Councils Say Three Waters Erodes Flood Response

Local Government

Local authorities claim the government’s water reforms will rob them of civil defence capacity

A West Coast council that has previously supported the government’s Three Waters reforms is now raising the alarm over changes it says will undermine civil defence – and its finances.

Buller District Mayor Jamie Cleine says under the new Water Services Entities Act his council is set to lose the services of more than 20 staff who play vital roles in flood emergencies.

The staff are employed by WestReef Services, a trading subsidiary of the council-controlled organisation (CCO) Buller Holdings, and make up about 20 percent of its workforce.

The act – passed in December – requires the transfer of CCO staff and assets to the regional water entities just as it does of councils that directly manage their water services.

The government says it’s been clear for some time that this would happen.

But Cleine says when councils were asked to furnish the government with information about their water assets and staff, their inquiries about CCOs were met with silence.

Buller Holdings’ chief executive Craig Scanlon confirms the direction came as a surprise.

“Our understanding was that only council assets and staff would transfer to the new water services entity and that CCO service providers such as WestReef would remain outside the scope. The Department of Internal Affairs has never once engaged with us over this.”

Cleine says losing the WestReef staff will weaken the council’s civil defence ability.

“We use staff across all our departments during such emergencies as the recent Buller floods.

“So this leaves a lack of capacity and there’s no clarity around what happens in the case of emergencies under the new structure.”

Emergencies under control

Hamiora Bowkett, executive director of the Three Waters reform programme, says under the act council water staff are guaranteed jobs in their present localities and they’ll still have civil defence roles.

“Each water entity will have appropriately trained local staff who are able to respond in the event of a civil defence emergency.”

The Buller mayor and others are unconvinced.

Even if all the water staff keep their jobs, they say, councils will no longer manage them and it’s unclear how a local emergency response would be co-ordinated.

Westland Mayor Helen Lash says her council’s CCO, Westroads, manages all the council’s infrastructure and has staff stationed up and down the coast.

“When there’s an emergency they handle everything. They share machinery, they keep the roads open. They’re not just about water.

“This is the thing the government hasn’t thought about. You take those guys out and we’re all in trouble.”

Grey District Mayor Tania Gibson says under council management, protection work before a potential flood starts well before the event.

“We don’t have a CCO so our guys in the office are the ones who know to call out the crews to raise the flood gates, check pumping systems and so on.”

The workers’ new employer, the South Island water entity, is likely to be based in Christchurch, which could complicate communication and potentially the timeliness of and emergency response on the West Coast, Gibson says.

Cleine agrees.

“In our case, when there’s a forecast event like the recent Westport floods, WestReef calls on all its staff, not just the water guys, to monitor river levels, clear stormwater drains, fill sand bags, build emergency bunds – it’s all hands on deck.

“If the water staff are isolated in a separate business it‘ll be harder to integrate our response.”

Losing the WestReef staff to the water entity will not only dismantle workforce synergies and make the council less agile in an emergency, it will deal a body blow to WestReef’s viability and council coffers, Cleine says.

“WestReef’s a multipurpose contractor, the staff are multitaskers and the commercial jobs it does bring in revenue.

“Losing water services will ultimately affect the dividends it pays to the council and leave ratepayers worse off.”

The dividends offset rates by a significant sum, Cleine says.

“The loss of Three Waters work could reduce the dividend by $300,000 a year. This would mean we’d either have to reduce services or increase rates by two to three percent to cover the shortfall.”

Westroads returns a similar sum to Westland District Council, Lash says.

“If they take our profitable CCO what do we do about that? Put the rates up?

“We need our people to make the company viable – they have contracts all over the place – in Canterbury, not just on the coast.”

Permanent loss

Internal Affairs’ Bowkett says the government’s “no worse-off” funding package is available to offset councils’ costs and other financial effects from the reforms.

“This funding is designed to address situations where … local authorities need to reorganise their activities and support functions following the transfer of water services to new entities.”

But Cleine says a one-off payment can never compensate ratepayers for the permanent loss of a profitable council business

He’s urging the government to deal with councils and the risk to their CCOs on a case-by-case basis.

About six South Island councils have been caught out by the CCO edict, including Selwyn and Westland, Cleine says.

“We’re extremely concerned about applying a blanket approach to this.

“The impact it’ll have on the community and the financial viability of Buller Holdings as well as our council is quite worrying.”

WestReef’s contract with the council has nine years to run and should be honoured by the new water entity with the company remaining in council ownership, he says.

“That would give the new water entity access to local knowledge about the water infrastructure in Buller and still let WestReef keep its staff, equipment and ability to provide other services to council and third parties – and respond to emergencies.”

The national transition unit for Three Waters says it’s working with councils on the “orderly transfer of CCO water services’ operations and staff” and on the matters they’ve raised, including the West Coast concerns about emergency management.

It’s encouraging the councils to submit on the Water Services Legislation Bill now before Parliament’s finance and expenditure committee.

Lash says the encouragement comes a bit late.

“The hearings are next week – they’re really rushing this through and they still don’t understand what they’re pulling the pin on – like us smaller councils. But we’ll be there to tell them.”

Made with the support of the Public Interest Journalism Fund