The Department of Internal Affairs

Department of Internal Affairs | Te Tari Taiwhenua

Building a safe, prosperous and respected nation



 

Future water services delivery system

The Local Government (Water Services) Bill covers the enduring settings for New Zealand’s drinking water, wastewater and stormwater services.

The Bill sets out key details relating to the water services delivery system, the economic regulation and consumer protection regime for water services, and changes to the water quality regulatory framework.

When enacted the Bill will be the central piece of legislation for New Zealand’s water services system. It builds on the foundations already in place through the Local Government (Water Services Preliminary Arrangements) Act 2024, including the development of Water Services Delivery Plans by councils.

Sitting alongside the new models that will be available to councils under the Bill, in August LGFA confirmed it will provide financing to support water council-controlled organisations (CCOs) that are financially supported by their parent council or councils.

On this page:

About the Local Government (Water Services) Bill

The Bill provides for:

  • Arrangements for the new water services delivery system, including:
    • Structural arrangements for water services provision such as establishment, ownership, and governance of water organisations
    • Operational matters such as arrangements for charging, bylaws, and management of stormwater networks
    • Planning, reporting, and financial management
  • A new economic regulation and consumer protection regime based on the existing economic regulation regime in Part 4 of the Commerce Act which currently applies to electricity lines services, gas pipeline services, and airport services.
  • Changes to the water quality regulatory framework and the water services regulator, including:
    • Changes to the Water Services Act 2021 to reduce the regulatory burden of the drinking water quality regime and improve proportionality in the application of regulatory powers.
    • A change in approach to Te Mana o te Wai
    • A new single standard for wastewater and stormwater environmental performance.

The Bill was introduced to Parliament in December 2024 and is expected to be enacted in mid-2025.

Read the overview of the Bill: Local Government (Water Services) Bill overview (PDF, 336KB)

Factsheets on key aspects of the Bill

The Department has developed a range of factsheets to provide key information about the Bill.

Financing for councils via Local Government Funding Agency

Sitting alongside the new models that will be available to councils under the Bill, in August 2024 LGFA confirmed it will provide financing to support water council-controlled organisations (CCOs) that are financially supported by their parent council or councils.

Councils will also continue to have the ability to borrow through the LGFA should they choose to keep water services ‘in house’.

LGFA has also confirmed it can immediately begin lending to high growth councils with leverage up to 350 per cent of their total revenue. This is a significant increase in the standard leverage available to councils at 280 per cent. 

Find out more:

Future regulatory landscape for drinking water, wastewater and stormwater services and networks

The Bill proposes changes to the way that drinking water, wastewater and stormwater services and networks are regulated.

View an overview of roles and responsibilities under the new regulatory regime (PDF, 188KB)

Small wastewater plant cost efficiency case studies

The Department of Internal Affairs commissioned a study through National Infrastructure Funding and Financing (NIFF) to provide examples of the impact of the proposed wastewater environmental performance standards for discharges to water from small wastewater treatment plants (the small plant standard).

Although the standards are still being developed, the Department asked NIFF to undertake an indicative assessment of how the small plant standard could improve cost and time efficiencies in the design, consenting, construction, and operation of small wastewater treatment plants (those serving populations of less than 1000).

A key finding from this study is that the small plant standard may result in cost savings of 40-60 percent in the design and consenting phases for small wastewater treatment plants.

The report provides councils with insights to help inform wastewater infrastructure investment planning including guidance on what cost savings may be possible to achieve for existing small wastewater treatment plants and enable them to reflect this into their own small wastewater plant portfolios.

The report is available here: 

Wastewater standards cost efficiency case studies – Small Treatment Plants (PDF, 4.9MB)

For more information on the proposed small plant standard and the wider wastewater standards see: Help shape New Zealand’s wastewater future - Taumata Arowai - Citizen Space

Further information

Read the Bill in full on the New Zealand Legislation website. 

Follow the Bill’s progress and find out more about making a submission to the select committee on the Parliament website.