Wednesday, 17 September 2014
Water Services (Exempt Charges) Bill 2014: Second Stage [Private Members]
-----I wish to congratulate him on his elevation on nearly the last day on which the House sat. It was well signposted, but none the less I offer my congratulations and wish him the best of luck in his new post. I have no doubt that he will seek to improve that which for which he has responsibility.
This is a Bill entitled an Act to make provision whereby an owner of a dwelling shall not be charged for water provided to him or her by Irish Water in circumstances where the water being provided is either subject to a boil-water notice or is contaminated by a negative condition, and such owner shall remain exempt from having to pay water charges for the period such notice remains or such contamination exists. This is the thrust of the Bill, which follows the long, sorry saga of the Government's attempts to charge for water, which have culminated in the establishment of Irish Water.
It is not that we wish to oppose that process, this element thereof or anything contained within the Water Services Act just for the sake of opposition. It is not a major secret that we agree with the concept of water charges, but we do so only where there is a system that is fit for purpose. We believe the Government has rushed its efforts to charge for water and to put in place the gold-plated, bonus-driven super-quango that is Irish Water.
The record will show that we did not agree with the establishment of Irish Water, its configuration, its top-heavy tiers of management, its bonus culture or its pay rates. The costs associated with its establishment are now well known, having been initially exposed by members of the media as being €180 million. Some €85 million of that was spent on outside expertise or, as many of us term such expertise, consultants. The funding for its establishment and everything it entailed was drawn from the National Pensions Reserve Fund, NPRF, and was agreed by the Cabinet's Economic Management Council, EMC, which was confined to the Taoiseach, the two Ministers with responsibility for finance - Deputies Noonan and Howlin - and the then Tánaiste, Deputy Gilmore, as well as the then Minister for the Environment, Community and Local Government, Deputy Hogan, who made the proposal.
When the costs, including those for consultants, were exposed, I stated that many members of the Cabinet appeared to feign surprise upon learning of their extent. However, it now appears that those members were genuinely surprised, as the information on the costs and what they entailed was withheld from them. On the "This Week" radio programme in recent weeks, we learned that much of the information in question was available to the then Minister. I wonder what information he conveyed to the council and how the latter did its job of acting in the best interests of those who gave its members the privilege of being in a position to make that decision.
We have seen the slow pace of the metering project, its exorbitant costs and the first year's income from the property tax given to Irish Water. We question the need for metering if the Government is genuine about having a system that promotes conservation. In an effort today to put down Deputy Martin's genuine question, the Taoiseach stated that the previous Governments of recent times had under-invested in the water network. Should the Taoiseach not be aware that Irish Water's capital spend for the next three years, which was announced this year, will be less than what was spent by conventional means in the previous three years? This rubbishes his claim out of hand.
When questioned during the past two years, the Taoiseach stated that children would not be charged for water. He revised this to state that children would receive an allowance of 38,000 litres per year. He will have to revise his statement again, given the fact that the policy paper from the Commission for Energy Regulation, CER, on the pricing structure means that children will only receive an allowance of 21,000 litres. The Taoiseach and the Government have form on these matters, form that cannot be trusted.
I could not make my next remark in the House six weeks ago when the CER's report was published, but it was undoubtedly not a coincidence that the report was issued on an August bank holiday weekend or that the ensuing period of public consultation was held during the month of August when the House was not sitting and many people were not available to make proper submissions or undertake proper scrutiny of what the report contained. It was also no coincidence that the Joint Committee on the Environment, Culture and the Gaeltacht was not afforded an opportunity to discuss the contents of Irish Water's initial submission to the CER or that my request to reconvene the committee to hold such a discussion was not allowed. I have no doubt that the Fine Gael candidate's statement last night was in the fine tradition of the type made previously by the likes of the Taoiseach in the town of Roscommon. I do not know what it is about Fine Gael when it comes to elections, by-elections, promises and false promises in the town of Roscommon. It is déjà vu. The lorry that the Taoiseach stood on will obviously be doing the rounds in Roscommon over the next three weeks.
Water charges will be calculated on 1 October, with bills due to arrive next January. The draft water charges plan is due to be finalised by the CER later this month. That plan proposes a 50% rate for homes that have been under boil-water notices for up to three months and a 100% reduction thereafter. However, households will also have to pay for their water out regardless of the dire quality of their supply.
People honestly do not care what Irish Water defines as water in or water out. They are still being charged for a supply that does not deliver.
We have also put in a detailed submission to the CER's consultation process and we have combined it with this Bill, and I am sure it is available for all to see. We believe it should be simply and squarely very easy to understand that it should be illegal for Irish Water to charge for a contaminated water supply at any level, regardless of any draft or proposed plan that may or will exist on the part of the CER, which has a responsibility to the people, is a representative of the people and is supposed to act in the great and best interest of people.
The Minister present is a member of the Labour Party and I appreciate the intervention by his colleague, Senator John Kelly, last night when he disassociated himself with the comments of the Fine Gael candidate. If nothing else, they appear to have learned from the mistakes, as Deputy Pat Rabbitte said, about doing those things during the course of elections, and they have learned obviously from the Tesco ad fiasco and so forth. I want to acknowledge that and say that the party has made progress in that regard under its new leadership.
However, Fine Gael is claiming that the people of Roscommon affected by boil water notices will not have to pay water charges but, as I said, that is simply untrue. Under the draft plan, residents will have to pay for water out, while those on a boil water notice of fewer than three months such as the people from Newtowncashel in Roscommon will have to pay a 50% rate for water they cannot use. What is more, the CER has denied any confirmation of the Fine Gael's claims resulting, and this has resulted in a fiasco with claim and counter-claim about water in and water out. Let us be straight, honest and clear about this. This Bill can put the issue to bed once and for all. It ensures quite simply and plainly that all residents affected by contaminated supplies do not have to pay for the water. It is a simple way to solve the issue based on the principle of nothing only fairness. Assurance will not be provided by any amount of idle talk or confirmation that the CER, having had a period of consultation, will take note and cognisance of the debate that is taking place, despite the fact that there has not been proper and adequate scrutiny of that report in the absence of the Dáil sitting or of a committee and that is something that the Minister with responsibility in this area has to grasp. The regulator promised a committee of these Houses that it would allow members of an all-party committee on the environment to discuss and scrutinise the contents of Irish Water's submission to the CER's office prior to the CER producing a report based on its research and allow the public have their period of consultation. I do not believe that process was adhered to in the fashion in which it was designed to do so and that being the case, somebody has questions to answer. The Minister with responsibility in this area is the one to ask those questions, seek and demand those answers and have them available for Members of House.
It is near time that sense of clarity and effective leadership came to the fore on this issue. Application forms are being delivered to houses throughout the country this week. A question on the form asks people do they think they have a medical need that may determine the amount of water they use or do not use. Where is that leading? Was it not a specific point allowed or catered for in the legislation that those with a medical need would not be charged inappropriately for the amount of water they needed because of their medical condition? It is another example of the line of form that has ensued since this issue was first brought to the House. To think that people were told that the expertise was within Bord Gáis in the first instance and thereafter was contained in the outside expertise at the cost of €85 million, which was kept from everybody at the time but that we had to accept: as the previous Minister said, "You can't make an omelette without breaking eggs." He is breaking a fair few eggs with the cost of this unfortunately. It is near time that the Minister present showed the sort of leadership that is required on this issue now and that he would agree to accept this Bill which brings absolute clarity based on fairness to one issue which is affecting 36,000 people nationwide, 21,000 in the county of Roscommon and which may affect many more in the intervening period.
