03.08.2017 : Garry Macdonald

The value of water

Over the past months New Zealand has been effected by numerous weather-related events. One of the consequences of the recent storms affecting Auckland's stormwater, wastewater and water services has been considerable media comment about expectations of councils in managing water resources.

John Pfahlert, CEO Water New Zealand, and Garry Macdonald, Beca Business Director - Water, wrote an article on the matter for the Water New Zealand Journal.


Stormwater overflows mixed with sewage, debate around whether water bottling companies should pay for water, public debate about whether major rivers should be swimmable or wadeable, infrastructure replacement costs and pressure on small councils – the list of topical issues around “3 waters’ is getting quite lengthy!

And it’s not just water and wastewater that’s coming into focus, as flooding becomes an issue and debate starts about what level of protection is appropriate given more frequent extreme events – and climate changes.

The New Lynn flash floods and physical damage to properties is only the most recent example. We have seen ‘flash floods’ in other centres such as Wellington and Napier that have overwhelmed the stormwater systems designed for a 50 year annual recurrence interval (ARI event). And this is a part from the regular flooding of households in Christchurch following the quakes, and relatively small changes in land levels that has had a massive impact on how stormwater is managed in the city. It also raises the issue of how we ‘value’ water. 

We sense a growing public hardening around holding government to account for the way water is managed. And it isn’t just in this country that the issue is getting a public airing.

A new report from the USA finds that closing the nation’s gap in investment in infrastructure would create 1.3million jobs and generate US$220 billion in economic activity. The analysis found a severe economic cost to inaction. At a national level a one day disruption in water can lead to a loss of $43.5b in sales and $22.5 billion in GDP. The report “The Economic Benefits of Investing in Water Infrastructure’, was commissioned by the Value of Water Campaign to better understand how investment in the nation’s water infrastructure affects economic growth and employment.

To maintain clean, reliable water services alone, the American Society of Civil engineers estimates that the US needs to invest an additional US$82 billion in water infrastructure per year over the next decade at all levels of government.

Despite this increased need, the report finds that the Federal Government’s contribution to water infrastructure continues to decrease, now just nine percent – down from more than 60 percent 40 years ago. The analysis falls against a national backdrop of increasingly complex water challenges that are exacerbated by overstressed and antiquated drinking water, wastewater and stormwater management systems – as well as regulatory requirements that at times outpace the technological capabilities of the nation’s water and wastewater facilities.

“The report findings make it clear that investments in water infrastructure generate higher quality jobs, increase the competitiveness of American businesses, and leads to a significant injection of economic activity throughout the nation” says Radhika Fox, Executive Director of the Value of Water Campaign.

“That is the message we want public officials on Capitol Hill and across the country to hear: Investing in water equals jobs. Investing in water infrastructure builds a prosperous America.”

So, there is an interesting association between the economic advantages of investing in water infrastructure not just roads and transportation infrastructure (as per our Roads of National Significance) and the consequences of loss of water services industry and the country as a whole.

It’s interesting to note that our own Government sees the economic benefit to the country of investing in rural irrigation schemes, but doesn’t appear to have supporting data/incentive to invest in urban sector water supply schemes.

There’s been plenty of talk in the country about the bow wave of investment required to replace out aging water infrastructure.

Central Government seems satisfied to leave the financial burden with local councils to deal with – on the apparent premise that three waters services are a ‘local issue’ that has little or no national significance.

The Value of Water report suggests otherwise – that all water services, and any disruption to them, have a much wider economic and social impact than just at local level.

Local government New Zealand continues to beat the drums on adequate financing for water infrastructure, with the launch of Water 2050 – an initiative to develop cohesive water policy across the three waters and rural sectors.

The Havelock inquiry will also lend its voice to the debate in due course. The challenge for the water sector is to acknowledge that what happened at Havelock North is really our ‘Pike River’ moment.

We need to see the Inquiry as an opportunity to improve performance, not bury the issues and pretend it was a one off that couldn’t happen on ‘my patch’. Failure to learn this time around may mean that next time it happens that isn’t all we’ll be burying.

About the Author

Garry Macdonald

Business Director - Water

Garry has over 40 years’ experience working as a wastewater and environmental engineer. He has a passion for consulting engineering and project leadership and the impact and environmental improvements he can achieve as a team. Garry has a strong interest in ‘giving back’ to his profession and to society, and plays an active role at a governance level and as a board member on several organisations – Water NZ, IPENZ, Oxfam NZ and Water Environment Federation.

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