McAnulty KieranThird ReadingHon KIERAN McANULTY (Minister of Local Government): I move That the Water Services Legislation Bill be now read a third time. I'm pleased to be here today for a third reading of this bill which will provide the new water services entities with the legislative tools and arrangements they will need to be fully operational when they go live between 1 July 2024 and 1 July 2026.I'll briefly canvas the core components of the bill. The Water Services Legislation Bill provides the implementation arrangements to steer the transition from the existing arrangements for water services delivery to a new model—the new model where these water services will be delivered by 10 regionally-based publicly-owned entities. The bill enables the entities to make rules plans and other instruments relating to water services and engage in compliance and enforcement activities. For example the bill provides that entities must have stormwater management strategies which include stormwater risk management plans. This will provide a system-based approach to stormwater networks and their regulations. It will also ensure the entities identify risks and hazards and get ahead of potential problems when they turn into disasters. The bill provides for mandatory relationship agreements between entities councils and other parties to manage critical interfaces such as stormwater and flooding management and planning under the Resource Management Act. These relationship agreements will set out how parties will work together and will provide for coordination across interdependent roles.The bill also establishes charging mechanisms that provide fair transparent and affordable charges to households and businesses for their water services. The bill includes detailed mechanisms relating to the transfer of water services assets liabilities from local government to the new entities which are in turn owned by communities through their territorial authorities. It provides strong protections to ensure existing treaty settlements continue to be upheld in the new water services delivery system.The bill provides a pathway for small mixed-use rural supply schemes to be transferred from the entities to the communities if this is what the community wants and if these schemes meet specified criteria. The bill integrates the water services entities into wider regulatory systems including the new resource management system.This is a significant reform and I'm proud of the work that has been done to get here. It follows years of research and analysis using the best of local and international expertise comparative examples and extensive consultation with local government iwi Māori and the water industry.The case for change is clear and what we have here is an evidence-based solution. When I think about the numerous benefits this reform will have these key things come to mind which I am pleased to have helped deliver for New Zealanders: an affordable safe reliable water network and one that is resilient in the face of extreme weather events; thousands of dollars saved per household by 2054 based on the research that informed the proposals—specifically households are projected to save up to $2770 to $5400 per year by 2054 on average depending on which region they are in; entities with the increased size required to access more funding to improve management of water services which is ultimately how we will save Kiwi households cash and ensure a reliable and resilient network; water related debt removed from councils balance sheets relieving councils of the burden of servicing this debt and this will of course help limit future rate increases.The reform is overdue. When we consider that the cost of meeting our country's water challenges is estimated at between $120 billion and $185 billion over the next 30 years and we know that this is out of reach of councils to address on their own unless they have unaffordable rates increases for households it is clear that we are ready for change and that this is what this bill and these reforms are about.The journey to reach this point began following the 2016 Havelock North water contamination disaster that led to the loss of four lives and made 5000 people sick. Some continued to live with the long-term impacts of this illness. However let's be clear that the systematic issues that may have contributed to the Havelock North tragedy were evident for many years before then to those who were aware. In a report issued in 2000 entitled Ageing pipes and murky waters: Urban water system issues for the 21st Century" the Parliamentary Commissioner for the Environment found evidence that the current model for delivering these services has now reached the end of its design life. And that's the point; this is about the model. It's about the system it's not laying blame. It's certainly not councils' fault. They're doing the best they can with what they've got. Ten years later in 2010 the previous Government's Land and Water Forum advised investigation of the potential benefits of rationalisation in the water services sector and of a more robust regulatory framework. Six years later in 2016 the Havelock North incident provided a tragic and sharp wake-up call to action. I acknowledge the previous Government's response an inquiry which looked not just at the Havelock North contamination incident but its implications for drinking water services across the country. The Havelock North inquiry clearly identified system-wide issues including the unacceptable prevalence of waterborne illnesses contracted from publicly owned drinking water services which New Zealanders should be able to trust. I would again like to acknowledge the previous Government's courage in initiating a wider Three Waters Review which looked at issues across all three services around the country: drinking water waste water and stormwater. The Water Services Legislation Bill I'm speaking to today and the Water Services Economic Efficiency and Consumer Protection Bill represent the final components of a comprehensive policy and legislative response to the matters explored in the Havelock North inquiry and Three Waters Review.I'm proud to be part of a Government that looked at the evidence available to us six years ago acting decisively to protect New Zealanders' health and wellbeing and that of our environment and ensuring they don't face unaffordable bills. We have developed and implemented a new regulatory regime for water suppliers with the Water Services Act 2021. We've also established a dedicated drinking water regulator Taumata Arowai.These changes will protect New Zealanders' health and the environment and they received near universal support from the sector. But they are a high bar for water service providers and create an additional affordability challenge which councils cannot meet alone. It is not just the safety of drinking water that is the issue. Waste water discharges into lakes rivers and harbours have become a regular occurrence. Recent flooding events have further highlighted the criticality of water services for communities the economy and our livelihood and have laid bare the fragility of our critical water infrastructure for some areas.As I have said it is estimated that New Zealand needs to invest up to $185 billion in our water services infrastructure over the next 30 years to address decades of underinvestment in our water services infrastructure. The current model for water services delivery simply isn't up to meeting this challenge certainly not without huge increases in costs for households who are at this time facing the same cost of living pressures we are seeing across the world. We currently have 67 territorial authorities delivering water services. These councils often don't have the finance or scale to make the infrastructure investments necessary. We need a more efficient model with a better access to financing and that is exactly what this bill delivers.The 10 new water services entities will have the size and scale to efficiently deliver water services investment and infrastructure and meet the new regulatory standards. They will also have balance sheet separation or financial independence to allow them to borrow to fund the increased investment in water services infrastructure that New Zealand desperately needs. I'm proud of what our Government has achieved here. The current situation is untenable and we have here a solution that is backed by evidence. We have done what is needed to ensure the long-term wellbeing of New Zealanders. I want to thank all those who have contributed to the preparation and passage of this bill. I particularly want to thank the local government sector. They have engaged throughout this process and even in cases when individual councils have not supported the reform they have put that aside to share their technical expertise and knowledge about the communities they serve. This help has been critical and greatly informed many of the provisions in the bill that is presented today and the previous two bills in this reform.The passage of this bill is a significant milestone in the journey to provide long-term affordable safe reliable and resilient water services. I commend the bill to the House.ASSISTANT SPEAKER (Hon Jacqui Dean): The question is that the motion be agreed to."