Southern Water Done Well

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The future of our Water Services: What you need to know


Our community faces a big decision about how drinking water, wastewater, and stormwater services will be delivered in the future.

We’re collaborating with three other councils—Clutha District, Central Otago District and Gore District—to form Southern Water Done Well. Together, we are working to find the best solutions that ensure sustainable, efficient, and compliant water services for our communities.


Consultation is open 9 May - 6 June 2025

We've done our homework. Before you make a submission, please take the time to read our Consultation Document which has lots of information on different ways to deliver Water Services in Waitaki and what they could cost.

If there's anything you don't understand in the document or something you want more information on, pop a question in our 'Questions' tool below or come along to one of our in-person Community Meetings to talk to staff and elected members about your concerns and share your thoughts.

You can make a submission using the online feedback form on this page and print copies will be available at Council Service Centres and Waitaki District Libraries.


What is Local Water Done Well?

The Local Water Done Well legislation requires councils to change how they manage water services, invest more in infrastructure, and comply with stricter government regulations. While this gives councils more control over local water decisions, it also increases central government oversight.

The Government has made it clear that councils must work together to make Local Water Done Well a success.

Watch an in-depth discussion with the Mayors of Waitaki, Clutha, Central Otago and Clutha districts for more about how our councils are responding to the Government's Local Water Done Water reforms:



Why change is necessary

Doing things the way we have always done them isn’t an option as current operating models are likely to fall short of meeting new legislative requirements, including financial sustainability.

Water costs are rising due to:

✅ Population and industrial growth

✅ Increasing infrastructure costs for upgrades and renewals

✅ Higher water and wastewater standards

✅ Additional compliance and regulation from Commerce Commission and Taumata Arowai

✅ Ageing infrastructure requiring urgent investment

✅ Mitigation measures to our changing climate

These challenges mean councils must rethink how they deliver water services to meet new regulations and community expectations.


The journey to Local Water Done Well

The water reforms were introduced to ensure every community in Aotearoa New Zealand has access to safe, clean drinking water while also improving wastewater and stormwater management.

A key trigger for these reforms was the Havelock North gastroenteritis outbreak in August 2016, where 5,000 people fell ill and four people lost their lives due to contaminated drinking water.

Following this tragedy, extensive reviews uncovered serious issues with New Zealand’s water infrastructure, safety standards, and regulatory oversight. These findings highlighted the urgent need for stricter water regulations and significant investment in better water management systems.

Now, through Local Water Done Well, councils are working together to create safer, more sustainable, and future-proof water services for our communities.

The future of our Water Services: What you need to know


Our community faces a big decision about how drinking water, wastewater, and stormwater services will be delivered in the future.

We’re collaborating with three other councils—Clutha District, Central Otago District and Gore District—to form Southern Water Done Well. Together, we are working to find the best solutions that ensure sustainable, efficient, and compliant water services for our communities.


Consultation is open 9 May - 6 June 2025

We've done our homework. Before you make a submission, please take the time to read our Consultation Document which has lots of information on different ways to deliver Water Services in Waitaki and what they could cost.

If there's anything you don't understand in the document or something you want more information on, pop a question in our 'Questions' tool below or come along to one of our in-person Community Meetings to talk to staff and elected members about your concerns and share your thoughts.

You can make a submission using the online feedback form on this page and print copies will be available at Council Service Centres and Waitaki District Libraries.


What is Local Water Done Well?

The Local Water Done Well legislation requires councils to change how they manage water services, invest more in infrastructure, and comply with stricter government regulations. While this gives councils more control over local water decisions, it also increases central government oversight.

The Government has made it clear that councils must work together to make Local Water Done Well a success.

Watch an in-depth discussion with the Mayors of Waitaki, Clutha, Central Otago and Clutha districts for more about how our councils are responding to the Government's Local Water Done Water reforms:



Why change is necessary

Doing things the way we have always done them isn’t an option as current operating models are likely to fall short of meeting new legislative requirements, including financial sustainability.

Water costs are rising due to:

✅ Population and industrial growth

✅ Increasing infrastructure costs for upgrades and renewals

✅ Higher water and wastewater standards

✅ Additional compliance and regulation from Commerce Commission and Taumata Arowai

✅ Ageing infrastructure requiring urgent investment

✅ Mitigation measures to our changing climate

These challenges mean councils must rethink how they deliver water services to meet new regulations and community expectations.


