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When preparing a regional policy statement or variation or change to give effect to Policy 1 and when preparing a regional plan or variation or change to give effect to Policy 2, every regional council must consider the following:
When preparing a district plan or variation or change to give effect to Policy 3, every territorial authority must consider the following:
Policies 4 and 5 specify matters that regional councils and territorial authorities must consider when giving effect to Policies 1−3. Many of these matters are the same, but some are specific to regional councils and some to territorial authorities. Given the cascading and overlapping nature of Policies 1−3 and the similarities between many of the matters contained in Policies 4 and 5, it is considered appropriate to evaluate them together. It will be specified where a particular aspect only applies to a regional council or territorial authority. In giving effect to Policies 1−3 there is also considerable overlap, so only the costs and benefits arising from Policies 4 and 5 that were not covered in the evaluation of Policies 1−3 will be discussed.
The key additional aspects here are a requirement to consider the sensitivity of freshwater resources in the assessment of notable values. This aspect would be incorporated into the earlier assessment undertaken in Policies 1−3, whereby regional councils are required to assess and characterise the freshwater resource in their region.
The needs of primary and secondary industry also need to be considered (Policy 4(c)), as does the contribution of the use of freshwater resources to economic, social and cultural well-being. Although it is difficult to determine the costs and benefits of this, this aspect would probably be incorporated into the determination of environmental flows and water levels; that is, social, economic and cultural matters would be considered through this mechanism.
On the other hand, avoiding the over-allocation of water is also listed as a matter for regional councils to have particular regard to. The main benefit of this will be to increase long-term certainty regarding the allocation of water for particular purposes. The specific costs and benefits will depend on how this policy is given effect, but one of the general benefits of this focus on the allocation of water is likely to be an increased awareness of the importance of fresh water to many aspects of our lives. This is likely to promote a change in thinking: from water being taken for granted to it being appropriately recognised and managed as a valuable resource. Along with this benefit, this policy (and the entire NPS) would be expected to encourage the involvement of a wider range of stakeholders in the management of fresh water, which can only be beneficial. Similarly, the increased involvement of tangata whenua is likely to be highly beneficial.
A key aspect of Policy 5, as distinct from Policy 4, is the focus on integrating land-use activities with the management of freshwater resources. The key emphasis of the policy is to ensure land-use development does not adversely affect water quality or quantity, and to ensure infrastructure for freshwater management keeps pace with land-use development. Again, the specific costs and benefits of this policy will vary considerably depending on how it is implemented. Broadly speaking, there is the potential for the policy to increase the cost of land development in terms of requiring higher standards of compliance for new and existing land-use activities. This could be through tighter controls on the effects of land use on water quality, and may involve things like improved sediment control, nutrient budgeting and riparian planting.
In terms of infrastructure, the cost of reducing the effects of land-use development will probably be passed on to land developers in the form of increased developer contributions. This could make some land unprofitable to develop, resulting in a cost in the form of a lost opportunity. This may also have flow-on implications for the affordability of housing, although the potential for this to occur is not considered high as developer contributions for the provision of services such as stormwater currently only make up a very small percentage of the overall cost of development. The general principle of this approach, as noted earlier, is that the cost is transferred from ratepayers to developers – a user-pays principle – so that rather than everyone having to meet costs through rates, costs fall directly on those who generate the need for additional infrastructure. This in part ensures the actual costs are realised and attributed earlier. A further benefit from a water management perspective is that infrastructure is more likely to be provided when it is needed, which reduces the extra costs associated with retro-fitting when there is found to be insufficient capacity at a latter date, as has been typical in a number of communities around New Zealand.
The benefits of increased integration between land-use development and freshwater management are likely to be increased certainty and consistency regarding the planning requirements and costs for the provision of freshwater infrastructure for land-use development. The ultimate environmental benefit of closer integration will be improvements in the ecological and biophysical characteristics of freshwater resources. Stemming from this are numerous economic, social and cultural benefits, which have been discussed previously.
