Speech for Building Nations Symposium 2019

• Thank you for the invitation to take part in this symposium about building our regions and the future of infrastructure in New Zealand. I want to acknowledge Chief Executive Stephen Selwood, Chair Andrew Stevens, and Infrastructure New Zealand staff for putting together the programme for this symposium.
• This morning, you heard from my Ministerial colleague Shane Jones about this Government’s priorities for infrastructure and regional development. Ministers Hon Grant Robertson and Hon Phil Twyford are also speaking over the next two days. The announcement of the newly appointed Board for Te Waihanga demonstrated the Government’s commitment to a strategic approach to infrastructure.
• You’ll hear about the Government’s focus and broad mandate to develop and improve our country’s infrastructure, whether it’s related to water, housing, transport, regional development, economic growth or climate change.
• Infrastructure is a critical enabler for New Zealand to improve social, economic, cultural and environmental wellbeing for all New Zealanders. But transformational outcomes for our people, communities, environment and economy.
• As Minister of Local Government, I’m privileged to be able to lead this Government’s partnership approach and conversation with local government – to work together to facilitate local government’s role in ensuring the delivery of essential local and regional infrastructure. 
• Your programme over the next two days reflects an extensive agenda of work in the local government space. The workstreams are closely interrelated, each contributing to a phased, coordinated and informed approach to enhancing the local government system, and wellbeing of our communities.
• This morning, I’ll reflect on some of these key workstreams, and their importance to building prosperous, healthy and resilient regions.

Three Waters reforms

• I want to start where I left off in my address to last year’s symposium – our priority to deliver the fundamental right of safe, clean, and affordable water for all New Zealanders, wherever they live. 
• Last year, I canvassed the serious and widespread challenges facing our three waters system, highlighted by the findings of the Havelock North Drinking Water Inquiry and the Government’s Three Waters Review.
• The case for change is clear and has been widely publicised. The Havelock North contamination incident in 2016 resulted in around 5000 illnesses and four associated deaths – we simply cannot allow this to happen again.
• Nor should we put up with a system where around 34,000 people across the country become ill from their drinking water every year, and many thousands must boil their water to drink it safely. This is simply unacceptable for a developed nation such as ours.
• As many of you will be aware, this Government has responded by recently announcing a suite of regulatory reforms – not only to ensure the delivery of safe, clean drinking water; but also to improve environmental outcomes from our waste and stormwater systems. Improvements that are system-wide – from source to tap and back again.
• The new regulatory framework will:
  • establish a dedicated water regulator;
  • extend regulatory coverage to all water suppliers, except individual household self-suppliers;
  • provide a multi-barrier approach to drinking water safety, including mandatory disinfection of water supplies, with exemptions only in limited circumstances;
  • strengthen government stewardship of wastewater and stormwater services, with regional councils remaining the primary regulators for the environment; and
  • provide transitional arrangements of up to five years to allow water suppliers to adjust to the regulations, with support from the new regulator if necessary.
• The new water regulator will have a range of responsibilities and functions, including:
  • sector leadership;
  • compliance, monitoring and enforcement of drinking water;
  • capability building;
  • information, advice and education; and
  • performance reporting.
• We’re still working through the details of the institutional form and scope of the regulator. It could be established as a standalone entity, or it might form part of an existing organisation. Likewise, we need to consider the benefits and feasibility of including regulation of all three waters within a single regulator.
• These details will be the subject of further Cabinet consideration next month.
• The regulator will play a key leadership role in working with water suppliers and infrastructure providers to support compliance with the new regulations.
• We want to move quickly in putting this new framework in place. To enact the majority of these reforms and establish the regulator, we’re aiming to introduce a Water Services Bill by the end of the year, with possible enactment by mid-2020.
• Although these reforms address the immediate regulatory issues, we also need to address the wider funding and capability challenges facing the sector.
• We must ensure that some communities don’t fall behind the rest of the country – that we build our regions equitably for the benefit of all.
• Throughout the rest of 2019 and into 2020, my officials will be having discussions with local government, water industry experts, iwi/Māori and others about options to improve three waters service delivery and funding arrangements.
• This may include thinking differently about how water services are delivered and paid for, including options for sharing costs across regional communities, or a nationwide fund.
• I’m pleased to see some regions showing leadership on this issue, such as Hawke’s Bay, Canterbury and Otago.
• But as I’ve stated previously, the continued public ownership of existing three waters assets is a bottom line, regardless of what options are considered.
• I’d like to take this opportunity to recognise Infrastructure New Zealand’s valuable contribution to the Three Waters Review so far. We look forward to your continued involvement.
  Local government funding and financing
• Although we’re addressing the immediate three waters challenges, we cannot shy away from the fact there are wider funding and financing challenges across the local government sector as a whole.
• In particular, we need to find better ways to support councils and communities who are facing acute pressures on their infrastructure, whether that be from high growth, low rating bases, high tourist numbers, or specific economic challenges.
• That’s why, when we came into government, we asked the Productivity Commission to conduct an inquiry into local government funding and financing and, where shortcomings are identified, to examine options and approaches for improving the system.
• A draft report has recently been released by the Commission, and we support its call for submissions. There will be a range of views in response to the draft report, and it’s important that these are captured and considered. I encourage you to take the opportunity to contribute to this important mahi.
• The Commission will release its final report late this year for consideration and response by the Government.
  Community resilience
• As we work together to build our regions and communities, we need to be cognisant of natural hazards and the effects of climate change, including the associated impacts and risks to the natural and built environment.
   
