Wednesday, 2 February 2005
Water and Sewerage Schemes.
Paddy Burke (Fine Gael)
I welcome the Minister of State, Deputy Brian Lenihan, to the House, although I thought the Minister for the Environment, Heritage and Local Government might have attended the House to take this important matter. I have raised this matter on the Adjournment because it is an important one for the country as a whole, and in particular for towns that are affected by waste water management schemes in the short term.
The Minister for the Environment, Heritage and Local Government has said on a number of occasions that the way forward for waste water services is the Ringsend development. That is the model they are all following and it will be done on a design, build and operate basis. I am somewhat sceptical about such schemes which is why I have tabled this motion to ask the Minister how he sees design, build and operate schemes being run throughout the country.
In recent years, a waste water scheme was announced for Castlebar, which was to cost approximately €50 million. I understand the local authorities will have to pay a proportion of the scheme. Dublin Corporation and the other councils that linked into the Ringsend project paid approximately 26%. That may be fine for Dublin which has quite a large rates base. In Galway, however, the local authority's contribution to the waste water scheme was in the region of 4.5%, in Limerick it was slightly more.
As regards Castlebar, however, and a number of other schemes planned throughout the country, the Department of the Environment, Heritage and Local Government is now seeking a contribution of 20% from the local authority. The Castlebar scheme will cost approximately €50 million and, therefore, the taxpayers and ratepayers of County Mayo will have to raise €10 million so that the waste water scheme for Castlebar can go ahead. There is no way that Mayo County Council, or Castlebar Town Council for that matter, can come up with €10 million.
That is only the starting price because where contracts are concerned we always see that the tendered price is always the lowest one. One can be sure that the overall cost will rise to at least €60 million. That means the county manager will have to find €12 million just for Castlebar. He also has many other towns to look after in the county. It is not just in Mayo — in every other county, managers will be faced with the prospect of obtaining 20% of the capital cost of such schemes.
The Department of the Environment, Heritage and Local Government has laid down guidelines for local authorities to implement development charges. They were supposed to be the be all and end all of future development, with kitties being put in place for projects like this. However, there is no way that the people who are now paying development charges can fund the required contribution of 20% for such developments. The development charges for Castlebar alone will not come anywhere near €10 million, not to mention towns like Ballina, Westport, Ballinrobe, Charlestown, Kiltimagh and others whose waste water treatment plants will need to be upgraded.
A business that pays its development charges now may wish to upgrade the business again in two years time, so it will have to pay another development charge. Where will the county manager be left as regard this matter? How will he get €10 million, €12 million or €14 million? Will he levy all the existing businesses? Will he proceed with development charges or will he forget about any further expansion for towns such as Castlebar?
The Department of the Environment, Heritage and Local Government, as well as the Minister and his Government colleagues should examine design, build and operate schemes. They represent a big step away from the conventional system which works well in some cases. However, we cannot expect ratepayers to foot such bills. The county manager is duty bound to enter into negotiations with large-scale water users. There are quite a number of pharmaceutical plants throughout the country that utilise a lot of water and, in turn, require waste water treatment capacity. If county councils have to enter into special arrangements with such plants we will run them out of the country. That is what will happen because all the business people will be paying capital and running charges.
The Government should re-examine the percentage of the capital cost of new waste water treatment schemes that local authorities have to raise. The sum of 20% is out of the question because there is no way that any local authority could afford that, although Dublin may be an exception due to its huge rates base. Any local authorities with which I have been involved, and others that I know of, will not be able to raise anywhere near 20% of the capital cost of new waste water treatment schemes, particularly for big projects. How will such local authorities enter into negotiations with big users? Large-scale water users will not pay €2 million, €3 million or €4 million of a capital project up front or even over 20 years.
This area must be re-examined by the Government. I hope the Minister of State provides a good reply to my questions. If not, I am sure he will take the matter back to his Cabinet colleagues.