It has been a busy few months for resource management reform. As signalled in the discussion paper released last week, the Government has now released a second discussion document, titled “Freshwater Reform 2013 and Beyond”. The new discussion document (which can be accessed here) suggests a suite of changes aimed at strengthening and enhancing the foundations of the freshwater management system.  

For those familiar with the Land and Water Forum (“LAWF”) reports, there will be few surprises in the discussion document. The proposals are based on, and consistent with, the LAWF recommendations, albeit they are somewhat less prescriptive.  

The proposals are intended to address the following key challenges to managing freshwater:

  • the decline of water quality in some catchments across a range of indicators, with a particular focus on the effects of nitrate;
  • the over-allocation of water in some areas;
  • the litigious, resource-consuming and uncertain nature of decision-making processes;
  • water is not always used efficiently or for its highest value use;
  • a lack of robust information on impacts and outcomes of management decisions; 
  • a lack of full consideration of iwi/Ma¯ori interests in planning and resource management decision-making; and 
  • an insufficiently adaptive and dynamic freshwater management system.  

The proposals to address these challenges are briefly summarised below. The first two reform areas set out below will be dealt with in the current round of reforms. The remaining, and arguably more controversial, areas for reform will be put off until 2014 at the very earliest to be dealt with by way of national guidance or as part of the Government’s longer term programme of reforms.  

Planning as a community

A new collaborative planning process is proposed for freshwater, as an alternative to the existing Schedule 1 process. The new process revolves around the use of one or more stakeholder groups. When preparing, changing, and reviewing freshwater policy statements and plans, councils would have a choice to use either the existing process (set out in Schedule 1 of the RMA) or the proposed new collaborative model.  

The new model would involve councils partnering with communities and iwi to develop options and solutions jointly. Councils would appoint at least one collaborative stakeholder group including representatives of the community and parties that have a major interest in the water body to give advice as the plan is developed. Councils would retain some flexibility in designing the process, but certain matters such as the nature of advice being sought by the stakeholder groups, clear timeframes and deadlines for processes, and what they will do if collaboration breaks down, would need to be notified publicly. Councils would retain responsibility for approving a plan for notification which reflects the consensus view. Transparency and “rigour of analysis” would need to be demonstrated.  

The hearing process for freshwater policy statements and plans essentially mirrors that outlined in last week’s discussion document for single resource management plans (see our newsletter on last week’s discussion document here). In summary, that process involves:

  • The hearing of submissions by an independent hearings panel which will make a recommendation to the council on any changes to the plan arising out of submissions. The panel would run mediation processes and hold a hearing with “Environment Court rigour”, including crossexamination.
  • Councils will issue decisions on submissions but will be required to “consider” the recommendations of the hearings panel.
  • The right of appeal to the Environment Court would be limited to circumstances where the council deviates from the recommendations of the hearings panel. Otherwise, the only right of appeal is to the High Court on points of law.
  • Environment Court hearings would change from a hearing to that of a “rehearing”. This change would reduce the scope of evidence that can be presented at the appeal stage.  

We continue to have serious concerns about this process as outlined in our December newsletter which can be viewed here (and our previous papers which can be viewed here and here). In particular, we remain of the view that full Environment Court oversight is a critical component of quality decision-making on planning documents, and would be deeply concerned at any limitation on appeal rights.  

It is, however, a positive move that the Government has not adopted all the recommendations from the LAWF report in relation to the proposed hearing process. We outlined our concerns about those recommendations in our paper on the second LAWF report which can be viewed here. For example, the LAWF recommended that parties should be required to seek leave to appeal the merits of a council decision to the Environment Court, which could then only be granted where the matter relates to a unique or naturally significant resource and the implications of the council’s decision was of a scale or magnitude of significance to the national community. This has not been adopted in the proposals.  

Finally, the proposals also aim to increase and improve iwi/Ma¯ori involvement in freshwater planning through:

  • a statutory requirement ensuring iwi have a place alongside other key parties and interests in alternative collaborative processes; and
  • a role for iwi in providing advice and formal recommendations to a council ahead of its decisions on submissions, with a statutory requirement for the advice and recommendations to be explicitly considered before decisions are made. This would apply to the existing Schedule 1 process and the alternative collaborative process. (This differs from the proposal for single resource management plans.)  