I hope that Government party members of both persuasions would agree with the sentiments I have expressed, if for nothing else but to begin a new chapter in allowing this sorry process gain some redemption. As I said, we at no time agreed with the concept of putting in place a new tier of management, a new tier on top of systems that were already in place and adequately positioned if funding was made available in the right manner to address the deficiencies that exist in the system. The Minister counterclaims by saying this is a way and a means by which that can be addressed. I have said to him already that the next three years capital spend will be less than the previous three years by the conventional methods that were available to the Department at that time. That is a fact. A total of €1.67 billion was announced over three years through great fanfare as if it was a huge departure from what had gone before and it was anything but that to be plain and honest about it.
It appears the Minister and his party were frightened by the imposition of a standing charge and the costs to the consumer associated with that. If he compares the costs and the price that was expected then when that was in place, he replaced it with a greater price; he had gone totally and absolutely volumetric now. Heading down the road of full cost recovery, there will be no alternative and the only way this train will have to come to a halt is by privatisation. That will be another Damascus moment for the Labour Party to go with everything else that went before. As I said to the Minister, he seems to have addressed the rot in regard to the promises that he will be making, considering that he has learned his lesson in regard to the Tesco ads. However, Fine Gael has not and we are back to the old tricks that we heard previously in regard to Roscommon. Here is an opportunity for the Minister, his colleagues and his party members to address an issue that is causing great distress. It can be addressed very simply, fairly and adequately with this Bill.
This new Cabinet and the members of it were going to bring a new direction and focus. Sorry lads but if they want to go down that road they can start by agreeing to accept this Bill which is quite simple and straightforward and everything associated with it is based on fairness and equality.
I join my colleague, Deputy Cowen, in wishing the two Ministers present well on their elevation. I thank Deputy Cowen for bringing forward the Water Services (Exempt Charges) Bill and I speak in support of it. If a customer went into any shop and bought a product and on bringing it home found it to be in some way deficient or not to be in good working order, they would be entitled to their money back. The same standards should apply in regard to water.
If water is not of drinking standard then charges should not apply. It is plain and simple, that should be the end of the matter. Thankfully, in my constituency boil notices are very rare. However, incidents of poor water quality are not so rare. Apart from the proposal to charge 50% of the water charges for the first three months when a boil water notice exists and for 100% of the water going out no account is being taken of incidents of poor water quality where a boil water notice has not been issued. I will give an example. I received an email from a constituent last week saying that she had experienced three water outages last Christmas and that when the water supply was finally reconnected gallons of thick brown water had to be run-off, which process can take up to an hour at a time. Apparently this is a regular occurrence for her, her family and some of her neighbours. Who will pay for all of the water run-off in the kitchen, bathroom, toilet, etc.? The constituent further states that on occasion even after an hour of running off water she still has to boil it and that any clothing mid-wash has to be rewashed as the clothes are dirty brown. The question posed by that constituent is: "How can the Government charge for facilities we do not have on a constant basis? It is unfair to ask me, a pensioner, to pay for all the gallons of water that have to be run-off." That is a valid question. There is no boil water notice in that instance. Similarly, there is no boil water notice in many other areas around the country where the water quality is poor. This will have to be taken into account by the CER when the final charges are published.
I take the opportunity presented by this Bill to highlight the situation facing families with grown up children living at home. We all want young people to be well educated. The manner in which it is proposed to structure these charges means there will be no water allowance for a young person on reaching the age of 18 years. This means most students studying for the leaving certificate and third level students will not have any free water allowance. The assessed charge for a family of two parents and two grown up children living at home is €482 per annum. The assessed charge for a family of two parents and three grown up children living at home, which is not unusual or uncommon, is €584 per annum. That household would need to earn more than €1,200 gross in order to pay that water bill. That is staggering. If the CER has under-estimated the amount of water that people use bills will be considerably higher. The reality is that water charges of €600 and €700 per annum will not be uncommon for families in that situation. This is not what people are expecting. The average charge of €240 per annum, which the Government is putting forward, is bogus. The CER says it can honour that charge by including all of the vacant properties in the country and properties with a single occupant. That is dragging down the average. The assessed charge for two adults in a household will be €278 per annum. The CER saw fit to dramatically reduce the water allowance for children by 45% from 38,000 litres to 21,000 litres without publishing any evidence to back that up.
A lot of people are in for a shock when water charges bills arrive in the post next January. I believe people have been misled. I believe that the Government's claims about the average charge are bogus. The goal posts have been moved by way of a reduction in the allowance per household and a substantial reduction in the allowance for each child. It is a bit like saying that the cost of a bag of apples has not changed when instead of there being ten apples in the bag there will be six. That is the three-card trick that this Government is trying to pull in relation to water charges. The truth will hit home with the water bills arrive through the letter boxes next January. There is much talk about income tax cuts in the forthcoming budget. The Government will say that water charges are not a budgetary matter. The reality is that whatever amount of money is given back to people by way of income tax cuts will be more than taken back from them by way of the water charges that will come into force from 1 October.
I join in wishing the Minister, Deputy Kelly and Minister of State, Deputy Coffey, well in their new roles. The Seanad class of 2007 has done well. The Ministers, in particular the Minister, Deputy Alan Kelly, have been left by their Kilkenny colleague with the hurling equivalent of a hospital pass. He will not need to consult Hawkeye in relation to this issue, which is the biggest hospital pass of them all.
The Minister, Deputy Kelly, has been left with delivering that particular demon child to the public. I wish him good luck with that. He will need all of his supposed hurling skills to do so.
We have been told the water we will receive will be of Ballygowan quality. The Minister, Deputy Bruton, pronounced from on high that Ballygowan water is what we are going to get, which is a little ironic, in particular for the 23,000 people in Roscommon who are forced to buy bottled water every week - not Ballygowan water because they cannot afford it - in order to ensure they and their families have access to drinking water.
We have had a very successful tourism season. The Minister, Deputy Kelly, is a former executive of Fáilte Ireland. One can only imagine what tourists will think when they arrive into wonderful establishments here only to be met with notices on A4 sheets saying that water and ice at that establishment comes from elsewhere and that customers can be assured the water being provided is clean. One can only imagine what people will think when they visit facilities at which they receive a wonderful welcome but are faced with such notices. Also, one can only imagine what that will add to the cost base of the business, for which it will not be compensated.
Boil water notices aside, people with medical conditions require additional water. While I am aware there is to be a cap in this respect we have not yet had any specifics in that regard. People with kidney, heart and other conditions need certainty in respect of their water requirements and a definition of "cap". Preferably, they should be given an exemption. I encourage the Minister and Minister of State to encourage the highly paid executives in Irish Water to become familiar with the Sale of Goods and Supply of Services Act 1980, which legislation governs consumer protection in this country. It is the legislation which sets out what a contract is, namely, a formal agreement between two or more people, enforceable by law. A contract relates to the purchase of goods of services. As such when people fill out the forms from the pack provided by Irish Water and send them back they will then be bound by contract. Under the Act, the purchaser, namely, the consumer, has a number of rights. The goods must be of merchantable quality and fit for purpose. The type of black-brown water about which Deputy Michael McGrath spoke, which we have all seen and know about, which destroys machinery and equipment, could not be described as being of merchantable quality or fit for purpose. Therefore, as the goods are not fit for purpose and do not meet the standard of the contact, the consumer has a range of rights, including the right to compensation and to have their money returned. The Small Claims Court will be very busy next year as people hold Irish Water to account under the Sale of Goods and Supply of Services Act 1980 for bad service or the supply of goods not fit for purpose as they do not do what they are reasonably expected to do.
