Maria Bailey (Dún Laoghaire, Fine Gael)
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In accordance with standard procedures agreed by the Committee on Procedure and Privileges for paperless committees, all documentation for the meeting has been circulated to members on the document database. The purpose of today's meeting is to consider the further Revised Estimates for 2017 for the Department of Housing, Planning and Local Government, referred by the Dáil to this committee on 17 October. I welcome the Minister, Deputy Eoghan Murphy, and the Ministers of State, Deputies Damien English and John Paul Phelan, and all the officials from the Department. As previously agreed by members, the format for today's meeting will see members given five minutes to ask questions, with five minutes for a response. I will call members in the order in which they indicate they wish to speak. In accordance with Standing Order 184, discussion for this part of the meeting should be confined to the items constituting the Supplementary Estimate, which will conclude at 10.15 a.m. Would the Minister like to make an opening statement?

Eoghan Murphy (Dublin Bay South, Fine Gael)
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I welcome the opportunity to discuss with the select committee this morning my Department's further Revised Estimate for 2017. I am accompanied by Ministers of State Deputies Damien English and John Paul Phelan and Department officials Mr. John McCarthy, Ms Mary Hurley, Ms Maria Graham, Ms Lorraine O'Donohue, Mr. David Walsh, Mr. Maurice Coughlan, Ms Theresa Donohue and Ms Janet Jacobs.

The 2017 Revised Estimate for my Department was published last December and was considered in select committee last March. That Estimate is now being revised to do two things: first, to take account of the transfer of community functions from my Department to the newly established Department of Rural and Community Development, under the leadership of my colleague, the Minister, Deputy Michael Ring; and second, to reflect the Government decision on the future funding model for Irish Water and the planned refund of water charge payments made by domestic customers.

I will take the community transfer element first. On 14 June 2017, the Taoiseach announced his intention to establish a new Department to undertake responsibilities in relation to rural and community development matter, to be led by Deputy Michael Ring. This has resulted in the transfer of community-related functions from my Department and of associated spending subheads from its Vote. The two community business units which have transferred to the new Department cover: community and voluntary supports and programmes, and social inclusion and communities.

These business units have a budget of €77.5 million for 2017, including administration costs. The transfer comprises a total of €67 million in current expenditure and €10.5 million in capital expenditure, together with appropriations-in-aid amounting to €6.3 million. I have circulated with my statement a table that summarises the financial transfers, which in accordance with established practice cover all spending in the areas concerned in the full year 2017.

In addition, the relevant staff implementing these programmes have moved to work in the new Department.

Moving on to the funding for Irish Water, the new Estimate for 2017 also reflects the Government decision on the future funding model for Irish Water and the planned refunds to domestic customers. The Water Services Bill 2017, currently in the Seanad, provides for the repeal of the 2014 domestic water charging regime and introduces a new programme focused on the promotion of water conservation, under which a levy will apply in certain circumstances for usage of water above a reasonable threshold. In making these changes, provision is made in the Bill for the extinguishing of liabilities under the current regime and the making of refunds to the 990,000 customers who paid in accordance with the 2014 Act. This will give rise to a new funding model for Irish Water which is underpinned by the Bill. The Bill thus reflects the recommendations of the Oireachtas Joint Committee on the Future Funding of Domestic Water Services, which were adopted by both Houses last April. Accordingly, a provision of some €293 million for payment to Irish Water has been made in the Revised Estimate, in programme B - water services. This figure includes the €173 million needed to pay refunds to the 990,000 domestic customers. There are also administrative costs associated with the refund process, estimated to amount to almost €5.9 million. A further €114 million is being provided to cover the additional funding required by Irish Water arising from the extension of the suspension of domestic water charges to the end of 2017.

In conclusion, following the transfer of community functions and the making of the new provisions for Irish Water, the gross budget for my Department in 2017 now stands at €1.995 billion. Taking into account the changes in those two programme areas, this represents an increase of €215 million on the Revised Estimate published last December. I am of course happy to discuss the details with the committee.

Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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I thank the Minister. I know it is too late to change this but some of us have a concern that the transfer of the final bits of community out of his Department, particularly those that relate to community development functions within urban local authority areas, could have a detrimental impact on the delivery of those services. I am aware that ultimately, that is not a decision for the Minister or his Department. I wish to put on record, however, that a lot of us would have preferred to see those functions remain in the Department that deals with local government, particularly because they are now also tied up with the local community development committees and the social inclusion committee activation programme.

The Revised Estimates basically have three elements: The transfer of the funds for those final remaining bits of community from the Minister's Department to the other Department; the additional funding for refunds; and the funding for Irish Water for this year. Can the Minister confirm that I am correct with a "Yes" or "No" answer? I know that is what he has just said, but I would like it to be very clear.

