Climate Minister Simon Watts outlines the government's new climate emissions plan. Photo: RNZ / Nick Monro
Local Government Minister Simon Watts has asked officials for options over Wellington Water, with the government pointing the finger at the councils.
Two damning reports on Monday found structural problems, poor value for money from contractors, and Wellingtonians paying nearly three times more for water repairs than other parts of the country.
Watts said he had not been aware of the overcharging and had asked for advice from officials about what could be done as a result of the reports.
"What it highlights is that there's a number of issues and challenges with the way in which water services are delivered across New Zealand, hence why we need a proper model to be able to deal with that. And the Local Water Done Well policy ensures that these entities are financially sustainable."
He said it also highlighted risk in other regions, but said the government was not yet at the level of seeking an inquiry to find out if it was more widespread. He was still waiting for his advice from officials on whether money could be returned to the council or he could take action under the law.
Whether resignations should take place was a question for ratepayers and the organisation itself, he said.
Hutt South MP and Infrastructure Minister Chris Bishop was less cautious.
"The issue with Wellington Water is it's basically like a staff social club, where the organisers basically go to the constituent organisers and say 'chuck some money in please'. There's no consequence if you don't, there's no commercial discipline, there's no proper oversight, there's been no proper governance.
"It's been a shocker and Wellingtonians are absolutely sick of it."
Pipe that burst on Brandon Street, Wellington. Photo: RNZ/Jazlyn Whales
The council-controlled organisation (CCO)'s board chair Nick Leggett told Morning Report earlier on Tuesday he was "taking soundings" from the councils on whether he should resign.
"I could be the sacrificial head, but I would rather be the person that responds to and fixes the problem before Wellington Water moves into a new water entity.
"To me, being held to account is gripping the problem and fixing it ... it's important that we have leadership with a strong chief executive and a senior management team and a board that understands that these things need to be fixed.
"People don't want excuses, they want to know that things are being changed."
Bishop argued it was the councils, not Leggett - a National Party member - who were to blame.
"Nick's been there for two years and these reviews have been commissioned under his leadership, and he is now doing exactly the right thing.
"They are taking action on it but Nick is hamstrung by the structure of Wellington Water which is that all the pipes ... are all owned by the individual councils.
"Actually, frankly, the responsibility for these issues lies with the councils who have done a really poor job of maintaining and delivering on water infrastructure in Wellington."
He said that rather than "playing the blame game", the councils needed to remain absolutely focused on the government's Local Water Done Well model which will see Wellington Water restructured into the new, larger CCO.
An Advisory Oversight Group chaired by former Wellington mayor Dame Kerry Prendergast and established under the Local Water Done Well policy was scheduled to meet at 7.30am to discuss the report and that restructuring. Under the government's policy, councils have until 3 September to figure out the configuration.
Labour says government trying to avoid blame for poor decisions
Labour's leader Chris Hipkins said he would support a government inquiry into whether the amount being paid for the infrastructure was fair, but said Wellington Water had already done one "and the results are damning".
He would not say whether Leggett should resign - saying that was a decision for the councils - but someone did need to.
"Someone needs to go, absolutely. Whether it's the chair or the chief executive or whoever, there certainly does need to be accountability - and I think those local councils ... are the owners of Wellington Water are best placed to make that call."
Asked about whether it was appropriate for the government to blame the councils, he argued that ran against the government's election rhetoric.
"The National Party have returned all of those decisions to local government and said central government should step out of it ... we had a plan that was actually going to make sure that there was greater accountability over how water infrastructure's delivered and this government cancelled it and said 'no, no, local councils can deal with it'."
He the report pointed to wider concerns across New Zealand.
"I think there are concerns about the way water infrastructure's been delivered across the country. One of the reasons we wanted to go to a smaller number of larger entities was so that we could actually have more accountability, more economies of scale, and frankly lower increases in rates.
"The government decided not to do that, to cancel all of that work, to cancel all the investment that had already been made in that and now ratepayers up and down the country are paying the price."
Labour's local government spokesperson Kieran McAnulty said the government blaming councils was an attempt to avoid responsibility.
"Of course they do, because they're trying to avoid responsibility. The government is the one that scrapped the affordable water reforms, they are the ones that are forcing through a thing their own advice says isn't going to work, and then they're turning around pointing the finger at councils.
"Listen to the language: they're talking about councils focusing on the basics, saying they won't give a city or regional deal to councils unless they're focusing on the basics - they're ignoring the fact that councils are already spending 85 percent of their revenue on pipes and roads. It is just a scapegoat. "
Labour's local government spokesperson Kieran McAnulty said the government blaming councils was an attempt to avoid responsibility. Photo: RNZ / Samuel Rillstone
McAnulty said Wellington Water was set up to help councils, however, there were legitimate questions about whether it was set up properly.
"But when councils are under severe financial pressure and they are facing situations where they can't afford the water, we're going to end up with decisions that aren't ideal.
"They also can't do it under a CCO model, that's proven and that's exactly what the government's trying to get councils to do and it's not going to work. [The Department of Internal Affairs] advice says it's not going to work. DIA are doing what the government are telling them to do, but they know deep down because of the work that they've already done that what the government's asking them to do isn't going to work."
He said the Wellington Water report was a sign the water system in New Zealand was "stuffed".
"No excuses, I mean it is a disaster, it shouldn't have happened, but the government is trying to use this as an example of why their approach is going to work. It's just not.
"The government wants to avoid responsibility for rates going up because of their decisions. And there's going to be good mayors and good councillors who lose their jobs in October because of the situation the government have put them in and I think that's pretty disgraceful."