Rather than dismiss Deputy Cowen's legislation, the Minister might consider the introduction of a new regime in the Department of the Environment, Community and Local Government through which that Department could work with him in avoiding a situation whereby next year people will be going to the Small Claims Court enforcing their legal rights under the Sale of Goods and Supply of Services Act 1980. It is typical of government - I do not mean Government in the sense of the current Government - Departments working in silos, which I have railed about for many years, that this Department will be funding a National Consumer Agency providing information to people about their rights, while another Department has under its aegis a body which is infringing those rights on a daily basis.
Businesses have been paying water charges to local authorities for some years. An issue on which I would like the Minister to engage is the passing by local authority executives of complaints or queries in relation to water to officials of Irish Water. Local authority executives want to to wash their hands of all water complaints. When one raises the issue with Irish Water one is told that there are queries outstanding from the local authorities.
Is it possible for the Department to have a dedicated telephone line, as in the Passport Office, so these kinds of questions can be clarified?
In fairness to Irish Water, it provides an excellent service to elected representatives and it reverts to us very efficiently. Generally and often, however, the fault lies at local authority level.
There are so many issues to be raised under the Consumer Protection Act. This is another Act with which the staff of Irish Water will need to become familiar. Under it, it is an offence for any retailer or professional to make a false and misleading claim about goods, services and prices. Therefore, it is an offence for Irish Water to tell 23,000 people that they have the best water in the world. It is an offence for the Minister for Jobs, Enterprise and Innovation, Deputy Richard Bruton, to tell 23,000 people that they will have Ballygowan water. I am sure Ballygowan would not be too impressed to have its water compared to the kind of water that the people of Roscommon are currently forced to drink. Claims about the weight, ingredients, or performance of goods must be stated truthfully or else one is opening oneself up to all sorts of complaints. The Act also covers claims about pricing, funnily enough. The former Deputy Phil Hogan might like to read the provisions of the relevant section of the consumer protection legislation. He told us the average bill will be approximately €230 but we know it will be around €500. Therefore, the former Deputy Hogan could brief himself before he departs regarding his responsibility under the Consumer Protection Act 2007.
The Minister needs to provide information regarding the issue of health. Even in the packs with which we have been provided, claims about health and support for those with various conditions are quite vague. Those with the conditions in question do not need the worry of a lack of knowledge on top of everything else with which they must deal. If Irish Water made a very clear statement to address this very urgently, it would be of assistance.
Establishment costs have never been dealt with in this House. That €180 million was spent meeting start-up costs of Irish Water before expenditure of a cent on equipment or on meeting capital costs is extraordinary. This is the kind of occurrence that the Government, when in opposition, would have railed against. Surely the Minister's Department, as the parent body, owes us an explanation on where the money has gone and why it had to be spent. Surely, given the amount of expenditure separate from capital expenditure, we must ask whether the money had to be spent. We were assured that by placing Irish Water on the structure that was Bord Gáis, it would not need the kind of money that was expended. However, what we have seen is what Deputy Cowen referred to, that is, a runaway train that still has not been slowed down. Nobody has yet applied the brakes to it. That is the kind of waste of money to which people on boil water notices refer. They say the money is going on salaries and expenses and not being spent in their counties to provide capital assistance or to resolve their problems. This is why there is so much frustration throughout the country over the way in which Irish Water has been established and is doing its business.
Both the Minister and Minister of State are on different sides of an argument that is currently being waged in Roscommon. The candidate of the Minister of State, Deputy Coffey, proclaimed last night that water charges would be abolished for those on boil water notices. The candidate of the Minister, Deputy Alan Kelly, said this morning that this had not been decided yet and criticised, without naming the individual, the Minister of State's candidate. There was something on Twitter today about deleting tweets. The Minister of State might want to direct his candidate's attention to it in Roscommon. This is the kind of thing that candidates throughout the country, from both Government parties, will try to start doing. The Labour Party candidates will start blaming the Fine Gael candidates for Irish Water because it was Deputy Hogan's creation. The Minister, Deputy Alan Kelly, is now in charge and must take responsibility and ownership of the issue. He must deliver to the 23,000 people who are on boil water notices some sort of assurance that they will not have to pay the same bills those of us with a good water supply will be forced to pay. As Deputy Michael McGrath has stated, the Government should give some indication to families, particularly those with adult children living at home, that they will not be absolutely carpeted by charges to them. I refer also to families with teenagers involved in sport and a range of other activities that require the use of showers. A very good case study was presented during the summer of a lady in north Dublin who was involved in the local GAA club. She does all the washing for the club but intends to stop doing so because she has estimated that, by providing the service to her community, it will cost a fortune. These are all the models and day-to-day matters that arise and to which the former Minister, Deputy Hogan, certainly never paid attention. He never worried too much about them because he has known that by the time the bills come through the doors in January 2015, he will be looking down on us all from his cushy number in Brussels.
The Minister has got the hospital pass. He has got a ball and has got to come on and run with it. He is now the face of Irish Water. Ministers of State can always hide, except when there is good news. The Minister, Deputy Kelly, is the face of Irish Water and he is the person whom we will hold responsible on behalf of those who cannot get water services and those who are getting sick of water services. I direct the Minister again to brief himself of his responsibilities as main shareholder in Irish Water in light of the Sale of Goods and Supply of Services Act 1980 and the Consumer Protection Act 2007. Responsibilities of Irish Water in that regard are quite a mess.
Like other speakers, I congratulate the Minister and Minister of State on their appointments and wish them well. No doubt we will be harrying them continually from this side of the House in the coming period.
I am happy to support the legislation Deputy Barry Cowen has introduced today. It is a clear-cut Bill attempting to deal quite effectively with a problem that the three previous speakers have clearly outlined to the Minister. The problem is real. There are 36,000 families throughout the country with a problem. There is a particular set of circumstances in County Roscommon that can be identified and quantified. In the previous existence of the Minister and Minister of State, both would have been able to recognise the problem and accept that a solution had to be found. Earlier today, when the leader of Fianna Fáil raised this with the Taoiseach during Leaders' Questions, I was particularly taken by the point made. Deputy Martin put it to the Taoiseach that there was a point of principle, and that it concerned the question of whether the Taoiseach stood over a situation in which an entity established by the Government would charge people for a service that could not effectively be used. No matter what anybody says, it is a point of principle. Sadly, the Taoiseach did not address that in his response. I hope the Minister for the Environment, Community and Local Government will do so. It is a clear-cut, straightforward, obvious set of circumstances that exists. Nobody expects the Minister, Irish Water or the Commission for Energy Regulation to create an environment in which everybody with a periodic problem with his water can claim an exemption from charges, but when a clear, widespread systemic problem exists that can be identified, it behoves the system, Irish Water and the Minister to do something about it.
I want to raise a couple of other points in the very limited time available to me. The first concerns the likely impact of this development on the rental market, particularly the social rental market. We know that in the greater Dublin area, for example, the rate of homelessness is increasing arising from the cap that has been placed on the rent subsidy. Could the Minister indicate in his response the extent to which his Department has evaluated the impact the charge for water will have, particularly on the social rental sector? Will the charge have to be paid by the landlord? Alternatively, will it be paid by the tenant? If the tenant departs the property without having paid, how will the outstanding moneys be recovered, or can they be recovered?
