John Perry (Sligo-Leitrim, Fine Gael)
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Question 49: To ask the Minister for the Environment, Heritage and Local Government the anticipated effect of the national water pricing policy which will result in a new countrywide consolidated charge for water services; and if he will make a statement on the matter. [42570/06]

Dick Roche (Wicklow, Fianna Fail)
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There are no proposals for a new countrywide consolidated charge for water services. Each of the 34 city and county local authorities have financial and management autonomy in their functional areas, and will continue to operate individually, in the setting of water charges for non-domestic users.

The Government's water pricing policy envisages full and transparent cost recovery of water services supplied to the non-domestic sector. Cost recovery from the non-domestic sector is to be achieved by way of a consolidated, meter-based volume charge to be applied within the functional area of the relevant authority. I envisage that local authorities will have completed the metering of all non-domestic water users by the end of 2007. The effect of this will be to enable local authorities to measure the amount of water supplied to each non-domestic water connection, thus providing a transparent and equitable cost recovery mechanism for non-domestic water services in accordance with the polluter pays principle.

Fergus O'Dowd (Louth, Fine Gael)
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I should point out that the question was misspelled. It should have referred to countywide, rather than countrywide, charges. I apologise in that regard.

If counties have not completed their water metering programme, they do not have to apply the county at large charge in 2007. It is inequitable that the same circumstances do not apply in every county. Until it does, it can be deemed unfair that it applies to certain counties like, for example, County Louth.

Where non-domestic users in towns such as Drogheda and Dundalk had water and sewerage charges applied, users in Ardee and Dunleer paid water charges only. This year, users in Ardee and Dunleer will have to pay water and sewerage charges and this involves a significant increase — up from 80 cent per cubic metre to €1.55 per cubic metre. This will have a significant and adverse impact on some communities whereas other communities in other counties do not pay this county at large charge.

Dick Roche (Wicklow, Fianna Fail)
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Individual councils control these matters. The current system of volume charges can be very unjust to individual users. One will find people paying higher charges than necessary if they are charged simply on the volume of water that enters their system. Some councils have also made a single charge for "water in and waste out".

The installation of meters is the only way to achieve equitable charging for non-domestic water users. I understand that metering is well advanced. The Deputy mentioned County Louth and I understand that it has almost completed its metering programme. We expect the balance of the country will be metered by the end of this year or early next year.

Fergus O'Dowd (Louth, Fine Gael)
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If the metering programme is not completed in a county, the consolidated county at large charge does not apply and businesses will therefore pay the same this year as they paid last year. However, where the metering programme has been completed, users in towns outside major urban areas which have a separate rating capacity now face a doubling in the charge they paid last year. Non-domestic users in other counties are getting away completely. These charges are being applied as a result of the directive the Minister issued. I ask him to delay the directive for at least another year until all counties are in compliance.

Dick Roche (Wicklow, Fianna Fail)
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I am not aware of the specific case the Deputy has mentioned.

Fergus O'Dowd (Louth, Fine Gael)
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It is unusual and it is not equitable.

Dick Roche (Wicklow, Fianna Fail)
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If the Deputy wishes to send me a note, I will look into it. It sounds like a perverse effect. It is, of course, more equitable that everyone pays on the same basis.

Fergus O'Dowd (Louth, Fine Gael)
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These users only had water charges levied last year, whereas this year water and sewerage charges have been applied in some towns.

Dick Roche (Wicklow, Fianna Fail)
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The Deputy has made the point clearly. If that were to continue, it would be inequitable. Some users would be paying the full cost while others are not.

Fergus O'Dowd (Louth, Fine Gael)
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That is what the county at large charge means. That is the point.

Denis Naughten (Longford-Roscommon, Fine Gael)
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Does the Minister believe it is fair that farmers should be charged for individual meters? In one instance, a farmer has been charged for the installation and running costs of 13 meters; 20% of farmers have to pay for more than five meters and the majority of farmers, especially those in the west, must pay for at least three meters. Does the Minister think this is acceptable?

Does the Minister believe the commercial users of water should have to pay for the leakage on the public element of that supply? This can happen where the local authority, through a lack of investment, has allowed leakage to occur. Should farmers and commercial users have to pay for the water that does not reach their places of work?

An allocation of €10 million was provided in the budget for the installation of equipment. Does this help cover the cost of the installation of meters and the repair of leaks?

Arthur Morgan (Louth, Sinn Fein)
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Does the Minister accept that the increase in these charges, from 80 cent to €1.55 in Louth as outlined earlier, will have a substantial, adverse effect on the competitiveness of businesses in those areas and seriously damage the economy?

Catherine Murphy (Kildare North, Independent)
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I previously received a reply from the Minister outlining the charges applied by each local authority and these varied from 60 cent per unit to €2.60 per unit. Can the Minister account for this variance? Is it an income generator, or is it only supposed to cover the cost of providing the service? For example, Intel in my constituency is a major user of water and we must be aware of the impact charges would have on future industrial developments.

Why has the installation of meters in new homes and apartment building been insisted upon?

Jerry Cowley (Mayo, Independent)
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I previously asked the Minister about farmers with many separate water taps and he said he would look kindly on their circumstances. A bill ranging from several hundred euros up to €1,000 can be a heavy ongoing expense for farmers. I hope he will reiterate his previous position. Some farmers may keep stock indoors for half the year and do not use the water meters.

Dick Roche (Wicklow, Fianna Fail)
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I will start with the issue of multiple metering raised by Deputies Naughten and Cowley. It is a specific problem, particularly in places like Sligo and parts of the west where there are multiple or fragmented holdings. I have already indicated that I am favourably disposed to resolving that and will issue guidelines to local authorities. More prudent attention could have been paid to this factor when some local authorities were establishing their charging systems. As Deputies are aware, I do not like intervening in areas that I regard to be within the specific responsibility of local authorities. The active functions and powers of local authorities have haemorrhaged to the centre for generations and I do not like that fact. This is an area where local authority members have some responsibility and they should exercise it.

That leads me to the points raised by Deputy Murphy. There are inexplicable differences in charges from area to area and I was pleased to publish and circulate that information. We have informed local authorities by circular that when they are striking their rates they should not, to take the point raised by Deputy Morgan, perceive it as some sort of cash cow to be milked. They must ensure cost recovery because otherwise the burden will fall on the general taxpayer; it is right and proper that business should carry some of the cost.

Deputy Naughten asked about fragmented holdings. I will be issuing a circular in that regard. I do not think the Deputy asked specifically whether it was fair that a person with a smallholding had to pay for up to 13 meters but the answer, in any case, is "No." That case should never have arisen and I will issue guidelines on abatement. Local authority members can now make those decisions but there needs to be homogeneity.

The Deputy also asked about the cost of running the scheme, including the cost of unaccounted-for water, which is a euphemism for the more common term, "leaks". We do not charge for the domestic element in this country but we charge for all other aspects of water services. Irrespective of the charging system, and bearing in mind that the domestic element is paid for by the general taxpayer, the full costs must be met. However, a more significant issue arises with regard to leakage, in the reduction of which we have invested a lot of money in the past two years. It is unacceptably high in some areas, for example it is more than 40% in the city of Dublin, which is an outrageous amount. A small investment of capital to address the problem of unaccounted water, or leakage, in the past few years has reduced the level from over 42% to below 32% in Dublin. That is the way forward and it is an issue we continue to press with local authorities.

Denis Naughten (Longford-Roscommon, Fine Gael)
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There is no incentive for local authorities to deal with it. It is paid for by local ratepayers.

Dick Roche (Wicklow, Fianna Fail)
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That is not quite true.