Barry Cowen (Laois-Offaly, Fianna Fail) | Oireachtas source

I apologise for my absence yesterday and thank Deputy Niall Collins for taking the first ten minutes and thank other speakers for allowing that to be the case.

This is an interim Bill with three main objectives: to establish Uisce Éireann, or Irish Water, as a subsidiary of Bord Gáis Éireann; to confer power on to that board and on to Irish Water to install water meters in all domestic properties; and to provide that the Commission for Energy Regulation can advise Government on regulatory procedures and act as a regulator for water services and functions.

We will oppose this Bill, not necessarily because Fianna Fáil is against water charges but because of the manner in which Irish Water is being established and configured. There are not sufficient safeguards within the parameters by which it has been set up to stave off what we believe is a real and live threat of privatisation at a later date. I am conscious of the fact that we have many group schemes, private and public, and that many of them by their nature and location would not be considered profitable in the event of a buyer arriving in years to come who would be interested in vast multiple connections and population centres. We fear that without sufficient safeguards in the ownership of the company, that remains a threat where we could not guarantee the future for all areas. It is for that reason we feel there must be further strengthening of the configuration of the company to convince Fianna Fáil and others that the threat is not likely to be realised.

We do not oppose the installation of water meters but the Government should first, before the publication of the Bill, honour the commitments it made when it announced the policy process more than a year ago. There was to be a full audit of the existing networks that was to be made available to the House. That audit would allow us to address the myth that the water service is not fit for purpose. If, as many on the Government side have said, we do not have an efficient water service, why should people be asked to pay for an inefficient service? It is only when that service is fit for purpose and we can stand over it, with the necessary safeguards in place, conservation at its heart and a pristine service, that the Government will be in a position to charge.

Full costings were to be made available that would give us the exact figures not only for the reinstatement repairs necessary to bring the entire network up to the necessary standard, but would put at our disposal a definitive cost analysis for water metering for the State and the National Pensions Reserve Fund, and ultimately for the user. There would need to be a proposal based on those costs that would state categorically how users would pay for putting that in place.

When the policy direction was initially announced, there was great confusion in both Fine Gael and in the Labour Party as to how it would be configured. We are no wiser today than we were then. It is against that sort of background that I cannot commend the Bill to the House. We are in the dark about the progress that has been made and what progress is likely. It is difficult enough for us to finalise our own policy in this area. How, then, can we acquiesce to the Government's request at this stage on the establishment of Irish Water and giving it the authority to commence metering? Nor can we support the idea in the Bill of the regulator being put in place.

Those are the broad questions we have but there are many other individual questions related to them. When this was announced last year, we were told installation would commence in 2012 and be rolled out on an accelerated basis. That idea has been canned. The Government now tells us there will be a three year roll-out. Previously the Government said 2,000 jobs would be created per annum in the roll-out. Can the Government commit to 6,000 jobs?

We were told there would be 150 to 200 local installation contracts. My sources tell me the tender process was very restrictive. I understand the Government tried to address that by compiling a list of local plumbers from which contractors had to pick. I have a problem with that because the Government still has not made any progress on the subcontractors Bill. How long has that been outstanding given the commitment that was made and the work that was done by the previous Government to put that in place? Why has there been such a delay? Can the Government commit to that legislation being in place before this Bill commences?

The tendering process is over and the applications are being considered. We were told no indicative figure could be given while the tendering process was underway.

That process is complete in the main in the sense that the applications were submitted, the closing date has passed and the Department is in the process of that competition and awarding contracts. The Minister of State is now in a position to give us a better indication of the costs. Rather than rushing this, why can the Minister of State not give us those costs in order that we can make a calculated response to it?

It has also been acknowledged that 300,000 homes cannot be metered. That being the case, there is nothing in the Bill that tells me the model to devise a mechanism for a flat payment or charge that will be paid in that regard. I understand it has been acknowledged that there is no cost benefit in making individual connections within apartment blocks. Can the Minister of State confirm that is the case? Can he let the House know how he is to devise a flat charge or what model he has used on which to base such flat charge?

The figures that come from the Department on the existing household connections countrywide, whereby 1,093,000 are connected to the public mains, 265,000 are connected to group schemes which, in turn, are connected to public supplies, 46,000 to private water schemes, 145,000 to other sources which we expect to be wells, and 2,906 have no connection, which I presume are ghost estates, amounts to approximately 1.7 million households. The latest census tells us there are 1.9 million households. The Minister of State has also factored in the 300,000 apartments. There is a gap in the figures and I ask him to comment on that also.

It was also stated that the Department would consult the regulator before the introduction of water charges. The Minister of State is now bringing forward a Bill that gives authority to an existing regulator to have that authority within this remit. How long will this consultation take place given that the Minister promised to have it done by now? Obviously, the Minister did not have the regulator in place and he could not do that either. How long will the consultation take place between the Department and the regulator to give an indication to the House thereafter of what the costs might be?

Will there be an additional charge for those who have a connection to a public water supply and also have a connection to a public sewer? Will there be less of a charge for somebody who has a connection to a public water supply and has a septic tank? There is no mention in the Bill of the discrepancies that can arise in that area.

The Department was also consult with the regulator on free allowances before the introduction of water charges. If there has been no regulator, there has been no consultation and we are no further on in that regard either.

