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WATER REVIEW: Privatisation not being considered

MEDIA RELEASE
Monday 30 October, 2000


AUCKLAND WATER REVIEW SHORTLIST OF OPTIONS

Privatisation not being considered


The first major milestone of the Auckland region water, wastewater and stormwater review has been reached, with the drawing up of four major options that are now being evaluated by councils.

They are the result of almost a year of research. The options went before councils for consideration earlier this month, and will be considered again in December when results of an evaluation are known.

The four options have been developed as alternative ways of achieving the desired outcomes for the industry, which include ensuring

- Auckland consumers have a high quality, healthy and reliable service
- the environment is maintained
- costs are minimised as much as possible
- there is public accountability

All councils in the region, apart from Franklin District Council, are participating in the review.

Public consultation will take place in February/March next year before final choices are made.

The four options are:

1) IMPROVING THE CURRENT STRUCTURE


This would involve no change to the current industry structure but there would be some changes to increase industry co-operation and co-ordination, improve accountability and transparency, and remove barriers to competition
(to put pressure on the existing water and wastewater providers to perform well).


2) “COMMON CARRIAGE” – SHARING THE PIPE NETWORK

It is not practical to have more than one set of water and wastewater pipelines throughout the region and none of the options proposes this. It may however be possible for different companies to share the use of the pipelines to deliver water and wastewater services to customers in the same way that Clear delivers telecommunications services using Telecom’s lines.

Because the “common carriage” option is complex, it would be introduced in phases.

Water services would then be on-sold through Local Authority Trading Enterprises throughout the region.


3) “NORTHWEST WATER” and “SOUTHEAST WATER”

Under this option the industry would be combined into two companies.
While the boundaries would need to be finalised, they could be ‘Northwest Water” serving Rodney, North Shore and Waitakere, and ‘Southeast Water” serving Auckland City, Manukau and Papakura.

The two companies would be required to publish information about their performance on a range of measures - e.g. time to respond to customer complaints, prices, costs, number of interruptions to water supply. The publication of these figures would be intended to put pressure on the companies to improve their performance against each other.

4) ONE AUCKLAND WATER COMPANY


One organisation would own and control the entire Auckland water, wastewater and stormwater industry. The company would be owned jointly by the Auckland region councils, which currently jointly own Watercare, and a similar structure could be used.

The company would be required to publish information about its performance on a range of measures, so that the public had information about how well it was performing.


As can be seen, privatisation is not being considered as an option.

The use of the Waikato pipeline is not part of the review as a decision has already been taken to use the Waikato as a source of future water supplies, and construction of the pipeline is underway.

The review is being carried out because:

- The public is becoming increasingly concerned about continued damage to natural waterways, harbours and beaches with sewage overflows and inadequately-treated stormwater runoff. Environmental standards and consumer expectations are continually rising, and the current system is failing to meet those standards in many cases.

- We need to ensure present and future generations shave continued access to a reliable supply of high quality drinking water (and safe disposal of wastewater).

- Billions of dollars must be spent in coming years to replace old pipes and to build and maintain new systems and treatment facilities. Some of the pipe network is ageing and unreliable. The review is looking at ways to ensure that this spending is co-ordinated, so that the overall cost to the region is minimised.


END


Media contact: Philip Keating, Communications Advisor for the Review of Water, Wastewater and Stormwater tel 09 2625181 or 025 464727

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