Council approves Water Services Delivery Plan

Published on 09 June 2026

Joint CCO with Southern Waters addresses affordability and Council borrowing.

Today the Mayor and Councillors approved an amended Water Services Delivery Plan for submission to the government, which sets out a $274 million investment in water infrastructure together with projected charges for water customers until 2034.

Waitaki District Council’s new Water Services Delivery Plan forecasts an average saving of around $324 per household per year for water customers in the Waitaki District. This is over the ten years of the plan, compared to the In House plan rejected by the Department of Internal Affairs (DIA) in October 2025.

While the cost of water services will increase in the next decade, to reflect the investment made, there will still be a significant saving to water customers in Waitaki from joining Southern Waters compared to keeping water in-house

The Plan  also sets out that two-thirds of Council’s debt, around $80 million by the end of the next financial year, will transfer to Southern Waters on 1 July 2027.

Around $80 million of the water investment borrowing, made since 2020 to meet the Government’s increasing standards for water quality and infrastructure, will be transferred to Southern Waters. This will be serviced by  water user charges, under financing arrangements set out by the Local Water Done Well legislation.

Ratepayers will not be charged for water on their rates bill from the 2027-2028 financial year, receiving a separate water bill instead.

Approval of the Water Services Delivery Plan by the Department of Internal Affairs, and Southern Waters taking over from 1 July 2027 will bring to an end a seven-year period of Government-directed reforms of the water sector.

Waitaki District Council Chief Executive Alex Parmley said: “This government and the last has made it clear that investment in water by all councils needed to increase and standards needed to be higher. Water infrastructure has been one of Council’s biggest capital expenditure programmes since 2020 and a huge driver of cost and rates increases.

We’re the 11^th  biggest District in New Zealand in land area but only 44^th in terms of population. Waitaki has 15 domestic water schemes supplying urban and rural households, and 8 wastewater systems – more than many of our neighbours.

This has been challenging as we have needed to fund the upgrades required to bring them up to the new standards set by the Government’s Water Services Authority, and replace ageing pipes and plant.

Water infrastructure, unlike roading, is not subsidised or co-funded by central Government. This means that all of the additional work required has been debt-funded, with ratepayers supporting the operating costs of delivering these projects.

This was undertaken as efficiently as possible to ensure affordability for water users, and with the assurance that – both Three Waters or Local Water Done Well – the debt and operating costs would be transferred to a new water organisation, and managed through separate billing for water services.

The repeal of Three Waters and the introduction of its replacement, Local Water Done Well, delayed this transfer – which meant Council had to continue borrowing to invest in its infrastructure, and experience increased operating costs to deliver it.

This, along with well-beyond CPI inflation for infrastructure, has driven much of the last three years’ rates increase.”

Following this decision, from 1 July 2027 Council's total debt will be reduced to around $41 million.  However Council’s net debt position will be around $23 million as it has around $18 million in loans out to various organisations in the District.

Council receives a higher rate of interest return from its loans  than it pays for loans it receives from the Local Government Funding Agency. This is a source of financial income for Council outside of rates or user charges.

Mayor Mel Tavendale was satisfied that the Water Services Delivery plan provided the most affordable option for the community of those available to Council, while also addressing the water reform led strains which had been placed on Council finances in recent years.

“We recognise the community concern about Council’s debt levels, and today's decision highlights that two-thirds of the borrowing was taken on to invest in the core service of water infrastructure – and at the direction of the past two Governments.

Combined with the inflationary spike in 2022 and 2026 for fuel, materials and infrastructure costs – it’s been challenging to maintain services while anticipating the resolution of water reforms.

The Southern Waters joint-CCO offers a more affordable pathway for water customers in the Waitaki District. It also separates out the investment borrowing made for water assets and infrastructure from Council’s other investments.

I’d like to thank the Hon Amy Adams for her support through this process, as well as her prudence in reducing the cost of her appointment to the ratepayer by attending meetings virtually when possible. I’d also like to thank my fellow Councillors, especially Councillor Schlack who was only elected last year, and immediately set to work finding the best solution for the Waitaki District.

We now need to focus on addressing the Simplifying Local Government reforms, and preparing for the 2027-2037 Long Term Plan.

The first involves the potential amalgamation of Waitaki with neighbouring Councils either by 2028 or 2031, and the second lays out how a slimmed down organisation without water services delivers efficiently for the District between now and then.”

Council will be holding community meetings about Simplifying Local Government later this month.

You can find out more about Southern Waters at their website here: Southern Waters - Safe, sustainable water for our Southern Districts

You can read the report, and the Water Services Delivery Plan here(PDF, 3MB).

ENDS

media@waitaki.govt.nz

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