Ms Maria Graham:

The business plan allows for the delivery. In gross terms, the business plan delivers the gross cost. How that is funded is a separate issue. It covers all usage, including waste usage. The business plan and the figures within it are correct. The figures I have provided on the costs of water services are the outer limits in the sense that they do not have an estimate of what a revenue coming from excessive usage might be. However, as I said, we can run two scenarios if the committee wishes.

As mentioned earlier, there are people who are paying for water in the rural water sector. Some of that is because of agricultural use. When we reduced the subsidy when domestic water charges came in, we were trying to ensure there was fair treatment. We were trying to see what the impact was. We did some work with the federation to get some ideas on what was the average cost being borne by people in order that the average cost to the group water sector was similar to the average cost borne by the Irish Water customer. When we were talking to the federation, one of the approaches was to set out the principles by which we would try to get a subsidy system that was amenable to it, given that there is a range of group water schemes that are not under Irish Water and are not big systems. We were trying to bring in a subsidy that reflected the fact that there were capped charges, free allowances for children and a product subsidy. I can pass these on to the committee. The principles underpinning the subsidy were to ensure there was fair treatment between drinking water consumers in the public and group sectors, taking into account the inherent differences in the structure, funding and organisation between the sectors, including the ability of individual schemes to set the price of water based on their local circumstances. There had to be a recognition of their particular cost structures, particularly as some of them have had expensive design, build and operate schemes put in for which we would have to continue to recoup local authorities on subsidy claims. Subsidy had to be tied to things like customer charters, compliance, optimal management and operational practice and the receipt of capital grants. The arrangements had to be as straightforward as possible to reflect the scale of the sector. It was important for the federation that, whatever the arrangements made, they were not too much of an administrative burden.