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Town Water Risk Reduction Program

Improve the regulatory and assurance framework

We are partnering with the sector to develop and implement an improved regulatory and assurance framework for local water utility.

Carcoar Water Filtration Plant.

We are partnering with the sector to develop and implement an improved regulatory and assurance framework for local water utility strategic planning, technical assessment and approvals, and performance monitoring. We also commit to improving our approach as a regulator.

New regulatory and assurance framework for local water utilities

From 1 July 2022, the Regulatory and assurance framework for local water utilities (PDF, 5151.05 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 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.

Watch the webinar

We recently held a webinar on the Regulatory and assurance framework.

Important information

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.

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 department 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 and has been informed by extensive consultation with the sector.

Co-operation between local water utility regulators

NSW Government regulatory agencies are responsible for overseeing and supporting local water utilities within their own regulatory frameworks.

Agencies of the NSW Government work individually and collaboratively in line with the NSW Government sector core values of integrity, trust, service and accountability.

Local water utility regulators are implementing a collaboration framework to support delivery of regulator actions identified in the Department of Planning and Environment’s Roadmap to an improved regulatory framework for local water utilities (actions 4.6, 4.7 and 4.8).  The collaboration framework (PDF, 250.58 KB) was developed by the following NSW Government regulatory agencies, collectively referred to as the local water utility regulators:

  • Department of Planning and Environment — Water
  • NSW Health
  • NSW Environment Protection Authority
  • Office of Local Government
  • Natural Resources Access Regulator
  • Dams Safety NSW
  • Independent Pricing and Regulatory Tribunal of NSW.

The collaboration framework sets out the roles and responsibilities of local water utility regulators, and our approach to communication and coordination.

We welcome feedback on the way local water utility regulators are working together and with local water utilities. If you have feedback about our approach to communication and coordination or any other aspects of the framework, including any opportunities for improvement, please reach out to the relevant local water utility regulator/s.

You can also direct feedback on the collaboration framework to the Town Water Risk Reduction Program at regional.town.water@dpie.nsw.gov.au

Our approach to quality assurance

The quality assurance framework (PDF, 588.49 KB), used for the department’s regulation and assurance of local water utilities, supports the department’s regulatory and assurance framework.

We appreciate the feedback we received from stakeholders during consultation on the draft quality assurance framework. Comments were considered and addressed in the final document including:

  • adding the frequency for the collection of measures with indicators measured annually or more frequently
  • clarifying the ‘advisory and support’ role within measures for internal and external quality assurance
  • clarifying that the regulator perception survey will continue and be used to collect external quality assurance measures
  • defining the interaction between external and internal measures, and that these will be used together by the department for quality assurance
  • noting that any expansion of the quality assurance framework scope will be developed collaboratively with the local water utility sector.
Cowra Sewerage Treatment Plant.

Apply for the approval of works under section 60 of the Local Government Act or section 292(1) of the Water Management Act

Townscape of Inverell. Image courtesy of Destination NSW.

Information about strategic planning outcome areas and how to use the IP&R framework for local water utility planning.

Culburra STP1. Image courtesy of Shoalhaven city council

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  and has been informed by extensive consultation with the sector.

Copeton Dam spilling.

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 provided by the sector and public submissions are available.

Draft strategic planning guidance - implement sound pricing and prudent financial management

We are seeking feedback from the local water utility sector on this draft guidance and invite submissions by Monday, 14 November 2022.

Access the draft guidance

Review of local water utility dividend eligibility criteria, calculation methods and other requirements

We are seeking feedback from the local water utility sector on our consultation paper and invite submissions by Friday, 16 December 2022.

Access the consultation paper

Regulator perception survey and results

The survey is designed to track views, and help inform key aspects of the department’s work.

Review and participate in our surveys.