Fergus O'Dowd (Louth, Fine Gael) | Oireachtas source

That said, the Minister, Deputy Hogan, has asked that the Department put in place an appropriate arrangement to provide a mechanism for Deputies to obtain details of the establishment costs of Irish Water in future.

In the context of the programme budget for the establishment of Uisce Éireann, the Minister, Deputy Hogan, sought the advice of the Commission for Energy Regulation, CER, under section 27 of Water Services Act 2013. In particular, advice was sought on the benefits which would be expected to accrue and the time period over which they would reasonably be expected to accrue from the Uisce Éireann programme expenditure to ensure the investment is expected to result in value for money from a customer perspective, whether the proposed expenditure was justified, and, assuming the economic regulatory model will include a regulated asset base, confirmation that the establishment costs efficiently incurred by Uisce Éireann will be included in the opening regulated asset base. In response to the Minister's request, the CER conducted a short review of the costs and provided an initial view on the matter. In that context, it advised that most of the proposed establishment costs appear to be reasonable and can be expected to result in value for money from a customer perspective. The in-depth review of costs by the CER will be critical in validating this view in respect of the full costs. The advice from the CER also noted that all the activities undertaken by BGE and Uisce Éireann are core to delivering the objective of a national integrated water service provider, with associated benefits to customers and other stakeholders in Ireland, and that Uisce Éireann has drawn heavily on BGE personnel and processes. It further noted that the latter is the most effective and efficient manner in which to establish Irish Water.

The CER advice to the Minister also noted that the establishment of Uisce Éireann as a separate business unit within the BGE group and the roll-out of the national metering programme have, to date, been significant undertakings. Following on from this advice, the Department has put in place appropriate procedures to seek to ensure that any proposed expenditure commitments which need to be made in advance of full regulatory review will be justified and of long-term value to the customer. The Water Services (No. 2) Act 2013 provides that the primary role of the CER is to protect the interests of the water services customer. Setting revenues at a level which only includes expenditure efficiently expended will be central to fulfilling that role.

There have been suggestions that the establishment of Uisce Éireann is a prelude to either privatisation or the introduction of competition in the water services market. I wish to state emphatically that this is not the case. We have consistently stated that the supply of water and wastewater services will remain in public ownership. The Water Services (No. 2) Act 2013 specifically provides that Irish Water cannot be privatised and will remain in public ownership.

Substantial progress has been made in delivering on the Government's reform process. The Water Services Act (No. 2) 2013 came into effect on 1 January last and Uisce Éireann has assumed statutory responsibility for the delivery of water services from the 34 water services authorities. The service level agreements between local authorities and Uisce Éireann, which commenced on 1 January, will involve the continued involvement of local authority staff in service delivery at local level for the next 12 years. This will ensure that local expertise in asset management and operations, combined with considerable network and utility management experience, will be available to Uisce Éireann. I am very confident that this will prove to be a positive collaborative arrangement. Where it is decided not to enter into a subsequent agreement, the legislation provides for the transfer of staff involved in the delivery of services from local authorities to Uisce Éireann. The legislation also provides for the protection of the interests of staff who are transferred.

During the consideration of the legislation last year, I made it clear that Uisce Éireann should be fully accountable for the way in which it discharges its functions. The two Water Services Acts passed in 2013 provide that Uisce Éireann must provide annual reports on its performance of its functions each year. The Minister for the Environment, Community and Local Government is required to arrange for copies of the company's annual report to be laid before the Oireachtas immediately after receiving it. Uisce Éireann must also keep accounts in a form to be approved by the Minister, with the consent of the Minister for Communications, Energy and Natural Resources, of all moneys received or spent by it in the performance of its functions.

Uisce Éireann will be accountable to the Environmental Protection Agency, EPA, which is responsible for the environmental regulation of Irish Water. As such, the EPA will be responsible for monitoring the quality of drinking water supplied by Uisce Éireann and also for monitoring discharges from wastewater treatment plants to ensure they meet the necessary standards. In addition, the wastewater treatment plants which are transferring to Uisce Éireann will be required to comply with licences granted by the EPA. The agency will have powers of direction and enforcement in these areas. The EPA has a proven track record of transparency in fulfilling its functions and details of its activities are published annually. Uisce Éireann will also be accountable to the CER, which will be responsible for the economic regulation of Irish Water.

The commission will also have powers to set standards of customer care and to direct Irish Water to comply with any aspect of a code of practice prepared in accordance with the Act.

The Minister for Public Expenditure and Reform has given a commitment that Irish Water will also be brought under the freedom of information legislation as soon as is practicable. The Minister made this commitment during the select committee hearing of the Freedom of Information Bill last November. During the debates in both Houses last year on the two Water Services Acts there was strong support on all sides for the extension of the remit of freedom of information legislation to include Irish Water.

I wish to take the opportunity to clarify an unfortunate misunderstanding in relation to replies to recent parliamentary questions which sought details of expenditure relating to Irish Water. In reply to Deputy Kevin Humphreys I indicated that I had requested Irish Water to respond directly to him. Unfortunately, the Department did not transmit the request at the time. The Secretary General of the Department has been in touch with the Deputy today in that regard and has apologised for that oversight.

I wish to address a couple of issues before I conclude.

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