Brian Stanley (Laois-Offaly, Sinn Fein)
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2. To ask the Minister for Environment, Community and Local Government the net figure collected from domestic water charges in 2015; the cost of collection; and the projected net cost to the Exchequer of the household conservation grant. [3663/15]

Brian Stanley (Laois-Offaly, Sinn Fein)
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My question relates to the funding of Irish Water in the current year. Will the Minister outline how the charges are going to work, the projected cost to the Exchequer of the household conservation grant, and the amount to be collected for domestic charges in 2015.

Alan Kelly (Tipperary North, Labour)
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The main aspects of the Irish Water funding model are set out in a detailed fact sheet published on my Department’s website. In 2015 Irish Water expects billed income from domestic customers to total €271 million and that from non-domestic customers to total some €229 million, giving a total billed income from customers of €500 million. The estimated annual cost of Irish Water’s billing and customer services for domestic customers is approximately €22 million. Irish Water’s costs have been examined by the Commission for Energy Regulation, CER, and only efficiently incurred costs can be passed on to the customer.

The Government is proposing to provide for the payment of a water conservation grant of €100 per annum, which will be available to all eligible households in respect of their primary residence. The water conservation grant will commence this year and an allocation of €130 million has been provided in my Department’s estimates for 2015. The budget allocation for the water conservation grant is based on an estimate of up to 1.3 million households applying for the grant. This estimated level of demand for 2015 takes account of the number of primary residences recorded in census 2011 as well as experience with other demand-led schemes.

Brian Stanley (Laois-Offaly, Sinn Fein)
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The concern here is that the Minister has said that he expects to bring in €271 million from domestic water charges. What compliance rate is that based on? If it is going to cost €20 million to collect the charges and there is a non-compliance rate of 30%, that brings the income down to €190 million. If one takes €20 million from that, one is left with €170 million, and when one takes the water conservation grant, for which the Minister has budgeted €130 million, that leaves €40 million. The cost to date of setting up the corporate structure is more than €200 million, so he has already overshot the runway in terms of the cost of this. The economics of this do not add up. I am saying this honestly. This is voodoo economics. Will the Minister outline the level of compliance on which the €271 million is based on?

Alan Kelly (Tipperary North, Labour)
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I will not take lectures from Sinn Féin on voodoo economics, especially after the performance the other night.

Brian Stanley (Laois-Offaly, Sinn Fein)
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I know the Minister will not, but let us deal with the reality. Let us deal with the hard figures. Come on now.

Paudie Coffey (Waterford, Fine Gael)
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Deputy Adams got his figures wrong.

Michael Kitt (Galway East, Fianna Fail)
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Give the Minister a chance.

Alan Kelly (Tipperary North, Labour)
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We are very happy that the funding model for Irish Water is very thorough and is going to work. The registration levels are improving all the time. As of yesterday, 1.03 million people had registered. The funding model for Irish Water and the expenditure is all set out. The €271 million for domestic income is what is expected and what has been gone through with the CER.

Brian Stanley (Laois-Offaly, Sinn Fein)
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What is the compliance rate? Is it 18 or 19%?

Alan Kelly (Tipperary North, Labour)
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It is impossible to assess now, but similar to all other schemes, the property tax and everything else, we expect a very high compliance rate. Income from commercial charges is €229 million, so that is bringing in a total of €500 million. With the €399 million, that is €899 million, as the Deputy is well aware, in relation to the total operating spend on Irish Water.

Brian Stanley (Laois-Offaly, Sinn Fein)
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How much was brought in by commercial water charges last year? These are the figures. This is what must stack up here. The Minister has not told me what compliance level he needs to achieve to bring in the €271 million. He might answer those two questions. The European Commission is quoted as saying that the water conservation grant is a transfer from the Exchequer to Irish Water and that this may not meet the market corporation test.

Barry Cowen (Laois-Offaly, Fianna Fail)
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That is a later question.

Brian Stanley (Laois-Offaly, Sinn Fein)
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This is a reality the Minister must deal with. This is something this State must deal with if it does not meet the market corporation test. Does the Minister believe that it will meet the market corporation test and does he believe that the reported remarks of representatives of the European Commission are not true? It was reported heavily last week that this is the line taken by the European Commission, that it is counting this €130 million as a direct transfer from the Exchequer. This is not off-balance sheet. It counts this as State funding to Irish Water. Has the Minister had an exchange with the European Commission in the past week on this matter?

Alan Kelly (Tipperary North, Labour)
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Another Deputy has a similar question later on. I am confident this will pass the market corporation test.

Comments by the European Commission were leaked over the past several weeks. We are, however, confident the market corporation test will be met. Several Deputies have referred to the water conservation grant as if it would have a negative impact on this. This will be a demand-led scheme which will be available universally, including for the Deputy’s backyard, for those with private wells and those in group schemes. The Government is very confident the package being put together will pass the market corporation test.

It must be remembered that EUROSTAT is independent of the European Commission, like the Central Statistics Office is of the Government. It will make its own determination which should be available in April.