Report: New Zealand faces full allocation of fresh water in next four years

In four years the water in most major catchments in New Zealand will be fully allocated.

A "gold rush" for water is underway.

No water means no new business, causing significant loss for the country.

These are among the findings of a two-year $300,000 research project into New Zealand's fresh water problems.

The research has been undertaken by the New Zealand Business Council for Sustainable Development.

However, it says between 20% and 80% of water allocated for commercial use (including municipal water supply) in some waterways is not being used at any one point in time.

It proposes a policy to allow the easier transfer of water from one commercial user to another.

This could add an extra $180 to $300 million in output to the economy each year.

It proposes integrated catchment management plans set the volume of water needed to protect the environment, recreational use, municipal and other needs – and set what's available for commercial use.

Commercial users would then have a proportional share of the water actually available for commercial use, rather than the fixed volume as under current consents.

The report also proposes a cap on the contaminants allowed into waterways, and allowing these discharge rights to be transferred between water users.

The proposals include providing better security for community use of water (environment, recreation, customary rights) and funding for groups which advocate for those interests.

The Business Council has worked with 19 other organisations, and consulted with a further 14, in a collaborative project to produce what it calls the "Best Use Solution".

Business Council Chief Executive Peter Neilson says:

"If we don't act, the current system will see all major catchments fully allocated by 2012. Business opportunities will evaporate – and we will see a costly spread of rationing, queuing and disputes over what remains of the resource. None of this is necessary.

"We have just 10 years to effect change and avert these problems. The solution offers a new starting point for practical policy improvement."

To illustrate the critical role water plays in running many businesses, the report quotes international research showing it takes 40 litres of water to produce a slice of bread, 70 litres to grow an apple, 140 litres for a cup of coffee, and 2,700 litres to make a cotton shirt,

It reports New Zealanders are concerned over water:

• 68% believe fresh water quality is worse or much worse than 10 years ago
• Seven out of 10 believe there is a water shortage or will be within 10 years, and
• 64% perceive agriculture and horticultural run off as the main cause of freshwater pollution.

People also understand and support the report's proposal to move to allowing commercial users a proportion of water available for use in a waterway, as opposed to a fixed volume.

A move to having a proportion of the water made available may involve what the report calls a "proportional haircut" for some commercial users if the water is currently over allocated. They will bear the risk if available water volumes should fall below those initially allocated to the commercial pool.

However, they will also reap the rewards of being more easily able to transfer water to others who need it. The report recommends the current maximum 35 year water access right be strengthened with a 35 year right of renewal, providing greater security for major irrigation and other long term water related investments.

The solution calls for:

• A series of national policy directions from the government, including setting priority catchments for early action
• law changes to separate the water take and use consents from the water entitlement and the transfer of those rights from one user to another
• integrated catchment management plans being developed by regional councils in stressed catchments
• accurate measurement of the water available, actually being taken and returned, and contaminant discharges
• creation of a national registry of consented access rights to record transfers
• protection of existing water users' rights where feasible
• continued Crown management of water on behalf of all New Zealanders, but a simpler system allowing the transfer of unused commercial water between users in the same catchment.

Mr Neilson says Ministers, political parties, government officials and the 33 organisations and groups have been briefed on the policy proposals.

The Business Council wants the in-coming Government to:

• Use the report as the basis of discussions to quickly develop
• A national accord among water users, including
• Draft legislation, to implement the changes and introduce new policy tools and
• Concerted and coordinated Central and Regional Government action over the next five years within priority water stressed catchments.

It suggests the new way of managing water be trialed in a highly stressed catchment, in the Canterbury or Waikato regions, with central government financial support.

These proposals are consistent with the Government's Sustainable Water Programme of action, but will require the Government to play a more active role including establishing:

• clear national priorities for long-term water uses
• a requirement to measure and monitor all significant takes and returns in water stressed catchments
• a clear timetable for addressing priority catchments an when the allocation of water should move from first-in, first-served to value-based methods
• Provision of new knowledge, systems and tools for water management
• A clear definition of a secure water access entitlement and its duration
• Funding the establishment of a national water registry and the
• Development and funding of a pilot scheme in a priority water stressed catchment.

"Our current fresh water management practices were for an era when our supply of water was vastly greater than our needs," Mr Neilson says. "We need policies and practices that enable the best use to be made of our fresh water where we face limits on both quantity and quality of the water available."

The 34-page Best Use Solution summary report and other information gathered by the project is available at