Three Waters Reform

Unsurprisingly, one of the biggest topics for local government this year (and beyond) will be Three Waters reform. The Government has introduced four new water entities, and has set up a National Transition Unit to start “executing the Government’s decisions on Three Waters reform through a consistent and coordinated nationwide approach to transition”.[1]

Several working groups have been established, including one that will provide advice about strengthening representation, governance and accountability for the new entities. This group is expected to report back to the Minister at the end of February 2022.

It may not be smooth sailing for these reforms however. The Government is being challenged by a lobby group called Communities for Local Democracy (C4LD), which represents (to date) 27 councils.[2]  Three of the councils involved in C4LD have applied to the High Court for declarations, seeking clarity about what ownership means in relation to ratepayer-funded water assets.  In short, watch this space - interesting times ahead - and Simpson Grierson is ready to assist with all things three waters.[3]

Future for Local Government Review

Currently taking a slight back seat to Three Waters and RMA reform, but just as important is the policy work that has commenced on the future shape of local government. This work will need to align with the other reform programmes that are underway, all of which will have significant impacts on the current structures, functions and powers of local government.[4]

The Review Panel has provided its interim report to the Minister, signalling priority questions for the review. Coming next is a draft report, with initial recommendations for public consultation in September 2022. The final report is due in April 2023.

This Review will almost inevitably lead to some important, and generational changes for local government; the most significant since the 1989 reforms and introduction of the Local Government Act 2002. 

Some other things to watch out for in 2022

  • Last year the Court of Appeal overturned the High Court decision on Auckland Council’s Accommodation Provider targeted rate (C P Group Ltd v Auckland Council [2021] NZCA 587). The decision made some findings which could impact all local authorities in relation to their rating decisions. Simpson Grierson is acting for Auckland Council, which has now applied for leave to appeal to the Supreme Court. We hope the issues can be fully addressed at the highest level and provide clear direction for councils for the future.

  • The Panel that undertook the review of the RMA noted that better outcomes and processes could be achieved by rationalising local authorities along regional lines. The potential consolidation of spatial and resource management planning functions through joint committees would inevitably increase the pressure for reform, and provide a stronger rationale for local authority amalgamation. We expect this aspect to inform the future direction of the Local Government sector and any subsequent reform.

  • In December last year the Minister of Conservation announced a review into long-standing problems in conservation law, in recognition that the current legislation (involving 24 Acts developed over a timeframe of almost 20 years) is out-of-date and no longer fit for purpose. The Minister has issued a Conservation Law Reform Roadmap which sets out what is to be undertaken by the Department of Conservation over the coming years. We anticipate that the local government sector will be hoping for a comprehensive review of the Reserves Act 1977, which is (in our view) overdue for review.

  • Last, but by no means least, climate change is impacting us all - in 2022 already, considering recent weather events - and beyond. We have an amazing team able to advise on all aspect of climate change, from risk and disclose requirements to tailor made solutions for the local government sector, and defending climate change litigation - which is increasingly involving or affecting local government. In addition to judicial review proceedings challenging a Southland District Council decision to allow access for coal exploration, there are currently two judicial review proceedings underway challenging, respectively, regional and national land transport plans based on alleged inconsistency with climate change aspects of the Government Policy Statement on Land Transport.  Simpson Grierson is acting for Auckland Transport and Auckland Council in respect of the challenge to the regional land transport plan and for Southland District Council in relation to the coal exploration proceedings. We have experience in the preparation of climate change policies for local authorities, and a wealth of climate change resources and publications that make great reading.[5]

Life goes on: LG “business as usual”

While the reforms are swirling overhead, councils still have to get on with their day to day business. For 2022, that includes the preparation of annual plans, and any long term plan amendments that may be needed after the turbulent past year - and, of course, its election year. 

Some things to think about for your annual plans include:

  • Do you need to consult? Annual plan consultation is only required if there is a significant or material departure from the LTP (these are slightly different tests), but you can of course choose to consult;

  • Are you intending to significantly alter levels of service for any significant activity? If so, you will need to amend your LTP, but other changes/inconsistencies with the LTP may not require amendment;

  • Are you introducing any new rates? This may require you to amend your revenue and financing policy, and also consult on that, in addition to providing for the new rates in your financial impact statement.

With elections looming there is a need to refresh information for staff and current elected members (as well as those hoping to be elected) on protocols and requirements that apply to them. Key issues include keeping track of the deadlines, election signage, potential Covid-related adjustments, and appropriate use of council resources. We have experienced team members able to assist with any of your election queries.

Get in touch

Please get in touch with one of our contacts if you would like to discuss any of the above issues

Read our other article: Resource management changes continue. Big steps forward this year with the intended replacement of the RMA, bringing the Natural and Built Environments Act and the Strategic Planning Act. 


[4] See  and . The overall purpose of the review is to “to identify how our system of local democracy and governance needs to evolve over the next 30 years, to improve the wellbeing of New Zealand communities and the environment, and actively embody the Treaty partnership.”

[5] See, and Climate Change Commission releases final recommendations to Government - Simpson Grierson Lawyers for links to all articles from issue 1 of our “Local government climate update” series


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