Table 11 provides a summary of the costs and benefits of Policies 4 and 5. Overall, it is considered that the policies would be effective at achieving many of the objectives, notably Objectives 1, 2, 3, 5, 8 and 9. It would also be relatively efficient, with the benefits outweighing the costs.
Table 11: Costs and benefits of Policies 4 and 5
View costs and benefits of Policies 4 and 5 (large table).
Without limiting Policies 1 to 3, this National Policy Statement will be achieved also through the inclusion, unless inappropriate, of conditions on any relevant resource consents granted and recommendations on designations confirmed in respect of the following:
Policy 6 provides for the proposed NPS to also be achieved through resource consent and designation conditions that require the use of industry good practice. The use of industry good practice is to ensure efficient consumption and protection against quality degradation of fresh water, sustainable management of demand, and integrated management of the effects of land-use development and discharges of contaminants on the quality and quantity of freshwater resources. Monitoring and reporting must be undertaken in relation to these matters, as required by conditions of consent.
Policy 6 reiterates the objectives and Policies 1−3 of the proposed NPS. It is logical − and expected − that the objectives and policies of the proposed NPS would be implemented at a local level and at the resource consent stage of developments. The wider costs and benefits of Policies 1−3 have been discussed earlier.
The majority of the economic costs associated with this policy are expected to be incurred by the agriculture sector and industry. Those affected most will be those currently, and intending in the future, to engage in unsustainable practices. These conditions are likely to increase costs by requiring the implementation of measures that will improve practices, technology or infrastructure to meet industry good practice standards, and by requiring the use of remedial or mitigation measures.
For agriculture, in some cases this may result in decreased productivity of agricultural land, but this will be at varying scales depending on existing practices. For industrial activities, increased investment in infrastructure may be required to improve the quality of discharges from sites. This cost is likely to be a 'one-off' in most cases, although it may have an ongoing component.
As requiring authorities under the RMA, councils follow the designation process for many public works, and therefore will be subject to the conditions required to be imposed by Policy 6. Costs associated with the improvement of urban stormwater, for example, would be incurred by territorial authorities, and these costs ultimately covered by ratepayers. Methods to improve discharges could include improved discharge treatment, riparian planting, wetland restoration and public education programmes, as well as improved approaches to town planning and development, such as low-impact urban design.
It is difficult to determine the overall effects of this policy on the economy. There is the possibility that the costs of meeting good practice standards may result in a lower level of economic activity and therefore fewer employment opportunities in some sectors of the economy. However, there is also likely to be increased investment in the development of industry best practice techniques, mitigation measures, improved infrastructure/technologies and guidelines, all of which provide employment opportunities.
There is the possibility that good practice standards have not been already developed or decided on for each sector of industry that may affect water quality or quantity, and therefore the cost of developing these standards will also need to be borne by industry in conjunction with local government (and potentially central government). Research will also be required to ensure that tangata whenua values and interests are addressed within industry good practice guides, to provide advice on how best to implement objective 8 and other relevant policies.
These additional conditions may increase the cost of the resource consent process (including administration, condition monitoring and enforcement costs), and therefore costs to councils and to the applicants. This policy also requires monitoring and reporting on the matters addressed, the cost of which will be borne by consent holders.
Policy 6 also has positive implications, in that it provides a level of consistency for developers and users of fresh water, providing some certainty across all regions with regard to the consent conditions likely to be imposed. This will help developers and industry determine the feasibility of projects at an early stage.
The social implications of this policy are expected to be predominantly positive. Social benefits include an increased industry and public awareness of the importance of water, education and increased awareness of industry good practice standards. Policy 6 will also result in improved water quality and quantity for recreational users, the public health benefits of cleaner water, and amenity values for other users and the general public.
A possible social effect is the potential increased cost of urban development due to the increased costs of meeting good practice standards. This could result in land affordability issues for the general public as well as industry. However, the relative contribution of the NPS in this regard is expected to be so low that to attempt to measure it would be extremely difficult.
The environmental effects of this policy are positive. As discussed in the evaluation of Policies 1−3, implementing the proposed NPS at the resource consent stage by requiring the use of industry good practice will result in:
improved water quality and quantity
improvement of freshwater ecosystems
more efficient consumption of fresh water
improved ecological corridors through the provision of plantings along streams and rivers in agricultural areas.
