Our Director & Economist Dinesh Kumareswaran sat down with Water New Zealand’s Hannah Edmond and Jon Reed for their podcast series Tāwara o te Wai, on the topic of financing investment in water infrastructure, the long-term financial viability of council-owned water utilities, and affordability of water services in New Zealand.
In this 30 min podcast, Dinesh explains a range of factors contributing to financing and investment decisions in New Zealand’s water sector, including:
- The “ringfencing” of water services and revenue from other council activities - that is, that the delivery of water services should be completely financially sustainable. This financial ringfencing helps ensure that the revenues would be enough for the provision of the services.
- The critical aspect of reforms to get greater clarity on costs, so that what customers are charged for the delivery of the services are cost-reflective. And that the delivery of these services are sustainable over the long run.
- Separating operational and financial decision making in water delivery, and the role of councils in setting the strategic direction, and meeting the regulatory and quality standards.
- What lenders look at when making their investment decisions. Including having sufficient revenue to cover operating costs and investments - via rates or direct charges; and good governance arrangements, asset management and planning.
Listen here:
Thank you to the Water New Zealand team for the opportunity.