$34 Million of Taxpayer Money Spent Developing and Selling the Three Waters Reform

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The government's three water reforms propose taking water infrastructure out of the councils and handing it over to four mega-regional entities.

Andy Jackson / Stuff

The government’s three water reforms propose taking water infrastructure out of the councils and handing it over to four mega-regional entities.

The government has spent $34 million to develop and prove its case for the controversial Three Waters reforms, documents show.

A Christchurch councilor said the figure was “a lot of money to have no pipes laid in the ground”, but the Home Office said it was in line with the costs of other substantial reforms.

In July 2020, the government officially launched its program to radically change the way water services are delivered in New Zealand.

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As it stands, the government will force councils to cede control of water infrastructure to four new mega-regional entities. One entity will cover the majority of the South Island, and local councils and iwi will co-govern the new entities.

Using the Official Information Act, Christchurch Councilor Sam MacDonald, a vocal critic of the reforms, asked the Home Office to provide a breakdown of the cost of the reform programme.

Christchurch Councilman Sam MacDonald thinks $34 million

Joseph Johnson / Stuff

Christchurch City Councilor Sam MacDonald thinks $34 million “is a lot of money to not have any pipes driven into the ground”.

The ministry’s response, which MacDonald shared with Thingsaid that between July 1, 2020 and February 28 this year, $34.1 million was spent on the reforms.

The response showed that $18.2 million had been spent on “legal and consulting,” $2.7 million on “hosting and corporate support,” $6.1 million on personnel costs, and 3, $1 million in subcontractors.

“Other operating costs,” which included the costs of a public information campaign, amounted to $3 million.

MacDonald’s OIA response also detailed the costs for each contractor and outside consultant for fiscal year 2022. This showed:

  • Professional services firm EY received $2.4 million for accounting and tax advice, as well as work related to advice funding programs;
  • Martin Jenkins & Associates Received $1.2 Million for Comprehensive Policy Services;
  • Mafic Partners received $887,000 for commercial rating agency and other financial advice;
  • Senate Communications received $616,000 for communications services.
Local Government Minister Nanaia Mahuta oversees the government's three water reforms.

ROBERT KITCHIN/Stuff

Local Government Minister Nanaia Mahuta oversees the government’s three water reforms.

MacDonald said the government had talked about the need for urgent infrastructure investment, “and yet they spent a lot of time on consultants instead.”

He added: “If the government really wanted to invest in local communities they would put that money in local communities, all they have done is spend it on bureaucrats in Wellington who can fly across the country. and pretend to listen to us.

“Looks like they spent a lot of money on muffins and plane tickets to deliver something the public doesn’t like.”

MacDonald said the government could have saved a lot of money “by coming to talk to local government first”, or rather spending it on 100km of new water pipes in Christchurch.

THING

Local Government Minister Nanaia Mahuta said the government would create four new public water entities, with local councils taking non-financial stakes in four new public water entities.

The Home Office said that while the costs of the reform program were “significant”, they were in line with other substantial reforms, including changes to resource management and the health sector.

The three water reforms required “the implementation of a major program of analysis of public, legal, trade, economic and other policies”, said a ministry spokesperson.

They said external consultants and “other expertise” were used because the reform program demanded “a level of capacity and specialization not typically retained within a government department”.

“The program also involved significant stakeholder engagement across the country over an extended period and involved significant public communications.”

New Zealand local government chairman Stuart Crosby said he was not surprised the reform program cost $34 million.

PROVIDED

New Zealand local government chairman Stuart Crosby said he was not surprised the reform program cost $34 million.

The ministry has estimated, based on information provided by the councils, that between $120 billion and $185 billion will need to be invested in water infrastructure over the next 30 years.

A spokesman for Ngāi Tahu pointed to this estimate when asked to comment on the $34 million cost of the reform.

“Ngāi Tahu has worked closely with mayors and takiwā councils on engagement with the DIA throughout the program,” the spokesperson said.

New Zealand local government chairman Stuart Crosby said he was not surprised by the $34million figure.

Crosby said the government’s proposal involves tens of billions of dollars in public assets and people would want the due diligence done.

“Yeah, it’s a huge amount of money, but considering what’s at stake here…you’d want them to do a solid job.”

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