Michael Healy-Rae (Kerry South, Independent)
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Question 147: To ask the Minister for the Environment, Community and Local Government his views on whether his decision to endorse Bord Gáis Energy as the entity to run the new water utility will result in a loss of up to 3,000 public sector jobs who are working in the water service at present; and if he will make a statement on the matter. [19642/12]

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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The overarching objective of the water reform programme is to put in place structures and funding arrangements that will ensure we have a world class water and wastewater infrastructure that meets all environmental and public health standards, can attract foreign direct investment and support job creation and maintenance in key sectors such as pharma-chem, IT and food and drink. It is estimated that the programme for the installation of metering infrastructure, commencing later this year, will provide some 2,000 new jobs.

The Government decided in December 2011, based on the recommendations of an independent assessment, to establish a public water utility company, Irish Water, to take over the operational and capital delivery functions of local authorities in the water services area. Further consideration has been given since then as to whether Irish Water should be established as a new entity or whether existing bodies in the Semi State sector could undertake the functions. The outcome of this analysis is that Irish Water should be established as an independent state owned company within the Bord Gáis Group.

It will be a matter for Irish Water to determine the staffing and skills required for the new organisation. The analysis underpinning the decision to establish Irish Water as an independent State owned subsidiary within the Bord Gáis Group was based solely on their capabilities to undertake the task.

Bord Gáis Éireann (BGE) has key capabilities that can be brought to bear in the establishment of Irish Water, including experience in operating as a utility in a regulated environment and a track record in raising finance, and has specific skills from its own experience of transformation, customer relations, network management, metering and utility operation that can be quickly deployed to assist in the successful establishment and operation of Irish Water.

The skills within the Bord Gáis Group will be paired with the experience and commitment to service in local authorities and the specific water and wastewater capabilities and expertise that exist in local government to build the new organisation. In the initial phase, Irish Water will work largely through service level agreements with local authorities. It is envisaged that these arrangements would end in 2017 at the earliest. This will ensure a smooth transition to the new model and guard against the loss of local expertise. It will also mean that the majority of staff will remain in the direct employment of local authorities for a considerable period.

The proposed public utility model represents a major change with significant implications for local government, the water industry in Ireland and its many stakeholders. These are key issues to be addressed in developing the implementation plan for Irish Water, and will involve close co-operation with local authorities, staff and the Unions to ensure that the change is managed well.