In terms of the additional money for the refunds and for the funding of Irish Water, can the Minister confirm the source of that funding? It is obviously not coming from within the original Estimate for his Department.

Eoghan Murphy (Dublin Bay South, Fine Gael)
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In respect of the Deputy's concern about the transfer of the community function to the new Department under the Minister, Deputy Michael Ring, and that urban element of it, the Minister, Deputy Ring, and I have a very close working relationship. We both deal with local authorities. Local government comes under my Department but given the role that the Minister, Deputy Ring, has in the new Department, local authorities will be key to that. We have a very close working relationship. In any transfer of functions there is always some difficulty; whenever a new Department is being set up it takes a bit of time. Staff have to relocate. All of that sometimes creates delays or difficulties but we are doing our best to make sure that we work together and that there will be minimal disruption to any funds or activities that are transferring from my Department out that of the Minister, Deputy Ring.

In respect of the Deputy's questions about what we are doing with the Revised Estimate, yes, it is about transferring the funding, staff and responsibilities for community into the new Department. It is also providing those amounts for the payments of refunds to be made, the administrative costs for those payments and the additional money that must be expended because of the continued suspension of water charges for this year, which was not previously allocated. As for where the money is coming from to do that, it is additional Exchequer funding that is available. In other words, it is taxpayer funding.

Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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I thank the Minister for his comment on the transfer of the community function. Although we will not have responsibility for the new Department there may be a role for this committee to invite in the Minister, Deputy Ring, maybe once a year or so, to discuss the management of those elements. The only reason I am saying this is since the restructuring of the old community development programmes from Pobal by the former Minister, Commissioner Phil Hogan, they are much more integrated into the local authority structure and policy.

We had a very interesting discussion here yesterday about rates. Part of the difficulty with rates is that they are split between two Departments, Housing, Planning and Local Government and Justice and Equality. When we are trying to discuss policy and potential reform that creates some difficulty. I am concerned that the case might be similar here. That might be something we could address.

While I am aware the sources of the funding referred to derive from revenue, what we would like to know is what part of the revenue pot they come from. Clearly, there were areas of underspend in the Estimates that were allocated for the Departments this year. It would be good to identify those elements of underspend that allowed the Government to transfer this money across to deal with the water situation. I am not objecting to the transfer but clarity is needed.

Eoghan Murphy (Dublin Bay South, Fine Gael)
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On the local development committees, the Minister, Deputy Ring and I had a number of engagements on this as we began this transfer process, to make sure that we were both clear about where the responsibility would lie and that there would not be any difficulties or interruptions to that important work. It is something on which we continue to liaise. The matter of bringing in the new Minister is one for the committee. The Minister, Deputy Ring is currently in another committee going through the Revised Estimate for his Department.

The funding that was used to facilitate the refunds for Irish Water and maintain the suspension of charges was from funding that would have been foregone, in that instance, for Irish Water and the administrative costs. That comes from general Exchequer funding. It is for the Minister for Finance and for Public Expenditure and Reform to manage that element of the overall funding envelope for each Department and to make sure that funding is available for this aspect of our work. As far as I am concerned in the Department of Housing, Planning and Local Government, the money comes in from the Exchequer and then we allocate it to Irish Water.

Mick Barry (Cork North Central, Solidarity)
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I am going to take the opportunity to ask the Minister a question about local authority staff being transferred over to Irish Water. The staff are now to be transferred in the year 2021. The original plan was that they would be transferred over at a later date, I think it was 2026 although I stand to be corrected on that. It is happening five years before it was originally planned. I am concerned that this has implications for those workers in terms of their pay and pensions. The official line is to say it will not make any difference. However, the experience of workers who have been transferred from State to semi-State bodies in the past has been that there were implications for pay and pensions. Any telecom worker will give the Minister the lowdown in that regard. Will the Minister indicate who made the decision to speed up the transfer? When was that decision made? Will the Minister comment on potential implications for the pay and pensions of those workers?

Provision is being made for €173 million to be paid to 990,000 households by way of refunds on water charges, paid either in full or in part. I welcome the fact that we are making this provision. I believe that many of the 990,000 households paid under duress. I have plenty of experience in my own constituency of pensioners having received phone calls from Irish Water putting them under pressure to pay, even if it was only a fiver, so as to avoid penalties. While those households are rightly getting their money back, they owe a debt of gratitude to those who marched and who did not pay. Those households took the risks-----

Maria Bailey (Dún Laoghaire, Fine Gael)
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I ask the Deputy to stick to the matter at hand. He can go into detail at the next meeting if he wants.

Mick Barry (Cork North Central, Solidarity)
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Sure. They took risks of fines and penalties and the threat of the law that was used against them, the threat of appearance in court. There is a debt of gratitude owed to those households. I welcome the refund of €173 million for the 990,000 households and will be supporting it.

