Executive Summary

Executive Summary

The issue of freshwater management (both ground and surface water) is the single most significant issue facing the Canterbury Region.  The Review Group acknowledges that the scale of the issues being addressed in terms of water availability and quality in the Canterbury Region and the scale and nature of competing demands for that resource is significantly greater than that confronted by other regional councils throughout New Zealand. They are correspondingly of much greater significance to the nation’s well-being.

The Review Group acknowledges the significance of water and the complexities it brings to ECan in its management role.  However, the Group was struck by the ‘gap’ between ‘what needs to be done’ to appropriately manage water and ‘ECan’s capability to do so’.  The Review Group membership included some of New Zealand’s most experienced assessors of organisational capability.  In their experience they had not previously seen a gap between capability and requirement matching this particular situation.  In their view, the extent of the gap between the capability of ECan and what is required for it to adequately manage freshwater issues is enormous and unprecedented.  A very large backlog of outstanding issues needs to be addressed before water management in the Region reaches a steady state position.  While the improvements and efforts made to address longstanding performance issues are acknowledged, the Review Group has concluded that ECan’s performance on water policy and management issues (allocation and quality) falls well short of what is essential.

This failure requires comprehensive and rapid intervention on the part of central government to protect and enhance both regional and national well-being.  Failure to intervene will lead to continued lack of progress in water management in Canterbury.  The Review Group considers that a profound change in approach is required to existing institutional frameworks to address this matter properly.  The reasons for this include:

• Around 70% of New Zealand’s fresh water resource is in the Canterbury Region, much of which is under demand from competing interests.  Unresolved water quality issues persist in the Region in the minds of many stakeholders.
• The Canterbury Region contributes a significant percentage of the nation’s renewable hydro electricity generation capacity, and is important in terms of agricultural and horticultural production. All of these activities depend critically on water.
• There are significant issues in relation to the Crown’s Treaty obligations, with Ngāi Tahu expressing a very strong interest in the management of water as a Treaty partner.
• Resolving water resource issues is complex and involves controversial and difficult judgments to achieve the appropriate balance between the environmental, economic, social and cultural considerations that must be taken into account.  Experience to date indicates that Environment Canterbury has not managed these competing demands and interests effectively.  All too frequently, the outcome has been undue delays rather than progress and frustration levels on all sides are high.
• Despite the passage of more than 18 years since the enactment of the Resource Management Act, Canterbury does not have an operative region-wide planning framework.  The absence of an over-arching planning and policy framework for the Region has resulted in a piecemeal, fragmented and inefficient approach to the management of freshwater. 
• It is a matter of record that, in the absence of a planning framework, the Crown was forced to intervene and establish the Waitaki Water Allocation Board to manage the allocation of water rights in the Waitaki Catchment following competing claims to water from rural interests and electricity generators.
• Most stakeholders spoken with expressed considerable frustration with the long delays in the resource consent approval process and associated very high processing costs.
• Territorial authorities (TA’s) within the Canterbury Region unquestionably believe that Environment Canterbury has failed to effectively and efficiently manage freshwater.  TA's view this as institutional failure.

While criticism of Environment Canterbury’s performance in freshwater management is widespread, the Review Group acknowledges that Environment Canterbury has, in recent times, made significant efforts to improve the situation both at a Council and officer level.  While this is commendable, it will not of itself be sufficient to satisfactorily resolve water management issues in the Region. 

The most recent initiative to progress the resolution of water management issues in the Region is the Canterbury Water Management Strategy (CWMS).  This Strategy has been vigorously promoted by the Canterbury Mayoral Forum, ECan and territorial authorities.  ECan has constructively aligned itself to this initiative and played a leading role in the development of the Strategy and its intended institutional framework.  ECan has taken this approach after forming the view that a collaboratively developed Canterbury Water Management Strategy is the only realistic pathway with any reasonable chance of success for developing a solution to these complex and controversial issues.  The Review Group notes ECan’s advice that the Canterbury Water Management Strategy will rely on legislative change to make it workable.

The intentions behind the CWMS are laudable and it is very widely supported throughout the Region, with all stakeholders recognising the imperative of solving the water problem in Canterbury.  The CWMS is however at a relatively early in-principle strategic phase of development.  The next phase will be to translate these higher level strategic objectives into ‘on the ground’ policies and an implementation plan.  Given the diverse nature of the competing interests involved in water, the next steps in implementation will inevitably become increasingly more difficult.  Already some signs of frustration are emerging amongst stakeholders.  As implementation of the CWMS advances, the potential risk for failure to achieve its objectives increases.

While there is much to commend in the CWMS it will not on its own be sufficient to resolve the Region’s water issues.  In saying this, we believe that aspects of the CWMS, notability its vision and objectives, should be a core component of any future institutional change.  There is a great deal of positive momentum in the Region following the development of the CWMS and this should be retained and built upon. It will also enable time for other central government initiatives such as the Land and Water Forum, to be completed and the implications for the Canterbury Region of any recommendations made to be considered.

The Review Group has therefore come to the conclusion that an entirely new institutional approach is needed for the management of freshwater in the Region.  This will involve a fundamental reform of the structure of decision-making within the Region for all freshwater-related matters.  The Review Group recommends that the Government create a new Canterbury Regional Water Authority (CRWA) to assume all water related responsibilities in the Canterbury Region. This recommendation reflects the fact that issues associated with water management in Canterbury will be enduring and will therefore require the full and on-going attention of a specialist body. Only by taking this approach can the Government be certain that a structure is in place that has the willingness and capability to resolve these difficult issues.

