Joint Council approach to Local Water Done Well enters new phase
The Central Otago District Council (CODC) has agreed to enter into a commitment agreement with other Otago-Southland councils, as a joint approach regarding the delivery of water services.
The district councils involved include Central Otago, Clutha, Gore and Waitaki, in an option for consideration alongside other water delivery models.
A year ago, the Government stated that water service providers must operate more like independent utility businesses, like telecommunications or electricity providers. Regardless of whether services remain in-house or managed by a Council-Controlled Organisation (CCO - either a joint council approach or by a standalone council CCO), they must be structured and operated differently, with direct accountability to customers, regulators, and ratepayers and shareholders. Councils must have their Water Services Delivery Plan (WSDP) to the Minister of Local Government by 3 September 2025.
In his report to the Council meeting today (Wednesday 26 February 2025), CODC Chief Executive Peter Kelly said councils in Otago and Southland had a recent history of working together on water service challenges, and as a result, the Otago-Southland Mayoral Forum directed chief executives to establish the Otago-Southland Local Water Done Well (LWDW) Working Group to explore a range of regional delivery models. As part of this, the Morrison Low report "Local Water Done Well Review” was completed and presented to Otago-Southland councillors in November 2024. Findings included that without structural changes, future water service delivery would become unaffordable, with 76% of residential users in the region facing doubled water bills within 10 years: Additionally, workforce shortages and infrastructure demands meant that a joint asset-owning entity would be the most effective solution.
A project team has been formed to define what a joint CCO would look like and how it compares against other practicable options. Project costs to develop, consult and submit a WSDP for a CCO are estimated to be $540,000, and would be equally apportioned between the four councils.
Central Otago Deputy Mayor Neil Gillespie chaired today's meeting in the absence of Mayor Tamah Alley:
"Listening to the councillors around the table, there is definitely a commitment, not just from our Council but all the councils involved, to work together to reach a beneficial outcome for our ratepayers to manage the costs of three waters delivery, and to share expertise and staff across the councils involved. Therefore, a joint approach is an option we should explore, amongst any other practicable options."
A view of the water organisation delivery model options with supporting pros and cons, is planned to be presented to the Council meetings in March for decision on a preferred delivery services model and options to consult on.
The Council also agreed to a consultation pathway (via the Local Government [Water Services Preliminary Arrangements] Act 2024 alternative consultation).
All the participating councils will consult over the late April – May period and there will be three options for each community to consider:
- retain the status quo,
- establish a single council CCO, or
- join with the other councils and establish a regional CCO.
The timeline at a glance of key decisions for Council:
- Late March: Complete and present pros and cons assessment to identify preferred water service delivery model and options for Council to consult on.
- Late March-early April: Present joint-council CCO design options and secure decisions.
- April: Draft consultation materials and secure Council approval.
- Late April-25 May: Consult with community.
- June: Schedule hearings, deliberations and decision making.
- June-July: Council decision making and WSDP approval.
- August: Contingency to secure WSDP approvals.
- September: Submission deadline 3 September.
