Róisín Shortall (Dublin North West, Independent) | Oireachtas source

The game is up for water charges. The bottom line is that the public has simply not accepted them, and if the Government does not accept this fact, it is even more out of touch than I thought it was. The public has not accepted water charges for a number of reasons - some because they object in principle to water charges; some because they simply cannot afford to pay them; some because they are sick and tired of cronyism; and some because of the shocking level of Government incompetence. I believe most people have not accepted them because they are sick and tired of having to pay charge after charge, while others, most notably the bondholders, have got away scot free. For many, this is a charge too far and no amount of mea culpafrom Ministers and Government backbenchers will change this fact. Without public acceptance of the charges, all other plans the Government may have for investment in water infrastructure are redundant. It is time the Government realised this. It will simply have to find another way.

The first test the Government has failed is that of fairness. By any yardstick, the charges are regressive. They take no account of a person's ability to pay. They are all the same and apply to everybody equally. As the Minister of State well knows, that is a regressive charge. This is the introduction of what is essentially a flat charge. There has been an attempt to soften the blow of the charges and gain political acceptance for them by introducing what is termed a conservation grant. This is a complete misnomer as it has nothing whatsoever to do with conservation. In fact, the earlier defence of the charges - namely, that they were about conservation - has gone out the window. Everything - investment in water butts, all of the different schemes operated in schools to encourage conservation and all of the habits people were trying to change in order to use water more sparingly - has gone out the window. It does not count at all because, as this is a flat charge, conservation does not matter. It is a capped charge, a flat charge that benefits rich and poor equally. Of course, there is no detail of when people will actually receive this conservation grant. We are told that people may start to apply from September 2015. Does anybody know when they will actually receive it? Certainly, low-income families will have to fork out the full amount for most of next year without receiving any grant. This is clearly back-of-an-envelope stuff where none of the detail of this so-called grant has been worked out; therefore, it will certainly be the end of next year before people on low incomes, and everybody else, will receive any kind of relief in respect of the charges. We do not know anything about when and how it will be paid.

We will also be facing the spectacle of the Department of Social Protection sending cheques for €100 to every household in the country, regardless of its circumstances. It is ironic that this is a proposal being put forward by the Government and that of all Departments, the Department of Social Protection will be engaged in this exercise of sending every household €100, while at the same time claiming it cannot reverse the cuts made to so many welfare payments in recent years.

The Government has stated that part of the reason for setting up Irish Water is in order that it will not be competing for scarce resources with services such as education, health and other important public services, but of course it will, because at some point at the end of next year we could have a situation in which the Department of Social Protection will send rebates to a potential level of €130 million in order that every household receives this so-called grant. In the budget at the end of next year these figures will, of course, come into play. The need to send the cheque for €100 to every household, irrespective of circumstances, will be competing with the needs of schools, hospitals, public transport and all other essential services that are so under-funded. Fine Gael must be delighted that thousands of its rural voters with private supplies will receive a €100 grant that they certainly were not expecting.

The other point about the issue of fairness is that the Minister yesterday, the Tánaiste last night and the Taoiseach on several occasions have all claimed that everyone will be better off next year. This is simply not true and I ask Ministers to stop misleading people by making these statements. People on incomes of less than €10,000 will not be better off next year. The prioritisation of tax cuts for the better-off - the reduction in the top rate of tax - will ensure that people on very low incomes of less than €10,000 receive nothing whatsoever. Those on short-term welfare payments will certainly not be better off next year. We know that when every person on a low income, be it from low-paid work or short-term welfare payments, has to pay his or her water charges, he or she will be worse off next year. As that figure is certainly into the hundreds of thousands next year, Ministers should stop misleading people.

Of course, the other point that arises in this regard concerns the impact on the Department of Social Protection not just in respect of its budget, to which I have referred, but also in terms of the cost of administering the scheme, whereby it must give a rebate or grant to every household. Has the cost of administration been factored in? I doubt very much that it has. Will the Department have to set up a new section? I am not aware of any other payment coming from the Department that must be made to every single household. How many staff will be diverted to this exercise of sending €100 to everybody? Will extra staff be recruited or will they be taken from other sections of the Department which we know are understaffed?

We know there are long waiting lists for a number of payments. The waiting time for carer's allowance is three months. Are those waiting lists going to increase as a result of this?

While the level of these new charges may seem reasonable, everybody knows they are the thin end of the wedge. That is a huge concern for people. The charges can only go in one direction, and that is up. It has been suggested that the user data the Government is quoting are not accurate. They are certainly not in line with data from the UK and other European countries. The Government may be significantly understating the level of water usage. Those chickens will come home to roost.

The Government sought to justify the establishment of Irish Water by describing it as a special purpose vehicle which will be allowed to borrow and sell bonds. This is portrayed as something happening in isolation from the users or customers of Irish Water. The public have learned the hard way that loans and bonds have to be repaid. To suggest this approach will somehow get somebody else to pay for the water is completely misleading. The public realise that whatever loans are taken out - significant loans and bonds will be required - they will have to repay them through higher charges in the future. Regardless of whether they are controlled in the short term, it is inevitable that they will rise in order to pay these loans. People should not be misled in that regard.

Serious questions arise about the viability of Irish Water in light of yesterday's announcement. How can any investor have confidence given the uncertainty around user fees? Why would anyone invest in Irish Water when its management has shown such vast incompetence and lack of leadership? How can anyone be confident of investing when its funding and business model keeps changing? We are told there will be penalties for non-payment but given that penalties have been pushed out to at least the middle of 2016, what happens if people hang on and do not bother paying until they kick in? Irish Water will not be generating any revenue. It appears that suddenly the Commission for Energy Regulation no longer has any role in this, even though the Taoiseach repeatedly stated that its role is vital. If it is the case that 50% of people can get a rebate, that significantly reduces the potential income of Irish Water. What are the implications of that for the funding model? In regard to collection of data and passing the market corporation test, the figures are too shaky for us to have confidence in their robustness. What happens if it fails the test?

The promises on legislation mean nothing. It is suggested that we can legislate for a plebiscite even though there is no provision for plebiscites in this country. It is absolute nonsense to suggest that we can legislate so that a referendum will be required. As legislation can be overturned by any future Government, there is no way of tying down a promise on a referendum. Equally, there is no way of tying the hands of a future Government by promising through legislation that charges will always be capped.

There are major problems with these proposals. The public simply does not accept what the Government is doing because of its track record in this regard. It did not stand up for the country against the interests of the bondholders and the ECB. It did not show fairness when it came to imposing the burden of austerity. Income and spending cuts were imposed disproportionately on the poor and now tax cuts are favouring the better off. It did not show any appetite for the political reform it had promised. The bonus culture of Irish Water, the stuffing of its board and the political pay-off for Phil Hogan have proven that. Apart from fairness and reform, people expected a level of competence. They have been very disappointed in this regard. This debacle has shown that the Government is not capable of setting up a new body or bringing in a new regime in a manner that secures the confidence of the public. It is a shambles and an unmitigated disaster. The Government has seriously failed the tests of fairness, reform and competence. That is why it has lost the confidence of the people.

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