11 Aug 2017

Coke's Kiwi Blue 'exempt' under Labour's water bottling plan

9:45 am on 11 August 2017

Some of the biggest multinational bottlers operating in New Zealand, including Coca-Cola, would effectively be exempt from Labour's proposed water charges.

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Water New Zealand says Labour's policy must be applied consistently if it is put in place (file photo). Photo: 123RF

The Labour Party plans to introduce royalties for commercial water use if it becomes the government - including for farm irrigation schemes.

But any companies who get their water through a city or district council water system would be exempt.

Some of world's biggest bottlers have factories in New Zealand, but this means they would not have to pay any extra for it under Labour's policy.

Coca-Cola Amatil, with its Kiwi Blue brand, takes about 36 million litres a year at its South Waikato plant, paying $40,000 a year.

But that is not for the water - South Waikato District Council said that charge only covered services for bottling such as infrastructure, operations and maintenance.

It gets the water for free.

Water New Zealand chief executive John Pfahlert said Labour's policy must be applied consistently across the bottling market, including those who took from urban supplies, if it was put in place.

"I can't see any good reason why the government would want to except an organisation like Coca-Cola, for example, from having to pay a royalty for water if that's the way the government wanted to go.

"We've made observations in the past about whether that's a sensible move."

Mr Pfahlert said Labour had not thought through its policy.

Waimate mayor Craig Rowley comes from a rural area that could be hit hard by the charges because of irrigation schemes in the region.

Mr Rowley said the policy would put too much burden on rural New Zealand.

"I think it would be grossly unfair if they are singling out the biggest users in the largest urban areas that wouldn't have to pay, just purely and simply because they're on a town water supply."

None of the big bottlers would talk to RNZ, but in Auckland, Coca-Cola Amatil, Lion Breweries, Dominion Breweries and Frucor also pay Auckland water company Watercare commercial rates - and for the delivery, but not for the water itself.

Jen Branje addresses protesters

Jen Branje, pictured addressing protesters in Ashburton, also says the opposition party needs to come up with a better scheme. Photo: RNZ / Belinda McCammon

Ashburton woman Jen Branje, who campaigned against the sale of land to a bottling company in her town, said Labour needed to come up with a better scheme.

"These people are still taking New Zealand's water and making a profit from it, so differentiating where it comes from or through what system is really neither here or there for me."

However, Labour Party water spokesperson David Parker said the policy was to take a royalty from commercial users making profits with water extracted from a river or aquifer.

"The issue of municipal water takes is tiny compared with the amounts that are at large with the millions of cubic metres of water that are taking from irrigation takes out of our rivers and aquifers.

"So you've got to get into perspective."

If local councils wanted to charge commercial users more, that would be up to them, he said.