An interim Bill at this stage, if one was to follow the methodology of which the Minister spoke last year, should only contain the framework to put a regulator in place in order for meaningful negotiation and consultation to take place thereafter before the Minister could come with a proposal on metering with the benefit of the associated figures, analysis and costs. It would make much more sense at that stage.

Many would argue that the high level of expectation contained in the rules and regulations and maintenance directives from the EU are not necessarily being met by many of the group water schemes, especially those who have their own private source and not necessarily those that have a relationship with local authorities for their services, despite the fine quality and excellent service that such schemes provide to those they serve. It could be argued that if they were to follow the existing expectations, they might not necessarily be able to afford to do so. Is it that the Minister will be forced to take over those two to meet the criteria that his regulator will put in place to meet the demands of the EU directives or will there be an amnesty? There is also more shooting in the dark in this area.

The OECD stated in 2010 that water metering is unequivocally the fairest way to charge for domestic water usage, and I acknowledge that. There is a recognition by the Department that metering will reduce usage by 10% and that this saving is two to three times the level of savings applicable if the same was invested in areas such as mains upgrade. I do not question the 10% saving that is projected for metering correlated to usage but I question the logic behind saying that such a saving, in itself, is two to three times better value than the same investment in areas such as mains reinstatement, rectification and repairs. What methodology and statistical analysis is behind that statement? I thought we all had acknowledged that the biggest cost deficit in existing maintenance is the amount of leakage, and that does not tie in with the statement that there would be more value in the savings metering will deliver than there would be in those delivered by the reinstatements.

The framework directive demands water to be charged at a price that fully reflects the cost of providing that service. It is my party's contention that we cannot take this to mean that this omits Government subvention altogether. Fine Gael's partners in Government had stated in this regard that an overhaul of the tax system would seek to get full cost recovery within the water framework and water pricing. Initially, the Government stated that Irish Water would be self-financing by 2018. With the various delays that have already taken place and with the absence of costings, projections and data, where now sits that prediction? If Irish Water has the power to borrow, as it states, would these borrowings be outside the central Government balance and has this been confirmed by EUROSTAT?

In the report by Government to the IMF published at the end of last year, the Government stated that it was not yet clear what level of charges would impact on low-income households. That is obviously the case. The Department does not have the data available to it to give an estimate, even at this stage, of the overall charge. That charge, in itself, is related to the overall cost of upgrading the system, of metering, etc.

Looking at the figures, based on some statements that have been made by Government Members and figures, and the Department and others over the past number of years, it is important for me and for Members on this side of the House to inform the public of what is coming down the tracks here. If the Government will not let us know, even though it wants to set up Irish Water, to meter and to put a regulator in place, if it has not adhered to the roadmap it put in place, and it has not provided any definitive figures related to that process, then the public is in the dark as to what it faces.

As the Opposition, we cannot give the Government carte blancheauthority to proceed in the absence of all those data.

In an effort to try to get at what has been kept so secretive, we must look at the existing and projected running costs of water services, which the Department of Finance indicates as €700 million. A universal figure has been thrown out without the specifics to verify it indicating that the upgrade of the system would cost approximately €500 million. There is also a major problem in Dublin. Bord na Móna, in devising a plan that the chair of Irish Water has said he is prepared to analyse, investigate and hopefully run with, has put a cost of €500 million on that. We are now at more than €1 billion. The estimates bandied about for metering have been anything from €300 million to €500 million. If we seek to capitalise those figures over 20 years, metering would come to €20 million per annum, fixing the problems in Dublin would be €25 million per annum and the upgrade would be another €25 million per annum. This gives a cost of €770 million that has to be paid for either by 1.9 million households or 1.7 million households - I need clarification on that. If it is capitalised over 20 years it would give a water charge of €450 or €400. There has been no mention of free allowance. How could there be when the Government's commitment was that the Minister of State and his Department would consult with the regulator on the free allowance before any decision was made or indication given on charges? That is a contention I have sought to extrapolate from figures that have been bandied about.

As I said at the outset, we are not against water charges. Sinn Féin is completely opposed to them and the Government is completely in favour. We would be to the right of Sinn Féin and to the left of the Government. That is the position to which we want to get. However, in the absence of the data, analysis and figures, we are in the dark. That is my problem with the Bill at this stage. If the Minister of State can answer my queries and present exact figures so that we can analyse how we will pay for it and can start being straight with the people, then we can play ball. The Government is trying to be cute on the issue because it is facing into local elections next year. If that is not the case, let us have it out here in the open. I have sought to analyse figures that have been in the public domain without being quantified that indicate every household will be faced with a water charge of at least €400 if not €450 per annum on the basis of capitalising costs over 20 years. The Minister of State should tell me if that is wrong and if it will be more or less. Where is the procedure providing for a free allowance? What provision is likely to be put in this Bill or another Bill to deal with less well-off people who cannot afford to pay?

What consideration is the Minister of State giving to group schemes and to private schemes with private connections or connected to public supplies? What efforts are being made to adhere to what is expected of them? Is their cost likely to be higher or lower? In the absence of those data, the Bill should not be passed. The Minister of State needs to go back to the drawing board and come back to us with the figures and analysis so that we can have a proper debate on how the State should pay for it and how this should be passed on to the people, including providing the less well-off and less fortunate with the same water they have received since the foundation of the State but at an affordable price that is equitable for everybody. Equalisation is at the root of this.

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