Regulation and assurance framework for local water utilities

From 1 July 2022, the Regulatory and assurance framework for local water utilities PDF, 1613.11 KB applies to local water utilities in regional NSW, covering local government councils exercising water supply functions under Division 2 Part 3 Chapter 6 of the Local Government Act 1993, and utilities exercising water supply functions under the Water Management Act 2000. The regulatory and assurance framework is design to ensure local water utilities manage risks effectively and strategically.

The new approach to assessment and approvals of works (under section 60 of the Local Government Act 1993 or section 292(1) of the Water Management Act 2000) is fully implemented from 1 July 2022, with an online application form available as well as external guidance for local water utilities. More information for local water utilities about how to apply for an approval is available at Regulatory assessments.

In 2021, we committed to ensuring that those local water utilities progressing their Integrated Water Cycle Management (IWCM) Strategy would not be disadvantaged by the new strategic planning assurance framework. We continue to engage with all local water utilities that are currently undertaking an IWCM Strategy, including those funded under the Safe and Secure Water Program. We will work with utilities individually to develop a clear transition program through to 1 December. We will also publish draft guidance over the coming months, with final guidance in place by October.

The framework represents a significant change to how the activities of local water utilities have been reviewed, regulated and supported in the past. This is centred on the department’s commitment to a stronger partnership approach and culture, to empower and enable local water utilities to address risks and strategic challenges effectively and efficiently based on locally developed plans and management systems.

Through the department’s Town Water Risk Reduction Program we worked in partnership with the local water utility sector to design the regulatory and assurance framework. A broad range of stakeholders were involved in the design including local water utilities, local government representative bodies, other local water utility regulators, and the private sector. We thank the more than 200 people and organisations who have been involved in the collaborative process to design the new regulatory and assurance process.

Sections 3 and 4 of the regulatory and assurance framework, are also the new Guidelines for council dividend payments for water supply or sewerage services, under section 409(6) of the Local Government Act 1993, replacing the 2007 Best-Practice Management of Water Supply and Sewerage Guidelines. Local water utilities not making dividends payments are encouraged, but not compelled, to utilise the department’s assurance framework, experience and capacity to support effective strategic planning.

The framework is based on the actions for change and collaboration mechanisms identified in the department’s Roadmap to an improved regulatory framework for local water utilities developed by the Town Water Risk Reduction Program and has been informed by extensive consultation with the sector.

The draft regulatory framework for local water utilities was released on 31 March 2022 and was publicly available for consultation and feedback until 30 April 2022. A summary of feedback PDF, 542.58 KB provided by the sector and public submissions are available.

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    Strategic planning assurance

    Learn more about local water utility strategic planning and how to apply for strategic planning funding under the Safe and Secure Water Program.

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    Pricing

    Providing clear price signals to enable customers to balance the benefits and costs of their use of water services.

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    Developer charges

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    Payment of dividend from water supply and sewerage business

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    Water conservation and demand management

    Ensuring efficient use of our valuable water resources.

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    Drought management

    Drought and emergency management planning is important for the management of town water supplies during drought and other extreme events.