The second point was alluded to earlier in the day by Deputy Catherine Murphy.
It is the issue of Irish Water demanding the personal public service, PPS, numbers for individuals who have received communications from Irish Water. No other public utility requires the personal public service number to be provided to it. I have been astonished by the number of people who have contacted my office about this and by the number who bitterly resent the idea that a semi-State body should demand their PPS number from them. They are even more infuriated when they consider the possibility or, indeed, the prospect that this utility company could be sold at some time in the future and that their private details could, as a result, find their way into the public arena.
Deputy Cowen referred to the issue of capital investment. None of us takes any great pride in the fact that, notwithstanding the huge investment over the last decade in public water infrastructure, there is still much more to do. I have been a public representative for long enough to know that for at least 20 years, during which each of our parties has been in government, there have been reports of up to 40% of water being lost. I was listening to that in County Kildare in the 1980s, 1990s and the 2000s. It does not appear that the very substantial investment that took place in the public infrastructure was done in such a manner as to ensure that the leakages were dealt with. We got new schemes and established schemes where no schemes had existed previously, but we certainly did not achieve the type of repair or upgrade of existing schemes that is clearly necessary. The point made very effectively by my colleague, Deputy Cowen, is that there is nothing in the budgetary proposals for Irish Water to suggest that anything will change in that respect in the next three years. That is a problem and perhaps the Minister would refer to it.
As I travel around my constituency I meet many people who live in finished or unfinished estates who raise the issue of taking estates in charge and the absence, unless it has been rectified over the summer, of a protocol addressing the responsibilities of the local authorities vis-à-visIrish Water for the taking in charge of estates. That does not appear to have been addressed yet. In so far as a protocol is now necessary, it clearly indicates that there was a serious flaw in the initial stage of the legislation. Does the Minister accept that there is a problem in that area? Certainly, my local authority says there is. What priority will he give to it and when will the protocol be brought forward to address this issue?
I thank my colleagues for what I presume are their sincere good wishes. There is a very youthful look on the team on this side of the House.
I thank Deputy Cowen for giving me the opportunity to address the issues associated with the Bill. Many issues were also raised by the four speakers. They might check the Official Report for today as some of those issues were addressed during parliamentary questions. Deputy Cowen could not attend and I do not know the circumstances for that, but a number of questions were addressed, including some of the issues raised by the last speaker.
The provision of safe and wholesome drinking water is of critical importance to the health and well-being of our citizens. Modernising and improving water services delivery in Ireland is a key policy objective in the programme for Government and it is one on which the Government is delivering. Significant reform of water services has already begun and has been delivered through the following measures: the establishment of Irish Water as a State-owned company within the Bord Gáis group, which is now named Ervia; the introduction of a new, sustainable funding model to support much-needed investment in water infrastructure, including the introduction of water meters in households to facilitate equitable water charges based on usage; and the establishment of an independent economic regulator for water services, with a key focus on consumer protection, through the conferral of statutory powers on the Commission for Energy Regulation, CER.
The establishment of Irish Water has been one of the most significant elements among a wide range of public sector reform measures achieved by this Government. The move towards the utility model will deliver major benefits to our people and our economy in a number of ways, notably through providing a more structured and co-ordinated approach to the delivery of water services on a national basis; achieving economies of scale in service delivery and more efficient procurement of materials and services; reducing unacceptable levels of waste from the drinking water distribution system, with an estimated 40% of treated drinking water being unaccounted for prior to the establishment of Irish Water; and reducing the overall costs of delivering water services.
The establishment of Irish Water within Bord Gáis Éireann was an important step in assisting the utility to leverage the existing core expertise available to Bord Gáis as a modern and efficiently-run utility. Bord Gáis employed its internal expertise to establish functions in Irish Water in areas such as asset management, information technology, customer operations, financial management, risk management and corporate governance. Ervia and Irish Water estimate that establishing Irish Water within the BGE group has saved potentially tens of millions of euro. In the longer term, they estimate that it will lead to a saving of over €1 billion over the period to 2021.
It is important to note that the reform of water services is not only important in delivering better value for money for our citizens, but is also critical to support economic development and growth. Worldwide, demand for natural water resources is rising, yet supplies are becoming more vulnerable. Ireland has a potential competitive advantage in having high quality supplies of fresh water available for use. We must make the most of this opportunity and create a world class system of water services delivery. By doing this, Ireland can both support indigenous industry and attract overseas investment in water-intensive industries such as ICT and pharmachemicals.
Already, the metering programme undertaken by Irish Water is delivering an economic dividend through the creation of over 1,200 jobs. This is an incredibly ambitious programme of capital works, with Irish Water planning to install over 1 million meters within a three year period. Since the commencement of the installation programme in August 2013, over 400,000 meters have been installed. Irish Water has committed to completing the installation programme by mid-2016. The metering programme is unparalleled in its scale and ambition. It is a considerable achievement. The introduction of charges based on usage is a cornerstone of the Government's pricing policy. That is the reason the accelerated metering programme is of primary importance to the funding model being put in place.
Water meters facilitate a fair form of charges for users of water services and facilitate the provision of a free allowance to households and families. The Organisation for Economic Co-operation and Development, OECD, has previously stated that metered charges are the fairest form of charging. The OECD has also noted that failure to install water meters would give households zero incentive to save water or to minimise waste in the form of leaking pipes, running taps and other wasteful usage such as unnecessary use of garden hoses. The OECD also advised that the failure to measure water use further perpetuates the public's low awareness of consumption levels and the real cost of water services. A better understanding of costs could, in itself, promote some reduction in consumption.
The OECD went on to observe that water metering will also remove the inequities between households. A household with large gardens or even a swimming pool will pay significantly more than a smaller household with average consumption. When households understand that they can manage their water bills through reducing consumption they are provided with an important incentive to manage their water use responsibly. In Denmark, for example, a reduction of 12.6% in household consumption was achieved in the period 1996 to 2007, following the introduction of water meters along with the promotion of water saving devices.
The Walker report, prepared by the UK Government and published in 2009, estimates that water metering in the UK has the potential to achieve a reduction of approximately 16% of average household demand through reduced personal consumption and reduced customer side leakage. A research project carried out in the greater Dublin area estimated that customer side leakage may be as high as 65 litres per property per day, but more recent studies in Dublin suggest that customer side leakage could in some locations be significantly higher.
The installation of water meters will ensure that these leaks can be identified and fixed. Metering will, therefore, achieve significant reductions in the volume of water that is required to be treated every day and will lead to savings in the operational costs of delivering water services and in deferred capital expenditure as well. Moreover, it will lead to other environmental benefits such as reduced abstractions from rivers and lakes and reduced carbon emissions from lower energy consumption.
There is also evidence from closer to home - from the group water sector. The National Federation of Group Water Schemes has long advocated the introduction of water meters in group schemes throughout the country, and members of these schemes have been accustomed to paying for water based on usage in recent years. The evidence from the group schemes sector provides further proof that very significant savings can be achieved through the introduction of metered charges.