However, there is also the possibility that some parties will avoid the consenting process altogether due to more stringent conditions of consent, which would result in what is likely to be localised adverse effects on the environment. It is considered the positive effects of the implementation of Policy 6 on the environment will far outweigh any foreseen adverse environmental effects.
Table 12 provides a summary of the costs and benefits associated with this policy. Overall, it is considered that the most significant economic cost will be associated with the implementation of measures that will improve practices, technology or infrastructure to meet industry good practice standards, and by requiring the use of remedial or mitigation measures. It is considered that the policy would be effective in achieving the objectives, particularly Objectives 2, 3, 4, 5, 6 and 7. The policy would also be relatively efficient, with the benefits outweighing the costs.
Table 12: Costs and benefits of Policy 6
View costs and benefits of Policy 6 (large table).
In addition to giving effect to Policies 1 to 3 and Policy 6 by regulatory means, regional councils and territorial authorities may give effect to this National Policy Statement through non-regulatory methods (including financial contributions, development contributions under the Local Government Act 2002 and other methods).
Policy 7 provides for local authorities to give effect to the NPS through non-regulatory methods, including financial and development contributions under the Local Government Act 2002 and other methods. Other methods could potentially include:
public awareness and education
advocacy
incentives or grants
funding and support of care groups
providing resources and support to schools
technical or scientific support
forming partnerships with key industries, tangata whenua and stakeholders.
This policy does not require action by local government, but provides more options which they may choose to implement as ways to give effect to the proposed NPS. As such, the benefits and costs discussed are potential rather than actual. It is also important to note that many local authorities have already implemented other methods that would help to give effect to the proposed NPS.
Although the administration/process costs of implementing the proposed NPS through other, non-RMA means are likely to be less significant, some financial costs would still be incurred.
Undertaking any of the other methods above (such as school and care programmes, providing technical support, or forming partnerships) will result in financial costs, predominantly to district and regional councils. On the other hand, this funding and support from councils would reduce costs to industries, school and other groups on the receiving end. There is also an opportunity for local businesses or industry groups to provide funding and support to care or school groups, which would be beneficial to both parties: the school/care groups receive funding, and the business/industry groups have an opportunity for marketing and positive advertising in their local community.
Development or financial contributions could potentially be used to help fund community infrastructure, such as new or upgraded stormwater systems.
The costs to council resulting from any development/financial contributions would be those associated with the upfront costs of developing the policy, administering the policy and developing the infrastructure, as well as bearing the associated risk of potentially not recouping the full cost of the infrastructure (including any associated loan costs). The benefits to councils would be the provision of infrastructure that helps give effect to the NPS, and having a mechanism in place to fund the infrastructure through those persons who require it to be in place (rather than the general ratepayer bearing the cost).
The potential cost to developers and industry of financial/development contribution policies will be the upfront cost of the contribution, but with this potentially having a flow-on effect on the local economy, land affordability and employment. It will be beneficial to the developer to pay only a share of the cost based on the demand their development will have on the infrastructure, rather than it being a requirement on the first developer to pay the total costs. However, clearly many of these assumptions will vary from council to council, so this assessment can only be relatively generic.
These other methods, particularly the funding and support of school and care groups, will raise awareness of the importance of fresh water and educate groups on how to care for these ecosystems. These methods are likely to reach a wider range of people, and funding and support of care groups encourages local interest and actions in freshwater management. This will be beneficial long term as communities gain a vested interest and a sense of ownership of local freshwater environments. Care groups and school groups aimed at improving the freshwater ecosystem would be expected to positively contribute to the amenity values of the local environment, particularly through riparian plantings, fencing, signage and walkways. Having cleaner freshwater systems also improves opportunities for the use of fresh water as a food source (mahinga kai).
A social cost of implementing other methods may be industry and public opposition to increases in development/financial contributions. Increased contributions are likely to raise the cost of urban development, such as residential subdivisions, and therefore result in land affordability issues, which is currently a significant issue for New Zealanders. However, as with any development contribution, this policy simply attempts to identify the 'real' costs of development.