The Government has also proposed to allow for tangata whenua values to inform decision-making, using the Mana Atua Mana Tangata Framework, which shows the relationship between the values of tangata whenua and those identified in the preamble to the National Policy Statement on Freshwater Management 2011.  

A National Objectives Framework

The Government intends to:

  • Establish a regulated National Objectives Framework to support regions to set freshwater objectives and limits. The Framework will have a standard list of possible values for which a particular waterbody could be managed, but the actual values for any water body (subject to some nationally set bottom lines) would be a local decision. 
  • Require freshwater objectives and limits to be set in an integrated way, allowing for the impact of limits and adjustment timeframes to be well understood and factored into decision-making.
  • Require that all water bodies meet the minimum state for ecosystem health and human health for secondary contact, effectively establishing some nationally-set bottom lines.
  • Provide further direction and guidance on additional elements of the National Policy Statement for Freshwater Management 2011.
  • Make improvements to the process for Water Conservation Orders including aligning the process with board of inquiry processes for matters of national significance, and allowing the responsible Minister to refer an application to a regional council or unitary authority, or to put it on hold.  

Populating the National Objectives Framework for every value and water body type will take some time. For those who have an interest in any particular water body, or type of water body, it will be imperative that you be involved in these processes to ensure that the right values are recognised and that an appropriate balance is achieved between the different values. It will also be imperative for the costs and benefits of any proposal to be properly understood, and it will be incumbent on participants to make sure that this assessment is undertaken or that they undertake it themselves at an early stage of the process.  

Managing quality

National guidance will also be given in the form of “toolkits”, which compile information on sector-specific good management practices that can be made accessible through a centralised database or portal. These will cover both efficient use and freshwater quality. Regional councils and unitary authorities will be required to adopt good practice in identifying and accounting for all sources of the contaminants to be managed.  

The proposal is intended to help ensure councils use good practice for policy formulation and implementation when using models such as OVERSEER® in a regulatory context. This could include the use of model results as:

  • a trigger for increased support to reduce discharge levels;
  • a threshold for increased regulatory requirements;
  • an indicator of trends in a farm’s discharges; or
  • a way of monitoring compliance with a regulated discharge cap, with careful policy design to take account of the model’s capabilities and limitations.  

Other reforms

Over the next two years the Government intends to develop a freshwater accounting system. The accounting system would require all types of freshwater takes, such as consented, permitted, domestic and stockwater takes, to be included. The Government has signalled that it also intends to provide best practice guidance for issuing water permits in a consistent way within and across regions. This may include a standard template for water permits.  

The Government has also warned that if there is not a reduction in the number of unnecessarily short duration water permits, it may have to consider further action to ensure longer terms. It has also said it will look at ways to provide incentives for efficient water use, including pricing tools, national efficiency standards, and ensuring applicants only apply for the water they need for the activity they want to do.  

Concluding comments

The proposed hearing process for freshwater policy statements and plans comes as little surprise following that recently proposed for the Auckland Unitary Plan and the new “single resource management plans” announced in last week’s discussion paper. There is considerable emphasis in this discussion document on stakeholder collaboration but that has been clearly signalled in the LAWF report. Similarly, the need to have a framework for setting national standards for water quality and quantity had been clearly signalled in the LAWF report.  

The Government has taken the view that actual allocation methods need further work and will be investigated over the next couple of years. Allocation issues which are inevitably going to be controversial include mechanisms for addressing over-allocation, potential restrictions on permit transfers in over-allocated catchments, methods for dealing with unauthorised takes, and compliance and enforcement. Even more complex issues have been postponed for a 5-10 year timeframe and include minimum durations for water permits (eg 20 years), alternative tools for initial allocation, allocation of permits on expiry, facilitating permit transfer and trade, and further incentives for efficient water use (including pricing tools).  

There is a relatively short timeframe for submissions which close on 8 April 2013. This is an important opportunity for those who were not involved in the LAWF process to provide feedback to the Government on the proposed water reforms. It also provides LAWF members with an opportunity to express any residual concerns about the LAWF recommendations and, in particular, those matters on which consensus was not reached (ie limits on appeal rights). Please contact us if you require assistance drafting a submission or understanding the implications of the proposals for your business.