Auckland water rates increase a big worry for poorer households

Watercare's Upper Mangatangi Dam.
Watercare's Upper Mangatangi Dam. Photo credit: RNZ

By Jordan Bond for RNZ

Auckland's water agency Watercare says it does have some sympathy for the Aucklanders whose water costs will double in the next 10 years, but says - unfortunately - it is a necessary pill that must be swallowed.

Some Aucklanders think the move will saddle the city's worst off with higher living expenses again - just a week after the council told Aucklanders they would be paying more for other services too.

Watercare has confirmed the cost of water will rise by around $80 per household each for nearly a decade.

Household water costs will go up by 7 percent on July 1, by the same amount next July, and then by 9.5 percent each year until 2029.

After COVID-19, Auckland Council group's revenue is expected to drop $750 million. The council said it could not borrow any more than it had already.

Watercare said planned maintenance and upgrades to Auckland's water systems must go ahead, so in the absence of loaned money Aucklanders would pay up front.

The water costs doubling in 10 years will disproportionately hurt lower socio-economic households.

"That's tough on people who don't have that money," one Auckland resident told RNZ. "Those of us - or them - that have more money, they should pay more than the poor have to," she said, clarifying she meant water could be means tested.

"People who are struggling to put food on the table, that's an extra burden... in 10 years time, I shudder to think what people are going to have to try and exist with," another said.

Another said giving water away free to international exporters needed to be addressed, when New Zealand citizens were set to pay more for it.

"I think we should be looking at who we give water free to. People coming into the country and exporting our water... I think the government should be earning some money from that and contributing to this," a third said.

Auckland Councillor John Watson was also frustrated by the rising local costs. The council just last week approved its own rates increase (separate to the water charges) which Watson voted against.

"It's actually more than a double whammy, it's a triple whammy," he said.

"You've got the 5 percent [council] rate increase, the very significant Watercare charges, and you've still got the [11.5 cent a litre] Regional Fuel Tax. Aucklanders are getting hit on three fronts, and all those fronts are going up." Watson said.

He said the combined household rates and water bills would go up by about $2300 a year over the next decade, from less than $4000 to more than $6000.

"Auckland is a very expensive place to live. You have this accumulation of costs from council, you have people struggling anyway with COVID-19. There seems to be a lack of awareness of how tough it actually is out there, particularly for people on limited incomes," Watson said.

Watercare chief executive Jon Lamonte said the decision to increase rates was not made lightly, and he did feel for the ratepayers having to foot the bill.

He preferred to describe the increase as $1.50 more per average household per week for water and wastewater services, and said the reality was that Auckland's drinking, storm and wastewater needed serious investment to work.

"I'm very conscious that these are difficult times. We take this very seriously - we wouldn't do this lightly," Lamonte said.

"Unfortunately it's a reflection of the fact that we've been unable to borrow more than we can at the moment - and if we can't borrow, the only way to provide the necessary infrastructure is to unfortunately raise prices. I have every sympathy."

Lamonte said people facing genuine hardship could apply to Watercare Water Utility Consumer Assistance Trust which provides financial support for those struggling with their bills.

He said the 20-year plan for Auckland's water would be unveiled soon, where he would outline how they would invest, on average, $2.5 million a day - $18 billion over the next 20 years.