Hon NANAIA MAHUTA (Minister of Local Government): The Government has been investigating options for addressing the significant challenges facing councils in delivering three waters services for four years, using the best of international and local expertise. We've robustly tested the options, with oversight and guidance of a joint central local government steering committee. This includes assessing options such as central government funding for the status quo; sector-led, shared-service delivery and regional models; introducing a national centralised fund similar to the New Zealand Transport Agency - type model; and relying on regulatory reform alone. None of these models adequately achieved the Government's rationale for reform, which is safe, reliable drinking water; better environmental performance of waste-water and stormwater services; efficient, sustainable, resilient, and accountable multi-regional water and sewerage services, making it affordable for future generations; balance sheet separation; and leveraging the advantage of scale for asset management and waters infrastructure investment. In terms of how many entities is best, the Water Industry Commission for Scotland assessed 30 different aggregation scenarios, ranging from one to 16 entities. For example, we did consider a regional model based on regional council boundaries. This option, however, would have perpetuated significant cost variations across the country, including disadvantaging rural regions.