MEDIA RELEASE

22 June 2004

Auckland city stormwater upgrade gets $7million boost

Auckland City will use a $7.1 million price adjustment from water and wastewater services wholesaler Watercare Services to help fund urgently needed stormwater upgrades.

Metrowater, a 100% owned subsidiary of the council, will receive a gross price adjustment of approximately $7.1 million at the end of this financial year (30 June 2004).

At its meeting on Thursday 27 May, the council voted that the payment be used to speed the upgrade of Auckland city’s outdated stormwater network.

Stormwater projects prevent the flooding of properties and roads, and remove pollution that would otherwise flow into the city’s harbours and waterways. Auckland City’s draft 10-year plan Focus on the Future 2004 - 14 estimates that $40 million a year is needed for the next decade to upgrade and maintain the network.

“Stormwater management is a critical issue facing the region,” said Councillor Douglas Armstrong, chair of the Finance and Corporate Business committee. “One of the purposes of setting Metrowater up as a separate business from the council was to improve outcomes for the environment. In addition, the close link between wastewater and stormwater means that Auckland City ratepayers and Metrowater customers stand to benefit from the improved stormwater management.

The alternative option, which was carefully considered by the council, was for this payment to be redirected to Metrowater customers.

“If we took this option, the average residential Metrowater customer would receive a credit of 88c a week or $46 for the year,” said Mr Armstrong.

“On balance we believe Metrowater’s customers have been well served by their water pricing this year, with thousands taking advantage of the new 10% prompt payment discount.

“Directing Watercare's price adjustment into Auckland City's stormwater upgrades will speed up the completion of the stormwater network and mitigate the need to increase rates in the future to fund this work.

“The council has taken a responsible, long term approach to this decision and ultimately Auckland City ratepayers will benefit enormously.”

Ends

Note to editors
- Auckland City will receive approximately $7.1 million from Metrowater as a charitable payment ($7.1 million less any tax payable).
- This is the Auckland City share of a total $15.7 million price adjustment from Watercare.
- Water services provided by Watercare are divided into drinking water (the water which comes into homes and workplaces or is used for fighting fires) and wastewater (also know as sewage - the ‘dirty’ water which leaves homes or workplaces).
- Watercare supplies water and wastewater (sewage) services to retail providers Metrowater, United Water, Manukau Water, Eco Water, North Shore City and Rodney District Council. These providers, in turn, supply residents.
- Watercare is owned by the city councils of Auckland, Waitakere, North Shore and Manukau and the district councils of Papakura and Rodney and governed by the Shareholders Representative Group (SRG) which includes representatives of these six local bodies.
- The SRG is chaired by Auckland City Councillor Dr Bruce Hucker.

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