Two comprehensive pieces of legislation approved by the Oireachtas during 2013, the Water Services Act 2013 and the Water Services (No. 2) Act 2013, provided the legislative basis for the programme of reforms. The two Acts addressed a wide range of issues to provide for the establishment of Irish Water and the subsequent transfer of water services from the city and county councils to Irish Water. However, with regard to the topic of the Bill before us, I would like to outline the measures that are set out in the existing legislation regarding the levying of charges by Irish Water and the measures the legislation contains to safeguard the interests of the customers of Irish Water.
The Water Services (No. 2) Act 2013 provides Irish Water with the statutory power to charge customers for the water services provided. Specifically, section 21 of the Act sets out that Irish Water shall charge each customer for the provision by it of water services. Such charges are to be calculated by Irish Water in its water charges plan, which is subject to the approval of the CER. The water charges plan to be prepared by Irish Water is required to specify the manner and method by which charges are to be calculated and the costs likely to be incurred by Irish Water in the performance of its functions under the legislation during the period to which the water charges plan relates.
The water charges plan is also required to set out the requirement to charge for both water supply services and wastewater services. While the majority of Irish Water's customers will receive both water supply services and wastewater services, a proportion may receive only a water supply or a wastewater service. Where a customer receives both water and waste services, the legislation provides that the amount of wastewater discharge from a household or other premises is deemed equal to the amount of water supplied to the premises. This is often referred to as "water in, water out," and is a broadly adopted method for charging for water services internationally. This will apply whether the volume of water supplied was measured by a water meter or assessed based on criteria to be approved by the CER.
In preparing the water charge plan, Irish Water is required to take account of the public utility nature of its functions but also the need to perform its functions in a manner that maintains Irish Water as a commercially viable utility. The CER, in evaluating the plan, may approve the water charges plan submitted by Irish Water with or without modifications, or it may refuse to approve the water charges plan. In addition to approving the water charges plan, the CER has a wider role in overseeing the level of service provided by Irish Water to its customers. In particular, section 32 of the Water Services (No. 2) Act 2013 provides that Irish Water must prepare and submit to the CER a code or codes of practice to address a wide range of customer protection issues. These include: standards in regard to the performance by Irish Water of its functions; billing by Irish Water of persons in respect of water services provided; methods of payment of water charges; the provision of information to customers of Irish Water for the purpose of enabling customers to communicate with Irish Water; the making of complaints to Irish Water by customers in regard to the provision of water services; the standards of such services; the contesting of the charge; and, importantly, any other matter the commission considers necessary and appropriate to secure the interests of customers of Irish Water.
Section 39 of the Act sets out the requirement of the CER in the performance of its functions and, in this regard, the CER is obliged to perform its functions in a manner that best serves the interests of customers of Irish Water. It is worth noting that the CER is required to perform its functions having regard to the need to ensure that the customers of Irish Water are provided with the quality of services provided for in the aforementioned code of practice; that water services are provided by Irish Water in an economic and efficient manner; that Irish Water operates in a commercially viable manner; that there is continuity, safety, security and sustainability of water services; and that due regard is paid to the recovery of costs of water services in accordance with Article 9 of the EU water framework directive, which requires member states to take account of the principle of recovery of the costs of water services.
Section 42 of the Act provides an important role for the Minister for the Environment, Community and Local Government by providing that the Minister may issue a general policy directive direction to the CER. In this regard, my predecessor as Minister, Mr. Phil Hogan, issued such a direction to the CER on 2 July 2014. The policy direction, which took account of decisions made by the Government, addresses a range of matters relating to the water charges plan to be submitted to the CER by Irish Water and relates to the interim regulatory cycle which will cover the period from October 2014 to the end of 2016. In particular, the direction provided for the following: the provision of a free allowance for domestic customers of Irish Water for usage in their primary residence, amounting to 30,000 litres per household on an annual basis; an allowance to cover the normal consumption of both water supplied and wastewater treated per child in primary residence in the State, with the level of this allowance to be verified through consumption data from metering; the requirement for assessed charges applied by Irish Water to be primarily based on occupancy, allowing for provision for other factors to be considered, such as comparison with metered usage; provision for special arrangements for customers with specific medical conditions which require increased water consumption, involving the capping of such charges at the relevant assessed charge; and provision that no standing charge should apply to domestic customers other than provision for the CER to consider a minimum charge for non-primary residences. Of particular relevance given the subject matter of the Bill tabled by Deputy Cowen, the direction also provides that the commission should make provision for circumstances in which the quality of water services provided by Irish Water to customers is impaired or services are reduced or restricted - for example, where there is a boil-water notice in place.
I believe it would be useful to outline the existing legislative provisions dealing with drinking water quality. To ensure the safety of our drinking water supply, the quality of drinking water in Ireland is regulated by the European Union (Drinking Water) Regulations 2014. These regulations specify 48 microbiological, chemical and indicator parameters or standards that water suppliers, including Irish Water and group schemes, are required to monitor to ensure compliance with those standards. Irish Water is now responsible for public water supplies.
The EPA is the statutory body responsible for the provision of drinking water supplies and has been provided with extensive powers by the regulations to ensure that drinking water supplies comply with the parameters contained in the regulations. These include the power to issue a direction to a water supplier to ensure compliance. The regulations provide that it is an offence for a water supplier to fail to comply with such a direction.
As part of the statutory monitoring responsibilities, where Irish Water, in consultation with the Health Service Executive, considers that a water supply is a potential risk to human health, it is required to ensure that the supply of such water is prohibited or the use of such water is restricted, and that consumers are informed promptly and given the necessary advice. This notification and, in particular, the advice provided for consumers will vary depending on the cause of the risk. The main parameters for which restrictions are currently in place are E. coli, cryptosporidium and lead. Boil-water notices are issued in regard to E. coli or cryptosporidium, while water restrictions are issued for lead.
The EPA produces annual reports on the quality of drinking water supplies in Ireland which set out the compliance of drinking water supplies with the mandatory standards set out for the drinking water regulations. The most recent report covers compliance in 2012 and shows that 98.7% of public water supplies were compliant. This shows a high level of compliance, although clearly we want to improve on this and ensure that all supplies meet the necessary standards. Significant progress has been made in improving the quality of drinking water supplies in recent years. Of course, of particular note is the 92% reduction in the detection of E. coli in public water supplies since 2005. At present, there are 978 public water supplies for which Irish Water is now responsible, serving approximately 82% of the population of the State. The remainder of households receive their supply from either private wells or private group schemes.
The EPA has recently reported to my Department that there are currently 31 restrictions in place on public water supplies, including 20 boil-water notices. The restrictions in place affect approximately 26,000 people. Of the schemes affected by the boil-water notices, one is in each of the counties of Cork, Kerry, Leitrim, Longford, Mayo, Sligo, Waterford and Wexford, four are in County Tipperary and eight are in County Roscommon.