The use of other methods to give effect to the proposed NPS will positively contribute to improved water quality and quantity, and an overall improved freshwater environment and surrounds.
Table 13 provides a summary of the costs and benefits associated with this policy. Overall, it is considered that the policy would be effective at achieving many of the objectives, notably Objectives 1, 2, 3, 5, 6 and 7. It would also be relatively efficient, with the benefits outweighing the costs.
Table 13: Costs and benefits of Policy 7
View costs and benefits of Policy 7 (large table).
All local authorities will make publicly available (including electronically) a record of the process used to identify the Tangata Whenua Values and Interests in Freshwater Resources of the region as required to give effect to Policy 1(e), including the identification of the relevant iwi and hapū.
All local authorities will assist the Minister for the Environment by making publicly available (including electronically) an up-to-date register of the regulatory and non-regulatory methods to give this National Policy Statement full effect.
Policy 8 requires the provision of certain information. This falls into two parts: 1) information on how tangata whenua values and interests were identified; and 2) information on the methods used to implement the NPS. The provision of information is important to all decision-makers at all levels of government to determine the effectiveness of their policies – including, at a national level, the effectiveness of this NPS.
In relation to the first part, there are a number of costs and benefits identified as part of the evaluation.
There will be costs involved in ensuring the information collected is appropriate for public release, and is correct and relevant for its purpose. The information will have to be collected from Māori initially, and intellectual property issues should be dealt with appropriately. Again it will be important to make it clear that tangata whenua values, while having many consistencies across iwi and hapū boundaries, are not always the same across the country. Analyses will have to be commissioned to ensure these issues are addressed before the information is put into the public arena.
These are consistent with kaitiakitanga.
There may be some cultural costs in making this information publicly available. However, this work may also help retain matauranga Māori for future generations, and in institutionalise Māori values and interests in regional documents. As long as there is adequate engagement with Māori on this issue, costs can be reduced over time.
Water quality, from a Māori world view, is intimately connected to a person’s well-being, as demonstrated by the whakatauki of the Whanganui people: “Ko au te Awa, Ko te Awa ko au” (I am the river and the river is me). When the waters are sick, so too are the people. With improved water quality it is perceived that the people will also be healthier, contributing to social wealth.
When it comes to the provision of information generally, this has a number of benefits in relation to sharing information on regulatory and non-regulatory methods, including the:
sharing of information on the success of methods
transparency of resource management policy
ability for various stakeholders to get actively involved in achieving resource management outcomes, especially through non-regulatory means.
In general terms, it is considered that there is already a high level of information sharing between councils and central government, but formalising an information-sharing requirement and reporting will likely focus greater attention on the success of the NPS.
Table 14: Costs and benefits of Policy 8
View costs and benefits of Policy 8 (large table)
The Minister for the Environment will seek an independent review of the implementation and effectiveness of this National Policy Statement at achieving all the objectives and policies of the National Policy Statement no later than 10 years after it comes into force and shall then consider the need to review, change or revoke this statement. Collection of data to inform this review will begin at least two years prior to the review.
Policy 9 requires the Minister to seek an independent review of the effectiveness of the NPS within 10 years of its enactment. This will introduce a greater level of accountability regarding the costs and benefits of freshwater management for all New Zealanders. The direct economic cost of this review will be borne by central government, and is estimated to be in the order of $0.9 million.
It is considered that the policy would be effective in achieving Objective 9, and would also be efficient, with a total cost of $0.9 million.
Māori will want a key role in the monitoring of the NPS to assess its effectiveness from a tangata whenua perspective.
In summary, it is considered that the NPS as proposed meets the tests required by section 32. Specifically, this evaluation concludes that the objectives meet the purpose of the Act, namely sections 5(a), (b) and (c). Therefore, it is considered that the requirements of section 32(3)(a) are met. In addition, each of the policies achieves one or more of the objectives, and the benefits outweigh the costs, while the risks appear to be manageable. Therefore, it is considered that the requirements of section 32(3)(b) are met. The following tables provide a summary of these two requirements.
