Prime Minister Chris Hipkins doubts councils can fix water under National's plan

Prime Minister Chris Hipkins says National's alternative proposal to the government's Three Waters scheme will barely change the status quo.

Last week, National unveiled its 'Local Water Done Well Water' vision, which would see Three Waters scrapped and control of water infrastructure handed back to councils.

The government's primary reason for taking power off councils is because they have been unable to solve water infrastructure issues themselves, with limited access to funds.

Studies released by the government in 2021 estimated the cost of repairing and upgrading water services at up to $185 billion over several decades, a bill that under the present system would be foisted on ratepayers. One paper suggested in 30 years the average household would have an annual water bill of nearly $14,000.

National's solution puts trust in local councils to "enforce strict water quality standards and require councils to invest in the ongoing maintenance and replacement of their vital water infrastructure", with "greater access for councils to long-term borrowing".

Speaking to Morning Report on Tuesday morning, Hipkins called it "pretty disappointing".

"There's no costings associated with it, which is a pretty fundamental thing that you're supposed to do when you're putting out a major policy like that. People need to know how much it's going to cost and who's gonna pay.

"And that can lead people only to the conclusion that the ratepayers will end up paying. We know that the status quo will result in, if unchanged, significant rates increases for households across the country."

Three Waters will hand the infrastructure over to four new publicly owned water service entities, which will be required to consult with their local communities.

National's proposal would allow for neighbouring councils to form multi-region water entities, if they wanted to, and "provide step-in powers for the government if any council or group of councils are unable to deliver a viable plan that can deliver on outcomes for water quality, infrastructure investment and financial sustainability".

Hipkins said this showed a lack of leadership.

"They're basically saying to councils… councils have had a lot of time to figure it out and they haven't, so you know, the reality is that this problem has built up over decades. Councils haven't been figuring it out. It's been getting worse."

Te Whatu Ora chair's comments 'very political'

Elsewhere in the interview, Hipkins was asked about comments about National's water policy made by Rob Cambpell, the chair of Te Whatu Ora/Health NZ and the Environmental Protection Authority.

"What on earth would make anyone think this was a sensible idea for debt raising alone, let alone the management and delivery of the tasks," Campbell wrote on his LinkedIn page.

Under the Public Service Commission's code of conduct, directors of Crown entities are supposed to act in a politically impartial manner.

Hipkins said Campbell was "not a full-time salaried public servant", "sort of halfway between a public servant and not".

Nonetheless, they are "still expected to act in a politically neutral way", Hipkins said.

"If there was a change of government, these people don't automatically lose their positions. They should be able to serve the new government, whomever that is. And that's one of the reasons why these rules are in place now.

"His recent, political - very political - comments have stepped sort of well outside the bounds of what we'd expect of somebody in those kinds of roles. So there's a process that we have to go through of talking to him about."

He declined to comment further while there was a "process in train".

As for the opposition's view on Cambpell's comments, Hipkins said he has not been paying attention to it.

It is not the first time Campbell's LinkedIn comments have come under scrutiny. Last August, he voiced his support for Green MP Chloe Swarbrick's Sale and Supply of Alcohol (Harm Minimisation) Amendment Bill.