Eoghan Murphy (Dublin Bay South, Fine Gael) | Oireachtas source

I move: "That the Bill be now read a Second Time."

Today I present the Water Services Bill 2017 before the Dáil. The Bill provides for the repealing of the 2014 domestic water charging regime and it 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, provisions 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. In so doing, the Bill reflects the recommendations of the Oireachtas Joint Committee on the Future Funding of Domestic Water Services, which was adopted in April by both Houses of the Oireachtas.

The publication of this Bill brings us towards completion of an extensive deliberative process about the funding of domestic water services. It does not bring us to a point I am personally happy with or proud of, but my responsibility in this matter is to implement this legislation to protect Irish Water as a single public water utility, and to continue to work to improve and modernise water services throughout the country.

While there may be many opposing views on the appropriate way to fund water services, this Oireachtas has had a full examination of the matter and came to a compromise that is reflected in the Oireachtas joint committee's report. The Government is following through on its commitment in the confidence and supply arrangement and is bringing forward the necessary legislation to reflect the outcome of the Oireachtas decision.

This Bill offers clarity and certainty to the water services sector about how services will be funded in the future and how Irish Water will implement the Government's objectives and priorities in this area. The Bill will also help to increase transparency and accountability regarding Irish Water and its performance, and will facilitate greater civic and public engagement on the issue of water as a natural resource to be protected and a service vital to our economic and social progress.

Over the past year we have seen an extensive policy debate on how we fund domestic water services. Last July, the Government enacted the Water Services (Amendment) Act 2016 to provide the political space for a calm, comprehensive and detailed debate on water services. In the same month an expert commission was established comprising international and national experts on water services, which dedicated five months to examining the various issues concerning the funding of domestic water services.

Last November the commission produced its report, which provided the basis for the work of the Oireachtas Joint Committee on the Future Funding of Domestic Water Services. The Oireachtas committee’s deliberative process, which comprised public meetings and detailed submissions from a range of public bodies and organisations, involved a welcome discussion about the many deficiencies with our public water and wastewater system, such as the reliance of 736,000 people on public water supplies in need of remedial action; the discharge of raw sewage directly into local waters at some 42 urban areas at the end of last year; and the loss through leakage of about 45% of all water produced.

The debate also outlined the evolving challenges that Irish Water faces, such as dealing with the presence of THMs - a potentially harmful by-product of the chlorination process - in public water supplies for about 400,000 people. It underlined the need for sustained investment so that we can address these problems and provide a secure, safe water supply and the appropriate level of wastewater treatment to protect public health, the economy and the environment.

A year of political and policy debate on water services also provided a further opportunity for Irish Water to outline the improvements it has made to our water and wastewater infrastructure during the first regulatory period. This included work such as the national programme to reduce boil water notices. By the end of 2016 Irish Water had removed long-term boil water notices that in January 2014 were affecting over 20,000 people. It also replaced or repaired almost 860 km of pipeline. To put this in context, this average of 286 km per year compares with an average of approximately 149 km per year during the final ten years of local authority responsibility for mains rehabilitation. There have been 28 new or upgraded water treatment plants. There have been 65 new or upgraded plants for wastewater treatment. Some 89 million litres of water are saved daily through the customer-focused first-fix repair scheme and related customer repairs, which is equivalent to the water needs of Galway city and county. These initiatives have all helped improve people’s daily lives, whether it be the quality of the water they drink, the ability to drink it without boiling it or simply living in an area free of raw sewage discharge.

Ultimately, we are having this funding debate because we are trying to improve people's lives and their environment, to facilitate business and industry, and to enable social and economic progress. Irish Water is doing this and I acknowledge the progress it and the local authorities have made. The deliberative process identified the problems, the progress and the need for funding certainty if we are to continue upgrading and modernising water services and infrastructure. In legislating for the Oireachtas joint committee's recommendations, we have devised a policy and funding framework through which the utility can implement national objectives and priorities within an economically regulated environment. This framework provides funding certainty from Government while maintaining a regulatory environment that demands efficiencies of Irish Water through the targets set by the Commission for Regulation of Utilities, known until now as the Commission for Energy Regulation but that will legally become the Commission for Regulation of Utilities in October.

While the processes of the expert commission and the Oireachtas joint committee resulted in enhanced debate on water services, the Government recognises the need for greater public confidence in the work of Irish Water, as well as further transparency about how it is funded and where that funding is invested. Therefore we are providing for a water advisory body to give the Oireachtas and Government assessments on the performance of Irish Water in implementing its business plan.

The Government also recognises the importance of the role of civic society in safeguarding water, be it for services to urban and rural areas or water in the aquatic environment. For this reason, and in line with our commitment in the draft river basin management plan for 2018 to 2021, we are providing for a national water forum, which will provide for public support for water services investment; public awareness of and participation in increased water conservation and initiatives to protect water quality in our rivers, lakes and coastal waters; and national appreciation of the links between water and public health, economic progress and environmental protection.

