Policy & legislation

Water Services Entities Act

The Water Services Entities Act, which passed in December 2022, was the first piece of legislation to enable water services reform.  

It confirms the shareholding model proposed by the Government, providing certainty around council ownership of the water services entities. 

The Act ensures communities will have a say in running and oversight of the water services entities, while giving those entities the financial and operational independence they need to deliver for New Zealanders. 

Specifically, the Act: 

• Establishes the water services entities, including legal form, ownership structure, objectives, functions, operating principles and service area 
• Establishes the governance structure – a regional representative group and independent, competency based board 
• Includes significant protections against privatisation 
• Provides the Minister with oversight and intervention powers, including the power to issue a Government policy statement 
• Protects iwi/Māori rights and interests in water, and enables mana whenua to make a Te Mana o Te Wai statement 

• Provides transitional arrangements, including the requirement to transfer employees on terms no less favourable than their council employment conditions. 

You can read the Act in full on the New Zealand Legislation website. 

Water Services Legislation Act

The Water Services Legislation Act sets out the functions and powers of the new water services entities, what they are required to do, the tools they need for their work and arrangements for the transition to the new system. 

Key provisions in the Act include:  

• Mechanisms for the transfer of assets and liabilities from local government to water services entities. 
• Providing water services entities access to carry out work in relation to infrastructure on or under land, including safeguards in relation to how these powers are exercised on Māori land.  
• Provisions to recognise and respect the Crown’s responsibility to give effect to the principles of Te Tiriti o Waitangi. 
• A compliance, monitoring and enforcement regime. 

• Regulatory functions and powers, which will replace and modernise relevant existing council bylaws. 
• A charging framework enabling transparency around pricing for consumers. 
• Protections for vulnerable consumers including an extension of the current rates rebates scheme to cover water charges. 
• New mechanisms to support the comprehensive management of the impacts of stormwater. 
• A pathway for mixed-use rural water supplies to transfer from the water services entities into community ownership. 

The Water Services Legislation Act also integrates the water services entities into other regulatory systems, such as the resource management system.  

You can read the Act in full on the New Zealand Legislation website.    

Water Services Economic Efficiency and Consumer Protection Act

The Water Services Economic Efficiency and Consumer Protection Act introduces an economic regulation and consumer protection regime for the reformed water services sector, which will be overseen by the Commerce Commission. 

More information is available on the Ministry of Business, Innovation and Employment’s website.  

You can read the Act in full on the New Zealand Legislation website.  

Water Services Entities Amendment Act  

The Water Services Entities Amendment Act gives effect to the Government’s refocus of water services reforms announced in April 2023.  

The Act amends the Water Services Entities Act 2022 to establish 10 water services entities based on existing regional boundaries, and introduces a staggered timeframe for establishing the entities, with all entities going live between 1 July 2024 and 1 July 2026.   

The Act provides for every territorial authority owner – and therefore every community – to have at least one representative on the entity’s regional representative group, with an equal number of mana whenua representatives. 

Specifically, the Act: 

• Enables local people to have a say in how the new water services entities operate and their impact on local waterways, via Community Priority Statements 
• Outlines a process and guidance to enable locally-led, voluntary mergers of entities   

• Provides for a dedicated Water Services Funding Agency to be established as a backstop financing mechanism for water services entities, if required   
• Enables shared services arrangements, including a provision for the responsible Minister to direct entities where collaboration or a whole of sector approach is required    
• Provides transitional arrangements, including that councils will continue to provide water services to communities during the period for establishing the new entities, including for long-term planning, reporting, and rate setting over this period.  

You can read the Act in full on the New Zealand Legislation website.