11 Jul 2014

Council not investing in water scheme

3:43 pm on 11 July 2014

Another potential investor has decided against putting money into Hawke's Bay's controversial Ruataniwha water storage scheme.

The Central Hawke's Bay District Council says it believes the proposed $600 million scheme, which could irrigate about 25,000 hectares, could be a huge money- and job-spinner for the region.

But deputy mayor Ian Sharp said on Friday the council won't be investing in it, now that residents have overwhelmingly opposed borrowing the $5 million needed to do so.

"I think it's important we distinguish between support for the water scheme and borrowing money to invest in the water scheme," he said.

"A number of the submitters who did not want us to borrow money to invest are 100 percent behind the scheme, they just felt it was fiscally irresponsible for the council to borrow money to invest in the scheme."

Mr Sharp said most of the 90 or so submissions received were against borrowing. He said several councillors and the mayor didn't vote at the council meeting due to a perceived conflict of interest.

"Some people who are against the scheme were concerned that there might be percuniary interest on behalf of some of the councillors - obviously in a rural area we have councillors that in fact farm.

"And so they thought they were probably compromised - which I think, in a way, was quite good because even people who were against the scheme obviously acknowledge the huge financial benefit to the district."

Mr Sharp said he doesn't believe the council not investing would make any difference to whether or not the irrigation scheme goes ahead.

The proposed Ruataniwha dam would be the biggest irrigation dam built in New Zealand, holding more than 90 million tonnes of water.

The Hawke's Bay Regional Council said it has the potential to supply secure irrigation to 25,000 hectares of land for irrigated farming, while improving the water quality and summer flows in the Tukituki River.

The proposed Ruataniwha dam site.

The proposed Ruataniwha dam site. Photo: SUPPLIED