Those key aims will advance if wider civic society debates and analyses the issues on an ongoing basis. The Government will support that by facilitating and funding a national forum that will advise the Minister but will also have an independent voice to communicate directly with wider society.

I will now outline the purpose and operation of each section of the Bill. Section 1 sets out the Short Title of the Bill and provides that the various provisions of the Bill may be brought into operation on such day or days as may be appointed by order of the Minister. Section 2 sets out the definitions required to give effect to the provisions of all Parts of the Bill.

Section 3 is a standard provision enabling expenses incurred by the Minister in the administration of the Act to be paid out of moneys provided by the Oireachtas. Section 4 provides that every order and regulation under this Act shall be laid before each House of the Oireachtas as soon as may be after it is made and, if a resolution annulling such order or regulation is passed by either House within the next 21 days on which that House has sat after the order or regulation is laid before it, the order or regulation shall be annulled accordingly.

Section 5 outlines the legislation and regulations that are repealed or revoked. Section 6 provides for the insertion of certain definitions into the Water Services Act 2007. Section 7 provides for the inclusion of the proposed water advisory body and the water forum in bodies that can be funded by the Minister.

Section 8 provides for the Commission for Energy Regulation, which from 2 October will be known as the Commission for Regulation of Utilities, to carry out a review to assess the average consumption by customers of water services provided by Irish Water to dwellings, a review that shall be used by the Minister to set the threshold over which excessive usage payments may apply. The commission will also recommend to the Minister, based on consumption trends, the level of allowance to apply for usage by larger households, that is, where five or more people are ordinarily resident in a dwelling. The first such review will be carried out and completed within one month after the coming into operation of this section, with provision for future reviews prior to the expiration of the water charges plans.

Section 9 sets out the process for specifying the threshold amount and the allowance amount, following receipt by the Minister of the report from the commission. It specifies that the threshold amount shall be calculated by multiplying by 1.7 the amount assessed by the commission as the average rate of consumption of water services in a 12-month period. Allowances will be provided where the excessive use of water is caused by the size of the household or medical needs in the household. Provision is made that the multiplier of 1.7 may be reduced in time, but not within the first five years of the Act, and not without a positive resolution of the Oireachtas. Guidance is given in the Bill as to the factors that might be taken into account in such a change to the multiplier in the future, which are primarily based on promoting water conservation and sustainable use of resources, reflecting the objectives of the Water Framework Directive.

Section 10 provides for the insertion of a provision into the Water Services Act 2007 to preclude Irish Water from charging a customer for water services provided by Irish Water to the customer's dwelling where that customer does not consume water services in excess of the threshold amount.

Section 11 inserts a provision into the Water Services Act 2007 for Irish Water to give notice to a customer where the threshold amount has been exceeded. A customer who continues to consume water services in excess of the threshold amount after a period of six months following a notice from Irish Water will be liable to pay Irish Water for the provision of any water services that exceed the threshold amount. The payment levels will be set by the commission having regard to the costs of Irish Water. This period of time will allow the customer to adjust consumption patterns or avail of the Irish Water first-fix scheme where the usage is caused by a leak in the grounds of the dwelling.

Section 12 provides that a customer who receives a notice of the provision of water services exceeding the threshold amount can seek an allowance relating to the size of their household to reduce or eliminate their liability. The allowance amount set will be multiplied by the number of persons over four in a dwelling. Section 13 provides that a customer who receives a notice of the provision of water services exceeding the threshold amount can seek an exemption from payment where the usage arises from a medical need of a member of the household giving rise to additional demand for water services.

Section 14 provides for an amendment to section 2 of the No. 2 Act of 2013 to insert the definitions for dwelling, strategic funding plan, threshold amount and water services policy statement. Section 15 provides for the charging of customers of Irish Water for services that exceed the threshold amount in respect of which a customer is liable to make a payment for services relating to the connection of the dwelling to water services and reading and testing of water meters when requested by a customer of Irish Water in respect of the dwelling.

Section 16 provides that the Commission for the Regulation of Utilities, CRU, would have regard to a strategic funding plan prepared by Irish Water when considering a water charges plan submitted by Irish Water. Section 17 provides that Irish Water amends its code of practice to make additional provision in relation to the making of complaints to Irish Water by persons in relation to notices received relating to the provision of water services and exceeding the threshold amount, and in relation to refunds being made by Irish Water to customers who paid water charges.

Section 18 provides that the Minister shall prepare a water services policy statement before the expiration of the water charges plan. The statement will contain information concerning the policy objectives and priorities of the Government regarding the provision of water services in the State and will be laid before each House of the Oireachtas.

Section 19 provides for Irish Water to prepare and submit a strategic funding plan outlining the arrangements for implementation of the objectives of the water services strategic plan for the duration of the water charges plan being prepared by Irish Water. The strategic funding plan will include an estimate of the costs associated with the provision of water services to dwellings and recovery of those costs, costs associated with the provision of water services to premises other than dwellings and recovery of those costs and income of Irish Water and the operating expenditure and capital expenditure of Irish Water. The strategic funding plan will be laid before each House of the Oireachtas and will be furnished to the commission. I plan to bring forward a technical amendment on Committee Stage in relation to this section. The amendment will clarify that it is the objectives of the water services strategic plan that need to be taken account of when Irish Water is preparing the strategic funding plan.