• As infrastructure professionals, you’re aware of the unprecedented challenges we face to ensure our infrastructure networks are well planned and resilient. This will require a joined-up and coordinated effort across all parts of government. 
• Our focus is on a joined-up approach to enhancing community resilience, with central and local government working in tandem with iwi/Māori, communities and critical stakeholders.
• In June, the Central and Local Government Forum agreed to develop a joint resilience work programme, focussing on five key areas:
  • information to support better decision making;
  • enhanced use of risk assessment;
  • enabling better decision making in hazard risk management and climate change adaptation;
  • use of insurance markets and risk financing; and
  • Principles and approaches to funding and financing.
• The programme and scope of this work are still being developed, so expect to hear more as this unfolds. We have a team of resilience Ministers engaged in this process.
  Infrastructure funding and financing
• While Government considers the long-term resilience of our communities, we must also find ways to remove barriers to the development of infrastructure essential to the wellbeing of those communities.
• Put simply, the necessary infrastructure for housing in New Zealand is currently not being built.
• There are a range of factors at play here. But we’ve heard from local government and developers that many councils – particularly those in high-growth areas – can’t finance new infrastructure, including infrastructure that is crucial to support housing development.
• As part of this Government’s Urban Growth Agenda, we’re investigating new avenues to support infrastructure funding and financing.
• The objective is to deliver a viable alternative financing model to enable delivery of new infrastructure projects and upgrades, without being limited by local authority financing constraints.
• You’ll hear more about this work from officials tomorrow, and we expect to make further announcements in the coming months.
   
  Māori housing
• The housing crisis is particularly acute for Māori.
• The Māori home ownership rate is only 43 per cent compared to 63 per cent for the general population, Māori make up 36 per cent of public housing tenants yet comprise just under 15 per cent of the general population, and Māori are five times more likely than Pakeha to be homeless.
• These statistics are not acceptable to our Government.
• Late last year, the Prime Minister asked me to take responsibility for Māori housing as Associate Minister of Housing and Urban Development.
• Underpinned by an additional investment towards Māori housing as part of this year’s Wellbeing Budget, we are identifying significant opportunities to positively impact on Māori housing outcomes.
• As we implement our housing agenda, this Government is signalling that we are looking for partnerships to make home ownership real for whānau, and that social community housing developments can be done differently with iwi/Māori involvement.
   
   
  A community wellbeing conversation with local government
• Just as this Government is committed to putting the wellbeing of New Zealanders at the heart of everything it does, all of the workstreams I’ve discussed this morning are about improving intergenerational wellbeing, and making Aotearoa a better place for all.
   
• Whether it’s having a fit-for-purpose local government financing and funding system; working together to mitigate the effects of climate change and building resilience; or making sure all New Zealanders have access to safe drinking water – we’re committed to a strong, robust local government sector focused on wellbeing.
• As part of this focus, it’s important to ensure local communities are empowered to identify and participate in achieving their own wellbeing needs. What councils do is critical to this kōrero – because each community has its own unique needs and priorities.
• That’s why, as Minister of Local Government, I’m leading a conversation with local government to explore how we can better embed a wellbeing approach across local decision-making.
• This work aims to build on our reinstatement of the ‘four wellbeings’ in the Local Government Act by improving key aspects of local decision making, such as:
  • more inclusive, effective community participation in local government;
  • more specific wellbeing priorities in council plans; and
  • Better collaboration between central and local government in the provision of public services.
• Although there are good examples of these things already, we want to broaden and accelerate the uptake of innovative council practice in these areas.
• This work shares many of the same outcomes as LGNZ’s Localism Project – such as more empowered local communities, strong local institutions, and aligning our investment for greater benefit.
• However, we don’t support the specific proposal for wholesale devolution of services. Rather, we propose a more nuanced exploration of how we can empower communities to maximise their wellbeing.
  Concluding remarks
• This Government’s extensive investment in infrastructure is a strong vote of confidence and recognition of you, as industry professionals, and your importance to improving the lives of everyday New Zealanders.
• The challenges are too big for any of us to achieve alone. We need to come up with the optimal solutions together, and I thank you for your contribution so far.
• I know that there is a wealth of experience and expertise here today.
  I encourage you, over the next two days, to be bold in seeking solutions to some of the big challenges I’ve discussed – so that together we can build resilient, healthy and confident communities.
• I wish you well for the rest of your symposium.