The journey to Local Water Done Well

The water reforms were introduced to ensure every community in Aotearoa New Zealand has access to safe, clean drinking water while also improving wastewater and stormwater management.

A key trigger for these reforms was the Havelock North gastroenteritis outbreak in August 2016, where 5,000 people fell ill and four people lost their lives due to contaminated drinking water.

Following this tragedy, extensive reviews uncovered serious issues with New Zealand’s water infrastructure, safety standards, and regulatory oversight. These findings highlighted the urgent need for stricter water regulations and significant investment in better water management systems.

Now, through Local Water Done Well, councils are working together to create safer, more sustainable, and future-proof water services for our communities.

  • So, what happens with rates?

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    Should the Water Services Delivery Plan be a CCO of either Option 1, 2 or 4 - how you pay for water will be changing. It's likely it will change for Option 3 too, as you will receive a separate bill.

    When we consulted on our Draft Long Term Plan in February, we showed you the graph in the picture.

    Where it shows a 30% rate decrease - that's what happens the first year of a new water services CCO. The water charges on your rates would be removed, and you would pay for water on a separate bill - like you do for power.

    This would have the effect of reducing Council's revenue by the total amount of water charges.

    Council's debt-limit would also be a smaller total amount. It would be 175% of revenue, but for example (and this is just an example)

    • 175% of $50 million is $87,500,000
    • 175% of $30 million is $52,500,000


  • Council's planned investments in water to 2034

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    Last year we let you know Council had water projects totalling $464,620,000 to get done between 2024 and 2034. We knew that wasn't affordable, so set to work on prioritising and deferring work where possible. As a result, we're investing around $206,311,000 in water infrastructure between 2024 and 2034.


    This includes the $17,426,000 for 2024/25 Enhanced Annual Plan and the Draft LTP’s projected $188,885,000 from 2025/26 to 2033/34.


    However, the deferred $258,309,000 will still need to be delivered after 2034.


    • :This is just infrastructure and does not include the cost of running the water network.
    • :Unlike roads, no water infrastructure is paid for by Central Government.
    • :Water charges are how things are paid for. Either via loans for big things that can be paid off over time, or by depreciation reserves – money put aside to replace assets.
    But what’s in there? Well, there’s a handy list linked at the bottom, but here’s some of the big-ticket stuff – as in, costs over a million dollars, that's coming up in the next nine years.


    Stormwater
    • $10 million for Oamaru Stormwater Mains upgrades
    • $2.185 million for District Wide Stormwater Main renewals
    • $1.35 million for Stormwater Main Inspection and Cleaning (to make them last longer)
    Total: $13,535,000


    Wastewater
    • $20 million for Relocating/Renewal of the Orwell Street Wastewater Pump Station
    • $20 million for a new rising Wastewater Main in Oamaru
    • $17.6 million replacing Oamaru Wastewater Mains
    • $4.5 million for renewing Palmerston Wastewater Mains
    • $3.2 million to implement Tradewaste Bylaw to reduce load on wastewater treatment plants
    • $3 million for the Beach Road Catchment Upgrade
    • $2.75 million on Wastewater Inflow and Infiltration Programme
    • $2.6 million for desludging Oxidation Ponds across the District
    • $2.5 million for Duntroon Wastewater Treatment Plant Upgrade
    • $2.25 million for Sewer Main Inspection and Cleaning (to make them last longer)
    • $2 million for capacity improvements across Oamaru Creek to avoid Tees St overflows
    • $2 million to bring Oamaru Wastewater Treatment Plant into Compliance
    • $2 million for Wastewater Overflow in Oamaru
    • $1.82 million for District Wide Urban Wastewater Main Renewals
    • $1.7 million in Wastewater Facilities Renewal
    • $1.4 million for disposal of desludged biomass from Omarama and Palmerston treatment plants
    • $1.4 million renewing Wastewater Pump Stations
    • $1.065 million for the Kurow Wastewater Treatment Plant Upgrade
    Total: $91,760,000