Section 20 provides for grants to Irish Water, sanctioned by the Minister for Public Expenditure and Reform, towards the expenditure incurred by Irish Water in the provision of water services to a dwelling. Before deciding whether or not to make a grant, the Minister shall have regard to the water charges plan last approved by the CRU, the strategic funding plan last approved by the Minister, the refunds plan, the need to ensure the recovery of costs of water services in line with the Water Framework Directive and the environmental objectives of the EU Water Framework Directive.

The Oireachtas Joint Committee on the Future Funding of Domestic Water Services recommended that there should be funding certainty and long-term stability for the water utility. The proposals in sections 18 to 20 of the Bill are in line with those recommendations. The amendment to which I referred is a minor amendment in relation to the naming of one of those strategies.

Section 21 provides that no liability arises for domestic customers of Irish Water in respect of the period from 1 January 2015 to 30 June 2016, or to any related late payment charge, that is the period prior to the suspension of domestic water charges.

Section 22 provides Irish Water with the power to make a refund payment to a customer who paid a charge for the provision by Irish Water of water services to a dwelling. Section 23 strengthens the role of the commission in relation to disputes between Irish Water and those seeking a connection to the public water or wastewater network. Sections 24 to 32 provide for the establishment of the water forum and set out the provisions relating to the membership, functions and operation of the forum.

Sections 33 to 41 provide for the dissolution of the Public Water Forum and the National Rural Water Services Committee and set out the transitional arrangements in moving towards the establishment of the water forum. Sections 42 to 53 provide for the establishment of the water advisory body and set out the provisions relating to the membership, functions and operation of the body. Section 54 provides for the Minister for Finance to pay into the local government fund the local property tax collected during the financial years 2014 to 2017. Commencing with the year 2018, the Revenue Commissioners shall pay directly into the local government fund an amount equivalent to the local property tax received by them, including any interest or penalties.

Section 55 provides that the Minister for Transport, Tourism and Sport can issue directions in relation to the collection of motor tax under sections 5(3) and 7(1)of the 1998 Act. Section 56 amends section 4(6) of the Local Government Act 1998 to provide that from 1 January 2018 all motor tax collected by the Minister for Transport, Tourism and Sport shall be paid into the Central Fund.

Section 57 provides that from 1 January 2018 motor tax collected by local authorities shall be paid to the Minister for Transport, Tourism and Sport. It also clarifies that all motor tax collected up to 31 December 2017 shall continue to be paid into the local government fund. Section 58 amends section 6 of the Local Government Act 1998 and provides for the deletion of subsections 1A, 2A, 2AB, 2B, 2CA and 9. It also amends subsection 2C to provide for a payment to the Exchequer in 2017. Section 59 inserts the Minister for Transport, Tourism and Sport as the relevant Minister. It also adds a provision that any direction in force, remains in force.

Section 60 deals with consequential amendments to the water charges plan in force to give effect to the amendments in this Bill. Section 61 provides for Schedule 4 to the Valuation Act 2001 to be amended by the deletion of paragraph 21. This deletion will provide for the entire network used for the provision of water services by Irish Water or a person who holds a water services licence or land and buildings occupied by Irish Water or such a licence holder now to be rateable. Section 62 provides for the removal of the requirement provided for in section 70B(5) to register a domestic wastewater treatment system every five years. Associated subheads 70B(6) and (7) are also deleted.

The Bill represents a comprehensive policy and funding framework to bring settlement and certainty to the funding of domestic water services. The framework should also improve transparency and accountability in relation to Irish Water, providing greater information to the Oireachtas and the public on the utility's work.

This transparency and information will be underpinned by stronger public and civic engagement on water issues through the new water forum.

The Bill provides for retention of the incentive among households to conserve water and will help Ireland meet the objectives of the Water Framework Directive and other water directives. To be clear, the aim is not to establish a new domestic funding stream for Irish Water. We do not want any money raised through the excessive usage levy. We want to tackle the 8% using 30% of our water. They are using this much either because of leaks or because they are wilfully wasting it. We want to cut out both, not get money for this waste. Again, this is not about new funding. If there are additional people in a home, the allowance will be increased. Those with an illness will be exempt entirely. It provides a framework through which Irish Water and the water services sector can plan and deliver a modern, reliable public water and wastewater system. This is vital for families, communities, the economy and the environment.

The ongoing debate on the funding issues has diverted attention to some degree from the core challenge of fixing our weak water infrastructure. It is time to give certainty to the sector. The Bill presented today reflects the outcome of a serious consideration of the issues by this Oireachtas. It is time to implement these changes and support Irish Water in focusing on making the changes and investment required to build a modern public water and wastewater system that we can all be proud of. building on the progress already made. I commend the Bill to the House.

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