The first question from Deputy Barry related to the implications for those workers transferred to Irish Water in terms of their pay and pensions. This is really an issue for the next meeting but if the Minister wishes to answer it, he may do so.

Eoghan Murphy (Dublin Bay South, Fine Gael)
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As the question has been asked, I would like to answer it, if the Chair agrees.

One of the most important assets that Irish Water has is its staff, the people who transferred to that organisation to do the very important work that needs to be done up and down the country. Obviously, service level agreements were put in place. These originally went to 2025, not 2026. Irish Water has come together as a single utility for the country and is working with the local authorities. It has been bringing in staff from local authorities and maintaining agreements with individual local authorities. It has taken on assets and is improving them and improving our water infrastructure. Irish Water has seen the possibility of expediting that. The potential savings that would accrue to the body and to the State as a result would be potentially €1 billion.

When Irish Water consulted me on whether it should pursue this, I agreed that it should but I was very clear in my conversations with it that this would only work if it could be done in agreement with the staff in terms of making sure that people were happy that there would be no diminution of their salary or pension benefits. No decision has been made but this is something we are progressing to see if we can do it. We have a piece of work ongoing in NewERA to make sure that benefits such as pensions would be safe because that is essential if this is to be successful. That piece of work is happening at present under the Water Services Act. We have not come to a conclusion on it, but we are doing this with the utmost care and consultation with the relevant people involved to make sure that they understand exactly what is being proposed and that we can all be certain that there will be no negative effect on pay, conditions and pensions.

Maria Bailey (Dún Laoghaire, Fine Gael)
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I thank the Minister. Have members any further questions for the Minister?

Fergus O'Dowd (Louth, Fine Gael)
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I think it is appropriate that I make one comment on Deputy Barry's contribution on Irish Water and its staff. I have always found Irish Water to be top class in its interaction with my constituents. Irish Water is extremely professional, helpful at all times, responds immediately to queries and will email by return and will solve problems. I have no experience or knowledge of the people to whom he referred but that certainly has not been my experience. I have not met anybody in the Oireachtas to whom I have spoken who has had a different experience from me.

Maria Bailey (Dún Laoghaire, Fine Gael)
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I wish to be associated with those remarks.

Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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For the information of committee members, I sent a request to the Chairman this morning, requesting that we bring in Irish Water, the unions and other interested parties, including the Department of Housing, Planning and Local Government in January or February to discuss the single utility proposals because I think it would be useful for us to do it at that stage and it would allow members an opportunity to have a fuller debate.

Maria Bailey (Dún Laoghaire, Fine Gael)
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We have that under "Correspondence" for next week. Deputy O'Dowd had requested that as well.

Fergus O'Dowd (Louth, Fine Gael)
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I made that request some months ago and have been patiently waiting for that meeting to ask the real questions.

Maria Bailey (Dún Laoghaire, Fine Gael)
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We have entered it in the calendar of meetings that members will have the opportunity to approve at our next meeting. Do we have further questions for the Minister?

Eoghan Murphy (Dublin Bay South, Fine Gael)
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I will respond to Deputy O'Dowd's point. I believe we have a duty of care to the staff in Irish Water who are public sector workers. I believe Members of the Dáil berate the organisation too casually, but in doing so berate the staff. We saw during Storm Ophelia how the staff of Irish Water stepped up to the plate in a very big way.

In the Dáil when Deputies were responding to Storm Ophelia in one breath they criticised Irish Water and in the next complimented the ESB. Both organisations were working together to restore power and water to households up and down the country. The Water Services Bill is being debated in the Seanad and I hope it will be completed this week. As we now have an understanding of the role of Irish Water in the coming years, I hope that as the Oireachtas, we try to support that work and help Irish Water do its important work for citizens, whether they marched or did not march or paid or did not pay their water charges. Irish Water has a job of work to do and it needs our support.

Having worked with Irish Water for the past six months, having visited the premises and met the staff - I met the staff on site in Drogheda and in other parts of the country - the staff of Irish Water need our support. The brand "Irish Water" has been damaged since its inception and we have to help the staff of Irish Water to do their job effectively for the benefit of everyone.

Mick Barry (Cork North Central, Solidarity)
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I must respond briefly to the comments of Deputy O'Dowd and the Minister, Deputy Eoghan Murphy. Obviously we are very strong critics of Irish Water but we are the best champions of the interests of the ordinary people who work for that company. That is shown by the fact that we raised concerns this morning about pay and pensions and will defend pay and pensions if there is any attempt to downgrade them.

Maria Bailey (Dún Laoghaire, Fine Gael)
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That concludes our deliberations on the Revised Estimate.