A number of restrictions issued under the drinking water regulations relate to exceedances of the limits for lead. These exceedances arise from the solubility of lead in drinking water. In recent years the WHO has been advising on reduction of exposure to lead on the basis that prolonged exposure to lead can result in harmful health effects, particularly in infants and unborn children. This has resulted in reduced limits being set by the European Union in the drinking water directive which has been transposed into Irish legislation by the drinking water regulations. In 2003 the allowable limits for lead in drinking water were reduced from 50 to 25 micrograms per litre. At the end of 2013 the limit was further reduced to 10 micrograms per litre or ten parts per billion. At this lower concentration, there is the risk of exceeding the limit wherever there is lead piping, particularly where the water has been sitting in the pipe overnight. It is possible to treat the water using particular chemicals, but this can only reduce rather than remove the risk. For this reason, the WHO recommends the removal of lead from drinking water systems as the necessary objective to reduce health concerns. There is a negligible amount of lead pipes in the water distribution mains, but Irish Water estimates that approximately 100,000 homes may be connected to lead service pipes. This is the pipe that connects the water main to the household stopcock or water meter. Irish Water has developed a ten-year timeframe to eliminate these service pipes and lead backyard services, which it estimates could involve an additional 30,000 to 40,000 homes. The estimated cost of the work is between €200 million and €300 million. The Water Services Act 2007 provides that the owner of a premises is responsible for the maintenance and renewal of the internal water distribution system and shall ensure it is kept in good order. Responsibility for replacing lead pipes from the main stopcock to the house and within the house rests with the homeowner. Irish Water is also evaluating the problem of lead piping within households. In this regard, it is examining methods of water treatment to reduce and prevent lead being absorbed into household water supplies.
The Water Services (No. 2) Act 2013 requires the EPA and Irish Water to co-operate in a manner that best promotes the interests of consumers and the efficient provision of water services. Irish Water is taking action in this regard by making drinking water quality its top priority. In its interim investment plan which will operate up to 2016 the main focus will be urgent provision of treatment plants to address schemes with boil water notices, eight of which are in County Roscommon; an action plan to address water supply schemes not considered sufficiently robust to ensure the water supply will comply with drinking water standards; and a specific programme of work to address the long-term problem of lead piping in the public supply system. The investment plan will provide for capital spending on new drinking water plants of €133 million, with a further €140 million focusing on drinking water availability and improving quality. A number of schemes are being fast-tracked where there are currently restrictions on supply - six new treatments which are under construction in County Roscommon will be completed between November 2014 and June 2015 and serve over 20,000 people, while a new scheme is to be completed in Tipperary to address boil water notices that have been in place for almost six years. It is clear that a dynamic effort is being made by Irish Water to address as a priority drinking water schemes with impaired supplies.
Water charges for households will commence on 1 October 2014, with the first bills to be issued by Irish Water to households in January 2015. In advance of this and in accordance with the provisions of the legislation, Irish Water has submitted its proposed water charges plan to the CER. In July 2014 the CER published a public consultation document on the proposed water charges plan which has been concluded. In its consultation document the CER set out its initial proposals relating to water charges and, in particular, how the requirements of the policy direction could be achieved. This included the following proposals. Where a water supply is declared unfit for human consumption for a period of less than three months, a 50% discount on the water supply charge should apply. Where the supply is unfit for human consumption for a period of more than three months, a 100% discount on the water supply charge should apply. The CER's proposals are more favourable to the consumer than those submitted by Irish Water which had suggested a 100% discount should only apply where the period involved was over six months rather than three I understand that, following the public consultation process, the CER is considering the approach to compensating households where the water supply is not fit for human consumption. It is important to highlight that all of the households in 18 of the 20 public water supply schemes, including all eight in County Roscommon, affected by a boil water notice that were notified to my Department by the EPA will be eligible to receive a 100% discount on the water supply element of their bill from Irish Water - in other words, as indicated in the documents published by the CER. If confirmed when the water charges plan is published shortly, as such, customers who have been on a boil water or drinking water notice for three months prior to the commencement of water charges on 1 October 2014 will not pay for their water supply. The legislative framework that the Government has put in place to establish Irish Water and the CER as the economic regulator for Irish Water means that there is a robust process for the protection of customer interests and clearly demonstrates that the customer is at the centre of the Government's thinking when framing this legislation.
Moving to specific elements of the Bill tabled by Deputy Barry Cowen, the Bill aims to amend the provisions of section 21 of the Water Services (No. 2) Act to provide that Irish Water should not charge a customer for the provision of water services to his or her dwelling in circumstances where the water being provided to that dwelling is either subject to a boil water notice, contaminated by a negative water condition or both. From the detailed measures I have outlined, it is clear that the legislative and administrative process is already in place to provide the basis for the compensation of customers affected by a water supply and does not comply with the statutory standards. For this reason, the Government cannot support the Bill supported by the Deputy. As I have outlined, the existing legislation provides the basis for addressing this matter with the necessary flexibility, an issue which is not addressed in the Bill. This flexibility is important to ensure equity and proportionality for all customers of Irish Water. The CER is considering the water charges plan, specifically how to deal with those with an impaired water supply. It is proposing to address the level of time for which the supply has been impaired and the issue relating to the water supply element of the charge.
This is an area where the Bill is flawed. An exemption from all water charges is proposed in the Bill, thus ignoring the fact that the provision of a wastewater service by Irish Water is not affected by any issue relating to the water supply. In its own analysis published as part of the public consultation document on the water charges plan, the CER estimates that only 15% to 20% of the water supply to households is typically consumed directly by household occupants or used in food preparation and is, therefore, affected by water that is unfit for human consumption. While a final determination on this matter has not yet been made by the CER, it is proposing discounts that go way beyond this 15% to 20% level. However, to exempt a household from wastewater charges, as well as water supply charges, would be disproportionate. As stated, Irish Water is obliged to charge for the services provided by it and to operate in a commercially viable manner. Compliance with the EU wastewater directive has required extensive capital investment in new treatment plants - investment that will be continued by Irish Water in the coming years.
The CER is due to announce the approved water charges plan for Irish Water towards the end of this month. The approved water charges plan must fully reflect Government policy as outlined in the policy direction issued by the CER in July 2014. The measures I have outlined are a key aspect of creating a sustainable funding model for water services delivery in Ireland. The introduction of regulated water charges creates a fair and equitable funding model for a new approach to water services delivery. The establishment of a new and sustainable funding model will help Irish Water to secure the level of investment required to upgrade public water and wastewater infrastructure and ensure the public receive a high quality drinking water supply and that wastewater is treated to high standards to avoid the pollution of watercourses and the coastline. This is the service citizens expect and deserve and it is what the Government is delivering.
I appreciate the good intentions of Deputy Barry Cowen in bringing forward the Bill, but, as I have outlined, the current policy is robust, there is a robust legislative framework behind it and we have fully addressed the objectives of the Bill in a far more comprehensive manner. Therefore, the Government will be opposing the Bill.
I welcome the senior Minister and the two Ministers of State. I was listening to the contributions of Fianna Fáil Members in opening the debate on this Private Members' Bill. I was taken by the praise for it and the idea that there was a great principle behind it, that it was very succinct, that it was clear what it was about and that it could be encapsulated in a few words. One must suspend reality to take seriously the arguments made by Fianna Fáil Members on this issue. It is a red herring.
There is no acknowledgement of the fact that in the way water charges are currently levied on commercial premises the concept of water in, water out is applied. That is what people who avail of both a water supply and wastewater treatment facility pay for. They are separated because in some instances people have a septic tank rather than a wastewater treatment facility. In all the time I served on a local authority, I never heard of a direction coming from Fianna Fáil-led Governments in cases of boil water or other notices that people should not be charged for water whether they were commercial or domestic users. People throughout the country are used to various notices about their water but in all the time I served on a council, there was never a direction or legislation not to charge people because the water was substandard. It was a case of carrying on. This issue will be addressed. The energy regulator is making provision for allowances where the water supply is not up to standard to ensure people receive a concession on their charges. Fianna Fáil's argument is a red herring.
