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Release Of Independent Report And Recommendations On Wellington Water Ltd

An independent report into Wellington Water Ltd’s (WWL) operational performance has been released today and suggests several opportunities to improve WWL’s performance.

The independent review was initiated by a resolution of Wellington City Council’s Long-term Plan Finance and Performance Committee. Agreement was reached to increase $2.3 million in additional opex funding to WWL, contingent on the conducting a review of WWL to enhance efficiency, identify cost savings, and improve transparency and reporting.

The report, executive summary and elected member summary are attached. They have been distributed to the mayors and chief executives of all of Wellington Water’s shareholding councils and chief executives of local iwi.

Wellington Mayor Tory Whanau believes these recommendations could help improve the performance of the water network in Wellington.

“It’s essential that we ensure Wellington ratepayers’ money is going towards actually getting pipes fixed. We put a significant amount of funding into our water infrastructure, and as your Mayor I want to be sure this is going exactly where it should be.

“We look forward to working with other shareholding Councils, mana whenua and Wellington Water to implement as many of these findings as possible for the benefit of our water network. Some of these changes will require time and be worked on as part of a new regional model for water delivery.

Wellington City Council Chief Executive Barbara McKerrow says the City Council accepts the recommendations from the report. “With increasing service delivery costs resulting in a growing backlog of leaks, it’s important that we support Wellington Water to find efficiencies”

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“Wellington City Council commissioned the review by consultants FieldForce4 who were engaged for their extensive global water utility and commercial experience.”

FieldForce4 found that maintenance costs had increased by 71% over the last three years. It also found that the level of reporting from WWL was not sufficient for a water utility of its size.

The review also suggested that efficiencies could be found if there was more focus placed on performance measures and cost targets.

The report findings included suboptimal contract management between WWL and its contractors, failure to ensure the performance and financial risk is proportionately shared between Wellington City Council, WWL and contractors, and found that the WWL reporting to the City Council fails to accurately capture and link network performance to the physical work programme and associated budgets.

The recommendations include adding commercial service delivery performance indicators (KPIs) to the Management Service Agreement (between the council and WWL) and the Alliance Agreement (between WWL and contractor Fulton Hogan).

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