Papakura Water Pressure Group

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How did United Water get into Papakura?

Historical Overview.

In 1992 David Hawkins was elected as mayor of Papakura. This was the time of "The New Zealand Experiment"; the time from 1985 to 1995 when the social and economic order of New Zealand was turned up side down in a New Right attack. The government sold off public assets and a wave of privatisations of publicly owned assets took place.

Mayor David Hawkins took up this cause with great enthusiasm and started to introduce these right wing ideas. Among other things, he privatised Council services such as Roading, Parks and Reserves and Building Consents. Council staff (excluding library staff) was cut  from 90 to 24.

At the Council meeting of 9 December 1996 Mayor Hawkins first introduced the idea of privatising Papakura's water services. He reported he hadn't fully thought it through at that stage, but it appeared to him that franchising would be the best option. Specialist private water service providers could do the job much more efficient than Council, he claimed and because water would no longer be included in Council rates, a rate drop of 27% could be passed on to the Papakura residents. Mayor Hawkins moved that Council "Call for public expressions of interest …". Clr Allan Bell seconded this and the motion was carried. A one month timeframe (the minimum legal requirement) was set aside for the public to put in submissions. This period of one month was to commence mid December 1996 and finish 24 January 1997, which allowed for the statutory Christmas holiday period. Although public submissions were invited, the public did not have access to the actual proposed Franchise Agreement until after the final decision to franchise had been made in March 1997.

Eight submissions were received. All were in favour of the franchise and coming from as far away as Stokes Valley, Wellington. The Franchise Agreement was drawn up during late January and early February 1997.

Around late February and March 1997, protests against the franchise were mainly coming from an Auckland group "Fair Deal Coalition", a watchdog on privatisation issues. Mayor Hawkins dismissed their protests, because they (the protesters) came from outside Papakura (pro franchise submissions from outside Papakura were acceptable though to the Mayor). Coalition members protesting at a public Council meeting were ordered out by the Mayor and police was called in to remove them. At the Council meeting of 24 January 1997, it was moved that tenders would be called for to franchise the water services and a Franchise Agreement would be considered.

At the 24 March 1997 Council meeting, United Water's tender of $13.1 million was accepted. It granted United Water the rights to run Papakura's water services for a period of 30 years with an option to extend this by 20 years. Council would retain ownership of all infrastructure. United Water maintains the infrastructure and returns it after 30 years in the same or better condition. The deal was done and the people of Papakura were lumbered with a potentially 50 year franchise water contract before they really were aware of what was going on.

Papakura residents are not happy about this and PWPG has been set up as a result. In August 2001, PWPG did a postcard poll and received 1160 votes on the franchise: 3.3% supported it and an overwhelming 96.7% were against it.

Today, the controversial water franchise agreement is still a hot issue in Papakura.

Notes:

  1. After the franchise agreement had been approved in principal by Council, a protest group, called Papakura Concerned Citizens (PCC), was set up by local resident Ross Vickery and collected 4,500 signatures opposing the franchise. The groups treasurer was David Buist who was later elected Mayor, after David Hawkins resigned. Mr Vickery was sued by three senior Council officers for defamation and lost. In an unusual move, the case (taken by the three officers) was fully funded by Council. Also unusual was the fact that Mayor Hawkins tried to interfere with Mr Vickery's application for legal aid.
  2. Of the eight submissions received on the water franchise, four were faxed from the office from a local contractor with considerable business interests in the district, three more came from people with associations with members of Council and one from Lindsay Perigo et al (a group against any government involvement in every way).
  3. David Buist was elected Mayor in November 2000. He has since done a 180 turn and now supports United Water. He even succeeded in having Council revoke a decision to grant $500 to PWPG after United Water had raised concerns about this.
  4. Under the Franchise Agreement, United Water is obliged to commission a report on the state of the infrastructure at the start of the 30 year contract and again at the end of the contract. These reports are then used by Council to satisfy itself that the infrastructure is in the same or better condition. In other words: United Water reports to Council on its own performance in maintaining the infrastructure.
  5. The $13.1 million paid to Council for the franchise, was quickly spent on a new library building and a swimming pool. Both projects had significant budget overruns and Council reserves were used to cover these. As a result, Council rates had to be increased by 9.4% in 1999/2000, 13% in 2000/2001 and again 14% in 2001/2002. These increases already nullify the rate reduction of 27% resulting from the Franchise Agreement. Nevertheless, Council is still spending more than the rates it collects and more increases are inevitable. In Papakura, the combined total of rates, water and waste water these days is significantly higher than the 'old' rates, which included water and waste water.
  6. Reports from the Controller and Auditor-General from 1998 and 2001 have been highly critical of Council's lack of monitoring United Water's performance.
  7. In August 2001 a high court testimony was made public, inferring that at the time of tendering for the water franchise a local New Zealand bid of $14 million (nearly $1 million higher than United Water's bid) was received and ignored by then Mayor David Hawkins. It was never put before the full Council.