareholders in these entities. These arrangements were recommended by the working group that was made up of local council representatives from across New Zealand some of whom previously expressed concerns about the three waters reforms. Therefore this proposed ownership structure is a direct result of engagement with the local government sector. Simon Watts: How does he reconcile that answer with the Water Services Entities Bill which states territorial authorities have—and I quote—"no right title or interest in the assets security debts or liabilities of a water services entity:"; and how is it possible to own something while not having any rights over it?Hon KIERAN McANULTY: On behalf of the Minister because the only threat to public ownership is privatisation. So I put to the National Party: when this Government approached that party and suggested that we put our respective views aside and on one issue and one issue alone we agree to entrench public ownership of these water entities they refused.Simon Watts: Does he stand by his comment in the House yesterday that those same councils that would not own their water assets under his model are "mischief making" and does he believe—SPEAKER: Order! Order! The member is going to have to wind back. This is a really complicated situation now where he's asking this Minister who is answering on behalf of another Minister about that Minister's comments and he's got to adjust his question to make sure he's doing that.Simon Watts: Can I seek for clarification. My understanding is he's Acting Minister.SPEAKER: No he's not now. I understand the plane has landed and he's answering for. That's why the question says "she".Simon Watts: Does she agree with the Acting Minister of Local Government who said yesterday that those same councils that would not own their water assets under this model are mischief making; and does she believe the over 30 councils who have raised that concern are just mischief making?Hon KIERAN McANULTY: On behalf of the Minister yes I do agree with the Associate Minister's description of that member as mischief making. That was the context of that comment. What we have is a situation here where a proposal that was made by the working group which in turn was made up by representatives of local government made this very recommendation. They are shareholders in these entities. If the National Party wishes to make a policy that shareholders are not owners I look forward to their further explanation on that.Simon Watts: Does she believe that the Auditor-General who said "The bill alone does not provide enough information for us to form a view." on the control of water entities is just mischief making?Hon KIERAN McANULTY: On behalf of the Minister I repeat my response to the previous question. The mischief maker in question was in reference to that member and the questions that he was asking at the time. The Auditor-General's submission to the select committee was very clear—that they continue to work with the Department of Internal Affairs to clarify matters around the ownership structure. But the Auditor-General did not express an opinion on the ownership structure; they were looking at issues of accountability and they provided some constructive feedback to the Finance and Expenditure Committee on ways in which we could improve the proposals—proposals which we have continued and consistently improved based on feedback that we have received from stakeholders and the local government sector.Simon Watts: What is her response to the three South Wairarapa district councils who said the governance and ownership structure of three waters is and I quote "a giant stitch-up"; and how can the public have faith their water assets will remain in the ownership of their council if local councils themselves say they no longer own them?Hon KIERAN McANULTY: On behalf of the Minister the only way to have absolute faith that they will stay in public ownership is to entrench that provision in law which the National Party refused to do. It is harder now to privatise water assets as a result of these proposals that what it was at the start. What I would say to any councillor who has expressed concerns about the structure is to participate in the select committee process or to turn up to the meetings that the Associate Minister is having with each and every rural provincial council to take feedback direct back to the Minister—feedback which has already resulted in constructive and productive adjustments to the proposal.Simon Watts: What is her response to Mayor Neil Holdom who said to select committee today about shares in water entities "The value of the shares will be put down as zero."; and doesn't this just prove the Government shareholding ownership scheme is just a farce?Hon KIERAN McANULTY: On behalf of the Minister what is the farce is the position that the status quo is sustainable. It is not. Not a single council regardless of their views on this reform process says that the status quo is sustainable. The only people saying that are the National Party. We have a $185 billion issue that we are trying to sort here and after four years of consideration ours is the only practical solution available. The National Party believe that the status quo is the way forward; everyone else says that's wrong."