Privatising water services will become easier if the government presses ahead with special legislation, a city councillor has warned.
At this week’s finance and expenditure select committee hearing, Dunedin City Council representative Cr Jim O’Malley said although the Local Government (Water Services) Bill retained local influence and ownership of water, the council was concerned about the "creeping privatisation" inherent in certain clauses.
The Bill proposes councils have the ability to create water companies to oversee water services.
"Council is concerned that the level of regulation and widening ministerial influence somewhat dilute council control regardless of the water services delivery model adopted," Cr O’Malley submitted.
"Likewise, the Bill’s enduring settings are still more weighted towards some models over others.
"Council is perhaps tentative that this reform may represent just one further step towards potential privatisation in the future despite the current provisions in the Bill."
Cr O’Malley was referring to the clause which stated the water companies could be owned by councils or "the trustees of one or more consumer trusts".
After the hearing, he told the Otago Daily Times that he felt the Bill was structured in a way that encouraged community trust ownership of water.
"The legislation has been written in a way that they very, very much prefer council companies and don’t want councils to keep it in-house.
"The council is not able to get the 500% borrowing rate that the water entity gets if it is outside the council, operating in exactly the same form.
"If it’s a company, you can package it up and privatise it down the line."
Other Southern councils also expressed their concern.
Waitaki District Mayor Gary Kircher submitted the Bill enforced regulation upon councils that was too onerous.
"For example, bylaw creation, approval of strategies and the statement of expectations are too involved and far reaching.
"Councils will require continued technical understanding to be able to continue to effectively play the role this Bill will establish."
Councils would also be forced to "re-consult" the public on matters already canvassed.
