Geoff Crutchley, chairman of the Maniototo Irrigation Company and also of the Upper Taieri Water Resources Management Group, told a seminar that allocation and management of water should be decided by communities.
Agriculture Minister David Carter, who attended the Middlemarch seminar, was told the group was taking a catchment-wide approach to water management.
Mr Crutchley said the group was made up of representatives from farmers, Department of Conservation, Fish and Game Otago, Otago Regional Council and Central Otago District Council who contributed to the policy. Other interested parties could also join.
He said it was the way of the future and superior to alternatives being advocated such as tradeable water rights. Speculators or corporates could corner the market, leaving the community with little or no control or access.
"It is something that worries me. Unless we take ownership as a community, then we risk water becoming a tradeable commodity."
Water for the 300km-long Taieri River was over-allocated. Permits, or mining rights, on which most of the water was allocated, were to expire in 2021, by which time consent would be needed under the Resource Management Act. Mr Crutchley said most water users had committed to the concept.
"This has required a shift in mindset, a leap of faith, to accept that their hitherto private entitlement should be converted to a supply agreement based on an entitlement owned by the local community."
Any move to create a water market would undermine that concept.
Mr Carter said Central Government's role was to get the rules right so communities could decide solutions. Managing and using water better was essential to lifting the economy's economic performance and he said that was being addressed through reforms of the Resource Management Act.
Mr Crutchley, chairman of the Maniototo Irrigation Company for 25 years and a leader in water management, had his service acknowledged by the New Zealand Landcare Trust.