Knowing the facts means better decisions

Finding the fairest way to split the costs of providing safe and reliable water services for households and businesses in Waikato district and Hamilton city is a big question.

How to fix the gap between what the community pays now and what it will cost IAWAI to meet government price and quality requirements is an even bigger one.

But both those questions must be answered as IAWAI prepares its next Water Services Strategy for public consultation.

Chief executive Peter Winder said public views need to be based on the reality of what IAWAI is facing for the communities it serves, and that means IAWAI needs to be clear and honest about what those issues are.

This month we’re asking the community for its views through Help shape our water future, a short survey backed by plain information on the key issues and the decisions that need to be made.

"It's not the formal consultation on our second Water Services Strategy – that will come early next year – but it helps to start shaping up the options we have, and to share with the community the things we don't have a choice about," Winder said.

In recent years, government has reformed the water sector, and the laws that manage it, to ensure water services deliver quality operation and supply, up-to-date maintenance and prudent investment for the future.

Legislation requires water suppliers to ensure revenues are sufficient to meet those obligations.

"We can't compromise on drinking water standards without putting public health at risk, and we can't compromise on wastewater standards without harming the Waikato River. Along with our partners, we are committed to improving the health and vitality of the awa."
 
Winder said most people don't know IAWAI is not only monitored by central government, it pays for the costs of that monitoring.

"This year we'll pay almost $1.4 million to government for oversight of our water quality and financial planning. That monitoring checks we are funding our community's services properly, and that we don't have wasteful expenditure or gold-plating."

One of the core reasons Hamilton City and Waikato District Councils established IAWAI was to reduce the impacts of the cost increases necessary to meet the new requirements.

"Our role is to plan, fund and deliver water services more efficiently than councils could on their own. But we know, right across the country, that water services investment in past years has not kept up with what's been needed. It's no different in our region.

"That means there's two big issues we need to deal with – the charges to meet the current costs of the service, and the backlog of costs to catch up on. If we don’t, we risk compromising the quality of our drinking water and our environment. When you combine this with the need to invest for future growth and the rising costs we face, it means charges for services will need to rise next year, and in the years ahead.

"Revenues have to rise, but there are choices to be made around how we split those costs and how we time the required increases in charges."

Winder said he knows it is little comfort for households to know that rising costs are less than they would have been without IAWAI.

"Those rises will be less under IAWAI than if the councils were meeting the new requirements on their own, but it's still a hit for individuals, families and businesses.

"Groceries, fuel, electricity and insurance have been rising fast. We get that, and we won't charge more than we need to, but the fact is we have no choice – water and wastewater charges will need to increase.

"We're being blunt and honest about the issues because they affect all of us.

"We have more than $200 million in maintenance that needs to be funded now, or we face water service failures in the years ahead.

"In Hamilton, we have four years to move away from charging for water and wastewater based on the value of your house or property. Hamilton businesses have been paying a different (higher) rate than households, which effectively means residential charges have been subsidised.
 
"Despite the price increases in the current year, our budgeted revenue from water and wastewater charges doesn't cover our budgeted costs. Across the whole region, growth isn't paying for the costs of the infrastructure it uses."

These are complex issues and Winder said efficiencies and savings alone can't bridge the gap.
 
"We're reducing the size of the charging increase needed through careful management of our costs and long-term efficiencies, but the fact is we will not find operating savings enough to fund the existing gap between water charges and our costs.

"Even if every one of our staff worked for free, we wouldn't cover half the funding gap we face.

"We launched this survey and supporting information to start the conversation. It's not the full consultation but it's a way to get some high-level views, explain what the real issues are and get people to sign up so they can be involved as we go.

"We hope people take a few minutes to understand the facts and be involved in the big decisions we must make in the months ahead."

The survey is open from 10 to 24 November.

For more information and to find the survey, visit iawai.co.nz/wss