We've been fleeced on water and those responsible will walk away

by Colette Browne

Water charge protesters won, and now our inept politicians will stick us with the massive bill

There should be just one item on the agenda of the Oireachtas Committee into water charges when it meets for the first time today - how to emerge from the Irish Water debacle with the least cost to the Exchequer

It is becoming increasing clear that the overriding concern of politicians responsible for the creation of our aborted water charges regime is how to extricate themselves from the fiasco with their dignity left intact. The danger is that, in the unseemly rush to find a solution that offers an escape route, public interest will be sacrificed on the altar of whatever is politically expedient.

According to a report in a national newspaper yesterday, it is expected that Irish Water will have cost the State more than €2bn by the end of this year. This figure does not include the €570m that was spent installing water meters or loan facilities that have been underwritten by the State.

Among the costs to date have been the €81,000 in legal fees that were spent every week in the first year when Irish Water was being set up, €650,000 on an advertising campaign, €340,000 on external PR companies and €50m on a contract for call-centre staff. Meanwhile, among the more eye-catching expenses that have been spent since charges were abandoned in May are €774,848 on "efforts to improve customer service" and €775,141 on "business change support services".

It is a national scandal that so much money has been expended on a public utility whose business model is constantly in flux. So far, the pricing structure has changed twice in quick succession before being suspended; social protection grants and tax rebates have been introduced before being quietly abandoned and a short-lived conservation grant cost €110m plus €6m to administer.

When the cost of Freedom of Information requests are being assessed, the relevant department calculates how much time civil servants will spend collating information in order to estimate the price for journalists. Perhaps someone in Government Buildings could apply this formula to Irish Water and estimate how much the endless hours civil servants have devoted to this disaster have cost us in lost productivity.

Setting up an enormous public utility, and then unilaterally changing its business model every couple of months, is bad enough, but the most egregious waste of money could be the cost of the water meters.

To date, around €550m has been splurged on water meters, which could end up rotting in the ground. It is a measure of the through-the-looking-glass nature of the recently published expert report on water charges that the cost of abandoning the water-metering scheme didn't seem to feature in its calculations.

In the event, the report suggested that a charge should apply only for those who use excessive amounts of water, but then bizarrely refused to recommend that the water-metering scheme should be continued, leaving one to wonder how exactly levels of waste could possibly be calculated.

Fianna Fáil was rightly pilloried when it embarked on its ill-fated e-voting machine omnishambles, which cost the State in excess of €50m. However, that figure pales into insignificance when compared to the €550m that could be flushed away on water meters.

To put the figure in context, the cost of cystic fibrosis medication, Orkambi, has been estimated at €400m over five years, but we have been repeatedly told that the State cannot afford to provide it.

How can the Government so blithely assure us that life-saving medication for CF patients is not affordable, while at the same time splurging hundreds of millions on a water-metering programme that could soon be abandoned?

Taoiseach Enda Kenny, in the Dáil last week, said drug company Vertex was "ripping off the taxpayer" by charging an "excessive" amount for the life-saving drug.

However, when it comes to ripping off taxpayers, drug companies are in the ha'penny place as long as we have politicians who pump masses of public money into ill-conceived pet projects and then just walk away after sticking citizens with the bill.

The drug companies may fleece us, but at least we get something useful in return. What will we have to show for the billions that have been frittered away on Irish Water?

We certainly won't have a robust and reliable water infrastructure, if the current level of investment is anything to go by. The inconvenient truth is that Fianna Fáil, between 2007 and 2011, spent around twice as much on water infrastructure as the current discredited regime.

If politicians think the anger over Irish Water has died down, they are in for a rude awakening. If anything, the problem for them is now worse because they also have the rage of the formerly compliant people who paid their bills, and understandably want a refund, to grapple with.

Given there have been innumerable reports commissioned by any number of experts into Irish Water, can the politicians perhaps commission one more? Ask some experts in good governance to review politicians' own miserable performance when it comes to water charges and then come up with some kind of repayment plan to reimburse the Exchequer for any waste that can be attributed to their ineptitude.

Given the kind of lump-sum payments and pensions that senior politicians can expect to enjoy when they retire from office, some kind of dent could surely be made in the overall figure.

Source: Irish Independent Dec 13 2016


Irish Water has cost State €2bn

by Joe Leogue, Irish Examiner

Irish Water will have cost the State over €2bn by the end of the year, according to government projections.