Table 15: Do the objectives achieve the purpose of the Act?
Objective |
Achieving the purpose of the Act (section number) | ||
|---|---|---|---|
5(a) |
5(b) |
5(c) |
|
1 Enabling well-being of people and communities |
|
|
|
2 Ensuring integrated management of the effects of fresh water |
|
|
|
3 Improving the quality of fresh water |
|
|
|
4 Recognising and protecting life-supporting capacity and ecological values |
|
|
|
5 Addressing freshwater degradation |
|
|
|
6 Managing demand for fresh water |
|
|
|
7 Efficient use of fresh water |
|
|
|
8 Iwi and hapū roles and tangata whenua values and interests |
|
|
|
9 Ensuring effective monitoring and reporting |
|
|
|
Table 16: Are the policies the most appropriate way to achieve the objectives?
Policy |
Objective | ||||||||
|---|---|---|---|---|---|---|---|---|---|
1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
9 |
|
1 Policies on regional policy statements |
– |
|
|
|
|
– |
– |
– |
– |
2 and 3 Policies on regional and district plans |
– |
|
|
|
|
– |
– |
– |
– |
4 and 5 Policies on the preparation of policy statements and plans |
|
|
|
|
– |
– |
|
|
|
6 Policy on certain consents and designations |
– |
|
|
|
|
|
|
– |
– |
7 Policy on non-regulatory methods |
|
|
|
|
|
|
– |
– |
|
8 Policy on information concerning iwi and hapū registers and other matters |
|
– |
– |
– |
– |
|
– |
|
– |
9 Review of this NPS |
– |
– |
– |
– |
– |
– |
– |
– |
|
The high level and national focus of the NPS makes the quantification of costs and benefits in dollar terms extremely difficult. However, for the purpose of providing a context, this has been attempted. Appendix A provides a more detailed breakdown of these costs and, most importantly, a series of assumptions as to how these costs were derived. It is expected that these costs can and will be refined further as the proposed NPS is presented to local government and other stakeholders.
It is concluded that the NPS is likely to cost central and local government up to $100 million in the 25-year period to 2035 (see Appendix A). A summary of the impacts on the primary sector is included in Appendix B, but quantification is difficult at this stage as it relies on the specific regulatory actions from (primarily) regional councils.
In addition to quantifying the dollar costs to local and regional government, it is possible to provide a context for these costs by quantifying the benefits to the country in general terms. Throughout the evaluation, a range of benefits have been identified, such as the value of New Zealand’s clean green image and the cost of water treatment. While these benefits are much more difficult to quantify, Appendix B does attempt to provide some context to the real value of water. Overall, it is considered that the benefits of the NPS outweigh the costs, and that the NPS is the most appropriate means to achieve the purpose of the RMA.
The final element of the analysis is an examination of the risks, uncertainties and assumptions associated with each of the policies. Section 32(4)(b) of the RMA requires an evaluation to take into account:
... the risk of acting or not acting if there is uncertain or insufficient information about the subject matter of the policies ...
There is some uncertainty around aspects of the some of the policies, in particular matters such as climate change. However, in terms of existing environmental trends, there is a great deal of certainty in relation to the need to reverse trends of degrading water quality, over-allocation and conflicts over water uses and demand, and for the establishment of environmental flows.
The risks of acting versus not acting are typically difficult to predict. However, it is clear that the risk of not-acting will likely mean:
further ongoing costs associated with improving the regulatory regime to address water quality under the enhanced status quo scenario − these costs have not been identified in this section 32 in detail, but are likely to be significant, and will be incurred whether or not this NPS is notified
further degradation of water quality, largely as a result of further intensification of land uses – both urban and rural − and poorly controlled discharges (largely non-point-source discharges)
a lack of action to improve water quality across the board, and therefore a loss of opportunities associated with clean water
increased demand and conflict over water use and allocation
decreased ecological function and a loss of important values as a result of water flows and levels falling too low, perhaps in part due to the impacts of climate change.
