New Zealand’s Three Waters services and the future of the water supply

In New Zealand, The National Environmental Standards (NES) for Sources of Human Drinking Water have been in place since 2008, but during the latest round of Three Waters reform announcements in September 2019, the Ministry for the Environment (MfE) proposed extensive amendments to these standards. While stakeholders can still comment on the proposed changes (with submissions closing very shortly on 31 October), we anticipate that the most intensive period of consultation on these changes is likely to come in the latter half of 2020.

The NES for Sources of Human Drinking Water are inextricably linked with other changes which have been foreshadowed through the Water Services Bill that was introduced to Parliament on 1 August 2019. We anticipate that the consultative process for the Water Services Bill—and the myriad of changes which that legislation will usher in if adopted—will be much longer and present more opportunities for dialogue than the current ‘Action for healthy waterways’ consultation package. The current package is primarily focused on the National Policy Statement for Freshwater Management and other instruments aimed at improving the health and well-being of freshwater bodies across New Zealand.

The Water Services Bill is focused on the delivery of Three Waters services, including the planning and management of infrastructure, governance of water resources, and end-of-pipe outcomes. The amended NES for Sources of Human Drinking Water (the focus of this article) will be the front runner for this wider legislative reform.

Understanding current approaches

Before we can understand future policy direction, it is helpful to know where current approaches have come from. Following the contamination of the drinking water supply for Havelock North with Campylobacter in 2016, there was a major outbreak of the gastrointestinal disease. The subsequent government inquiry captured several significant lessons—lessons that were learned the hard way, but were vital in catalysing a major overhaul of the way we protect and manage human drinking water supplies in New Zealand.

Following the conclusion of the inquiry, the government pledged to introduce a new framework for drinking water, headed by an independent regulator. Initial proposals for the drinking water framework are presented in the ‘Action for healthy waterways’ discussion document released by MfE in September 2019. It is envisaged that the framework will be used as part of the consultative process to inform further policy discussions and refine proposals from mid-2020. In the meantime, drinking water supply is regulated in New Zealand via:

• The Resource Management Act 1991 (which will remain as the key legislative instrument controlling access to water in the future) will need to be aligned with any other new or amended regulations, depending on the outcomes of the Water Services Bill
• The New Zealand Drinking Water Standards 2005 (DWS, most recently revised in December 2018)
• The existing NES for Sources of Human Drinking Water—a regulation made under the RMA and given effect in June 2008. The existing NES controls activities that may negatively impact on potable water sources
• Requirements inserted into the Health Act 1956 (Part 2A – Drinking Water) in 2008 by Section 7 of the Health (Drinking Water) Amendment Act 2007. Part 2A was subsequently amended again in July 2019.

Key proposed changes to the NES for Sources of Human Drinking Water include:

• The inclusion of all drinking water providers, such as smaller providers like schools, marae, and back country huts. However, individual households would be exempt.
• Focus on defining 'source water risk management areas’. Under the current proposal, regional councils will be required to develop and implement management plans for these areas. This may involve defining capture zones for groundwater takes and source catchment areas for surface water takes. Some regional councils, such as Environment Canterbury, have already included this information in their existing plans.
• Regional councils will need to review plan rules for activities within source areas. Rules will likely need to involve management controls for non-permitted activities in these areas. Non-permitted activities may include industrial and trade waste discharges, wastewater discharges, groundwater abstraction for dewatering, construction phase stormwater, or injection into groundwater. As our towns grow, the drive for wastewater discharges to be moved to land near treatment facilities (from aquatic receiving environments) is likely to increase, and managing both wastewater discharges and the maintenance of high-quality drinking water sources in this context could be challenging
• Telemetry requirements for water takes, including the installation of telemetry units to measure water use every 15 minutes, and daily transmission of data to regional councils (this is also linked through the new NPSFM)
• Water safety plans to reduce the risks to drinking water sources and quality. These are required under the existing Health Act, as well as under the proposed changes. However, the scope for content of Water Safety Plans is likely to be amended.

Wider changes associated with the Water Services Bill that will not necessarily be implemented through the NES could include:

• Requirement for mandatory disinfection of drinking water supplies (for example chlorination), with exemptions only in ‘appropriate circumstances’;
• Setting out the scope, roles and institutional form of an independent regulator. The government recently confirmed that a single, stand-alone entity will be created to  oversee provision of all Three Waters services.

Engagement with key stakeholders

An intensive round of stakeholder engagement on the Water Services Bill was completed in May 2019 with the government agencies responsible for various aspects of water services (such as the Ministry for Primary Industries, Department of Conservation, Ministry of Defence). Iwi groups, including Kahui Wai Māori (one of the government’s lead iwi stakeholder groups for consultations on freshwater issues since 2018), also joined the discussion.

The Department of Internal Affairs released a summary report for this engagement in June 2019, which highlighted a number of points raised by those groups involved in the discussions. We have identified the following points as being particularly relevant to the current consultation:

• Capacity and cost issues, particularly for smaller district councils (with generally smaller drinking water supplies) to adequately assess source risks, provide the necessary level of infrastructure, prepare water safety plans and monitor compliance with the New Zealand Drinking Water Standards
• Ensuring that processes associated with preparing for and implementing the requirements outlined in the Water Services Bill will not duplicate existing requirements. One example is the implementation of plans already introduced to Freshwater Management Units, such as the Whaitua Implementation Plans introduced in the Greater Wellington region
• The need to define who or what is considered a drinking water supplier based on the volume of the take and number of users
• Facilitating the inclusion of Mātauranga in the implementation of water supply regulations, and mirroring the focus of the NPSFM in using the concept of Te Mana o te Wai to drive a focus on overall source catchment wellbeing
• Creating a centralised regulator which is generally supported, but would ideally have a regional presence
• Understanding the concerns regarding our capacity to resource the level of compliance monitoring, which would be required under the proposed changes (including retraining of technical personnel). There would need to be significant investment to attract young people into the water industry and provide education for the development of skilled workers for drinking water suppliers and regulators
• Planning for the likely removal of secure bore status from the new framework as indicated by officials. This may mean placing greater responsibility on water providers to manage activities within the source areas and/or more emphasis on water treatment as the basis for ensuring high quality water supply. We believe that the regulating body would need to establish clear and robust guidance regarding secure bore status as early as possible, if it is to be excluded from the framework. Timelines for addressing non-compliance and provision of funding assistance will also need to be clarified.

This is our final article concerning the recent ‘Action for healthy waterways’ policy proposals announced by the Ministry for the Environment. Along with the rest of the industry, we look forward to hearing the key position statements and issues identified by stakeholders in the consultation process, as well as working towards a consensus that will protect our freshwater resources for future generations.

We will be providing further commentary on issues relating to urban resources (such as stormwater and wastewater management) as further information regarding the government’s intentions for these issues becomes available later in the year. Watch this space for our take on these future developments.

In the meantime, our Urban Planning & Environmental Services and Water teams are available to provide assistance in understanding and implementing policy changes as they are gradually rolled out.