Mr. Matthias Kelly:

With regard to the first question, the short answer is "Yes". In other words, in the German case the absence of full price recovery did not render Germany in breach of the obligations.

With regard to whether full cost recovery was in the original proposed directive, it was, and it was withdrawn following conciliation at the Parliament. That is recognised in the document I was looking at from the European Parliament which I will read into the record. It is A5-2000-0214 and the relevant part states:

Water pricing is a sensitive issue for number of Member States that have particular regimes for exempting certain categories of users. However, in the conciliation the attention focused on Ireland. It is the only member state that does not charge households according to water and sewage volume but finances these services via taxation. At the end of the conciliation it was agreed to provide for the Member States to be able to opt out from the obligation of cost recovery if this is based on "established national practices".

That is why, when I spoke earlier, I spoke about it being the Irish exemption. There was a clear recognition by all involved at the time that Ireland had an established practice. There was acceptance that Ireland could continue to have that established practice, which is why full cost recovery was dropped from the directive as we now have it.