John Halligan (Waterford, Independent)
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82. To ask the Minister for Environment, Community and Local Government the amount of revenue that Waterford City and County Council is to recoup next year from Irish Water; the amount of this that is made up of payroll costs to do with water supply and waste water treatment by the council as agents for Irish Water; if he will provide a percentage breakdown of the amount of the overall earnings of the council this figure represents; the amount that Waterford City and County Council invoice Irish Water for in operational costs every month; if Irish Water has indicated it will seek a reduction in what it will pay the council going forward; the support services Waterford City and County Council are providing to Irish Water; and if he will make a statement on the matter. [45995/14]

John Halligan (Waterford, Independent)
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On behalf of the Technical Group I offer my sincere condolences to the family of the young man who died in what can only be described as unacceptable circumstances, namely, without a bed or a roof over his head. It is unacceptable that such a thing could happen in Ireland today, which has a relatively small population of 4.5 million people. I thank the Minister for the initiative he is due to announce on Thursday. I am sure he will do everything in his power to deal with this inherently poor and desperate situation.

How much revenue is Waterford City and County Council set to recoup next year from Irish Water and how much of this will be made up by overall pay costs to do with water supply and wastewater treatment by the council as an agent of Irish Water? Will the Minister provide a percentage for how much of the overall earnings of the council this figure represents? For how much does the council invoice Irish Water in operational costs every month and has Irish Water indicated that it will seek a reduction in what it will pay the council in the future?

Alan Kelly (Tipperary North, Labour)
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I do not know if the Deputy was present when I commented on the issue of homelessness, but it will be addressed in later questions.

In December 2013 all of the local authorities signed individual service level agreements with Irish Water. Under these agreements, local authorities are conducting certain water services such as operations and maintenance of plants on behalf of Irish Water. I have no role in agreeing individual service level agreements which are operational matters for individual local authorities and Irish Water. However, I understand from Irish Water that Waterford City and County Council has been paid some €12.2 million to the end of October 2014 under the agreed service level agreement.

As well as in-built reviews of a service level agreement after two and seven years, there are annual service plans with agreed objectives and standards of performance, set against a budget covering headcount, goods and services and investment in the forthcoming year. Agreement on the annual service plan is a collaborative process between Irish Water and each of the local authorities and their representative bodies. The 2015 process is well under way and it is expected that annual service plans for 2015 will be agreed shortly. Until these plans are finalised, it is not be possible to give a breakdown per local authority for 2015.

A key objective of both the service level agreements and the annual service plans is to maintain service levels for all users of public water and waste water services. Meeting the new uniform regulatory requirements and standards and the regulator’s customer requirements is at the heart of the 2015 annual service plans.

John Halligan (Waterford, Independent)
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My understanding is that local authorities will continue to provide water services as agents of Irish Water. The cost of providing these services vis-à-vispayroll costs and a portion of the councils' central management charges will be recouped directly by Irish Water. However, it is likely that Irish Water will seek a reduction in what it will pay councils. There are considerable financial and operational uncertainties around this issue. For instance, will local authorities face significant operational and financial risks if the service level agreements, as agreed, are not honoured in full by Irish Water? For example, operating costs in the utility company, to date, have been twice those of its UK counterparts. When set up Irish Water signed a 12 year service level agreement with more than 4,000 local authority workers and there are major concerns about pension liabilities. Will the Minister clarify whether if the pension liabilities of Waterford City and County Council staff and others who moved to Irish Water were transferred to the new employer?

Alan Kelly (Tipperary North, Labour)
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On the last issue, I presume everything has been done appropriately. If the Deputy has a specific question on the issue, I will get back to him directly if he sends his query to me. The requirements in this regard are set out, but I do not have a direct role in the matter. However, I am intent on ensuring the review process for the service level agreements will be conducted in a comprehensive manner. A review process will take place after two years and seven years. A framework has been agreed and is in place. Each year an agreement must be put in place and issues identified will be dealt with in a suitable manner. Some issues will be unique to a particular local authority and Irish Water will engage on them. To date, I have no reason for concern in my dealings with Irish Water or the local authorities. I deal with both sides of the coin.

I have seen no concerns to date that would give rise to any form of alarm.

John Halligan (Waterford, Independent)
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I wonder whether water charges will be used to pay off huge legacy debts incurred by councils over the years, for example, overruns on contract failures on various capital projects. My information is that many local authorities have already had to borrow money to settle contractual claims and legal disputes. For example, in Waterford city, substantial legal costs and settlements of €4 million were paid to a contractor following a dispute in 2010. We were recently told by Irish Water that it will take on between €100 million and €130 million in debt from uncollected commercial water charges. Can the Minister give any indication of the extent of liabilities which will be transferred to Irish Water for debts such as unpaid development levies or loans various councils drew down for expensive investment projects on budgets that went by the wayside?

Alan Kelly (Tipperary North, Labour)
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The figures quoted by the Deputy are broadly accurate. Irish Water does have a role and is taking on what it needs to take on. However, it is a case-by-case scenario and it obviously has to be very prudent and has to do this in the right manner. If the Deputy has a specific concern in regard to water or a specific project in mind, while I do not have that level of detail available here, I would be quite happy to get the Deputy an answer, one on one.

I must repeat that a huge amount of rigour has been gone through in how Irish Water is dealing with those cases and the legacy issues to ensure there is value for the taxpayer and that this is appropriately managed. I can give many examples where success stories have emanated because of Irish Water. The biggest one, which, to be fair, everyone has acknowledged, is at the Ringsend plant close to here, where a huge amount of capital investment has been saved due to the establishment of Irish Water. There are examples all over the country. This is a very positive thing. The saving in regard to Ringsend alone is equal to the set-up cost of Irish Water.