Seeking feedback on a proposed levy to recover Commerce Commission costs of regulating water services

About the consultation

The Commerce Commission will oversee and implement a new economic regulation and consumer protection regime for New Zealand’s water services following the passage of the Local Government Water Services Bill in mid-2025.

The Commerce Commission will have a range of regulatory tools, including mandatory information disclosure, to promote transparency and ensure investments are made where they are needed most.

It is expected that the Local Government Water Services Bill will enable the levy regulation making power in the Commerce Act to be used to develop regulations to recover the Commerce Commission’s costs from regulated water services suppliers from 1 July 2025.

What we are seeking feedback on

The proposed levy has been designed to recover the Commerce Commission’s costs of administering the new regulatory regime, excluding any future litigation and Crown Monitor costs for Watercare.

The Ministry of Business, Innovation and Employment would administer the levy on behalf of the Minister of Commerce and Consumer Affairs.

We have developed a discussion document which includes sections on:

• Levy structure
• Levy design
• Levy apportionment
• Levy implementation.

We want to hear feedback from interested parties about the design of the levy and how it could be improved to ensure it is fair, efficient, justifiable and transparent. 

We have sought to align the proposal with consultation being undertaken by the Water Services Authority – Taumata Arowai (the Authority) on a proposed levy to fund its work. The Authority will be responsible for regulating drinking water suppliers for safety and quality and overseeing the environmental performance of stormwater and wastewater networks. This consultation is available on the Authority’s website

Consultation on Water Services Authority – Taumata Arowai levy for 2025 - 2028(external link)  — Taumata Arowai

Relevant documents

What happens next

Following consultation and analysis of feedback, the Government will make decisions on a levy design, with the aim of levy regulations coming into effect soon after the Local Government Water Services Bill passes.