Paddy Burke (Fine Gael)

I thank Senator Buttimer for sharing time and welcome the Minister of State, Deputy Michael Finneran, whom I wish well in his portfolio.

I agree with Senators' comments on banks. The Government should not have allowed banks to offer 100% and 120% mortgages. This was a reckless approach and the Government was equally reckless in allowing the practice because people will get into serious financial difficulties as a result.

Some local authorities are in serious financial difficulties and face problems raising the local contributions required for water and sewerage schemes. In some cases, these amount to 30% of the overall cost. In the current climate, where will local authorities generate such sums for the sewerage and water infrastructure that is critical to the supply of housing? Many communities want extensions to water and sewerage schemes but the local authority is unable to raise the necessary local contribution. Will the Minister establish a fund to assist local authorities which are in this position by reducing the contribution they are required to make? My local authority is experiencing difficulty raising the contribution for several sewerage schemes, most of which are small. It is a sad state of affairs when local authorities are unable for financial reasons to proceed with an extension or treatment unit.

Dublin City Council had to provide an additional €35 million for work done to the Ringsend water and sewerage plant, which was developed through a public private partnership. The Government must examine the operation of public private partnerships. It is unacceptable that local authorities are required to bail out the private partner. Who must pay the piper in such circumstances? It is the business community which pays for water and sewerage services and in many cases the charges are severe. In Castlebar, for example, businesses pay €10 per 1,000 gallons of water and sewerage in what is known as a "water in, water out" system. This is a massive overhead on industries and small businesses, such as hairdressers, restaurants and bars. I ask the Minister to consider alternative funding mechanisms for small future water schemes, which are crucial to the provision of much needed housing.