Policy & legislation

Water Services Entities Act

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

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

The legislation 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.

On 11 November 2022, the Finance and Expenditure Committee reported back following the Select Committee process. The Committee considered over 80,000 submissions on the legislation. Approximately 139 amendments were made to the Bill as a result of submissions made by New Zealanders.

The amendments made help strengthen the ability of the water services entities to deliver sustainable water services and protect the health and well-being of communities today and for future generations.

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

Water Services Legislation Bill

The Water Services Entities Legislation Bill provides the water services entities with the necessary legislative functions, responsibilities, and powers to be fully operational, once established.

This Bill will establish the detailed powers, functions and duties of the new water services entities which are necessary for them to deliver water services to communities in place of territorial authorities.

It also encompasses transfer of assets and liabilities. It will provide water services entities with powers to carry out work in relation to water services infrastructure on or under land. These are a combination of existing powers available to local authorities under local government legislation, together with similar powers available to other utilities in the gas, electricity and telecommunications sectors. The powers include safeguards in relation to how these powers are exercised on Māori land.

The Bill will also contain:

• 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 the existing bylaws framework.
• Provisions to protect vulnerable consumers.
• Provisions regarding transfers of local-government-owned mixed-use rural water supplies.

The Bill does not establish economic regulation and a consumer protection framework for the water services system. This is being developed in another bill – the Water Services Economic Efficiency and Consumer Protection Bill.

The Water Services Legislation Bill will also integrate the entities into other regulatory systems, such as the resource management system.

You can view the Bill on the New Zealand Legislation website, here: Water Services Legislation Bill 210-1 (2022), Government Bill Contents – New Zealand Legislation

The Water Services Legislation Bill has been introduced to Parliament. Public submissions have now closed. Follow the Bill’s progress on the Parliament website, here: Water Services Legislation Bill (bills.parliament.nz)

The Water Services Economic Efficiency and Consumer Protection Bill

The Water Services Economic Efficiency and Consumer Protection Bill implements Cabinet’s agreement to establish an economic regulation and consumer protection regime as part of water services reform.

You can read more about economic regulation and consumer protection in water services on the Ministry of Business, Innovation and Employment’s website here: Economic regulation and consumer protection regime for three waters services

You can view the Bill on the New Zealand Legislation website, here: Water Services Economic Efficiency and Consumer Protection Bill 192-1 (2022), Government Bill Contents – New Zealand Legislation

Follow the Bill’s progress on the Parliament website, here: Water Services Economic Efficiency and Consumer Protection Bill (bills.parliament.nz)

Legislation to give effect to changes to water services reform

Additional legislative changes will be required to give effect to the Government’s changes to water services reforms that were announced on 13 April 2023.

The Government intends to introduce and pass legislation to allow for these changes before this year’s election. This will be subject to the Parliamentary timetable and processes, including the opportunity for public feedback.

The water services reform changes do not have any significant impacts on the water services legislation that is currently before Parliament.

The Water Services Legislation Bill and the Water Services Economic Efficiency and Consumer Protection Bill will continue their progress through Parliament on their current timetable. The Finance and Expenditure Committee is due to report back on 8 June 2023.

Feedback provided on these Bills is being considered by the Finance and Expenditure Committee and any changes in response to feedback will be progressed through the select committee process.