Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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118. To ask the Minister for Housing, Planning, and Local Government for an update on funding being provided to local authorities to cover the anticipated costs of moving to a single water utility. [23332/23]

Darragh O'Brien (Dublin Fingal, Fianna Fail)
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On 1 January 2023 Uisce Éireann (formerly Irish Water) was established as the standalone national authority for water services and is currently operating through a series of service level agreements with local authorities. A funding model was previously agreed which sees water services funded from an appropriate mix of Exchequer funding, for domestic services and capital investment, and user charges, for services provided to the non-domestic sector, which includes industry and business.

The transformation of water services under a single utility gives rise to significant challenges for the local government sector. It is necessary to ensure that local authorities remain properly resourced to continue to deliver on other important key functions and services. Local authorities cannot be left with stranded costs arising from the transfer of responsibilities to Uisce Éireann, where there are expenditure commitments without a corresponding income stream.

To address this a Higher Level Working Group on Stranded costs has been established. The Group is tasked with the development of a Memorandum of Understanding (MOU) between the County and City Management Association (CCMA), representing local authorities, and my Department. The MOU, when agreed, will set out an appropriate methodology for dealing with each legacy issue and stranded cost. This will identify and apportion those costs which are to be borne by Uisce Éireann and costs to be funded by my Department with funding mechanisms for delivery of same.

The work of the Group is ongoing at present and a draft MOU will be submitted for my consideration in due course.