Alan Kelly (Tipperary North, Labour) | Oireachtas source

A key component of the strategy to establish Irish Water is that Irish Water will be classified as a market corporation under EUROSTAT rules and as a result, will not, other than in respect of Government support, be included in the calculation of the general Government balance.

The Central Statistics Office, CSO, an independent body, is responsible for engagement with EUROSTAT on such matters, and my Department has engaged with that office and has provided the necessary information to facilitate its work. The CSO has confirmed that it has submitted a classification proposal on Irish Water to EUROSTAT and that the proposal envisages Irish Water being classified outside the general Government sector. The CSO has further stated that this is a closed process and that it is awaiting the final adjudication by EUROSTAT. I genuinely cannot give the Deputy a date, although I would expect an outcome in a couple of months. It is a closed process and it is a matter for the CSO to make the announcement.

Pending a decision by EUROSTAT, for prudent forecasting reasons, the spring economic statement and accompanying documents are based on Irish Water being in Government. In the draft of Ireland’s stability programme: April 2015 update, table nine outlines the impact of Irish Water being included in Government on debt and deficit forecast, in order to be prudent. By 2020, the Irish Water debt, based on its capital investment proposals, would amount to just under 1% of Government debt if it was classified in Government. However, we expect it to be off balance sheet.

The Government is confident that the underlying funding model for Irish Water supports increased investment in the water sector through an off-balance sheet classification of the utility, while at the same time providing for water charges which are affordable, clear and certain. The decision is ultimately a matter for EUROSTAT.

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