Borrows Chester: South Taranaki District Council (Cold Creek Rural Water Supply) Bill — First Reading 
Text is incorporated into the Bound Volume 
Borrows Chester: South Taranaki District Council (Cold Creek Rural Water Supply) Bill — First Reading 
[Sitting date: 21 March 2012. Volume:678;Page:1182. Text is incorporated into the Bound Volume.] 
Hon CHESTER BORROWS (National—Whanganui) 
: 
 I move  
That the South Taranaki District Council (Cold Creek Rural Water Supply) Bill be now read a first time. 
 This scheme and this bill are about farmers and local residents doing for themselves drawing on New Zealand’s penchant for being self-sufficient and using what is available to them to make life better for them. 
Andrew Little 
: What about the taxpayer contribution? 
Hon CHESTER BORROWS 
: Well I am glad the member asked “What about the taxpayer?” because this scheme was built from local farmers recognising a need to up their productivity and also maintain water quality for their standards and for their residents. Back in the day there was a scheme where they could obtain a subsidy dollar for dollar. For every dollar they put in the taxpayer subsidised them so that they could build a water race scheme built on Cold Creek which runs off the side of Taranaki so that they could provide consistent high-quality clean fresh water for their stock for their farming practices and for their residences. There are about 350 households marae and entities that are drawing water from this scheme. 
What they had to do in those days was be able to guarantee that they could raise production by 10 percent so the farmers also had to put up the money themselves. All the householders were putting into it but it was the farmers mainly who were putting into it because they had the businesses that were going to support the scheme and they were going to gain the productivity bonuses from it. They had to put the money in up front. Remember this was a period of time when interest rates were incredibly high approaching 20 percent and penalty payments were over that. So young farmers who were purchasing farms buying herds etc. and who were contributing to this scheme were having to find money and a lot of money at a time when it was particularly difficult. A young farming partnership at that time that I am aware of the Ardern brothers who were farming in this location as part of this scheme had to find $13000 out of their new farming enterprise in order to be able to commit to this scheme and to be able to get the Government subsidy. So when Mr Little asks “What about the taxpayer?” I can tell him that the taxpayer contributed then but the productivity that has been gained since that time has been approaching probably 60 or 70 percent in terms of coming out of that particular area. 
Hon Trevor Mallard 
: They’re all paying their tax are they? 
Hon CHESTER BORROWS 
: And they are all paying their tax—that is right—especially in a good year. In a good year they pay more tax than probably anybody sitting in this room. In any event the reason for this bill then is that in order to obtain the subsidy the group wanting to build the water scheme had to vest legal title of that subsidy in an entity. A couple of members of the scheme were at that time serving as members of the Egmont County Council so the ownership of the scheme was vested in the county council. Later on with subsequent amalgamations of territorial local authorities the ownership went on to the South Taranaki District Council. Then moving on down the track the farmer owners of the scheme sought to run the scheme themselves in order to be able to administer maintain and keep the scheme. They do all the billing they do all the maintenance and they pay for everything. They have also been to the council on a number of occasions and four times over the last 12 years the South Taranaki District Council has voted to vest ownership back in the owners of this scheme—back into the farmer owners and the household owners who are running and maintaining this scheme. It has agreed to do that. It has voted to do that four times. Eventually we find ourselves here today. 
The question may well be asked as to why then we need to do this. The reason is that the legislation that was passed in the early 2000s meant that if there were more than about 250 consumers on a potable water scheme it had to be in community ownership. It could not be just simply divested from the council to those who were running owning and managing the scheme today—hence the need for a local bill because as I said earlier there are about 350 households that are connected to the scheme. 
There is another way round that and I understand that there are a number of questions that various parties may have. Support from across the House—which I am grateful for—is for the first reading only but there are ways round that. For instance if the scheme was deemed to be non-potable then there could be a filter at every house. In that way it could be divested in any event. There have been some concerns from the Inland Revenue Department and from the Ministry of Health. They will be addressed and answered through the select committee process I am quite sure. 
There are also concerns from local iwi. The reason why local iwi are upset about the process is that during the decisions to vest this back in the residents in the area the iwi had not been consulted as well as they should have been by the South Taranaki District Council. The farmer owners have sought to rectify that. Just last week we had a discussion with them albeit through the process there had been some public reporting of it and the two marae that are on the scheme had also been approached. However there was an expectation—maybe it was somewhat naive—that the marae themselves would keep their iwi informed as to what was happening in respect of the water scheme and we found fairly late in the day that that had not taken place. 
It is important to note too that this is a bill that is about concrete and pipes. It is not a bill about water and it is not a bill about the mauri of the stream; this is about concrete and pipes. The water race scheme would continue to get its consents through the Taranaki Regional Council and I understand that iwi have an argument about whether that should be the case or whether they should be the kaitiaki of water in their area. The proponents of the bill would argue that that is not an argument for them but is an argument to be had at a higher level. 
There is another argument that has been voiced about the nature of the asset. In other words if this is a State asset—Taranaki being a rohe where there are no other real State assets that are owned and so nothing that is available for the yet to be negotiated Treaty settlement—then iwi obviously have an interest in the Cold Creek scheme. The point that the residents would make is to ask what actually is the value of what the council has at the moment because it is the operators the owners and the consumers on the scheme who are doing all the work and paying all the bills and the council’s quantifiable dollar interest is negligible. So there is an argument around that. 
In the end though I think another point to make is that this is community ownership at its lowest level. Whereas the thrust behind the Act that prevents vesting of a water scheme a potable scheme that would vest ownership in the owners negates that being able to be done because there are too many consumers on the scheme—so a scheme of that size should be in community ownership—the proponents of this bill would say that this is about as low a community ownership as you could possibly have. That is because those who are relying on the scheme those who are consuming from the scheme those who are running businesses from the scheme and those who built the scheme maintain the scheme and paid for the scheme are in fact the local owners. So there should be no real argument about the community aspect of it or community ownership because it will be owned by the community in the community that it serves. 
There is one other issue that has been raised and that is making water available to the township of Opunake which is in a slightly different catchment. In emergency situations pipes have been run from the tail of the scheme across to Opunake to provide clean water which it normally gets off the mountain but which after a heavy rain is unable to be done. That facility is still open and the owners of the scheme are quite happy for that to continue. 
I do commend this bill to the House. I am grateful for the indications of support that it has had from across the House at least for the first reading and I look forward to the select committee process through the Local Government and Environment Committee. Thank you.