Source: New Zealand Parliament – Hansard
SIMON COURT (ACT): Thank you, Madam Chair. Minister, I just want to come to clause 9 of this Bill, the Water Services Legislation Bill, which proposes to amend section 18 of the primary legislation, “Other things water services entities can do”. Clause 9(3) says, “A water service entity—may establish, own … or operate a subsidiary only if the subsidiary complies with the requirements specified in Schedule 5”. But more importantly, clause 9(3)(b) says what it may not do: it “may not enter into a partnership with another person or persons.”
Now, assuming that means a natural person or a person in the sense that it could be a corporate, this clause appears to extinguish the opportunity for water service entities to partner with the private sector to deliver services in the form of a public-private partnership for example, or a special purpose vehicle, for example, Minister, where a local government entity now, or in this case a water services entity of the future, which is seeking private and institutional capital—it could be from the Accident Compensation Corporation, where that capital comes from. It could be from the New Zealand Superannuation Fund, it could be from KiwiSaver, it could be from an iwi investment fund. The private capital component, plus private management experience, capability, whatever that specific expertise is, partnering with water service entities in the form of a public-private partnership, say to deliver a whole lot of new services for a new subdivision, or, potentially, to upgrade existing networks in existing urban environments to allow for much higher densities to be built. For example, where currently there are one- or two-storey homes—many parts of our major metros are zoned for six storeys or even eight storeys by right, Minister, but they can’t proceed because the water infrastructure is very expensive and whether it’s a council or a water service entity it’s not clear where the capital will come from to do that.
So Minister, could you please confirm: does clause 9, which amends section 18 of the primary legislation, extinguish the ability of water service entities to enter into public-private partnerships?
Hon KIERAN McANULTY (Minister of Local Government): No, it doesn’t, and we covered this to some degree last night when the answer to Ms Grigg’s question around council-owned council-controlled organisations (CCOs).
Nicola Grigg: Great question.
Hon KIERAN McANULTY: It was a great question actually, very topical and a good opportunity to clarify some of those concerns that are out there. What I said in response to that question was that only the CCOs in Wellington and Auckland will be included in that. The others will remain in ownership with the councils. There is nothing in this bill that would stop entities entering into joint ventures with those or with private companies as well.