    Drinking Water
    • $12 million Oamaru Water Strategy Source Resilience
    • $9.96 million Oamaru Urban Water Main Renewals
    • $8 million Universal Water Metering
    • $6.1 million on upgrading Oamaru North falling water main
    • $4.15 million Oamaru Water Strategy Phase 1, 2 and 3
    • $3.2 million Water Main Upgrades to current private supplies up Valley, Waitaki Bridge, Moeraki Kaiks
    • $2.5 million Kurow Water Supply Compliance and Resilience
    • $2.34 million Oamaru Rural Water Main Renewals
    • $2.25 million on Leak Detection
    • $2.25 million Rural Water Mains Renewals
    • $2 million Waihemo Urban and Rural Water Main Upgrades
    • $1.6 million Urban Water Main Renewals – Valley Townships
    • $1.6 million on assessing all drinking water infrastructure across the District
    • $1.4 million on Oamaru Water Treatment Plant renewals
    • $1.35 million on a backflow prevention plan
    • $1.35 million Water Restrictor Check programme
    • $1.3 million Oamaru Water facilities renewals
    Total: $63,350,000


    There are also additional smaller projects totalling $20.25 million, with a total of 88 projects in the Draft Long Term Plan. That brings the total to $188,895,000.

    You can find them all, here, on Page 7 - 10: https://www.letstalk.waitaki.govt.nz/.../documents/302504




  • Let's talk about debt

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    Today Council's $70 million debt is $50 million of water infrastructure, $20 million of property and other projects.


    The Local Water Done Well reforms rely on increased borrowing (more debt!)


    Where that debt is, and how it is managed, is an important part of the future of water services.


    The reforms mean CCO's can borrow up to 500% of their water revenue, to pay for infrastructure, consents and meeting standards. Council can't do this.


    Council could stick with its current 175% debt ceiling or get a credit-rating and expand that to 250%. The graphs below show that.


    Graph 1 shows what that looks like over the next nine years based on our LTP. Council hits and breaches its debt limit by 2027/28 at its current 175% debt ceiling. That is not financially sustainable, and illegal. It also shows that without waters debt; Council's overall debt reduces to 50% of its revenue by 2034. At 250%, Council heads above 200% debt to revenue by 2031 and stays there for a long period of time.

    Graph 2 shows the longer term out to 2054, and the breakdown of that debt with a 250% ceiling. It doesn't have the 175% in there, because that gets blown through so early.
    The vast majority of debt would be waters, with a thin slice of everything else Council needs to borrow for - roads, property, parks etc. There would be very little room for delivering anything that is not water without significant additional cost to the ratepayer.


    The idea that the Mayor and Councillors could keep water-charges low, by deferring projects, is how things used to be. That's not the way it will work in future, because of the Local Water Done Well reforms.

    The infrastructure regulator has the power to direct Councils or CCOs to invest in infrastructure.

    The Commerce Commission has the power to set pricing, meaning either more borrowing or higher charges.

    Three of the four options being consulted on use the additional borrowing capacity that the Local Water Done Well reforms give to CCOs.

    All four options require either Council, or a CCO, to take on additional debt to fund infrastructure, consents and meet water standards.


    These graphs are on Page 33 and 34 of the consultation document.

  • So, what are the options, how much will water charges be, and how will that work?

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    Currently you pay water charges on your rates bill. It's about $1,913 per year now.


    That's going to change because of the Local Water Done Well Reforms.

    Whether In-House, Stand-alone CCO or Joint-council CCO - you'll receive a separate water charges bill from 2027/28. That means those charges will not be on your rates bill each year.

    This will be like the bill you get from the power company because Water Services will be regulated just like power companies are, that's part of the reforms.

    Council has modelled all of the options, and the first table below shows the water charges in 2027/28 and 2033/34.


    • Joint Council CCO SWDW - 2027/28 - $2,168 per year / 2033/34 - $2,894 per year
    • Stand-alone CCO - 2027/28 - $2,466 per year / 2033/34 - $3,754 per year
    • In-house business unit 2027/28 - $2,269 / 2033/34 - $3,093 per year
    The second table shows the modelling for South Canterbury, for the same period. The South Canterbury Councils did not model for a stand-alone CCO.


    • In-house Business Unit - 2027/28 -$2,041 per year / 2033/34 - $2,924 per year
    • Joint-council - 2027/28 - $2,269 per year / 2033/34 - $3,093 per year
    You can see the preferred option of Southern Water Done Well is the one which produces the lowest charges to you, the water customer.
    All of this modelling can be found on our Consultation Site, and the image is taken from Page 30 of the Consultation Document
Page last updated: 29 May 2025, 10:48 AM