Webb Duncan; Salesa JennyThird ReadingHon Dr DUNCAN WEBB (Minister of Commerce and Consumer Affairs): Kia ora e te Mana Whakawā. I move That the Water Services Economic Efficiency and Consumer Protection Bill be now read a third time. This bill is part of a suite of legislation designed to give effect to the affordable water reforms. It introduces an economic regulation and consumer protection regime which will ensure that the entities promote the long-term interests of consumers by providing services that are efficient effective and responsive. The bill empowers the Commerce Commission to oversee this regime and provides it with the necessary regulatory tools.We know our water services regime isn't working as it should be. We know the quality of the service being provided does not reflect what consumers demand. We know there has been systematic long-term under-investment in water infrastructure. We know that there are inefficient pricing practices and a lack of transparency around the costs of delivering water services. Finally we know there are mounting concerns about the capability and capacity of the water services sector to respond to increasing Government and community expectations. These new entities will have the size and scale to tackle these issues and attract the $120 to $185 billion needed to address historic under-investment. However the new entities will be natural monopolies in the supply of water services where competition is impractical. There is a risk that they will act inefficiently and seek to capitalise on their market power. This bill provides the independent scrutiny necessary to protect New Zealanders from the sorts of harm that can occur when essential service providers have substantial market power and consumers are unable to switch between them.Consumers deserve high-quality services that are safe affordable and resilient. This bill will ensure that the full benefit of the reforms is realised for New Zealanders. It will drive efficient investment and pricing practices and make the entities accountable for delivering service quality levels that communities expect. In particular the economic regulation provisions in the bill will require the entities to disclose certain information directly govern service quality and set a strong efficiency challenge to drive lower prices.This is the same sort of regulation used in other essential industries in New Zealand that hold monopoly power including the international airports in Auckland Wellington and Christchurch; electricity lines businesses; and natural gas pipeline businesses. Information disclosure regulation will require regulated providers to publicly disclose prescribed information about their performance. The Commerce Commission will undertake a summary and analysis of this information which will increase transparency and make the entities more accountable to stakeholders. Quality regulation will require regulated providers to meet network service quality standards while price quality regulation will set both quality standards and maximum allowable revenue or prices that the provider is permitted to recover. The bill provides the commission with the necessary flexibility to use different tools at different times for each of the entities or types of water services. These tools will ensure consumers are receiving water services at appropriate prices and quality standards.I do note that in light of the Government's changes to the affordable water reforms there have been some implications for the timing of when economic regulation is implemented. The entity servicing Auckland and Northland which will be established on 1 July 2024 will continue to be subject to economic regulation from 1 July 2027. However the other nine entities which will be established over a two-year period ending 1 July 2026 will now be subject to economic regulation from 1 July 2029.The economic regulation and consumer protection regime established by the bill put in place strong incentives for the entities to provide affordable quality water services. However if entities do not comply with these requirements the commission can take a range of enforcement steps including pecuniary penalty orders compensatory orders and injunctions. The consumer protection safeguards will give consumers a strong voice on how water services are delivered and it will also hold the entities accountable for delivering on community expectations including meeting minimum service standards. The commission will be required to set a service quality code by 1 July 2027 and the code will cover standards related to outages faults minimum flow or pressure rates billing practices customer services and consumer rights amongst other things. The bill provides for the scope of the Consumer Advocacy Council to be broadened so it can advocate on behalf of water services consumers. Finally the bill establishes a comprehensive independent consumer dispute resolution service so that consumers can easily escalate complaints they cannot resolve with the entities themselves. The service will provide for the resolution of low value—that's up to $50000—consumer disputes in a way that is more accessible and less formal than the courts. Together these economic regulation and consumer protection safeguards will help ensure New Zealanders are treated fairly and receive quality water services which offer good value for money. I'm confident the Commerce Commission will be able to quickly drive improvements to the water services sector to ensure it is efficient effective and responsive. The commission is a high-performing regulator. It has proven experience in regulating a number of markets. The bill equips the commission with a range of regulatory tools to expand its remit to cover the water services sector.To further reflect the unique nature of the sector the bill establishes the position of Water Services Commissioner on the commission's board. The commissioner will be responsible for leading the roles and functions of the commission for the sector and will ensure that the commission's water services regulatory role is given the focus and prominence that the sector requires. The bill also complements the wider water services framework by requiring the commission and the responsible Minister to take into account the relevant obligations of the regulated water services providers including with respect to Te Tiriti Treaty settlements and Te Mana o te Wai climate change housing and urban development. Finally in recognition that the commission is at the start of its Te Ao Māori journey the bill requires it to build capability and capacity to ensure it can understand these obligations and effectively engage with Māori.As I come to a close I would like to thank the members of this House and particularly those who participated in the Finance and Expenditure Committee for their collaborative—Hon Member: A great committee.Hon Dr DUNCAN WEBB: —a good committee—and thorough consideration of the bill. Thank you in particular to committee chair Ingrid Leary and the former chair the Hon Rachel Brooking. I would also like to extend thanks to the submitters on the bill to Parliamentary Counsel Office staff the Commerce Commission and its officials and all officials who all made a significant contribution to its workability.New Zealanders deserve to have safe and affordable drinking water waste-water and stormwater services that meet their expectations now and into the future. The bill will safeguard and enhance these critical water infrastructure services by providing necessary scrutiny of these entities' operations. It's a critical part of the affordable water reforms and it will help to ensure that the new system is efficient effective and responsive. I commend this bill to the House.ASSISTANT SPEAKER (Hon Jenny Salesa): The question is that the motion be agreed to.