The kernel of the issue is Fianna Fáil presided over a water services capital investment plan that ground to a halt. I had a great deal of experience in this regard as a member of Mayo County Council. The polluter pays principle was implemented as part of the interpretation of an EU directive. It was implemented in unique style by Fianna Fáil, which meant that a local authority had to come up with a share of the funding. That was levied and fell foursquare on commercial users. The problem in Mayo was that when we ran out of planning levies to make up our portion of the polluter pays contribution, we had no hope of delivering water and sewerage schemes. Raw sewage to this day is pumped into the bay in Belmullet but the bay was designated as a protected area under the shellfish directive. This meant that not only could the council be sued by Europe if the quality water diminished by allowing raw sewage to be pumped into the bay, a case could be taken by the EPA. The position was similar in Foxford and Charlestown. There are leaks all over the system. Ballina, which is where I am from, is the largest town in the county and there are leaks all over the town's water network. Businesses, including hotels, are unable to operate. Such was the condition of the pipes that once a section a pipe was repaired, it burst further along the road. It was like an old tyre. When one repairs a puncture, the pressure increases in the next weakest part. It was an absolute disaster and Fianna Fáil had no plan to resolve this.
We have a plan and that is Irish Water. According to the two year capital programme the Government published, €41 million will be invested in my county, of which €21 million will be used to implement water schemes with the balance spent on long overdue wastewater treatment plans in areas where SACs are polluted. Nothing would have been done under Fianna Fáil's plan. That is the point of principle. This is the problem we were faced with and had to resolve because the party did nothing about it. Counties such as mine with a low rates base and less development were never in the running. That is why large urban centres had wastewater and sewage treatment plants and we did not. The test for Irish Water is whether the schemes that have been on a list forever and a day will come to fruition. That will happen. That was a point of principle Fianna Fáil never cared to address when it was in government.
This is a populist Bill, which is true to form for the party. The debate should be about affordability. People should be asked to pay something towards their water supply and it should be framed in a way that encourages them to conserve water and prevent water wastage. I made a submission to the Minister when he issued his draft water charges policy. The CER has been given a framework and Irish Water must take on surplus staff from local authority water services departments. I contended in my submission that it may cost €2 billion up to 2023 to take the additional staff on. While they may have to be taken on, that cost should be included in the calculation of water charges.
The household allowance is 30,000 litres. In a rural area of my county, the domestic allowance for a group water scheme is 225,000 litres but this will be reduced to 30,000 litres. We have to be realistic about household allowances and they need to be increased. At the end of the day, we are asking everyone to pay for water, which is right, but let us not crucify them. The CER will come up with a formula based on the parameters it has been given but it is down to the Government to consider affordability. More problems will be visited on the doorsteps of Government Members if affordability is not tackled. We have to be realistic about charges. Building the capital infrastructure is a massive challenge but we cannot heap on all the charges now. There is a strong case for spreading the cost of the investment in badly needed infrastructure and I have only given one example in County Mayo.
It is also an opportune time to examine the issue of water fluoridation. Since the inception of the policy, there have been many advances in science, understanding and so on. Considering the many concerns validly raised by citizens about adding something to water, it would be opportune for Irish Water, whether in conjunction with the Department of Health or one of our universities, to investigate the pros and cons of this policy. We can examine the addition of fluoride to water with fresh eyes while taking into account public health concerns.
I support the Government's position on the legislation. This a case of Fianna Fáil Members once again coming forward with passion and bleeding hearts. To take them seriously at all, one has to suspend reality, go into the daze and enjoy the performance. There is no truth or depth to it whatsoever. God help the people if they ever get into power again.
I welcome the opportunity to contribute to the debate. I understand the sentiment behind the Bill. It is important that contaminated water is not charged for but I am opposed to domestic water charges in their totality. Deputy Mulherin referred to the Government having a plan and Fianna Fáil having none. The Government has Fianna Fáil's plan because Fianna Fáil, despite its position now, agreed as part of the disastrous bailout that there would be charges for water-----
-----a separate utility company would be established and water services would be removed from local authorities. The Government, therefore, is implementing that party's plan.
It is there in black and white in the memorandum of understanding and the four-year programme, on page 26, where it is set out clearly that the Irish Government would both transfer responsibility for water services to a new public utility and introduce water charges. It is disingenuous of Fianna Fáil to say it now opposes water charges.
Fianna Fáil may claim it would make exceptions such as those in the Bill, and we would certainly support it. Where water is contaminated, it is common sense. Nobody should have to pay for any poor-quality service. Fianna Fáil may say it would be more generous than the current Administration in ensuring that less of the burden would fall on those with lower incomes; however, I question whether it would do things any differently if it were on the other side of the House. Fianna Fáil agreed arrangements with the EU and the IMF. Fianna Fáil projected that it would bring in exactly the same amount of money as Fine Gael and the Labour Party are projecting. The only difference is that Fianna Fáil was going to do it one year earlier.
Fianna Fáil and the two parties in government are well aware that the average charge currently quoted will rise as the full impact of charges takes effect and Irish Water ensures that all the costs of maintaining water services are recouped from water charges. We know the high cost of establishing Irish Water on top of the local authorities which continue to provide the service. The cost will be recouped when the short-term allowances currently proposed are removed and the full costs are passed on to householders. I have said before, as have many other commentators, that it will eventually entail a charge of more than double the €278 currently quoted for a household of two adults. Even as things stand, many households, depending on their composition, will face water bills well above €278.
Before the Minister of State went on his summer holidays, he maintained that the average charge would be €240 per household. During the summer break, when the House was not sitting, the real figures were released and we know that a household with two adult children, even if they have no income, will pay between €480 and €490. This is a huge charge that will hit low-income and middle-income families, on top of the property tax, with no account taken of ability to pay. There are people who cannot put bread on the table. I do not know if the Minister of State realises this. I am sure he met some of them over the summer. They are in dire straits. They are people in negative equity, who cannot pay their mortgages and whose mortgage payments nearly equal their total household incomes. I plead with the Minister to do something about it. It is a serious issue. Deputy Mulherin referred to affordability. I welcome the fact that she, as a Government Deputy, did that.
She is pleading with the Minister to deal with this issue because she has heard about it. A section of the population cannot survive even now. Water charges are a serious imposition on top of the property tax and other taxes that will come in. They will further squeeze those households, which are in the difficult position of trying to make ends meet. That is why we are totally opposed to water charges. People are receiving information packs in the post from Irish Water, which include a form requesting personal public service, PPS, numbers, which is to do with claiming the allowances for children aged under 18. Our position on these forms is clear. We are not recommending that people do not return the form, because that is a matter for adults to make up their own minds on. While some are telling people not to return the forms, we are clearly advising people that if they do not return the forms they may lose out on allowances due to them. Some advocate that householders return the packs to Irish Water with a message referring to the fact that they have not signed the contract and are, therefore, not consenting to being charged. Some even suggest that there is no legal basis for the charge and that people who do not fill out the form will not be billed. This is nonsense and Sinn Féin will not be party to deluding people. Those advocating such an approach have provided no legal evidence to back up their position. The only way water charges can be overturned is through legislation in the House. While I support this small Bill, we need to work for the total abolition of water charges on householders.
