Skip to main content.

Appendix 3: Case study on Lake Taupo

The following is a case study on the issue of protecting Lake Taupo water quality. It should be noted that this process is still active, and it will be some time before it is complete. This paper highlights some lessons for central government, both at a policy and operational level, and issues on the horizon.

While Taupo could be considered a unique situation because of its iconic nature, it does provide a good study on a sustainable development process. It is also somewhat unique in that it is a preventative exercise rather than a restorative one.

Background

Lake Taupo is New Zealand's largest lake, known for its dramatic vistas, deep clear waters, superb trout fishing and volcanic heritage. It is at the heart of the local economy, which is largely based on forestry, electricity generation and tourism.

Scientific evidence shows that the health of the Lake is declining as a result of nitrogen flowing from surrounding land. To protect the Lake, Environment Waikato proposes to promulgate a Variation to their Regional Plan. In essence this will cap the nitrogen inflow at current levels from all sources, and reduce the manageable nitrogen by 20 percent. This equates to a 9 percent reduction in total nitrogen inflow.

It is thought that this reduction in nitrogen would hold water quality in the Lake at its present level. As much of the nitrogen inflows are via groundwater sources, there is a significant time lag on this. Therefore the Lake is likely to continue to deteriorate for several decades before it improves back to its 2000 condition.

Process

Research over several years has highlighted the issue of nitrogen inflows and its impact on Lake Taupo. As the regional council with responsibility for managing the water quality in Lake Taupo, in 2000 Environment Waikato (EW) formally began a process to develop a variation to its regional plan to protect the Lake. This involved:

  • commissioning further research and development on the issue
  • seeking cooperation with Taupo District Council (TDC)
  • extensive consultation with stakeholder groups to develop community support for action
  • commissioning a cost benefit analysis to establish costs versus benefits
  • commissioning an analysis on possible cost sharing between Government, EW and TDC.

In mid-2003 EW and TDC formally approached government for its involvement and assistance with the project. This was agreed by Cabinet in July 2003.

Currently there are three sets of parallel discussions/negotiations:

  1. six-way discussion involving EW, TDC, government, Tuwharetoa, forestry interests, and pastoral land owner interests
  2. two-way discussions involving government and Tuwharetoa on Treaty-related issues
  3. three-way discussion involving EW, TDC, and government on funding, RMA, and administrative issues.

The current timeline is:

  • proposed Regional Plan Variation promulgated by EW; September 2004
  • public submissions on the Variation through to August 2005
  • hearings September/October 2005
  • council decision December 2005
  • possible Environment Court appeal hearings.

Lessons learned

The process to find an effective solution highlighted a number of challenges created by the current framework, as discussed below.

1. Effective community goal setting

Until a community has agreed upon specific objectives for the future condition of a water body, it is difficult to reach agreement about the content of any programme to achieve those goals, as well as how the costs and foregone opportunities should be shared.

Environment Waikato has led a consultative process of informing the communities about the issues facing the Lake and catchment land use patterns, together with options for addressing these issues. A facilitated debate about the intended future state of the Lake, and the implications of this for land use, led to a consensus to adopt the goal of returning the Lake to its 2000 condition within several decades, while rejecting the option of full restoration or unconstrained eutrophication.

2. Use of cost benefit analysis to aid decision making

This approach directly contributes to the ability to make decisions about trade offs. While in many such instances it is not possible to quantify costs and/or benefits in monetary terms, it does give a direct appreciation of the "positives" versus "negatives" and allows for a greater transparency of decision making. This reinforces the need for a good analysis under section 32 of the RMA.

Environment Waikato commissioned a cost benefit analysis on protecting the Lake, in order to gain some indication of costs versus benefits. While this analysis had its limitations, it did give a direct indication that the benefits were well in excess of the cost; the cost (mostly to farming) was put at $116m, while the benefit (to tourism) was $394 million.

3. Science to underpin policy decisions

Environment Waikato has good research findings to back-up the claim of deteriorating water quality, the cause of this (eg, nitrogen inflows) and the required solution (eg, a minimum of 20 percent reduction in nitrogen inflows from manageable sources).

4. Central Government Involvement

There is a need to have clear criteria or rationale as to why and how central government should be involved in protection of water bodies. This should be developed as part of the water bodies of national importance work.

Given Lake Taupo's relatively unique iconic status, there were a number of clear rationales to justify central government involvement. Examples were:

  • Lake Taupo is nationally, if not internationally important for its natural and cultural values.
  • There are Treaty obligations to actively protect the Lake as a taonga and to meet Māori expectations to manage their own land.
  • There was a legacy of past government involvement via development of much of the pasture land in the catchment through the 1950s-1970s.