Although this evaluation of the NPS does demonstrate that acting at a national level is the right course to take, there are a number of potential risks. These include:
whether the timeframes specified in the NPS are appropriate given the significance of the resource management issues
whether the NPS creates a level of additional work for regional and district councils for which insufficient resources are available to deliver on the NPS requirements in time
whether a few or many regional and district councils interpret their own plans relative to the NPS as being satisfactory, and therefore little change will occur at the local/regional level.
There are a number of timeframe-related constraints with the NPS. The NPS largely focuses on policies that are implemented through regional and district council plans. Although this is the best approach, there are constraints that over the period taken to translate the NPS into various regional and district plans a great deal of time will be lost. Furthermore, although the policies include specific timelines, there are risks that the timeframes are too long given the significance of this issue.
Timeframes identified in the policies are as follows.
Policy 1(a)–(j) requires that by the second anniversary of the date of commencement of the NPS all regional policy statements must contain provisions to determine and set timetable priorities for regional plans in a number of relevant matters, specifically water quality standards and low flow provisions, along with a wide range of other matters. Although a significant amount of work is required by Policy 1, this timeframe would appear to be realistic given the timeframes needed to prepare objectives, policies and methods, and the statutory timeframes associated with implementation.
Policy 2(a) provides the opportunity for regional councils to notify a regional plan dealing with Policy 1 (a), (b) and (c) matters. Policy 2(b) then requires other matters to be notified in a regional plan within 40 working days of the regional policy statement becoming operative. This suggests that the matters in Policy 1(d)−(j) are more critical, as a specific timeframe is set, whereas Policy 1(a)−(c) leaves discretion to regional councils as to the timeframe.
Policy 3 requires that territorial local authorities notify a district plan change within 40 working days of the regional policy statement becoming operative. The district plan change may occur in advance of some of the regional plan provisions (specifically those relating to Policy 1(a)−(c)), and would be concurrent with regional plan provisions for Policy 1(d)−(j). This creates some risk that there will be a lack of integrated policy development (ie, the district and regional plans could be incompatible, or could have gaps). Again, this is a large volume of work, and although some councils may be well underway there is a risk that the work cannot be completed in time. This is again an area where it would be appropriate for the Ministry to assist in providing information and guidance.
Policies 4 and 5 take immediate effect, as no timeframe is specified, but in practice they relate to the preparation of policy documents or plans in any case. Whether these policies provide sufficient guidance to alleviate the risks identified in the point above remains to be seen. The risk is considered low if local and regional governments have an open relationship for their policy development.
Policy 6 takes immediate effect. The constraints are considered to be reasonably low.
Policy 7 takes immediate effect, and the constraints are considered to be low overall, although greater direction could be provided to councils on non-regulatory methods to use.
Policy 8 takes immediate effect, although it is linked to Policy 1(e), which is to be effected by the second anniversary of the date of commencement of the NPS. Policy 1(e) requires a large volume of work, but because this policy is referring to processes rather than data or information collection, it is considered to be achievable and therefore low risk.
Policy 9 requires a review of the NPS no later than 10 years after it comes into force. This is a realistic timeframe, and is required by the Act in general terms of policy review in any event.
A further constraint for the implementation of NPS arises from 'resourcing'. The NPS will create a large amount of additional investigative, monitoring and policy development work for councils. Although an approximate estimate of these costs is provided in Appendix A, one key risk to delivering on the NPS is a lack of 'professional' resources at regional and district councils. If additional resources are not available (due to labour supply), some tasks may not be completed within the timeframes stipulated. A further possibility is that the NPS will result in resources being diverted from other programmes by regional and district councils. However, it is important to bear in mind that some of these costs might ultimately arise even without an NPS in effect.
Finally, given the heavy reliance on regional policy statements and plans and district plans as an implementation measure, it is possible that despite the various trends in environmental quality identified in this and many other reports, some councils may argue that their plans already meet the requirements of the NPS, and therefore no further change is necessary. Councils, and stakeholders, may have differing views about how best to implement the NPS.
7 See Appendix 1. This is an estimated order-of-magnitude assessment only, and has a number of assumptions.