Figures released to the Irish Examiner show the controversial utility will cost the State €844m in 2016 alone, when its operating subvention, capital contributions and the replacement revenue — provided by the State following the decision to suspend billing customers — are taken into consideration.

 

The State gave Irish Water €678m and €621m in 2014 and 2015 respectively in operating subventions and capital contributions, bringing the total cost to €2.143bn over the past three years.

The operating subventions from the Government were paid in respect of concessions Irish Water was to pass onto customers, such as free allowances for children.

The Department of Housing, Planning, Community and Local Government released the figures following a request for the total cost to the State in establishing Irish Water to date.

“The provision of State funding to Irish Water is made up of a number of elements,” a department spokesperson said.

“Only those elements which do not have an expected return are counted for the purposes of calculating the cost to the State. For example, Irish Water received borrowings and not subvention for the costs of the domestic metering programme.

“No exchequer funds have been provided for the establishment costs of Irish Water.”

In 2014, the State provided a €439m operating subvention and €239m in capital contributions or equity. Last year, its operating subvention dropped to €399m and capital contributions came in at €222m.

However, 2016 has proven to be the costliest year to date. While capital contributions dropped to a low of €184m, the operating subvention rose to a high of €479m.

Furthermore, in 2016, the State gave Irish Water €181m in replacement revenue.

“Following the Government decision of 18th October 2016, it was agreed to provide Irish Water with an additional subvention of up to €181m to allow Irish Water meet the shortfall in its projected revenue stream that arose due to the suspension of domestic water charges,” the department said.

The figures are revealed as the 20-member Oireachtas committee on the future funding of domestic water services meets tomorrow for the first time since the publication of the Duffy report on charges.

Source: Irish Examiner, Dec 12 2016


Noel Dempsey: ‘Nonsense’ to pursue unpaid water bills

 

 

By Fiachra Ó Cionnaith
Irish Examiner Political Correspondent

 

 

A former Fianna Fáil environment minister has contradicted his party leader by saying it is “nonsense” to chase people who are refusing to pay water charges, and that refunds should be given by the State.

Ex-TD Noel Dempsey made his comments just 24 hours before the cross-party Dáil committee on water charges tasked with addressing the controversy meets for the first time tomorrow .

Speaking on RTÉ radio as it emerged that Irish Water has spent a massive €5m on business strategists, lawyers, and PR experts since charges were suspended six months ago, Mr Dempsey said he was shocked by the ongoing spending.

Asked for his views on what should happen next, the former Meath TD — who held the transport, communications, environment, and education portfolios between 1997 and 2011 — said there is no point in trying to force non-payers to pay the debts and that refunds must be made.

“The notion that you can charge people who didn’t pay is a nonsense,” he said. People who did pay should be refunded. But that will probably be fudged.”

The comment is likely to surprise Fianna Fáil headquarters and comes as pressure grows both within Government and on the Opposition benches for refunds to be given to people who paid water charges.

While the party’s official position is that it wants to see a cost-benefit analysis of both refunds and forcing non-payers to repay the debt before deciding on what action to take, party leader Micheál Martin has made it clear he believes non-payers should be pursued.

Earlier this month, Mr Martin said: “I believe in people obeying the laws” and that the focus “should be on pursuing people who haven’t paid”.

It emerged at the weekend that Irish Water has spent over €5m on strategists, lawyers, and PR advisers, among other costs, in the six months since the confidence and supply agreement between Fine Gael and Fianna Fáil saw the charges frozen. The company confirmed to a Sunday newspaper that despite effectively being in limbo since May it is still spending almost €3,000 a month on PR expertise.

In addition, it has paid €406,268 during the period to Ernst & Young for legal advice, and €123,570 to consultancy firm PriceWaterhouseCoopers, among other expenditure.

The significant costs are likely to be discussed at tomorrow’s first official meeting of the Dáil cross-party committee on water, which has been tasked with examining the future of water services in Ireland and how they should be funded.

An independent Government-commissioned report last month concluded that the vast majority of people should no longer have to pay fees, although an unspecified number will still pay charges, yet to be outlined.

These recommendations must now be discussed by the committee of Government and Opposition TDs and senators, which has been asked to make its own recommendations to the Dáil by next March.

Anti-water charges campaigners say that if political parties are to adhere to their pre-election promises they should vote to scrap water charges completely next March.

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