5. Guidelines for funding

There is a need to develop guidelines as to the share of funding which central government could assume in similar situations. This needs to draw on the "exacerbators and beneficiaries" approach as used in other areas such as Biosecurity.

A basis for cost sharing between the government, EW and TDC was commissioned by Environment Waikato under the auspices of section 122 of the Local Government Act.

While there were weaknesses in this, it still provided a good basis on which to start discussions on the funding split between the three partners. In the end, the decision was made to split the funding 45 percent to central government, 33 percent to EW, and 22 percent to TDC.

6. Consultation

Māori

There are political sensitivities requiring any negotiating group from Government to be sufficiently "high powered" to be able to make some decisions. Such negotiations take time and resources, which Government and the Ministries involved need to appreciate and fund. In the discussions on Lake Taupo, care has been taken to differentiate the Lake Taupo issue away from any historical Treaty claims.

Tuwharetoa are the local iwi, and own approximately 70-75 percent of the entire Lake Taupo catchment. Tuwharetoa preferred to deal directly with Government, seeing the situation as a Treaty Partners issue and wanted a relatively high powered Government delegation to deal with.

Consultation with other bodies (land owners, Environment Waikato, Taupo District Council)

Assuming that it is the regional council who is taking the lead, there are direct advantages for Government officials to consult with other affected parties as part of the regional council/Government team, rather than directly. This may well differ if Government initiates any direct action. There can be significant synergies in having Government officials and regional council staff working together.

7. Research to find solutions

The issue here is for all funding bodies to consult and coordinate their efforts, particularly with the "regulatory bodies" involved in such situations. This is likely to give a much better focus to the research and development and hopefully more positive outcomes. Research and development to find solutions is the best option to identify possible "win-win" solutions.

Currently there is a Sustainable Farming Fund (SFF) project underway in conjunction with Tuwharetoa (Puketapu Blocks), to look at on-farm management systems that can be used to reduce nitrogen outflows. A further SFF-funded project is developing codes of practice in conjunction with local farmers.

Recently, the Foundation for Research, Science and Technology announced funding of $13 million to AgResearch and $5 million to National Institute of Water and Atmospheric Research (NIWA) to research further issues relating to Lake Taupo, including investigating possible land use options.

Issues on the horizon

RMA issues

A number of issues relating to the RMA have come to light as a result of the Lake Taupo work. These include:

  1. Under section 15 of the RMA, a farmer would be deemed to be discharging a contaminant into a water body if their livestock urinated onto the land, resulting in nitrate leaching through into groundwater or into streams. This would breach the Act unless expressly permitted by the Regional Plan or allowed by a resource consent. No regional plans in New Zealand expressly permit such discharges, and resource consents have not been required by Councils to date.
  2. Economic instruments - nutrient trading. Trading of nitrogen is being considered for the Taupo catchment, as this would enhance the flexibility of land use after the introduction of the Regional Plan Variation. The transfer of discharge permits is not allowed under the RMA. It appears that nutrient trading is possible via the cancellation of current consents and the granting of a new consent. This would be a relatively bureaucratic system, which is not likely to facilitate a trading system.
  3. Measuring, monitoring and enforcement of diffuse discharges. Measurement of diffuse discharges can be done in a physical sense, but is relatively impractical and expensive. A more practical means of doing so is the use of computer models such as Overseer. The issue is that such models have an error margin of ±20-30 percent, which would adversely affect the use of these models for enforcement purposes. This raises an issue of the flexibility of potential rules and resultant land use. A farmer with a set allowable nitrogen leaching figure of xkgN/ha would have much greater flexibility in achieving this level. If a set figure (as determined by a computer model) could not be used, then a much more prescriptive approach would be required - the farmer would be prescribed as to the number and type of stock that could be run, maximum fertiliser levels, maximum supplement inputs into the farm, and possibly some restrictions on management.

Summary

  1. Environment Waikato has taken a clear leadership role, and instigated a significant programme of consultation, analysis, and research.
  2. This consultation has led to the community accepting the proposed plan of action.
  3. A clear rationale for Government involvement was established.
  4. There is good science to underpin policies.
  5. A cost benefit analysis gave a direct indication of costs versus benefits.
  6. A formula for funding by the different bodies was established.
  7. Ongoing consultation is being carried out to maintain stakeholder/community support.
  8. A partnership arrangement was developed between EW, TDC, Tuwharetoa, and Government.
  9. Research was initiated to find solutions.

[ | ]