The Review Group recommends that:

• The CRWA be established under its own Act of Parliament.  That Act should set out the overriding objectives of the new Authority.
• The Authority membership be appointed jointly by the Minister for the Environment and the Minister of Local Government, in consultation with key stakeholders within the Region, with the Chair being a respected person with the necessary credentials from within the Region.
• The governance structure of the Authority be reviewed after three to five years to consider alternatives, including a mix of appointed and elected members.

The creation of an entirely new specialist entity is, we believe, the only way that the Government can be certain that it has an institution capable of dealing with the complexities involved in resolving freshwater issues in the Canterbury Region. The Authority would assume responsibility for all of the functions of Environment Canterbury related to the management of freshwater in the Region.  This includes:

• Addressing the complexities involved in balancing the competing interests for the relevant resources.
• Producing relevant plans for the allocation and management of water resources and water quality within a timeframe to be specified in the legislation.
• Allocation, monitoring and enforcement of consents relating to water.
• Addressing the water quality issues that are currently the responsibility of Environment Canterbury.

The Review Group is conscious that, in recommending the creation of a specialist body for managing water issues, the matter of how the balance of ECan’s activities are managed arises.  The Group assessed the adequacy of the current legislation in dealing with this issue and concluded that the circumstances that apply in this particular case were not anticipated by either the LGA or RMA.  It is not appropriate to rely on the statutory intervention provisions of either statute.  In particular, Section 25 of the RMA, if used would introduce a person responsible for managing water, but would not replace the council.  This would create a confused governance and accountability regime and would not be an enduring solution. 

The Review Group therefore recommends that the existing council be replaced by a temporary Commission as soon as practicable under special legislation.  This Commission will give ECan and the Region breathing space to allow the CWRA to be soundly established, and provide impetus to urgently addressing water management issues.  In addition to the normal governance responsibilities of a regional council, the Commission would be charged with:

• Overseeing the separation of functions and funding associated with the management of freshwater from ECan to the CRWS.
• Progressing ECan’s activities related to the management of freshwater until the new CRWS is able to undertake those activities, so as to assure a seamless transfer of functions to CRWS.
• Putting in place the structure necessary to operate those functions that will remain the responsibility of ECan (that is, the non-water related functions).
• Implementing other Review Group recommendations regarding the broader performance of ECan.
• Initiating a review to consider the optimum arrangement for the management and operation of the public transport fleet within the Region. The overwhelming bulk of this activity is within Christchurch.  Christchurch City Council (CCC) is strongly of the view that the present arrangement leads to material additional costs due to the overlaps in responsibility between Christchurch City and ECan and that this resource would be better applied to improving public transport services.   The Commission would act on that review when completed.

The Commission should be responsible for governing ECan until a new Council is elected. These elections could take place either in 2013, or such earlier time determined by the government.

The Review Group also made a number of findings and recommendations arising from the overall review of ECan in discharging its responsibilities under the Resource Management Act and Local Government Act.  The Review Group acknowledges the steps that ECan has taken to improve its performance in recent times.  Examples of this include: considerable improvements  in the processing of resource consent applications  in a more timely manner, as well as other process and systems improvements.  ECan is on track to perform significantly better in the next MfE survey.  Other examples of improved performance are the work undertaken on the Long Term Council Community Plan, and more robust financial reporting planning and monitoring.

We have identified the following priority areas for further performance improvement.  These recommendations apply irrespective of the institutional changes recommended by the Review Group.

In respect of the Resource Management Act, it is recommended that:

• ECan should undertake a ‘fit for purpose’ review of the Planning and Consenting Directorate, including
  • More resource management ‘content’ leadership should be introduced in the resource consenting section.
  • A broader range of skills is required in the consenting section – notably planning/resource management skills. 
  • ECan needs to more effectively and actively manage the Hearings Commissioners process in terms of accountability, responsibility and timeframe management.
  • ECan should consider cost recovery pre-lodgement of consents, to remove the perceived barrier to more effective pre-application engagement with major applicants.
  • ECan needs to adopt a new case management operating model for large and/or complex consent applications. 
  • ECan requires more experienced practicing planners, economists and social scientists on staff to facilitate a better balance between environmental, economic, social and cultural perspectives.  
• ECan should institute an ‘account management’ approach for dealing with major stakeholder groups, in much the same way as exists with most territorial authorities.
• Iwi liaison should be elevated in importance within ECan. 
• ECan should undertake a review of its internal legal team to ensure it is fit for purpose.

In respect of ECan’s broader responsibilities under the Local Government Act, the Review Group acknowledges that some of the issues relate to an historic failure of collective action by local government in the region. The Territorial Authorities (TA’s) and ECan must all shoulder responsibility for addressing this.  Indeed there have been a number of examples in recent times where effective collaboration has been demonstrated, including the Urban Development Strategy and Canterbury Water Management Strategy.  We consider that two governance related measures would further enhance collective local government performance for the benefit of the Region as a whole (we note that the Canterbury Regional Water Authority once established will also have a part to play in these measures):

• The establishment of a new Triennial Agreement that improves role clarity and protocols.
• The formal establishment of a Canterbury Chief Executives’ Forum that parallels the Mayoral Forum. 

In addition to these governance related recommendations, the Review Group recommends a review to consider the optimum arrangement for the management and operation of the public transport fleet within the Region.  The Commission would act on that review when completed.