Ordinary citizens and families across the State are being forced to pay yet another regressive tax to repay the banking debt that was not theirs in the first place. Those responsible for creating the economic crisis, the collapse of our public finances, forced emigration and mass unemployment remain unaccountable for their actions. This Bill is a typical Fianna Fáil stunt. Its members come in here and shake their fists, but cannot accept that this is part of their great master plan. Fianna Fáil supports water charges and this sort of sideshow will fool nobody. Sinn Féin believes the political choices a government makes are defined by its view of society, its ambition, its ideological anchor and the interests it seeks to represent. The Fine Gael and Labour Party Government continues to make choices that are not in the interests of the vast majority of citizens and that are in contravention of the mandate it was given by the people in 2011.
Despite its pledge to do things differently, Fine Gael and the Labour Party have recycled the failed politics and the old way of doing business, which was the cause of the economic and political crisis in the first place. The water charge was conceived by the previous Fianna Fáil and Green Party Government, which agreed the unfair policy with the troika as part of its financial bailout in December 2010. At the time, the Government said it had got the best deal. Sinn Féin strongly disagreed. When the Dáil voted on a motion on Wednesday 15 December 2010 to support the terms of the financial bailout, Sinn Féin voted to reject the deal, as did the Labour Party, whose members are absent tonight. Its then leader, Deputy Eamon Gilmore, said:
Labour is opposing the motion because what is on offer is a bad deal for Ireland. In the coming election we will seek a mandate to renegotiate the programme.As we know, the Labour leadership did no such thing. It did a U-turn in government and is implementing the very policy against which it rallied.
Before coming here I checked the Labour Party's website and looked at a statement it issued just after the announcement by the Fianna Fáil and Green Party Government that it would introduce water charges, as follows:
The Labour Party believes that water is a basic and fundamental need and should not be treated like a market commodity ... Charging for domestic water, in the light of our current taxation system, will only add to inequality, since such charges don’t take account of people’s ability to pay.The Labour Party was right, but it is wrong now to do a U-turn on that position.
Providing reliable, high-quality water and sewerage services which are economically sustainable is a major challenge for any government. Sinn Féin has first-hand experience and a strong record of delivering exactly this in the North. In May 2007, when the power-sharing institutions at Stormont were restored, Sinn Féin decided to reverse the plans by British direct rule Ministers to introduce household water charges. Sinn Féin also ruled out any future privatisation of these critical public services by ensuring that the Executive, under the Northern Ireland Department for Regional Development, remained the sole shareholder of the newly established utility company Northern Ireland Water. Today, according to the Utility Regulator in the North, households save an average of €490 annually as a result of the decision Sinn Féin took.
We did not leave it there. We did not just reverse the British decision to introduce water charges. Between 2007 and 2011, we injected €1 billion in investment in major upgrades in the North's water and sewerage infrastructure, benefitting almost 1 million households and businesses. It has improved drinking water quality, protected the environment and supported the local economy. Fine Gael and the Labour Party know exactly what was achieved in the North because since January 2012, the Government has been in contact with the Department for Regional Development and Northern Ireland Water exploring all these matters.
Despite seeing how best practice and putting citizen's needs first delivers an efficient water and sewerage service, Fine Gael chose to impose the unfair household water charge on families as promised by the previous Fianna Fáil Government. Households will receive their first bills in January 2015 and it is up to every person to decide how to deal with them. We will not lead them down the path of telling them there are no consequences for not paying and then abandoning them when the consequences of their choice become apparent.
Sinn Féin believes households already pay for these services through their income tax and that citizens should not be forced to pay twice through a new separate bill for water and sewerage services. Sinn Féin is vigorously opposed to the introduction of these charges. The Fine Gael Bill supports the introduction of charges as it was Fine Gael's proposal which is now being delivered by that party and Labour. Sinn Féin believes the best way to provide reliefs for households is to abandon regressive charges altogether. We will in the next number of weeks show in our alternative budget how we can reduce the deficit, balance the books and, at the same time, abandon the nonsensical idea of introducing a regressive water charge for people the length and breadth of the State. I ask the Government and those who were in the previous Government to see the light and come around to the view that water charges should not be imposed on families already crippled by seven austerity budgets.
I welcome the opportunity to contribute to the debate this evening. I oppose totally the introduction of the water tax on the citizens of this country because we already pay for water. Now, the Government will make us pay on the double for the same water supply. The purpose of the Bill tonight is to exempt those who have received a product from Irish Water which is not fit for purpose. It shows the fallacy of the Irish Water project the Government has pursued. Why should we even have to look at introducing legislation to protect consumers and citizens in this way? That is the overall problem. There is no doubt that the Government and Irish Water have set out to treat citizens as customers and as people operating in a free market to buy a product. This product is not fit for purpose for many households. Approximately 36,000 households do not have a drinkable water supply yet the Government proposes to charge them for it. It is not acceptable to engage in the gymnastics of saying there is water in and water out and that if one is in an area with a public sewer supply one will still have to pay as one can still use the water to flush one's toilets. Any company that produces a product consumers cannot use must refund the costs. That would happen with any other product in the so-called "market place" the Government wants to see us all in.
In his contribution earlier, the Minister spoke about Denmark and how it achieved a 12% reduction of water usage on the introduction of metering. He did not say it was on the introduction of charges. It was on the introduction of metering and technology to conserve water. The project the Government has embarked on is not about conserving water supplies, it is about generating revenue. That is the sole purpose. Irish Water has the right if it does not achieve the revenue intended from charging to revert to CER to have the tariff revised to ensure its targets are reached. That makes a mockery of the whole system that is being introduced. Citizens are being forced to pay on the double for a service that everybody should have as of right.
I am opposed to the introduction of this water tax. While the motion is straightforward and makes sense, it is a bit cynical of Fianna Fáil to move it as it would introduce the water tax if it was in power. At the same time, the proposal before the House is a straightforward recognition that people who have water that is contaminated or needs to be boiled should not pay for the product. The Government is making it a product by establishing Irish Water.
It is a fact that €1.2 billion was collected through VAT and motor tax to pay for water services over the last number of years. Where has that money gone? Why did it not go to conservation of water and the fixing of leaky pipes? This tax, which the Government will introduce by whatever means, will take more money out of the pockets of those who spend in our local economies. The idea of saying there will be allowances on which CER has not been able to make up its mind for children, those with medical needs and even those who have to boil their water makes no difference. Irish Water wants to raise €500 million out of this. If allowances are made in some areas, other households will have to pay for that to make up the €500 million. I concur with Deputy Pringle that Irish Water will be able to go to the energy regulator and say it cannot raise the money it needs and require a change.
This is about another austerity tax, not conservation of our water. It is not about supplying water to the people of this country. The 1.7 million households which will pay consist of people who have children and medical needs and everything else associated with water. Water is a human right. That is a message the Government has forgotten. It is a human right and it should not be paid for this way. It should be paid for through progressive taxation or a 1% wealth tax generating €500 million. The Taoiseach said today that not introducing Irish Water would mean bringing in more taxes. Bring in more taxes on wealth. That is what should be done in a progressive taxation system.
While water metering is taking place, over the last 15 days not one water meter was installed in Crumlin. The people in the community came out and said to GMS "No, we do not want them". Peaceful protesting has meant that in 15 days not one water meter has gone in. GMS moved out of the area this morning as it could not put the water meters in. These people know that even if they do not have a water meter, they will still get bills in January. People hate and resent this tax. They will have to make up their own minds as to what they want to do as part of a campaign and decide if they are willing to take on the Government. The Government will have a great deal to answer for.
Many people were congratulating the new Ministers. If the Minister, Deputy Alan Kelly, keeps going the way he is, he will be thought of in the same way as Deputy Phil Hogan has been thought of.