First tranche of funding opens to support the future of local government and communities

Councils are now able to apply for the first tranche of funding from the Three Waters Reform Program to invest in their local communities, Local Government Minister Nanaia Mahuta announced today.

“For too long, councils have had to offset tough decisions about funding water infrastructure and services with other important initiatives, with water infrastructure often taking second place,” said Nanaia Mahuta.

“Councils face significant challenges over the next few years; With growing populations, housing pressures, increasing natural disasters and climate change, it is important that councils are able to prepare their communities for the future.

“As well as saving taxpayers money in the long term, the government’s reform program will allow councils to focus on the well-being and aspirations of their communities. This “better off” funding can be used for the projects communities feel they need most, whether it’s local parks and gardens, swimming pools, libraries and community centers, or investments in transportation. public and infrastructure to protect against extreme weather events and rising sea levels.

“Applications are now open until September 30 for councils to submit funding proposals for their share of this first tranche of funding,” Nanaia Mahuta said.

The terms of use of this funding are set out in the Memorandum of Understanding negotiated by the New Zealand local government last year.

“We are delighted to be working with New Zealand local government not only on these reforms, but on other challenges and opportunities for the sector, including examining the future of local government. Their contribution has been essential in improving our relationship and our policy-making approach,” said Nanaia Mahuta.

It is estimated that $185 billion is needed to repair, upgrade and maintain New Zealand’s water services over the next 30 years, to ensure critical water infrastructure is maintained.

The Home Office has issued guidance to councils on the application process.

The first $500 million tranche of funding will be available beginning July 1, 2022. Any unallocated money will flow into the next tranche, which will become available July 1, 2024, when the four public water service entities are created.


Under the Three Waters reform programme, the government has developed a funding package to support the local government sector in the transition to the new water service delivery system and position the sector for the future.

The best-off component of the funding package is:

  • $2 billion in funding to invest in the future of local government and community well-being;
  • In recognition of the importance to the local government sector (and the communities they serve) of devolving responsibility for the provision of water services.

Use of this funding helps boards transition into their new post-reform role by meeting some or all of the following criteria, as outlined in the agreement heads:

  • Support communities in the transition to a sustainable, low-emissions economy, including building resilience to climate change and natural hazards.
  • Provision of infrastructure and/or services that enable housing development and growth, with an emphasis on brownfields and infill development opportunities where available.
  • Provision of infrastructure and/or services that support the creation of local places and the enhancement of community well-being.

The announcement of this support package was made in July 2021. Further information, including the council’s allocation, can be found on the Department of Home Affairs website.

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