Seanad debates

Friday, 19 December 2014

Water Services Bill 2014: Committee Stage

 

8:35 pm

Photo of Brian Ó DomhnaillBrian Ó Domhnaill (Fianna Fail) | Oireachtas source

Exactly, but that is not happening here. Therefore, it does not meet the basic requirement of a fair taxation regime. It is against all the international standards that have been established, as outlined by Senator Barrett. It is deeply unfair and regressive and does not stand with the progressive nature of the PAYE tax system.
Consider the position in other countries that charge for water. A UN declaration in 2010 accepted that if there is to be a water charge introduced based on consumption, no income decile should pay any more than between 1% and 2% of disposable income. The percentage of disposable income paid for water services by the lowest income decile varies across the OECD. In Turkey, for example, it is 10.3%. In the Czech Republic it is 3.9%, and in Canada it is approximately 1.3%. Even with the changes introduced by the Government, a two-person household in Ireland will be levied with a charge greater than what the United Nations defines as fair. In other words, it will be above 2% of the disposable income of the lowest income decile. Even by introducing the charge at this early stage, and with the Minister bringing in the lowest possible charges and doing his utmost, we are still not getting it right. What hope will we have in 2018 when there is a revisiting of the charging policy, when the regulator will be pushing up the prices and when the private interests of outside forces will be pushing up prices by lobbying the regulator? This will be inevitable because it will make the company more profitable. By making the company more profitable, it will be able to increase the amount of money required to fix the pipes that are broken.
The Government is setting up a system that will skin people, particularly those with a low income. It is bringing in a flat-rate grant across the board, which makes no sense at all. I agree with Senator Cullinane that the system does not even meet the basic requirement of being simple to administer. Perhaps the cost of administering the grant will be as great as what it is worth.
There has been no thought put into this and it has been rushed. I appreciate that the Minister, Deputy Kelly, has done what he could in a short period. However, what was talked about here last night, a period of reflection, is required. The best brains should be employed. Even if the Minister does not believe us on this side, he should get the best economists in the country and listen to those associated with , the Nevin Economic Research Institute and outside experts who are raising some of these concerns.

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