United has been hit by a rise in costs after having to increase its testing and monitoring of water supplies at Wanaka and Hawea, while wastewater schemes for the two towns are also over budget.
United Water manager Gerry Essenberg said the contractor had halted works which do not compromise the integrity of the QLDC's wastewater, stormwater, and water supply schemes.
A report from United Water to the Wanaka Community Board this week has outlined increased costs for the contractor as it struggles to keep to council budgets.
QLDC engineering services manager Mark Kunath said the council was not experiencing a cash problem "overall", although some individual schemes were running over budget.
Water supplies to the district were affected earlier this year when tests discovered the harmful E-coli bacteria twice in Hawea's water, while Wanaka's water supply continues to be afflicted by an invasive algae which blocks household filters and affects water pressure, he said.
Operation costs for Wanaka's water supply are 10% over its $622,000 budget, with United having to respond to an increased number of "requests for service" from residents who continue to experience problems related to algae, Mr Essenberg said.
Screens on Lake Wanaka water intakes have been unable to prevent the algae from entering the town's reticulation system and costs had increased because a higher level of testing was needed to monitor the issue, he said.
Hawea's water supply operations and maintenance are also running 10% over an $83,000 budget and a "renewals" contingency budget of $5000 is insufficient to undertake any significant renewal work, the report says.
Wastewater and water budgets for Albert Town and Luggate are running under budget.
United had increased its water monitoring and testing for E-coli at Hawea and this has affected costs, he said.
Mr Essenberg's report also highlighted an E-coli scare at the Glendhu Bay Camping Ground, last month, when the existing water supply system failed and the camping ground manager had "elected" to bypass the treatment system.
United Water had been required to issue a "boil water notice" at the camping ground for a week after the contractor had disinfected the system, he said.
Wanaka wastewater was also "significantly" over its $1 million budget, as operations at the township's multimillion-dollar Project Pure scheme were being affected by increased costs for power and the disposal of sludge from the plant, he said.
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