She is quoted as saying, "the status quo was no longer an option". What she does not seem to realise is the government's fundamentally flawed proposal is not the only option available to local councils. It is in fact a very bad option as the Castalia and Ferrier reviews categorically state (as detailed by the NZCPR. See HERE >>>). Has Mayor Reece even read those peer reviews, which show the assumptions underlying the modelling are faulty and the assumed financial benefits are fiction.
Mayor Reece also seems to think Nelsons ratepayers (the people who own the water infrastructure) should not have a say about whether their assets are given away for 3 cents in the dollar.
She has rejected the call for a referendum by Cr Mel Courtney. Mayor Reece needs to be reminded that the Local Government Act REQUIRES her council to consult on matters involving strategic assets. It will be interesting to see what ratepayers think about that when they have a referendum in October next year to decide who should be Mayor. If the incumbent Mayor Reece wants to represent the view of Wellington to the people of Nelson she should disclose which party she represents and stand for Parliament.
Mayor Reece is of the view that losing control of the council's water assets is not a "transfer of assets where council would maintain their position as owners in the new legislation – albeit as part of a larger group."
That's simply not true. Council's "position" will be diluted from 100% influence to a fractional minority position. Iwi will have 6 of the 12 seats and effective control of Nelson's water assets. The Wellington City Council will dominate the remaining 6 seats. How can Mayor Reece claim Nelson is "maintaining their position"?
It really is time for the good folk in Nelson to find a united voice and let Mayor Reece know that reality is required before she gives away Nelson's water infrastructure.
Deputy chief executive for Local Government New Zealand Jason Krupp, says, "What we’re getting is an assets for equity swap – where councils get in return an equity stake in this larger entity."
That is absolutely not the case. Councils are NOT receiving equity (shares) in the new water entity, despite the assets being removed from the Council's balance sheet. In return for giving away hundreds of millions of dollars of assets paid for by ratepayers over many years, the Nelson council will have a very minor role in a new entity over which they will have no control. How is that equity? How is it in the slightest bit equitable?
There are another issue the Nelson mayor and her councillors should consider. What will happen to council overheads after water is removed. Will overheads drop proportionately? Or will general rates and other service charges need to rise to recover overheads that were previously recovered from water? This question has not been addressed by WICS and ignored by central government. It is however an important part of the equation that Nelson's ratepayers will want to learn more about.
Frank Newman, a political commentator and investment analyst, is a former local body councillor.