Economic regulation and consumer protection for three waters

About the consultation

This Government is committed to significantly improving the safety, quality, resilience, and performance of three waters services (drinking water, wastewater and stormwater). The Three Waters Reforms aim to ensure that three waters infrastructure and services are planned, maintained and delivered so that these critical services are fit for purpose. 

The Three Waters Reform process has revealed a range of problems that relate to natural monopoly characteristics of the system. This includes quality of service that does not reflect consumer demands, and systemic long-term underinvestment in three waters infrastructure. 

The Government is considering regulatory safeguards to ensure that consumers and communities receive efficient and affordable three waters services that meet their needs both now and into the future. Key areas for consideration include:

• Economic regulation to help consumers from problems that can occur when businesses have a lot of market power. This could involve requiring businesses to disclose certain information, directly regulating the price and quality of services, and setting a strong efficiency challenge for regulated businesses.
• Consumer protection, to incorporate the voices of consumers and communities should be incorporated throughout the design of the three waters regulatory system, to ensure it is responsive and accountable. This could involve requiring businesses to meet minimum service levels, providing protections for vulnerable consumers, or establishing a consumer disputes resolution scheme. 

What we are seeking feedback on

We want to hear from New Zealanders about whether economic regulation and consumer protection is needed for three waters, and if so, how this should look. Specifically, the discussion document seeks feedback on issues such as:

• whether economic regulation should apply to all three waters, or just drinking water and waste water, and which suppliers it should apply to
• what form of economic regulation should apply, such as information disclosure and price-quality regulation, and how this should be designed
• whether additional consumer protections are needed for the three waters sector, e.g. whether there should be minimum service level requirements
• how to give consumers a strong voice and resolve consumer disputes
• who the economic regulation and consumer protection regulator(s) should be, and how the regimes should be funded. 

Below are the documents to read and the template for you to complete if you would like to share your views with us. Your feedback will help us advise the Government on the design of the future three waters regulatory system. 

Submissions on the discussion document

We received 53 submissions.

Further information

In July 2020, the Government launched the Three Waters Reform Programme – a three-year programme to reform local government three waters service delivery arrangements. More information is available on the Department of Internal Affairs website.

About the Reform Programme(external link) - Department of Internal Affairs