The Many Fundings Of Irish Water

It has become more and more difficult to understand where Irish Water funds come from, and the government has certainly not helped, merging funds into one another, diverting investments…

 

€6.5bn earmarked so far, and counting

LGF - Local Government Fund
NPRF - National Pension Reserve Fund
ISIF - Irish Strategic Investment Fund
WCG - Water Conservation Grant

 

1-Local Government Fund (LGF )

The LGF was set up to fund local authorities. You pay your motor tax, it gets pooled into a central fund and is then redistributed for what it is intended to address, eg roads. But the government doesn’t see it like that.

The LGF fund receives €1bn per year from motor tax, and since 2014 it also receives the newly introduced Local Property Tax (LPT), to the tune of €500m per year. Also supposed to be redistributed to Local Authorities.

€1.3bn of LGF funds will go to Irish Water by 2016:
(source)

 

2-National Pension Reserve Fund (NPRF)

Irish Water had accrued €14m debt already late last year on its borrowings from the National Pension Reserve Fund.

The debt was confirmed by Finance Minister Michael Noonan after a Dáil parliamentary question revealed the original €250m loan had risen to €300m.

Responding to questions from the Fianna Fáil environment spokesman Barry Cowen, Mr Noonan said the money was provided to help Irish Water pay for meters being installed from 2015 to 2019.

He said the deal was made in July 2013, when a €250m “bridging loan facility” was handed over by the reserve fund.

The money, which rose to €300m after a further request this month, was paid over in two parts, at the end of last year and during summer 2014.

It is due to be fully repaid by next September.

If it is due to be paid back by September, I wonder why the same fund is being plundered again in 2015/2016:

€945m of NPRF funds will go to Irish Water by 2016:
(source)

 

3-Irish Strategic Investment Fund (ISIF )

Interestingly, the ISIF will be merged with the NPRF and replace it.

As much as LPT was being merged with the LGF, once again funds are shuffled and tricks are pulled, making it difficult to understand if the numbers cited in different newspapers took this into account or not.

Regardless, and until this has been cleared, the numbers cited in those articles do not tally up, so I’ve kept them separate:

“The utility company is the biggest beneficiary of ISIF money to date, having secured a €300m capital investment — more than a fifth of the total amount committed from the fund.”

€300m of ISIF funds will go to Irish Water by 2016 (source)

 

4-Exchequer

Once again, this could be another trick by the government. It is easy to say that ISIF and LGF funds are part of the Exchequer remit, but once again figures provided in the media made no distinction whatsoever and did not add up when compared to other funds.

€1.1bn of Exchequer funds will go to Irish Water by 2016:
(source)(source)

 

5-Water Conservation Grant (WCG)

This program is set to cost €130m a year, but there is no indication that this will be drawn from existing funds featured in the table.
€260m need to be spent to finance WCG until 2016
(source)

 

6-Banks

Despite all this generosity and ingenuity from the government to make it as murky as possible, Irish Water also asked the banks for help.

€50m overdraft facility at Bank Of Ireland, €100m loan from Ulster Bank,
€450m from others (AIB, Barclays, BNP Paribas, BOI, Danske, HSBC, Ulster, Royal Bank of Scotland and Royal Bank of Canada)

€600m of private funds will go to Irish Water by 2016.
(source)

 

7-Is there more?

Of course there is.

Irish Water now also collect Commercial Rates from Local Authorities, that’s another €250m a year.
€750m of Commercial Rates will go to Irish Water by 2016.

The table at the top of this article is only for period 2013–2016, but tens of millions had already been spent in 2012:

-Hogan knew of €40m Irish Water consultancy allocation in 2012
- “speaking to reporters on 15 January, Hogan said he wasn’t aware of the specifics of the spend on external services, noting that he “certainly knew” about the total €180 million cost of setting up the company” (link)

€200m were spent in 2012 setting it up.
NB: it is unclear if these costs were part of the NPRF €300m loan in 2013 featured in the table above. According to this article from 2012:
€450 million would be given to Irish Water from the National Pension Reserve Fund, which would be passed on to customers through a standing charge over 20 years.

And the financing involves hundreds of other millions:

-Irish Water will also be spared €60m in rates charges that other utilities will have to pay
-On top of this up to €40m extra will have to be paid out to homes that are not customers of Irish Water
-Siteserv, the business purchased by Denis O’Brien from IBRC, with a write off of €110 million, was subsequently awarded the water meter contract.
-Energy watchdog to pay consultants €900k for advice on Irish Water
-State underwrites new €100m borrowing by Irish Water
Total:        €1.2bn extra funds in exemptions and for CER

And in another bewildering statement, the IMF has now hinted that failing the Euro test would not put the utility in jeopardy, instead they would throw another €550m at it! And to fail it is.

Do the Maths

By 2016:
1-€1.3bn of LGF funds
2-€945m of NPRF funds
3-€300m of ISIF funds
4-€1.1bn of Exchequer funds
5-€260m need to be spent to finance WCG
6-€600m of private funds
7-€750m of Commercial Rates
8-€1.2bn extra funds in exemptions and for CER

TOTAL: €6.5 Billion

And that’s before the €550m the IMF suggested we throw at it again if it fails the EU test.

Original article by BeYourOwnReason

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The Pension Debate, Mary Lou McDonald takes on Brendan Howlin, The Epic Táin Bó Cúailnge

An interesting debate took place in the Dail on Tuesday May 12, 2015 on Ministerial Pensions when Mary Lou McDonald, SF asked Brendan Howlin,Labour Party and Minister for Pubic Expenditure and Reform for a list of annual pension payments to former Ministers and taoisigh including the recipient's name.

Minister Brendan Howlin, Labour

 

The Pension Debate

Deputy Mary Lou McDonald Sinn Fein

Like the epic battle in  An Tain Bó Cúailnge, queen Medb a.k.a  'Mary Lou McDonald' took on Dáire mac Fiachna aka 'Brendan Howlin' to steal Donn Cúailnge, aka 'the prized list'.  Minister Howlin had the prized list,  and wouldn't let it go easily but Mary Lou wanted it badly.

“Janey Mac. Did the Deputy get lucky with the draw?  Minister Howlin directed his first remark to the questioner Deputy McDonald's. “Did the Deputy win the lotto, he asked?  He was playing with her. He knew he had the information that the Deputy was looking for. Would he be magnanimous and give it to her?

Deputy McDonald kept her cool, saying she didn't know how he was going to deliver his response but “he might tell us whether he regards the payments as prudent, modest and sustainable”

Minister Howlin, like an ancient lord of Ulster, knew he possessed the full list of names and payments.  He also knew that information is power.  He wasn't  going give it away cheaply.  He informed Deputy McDonald that he had a full list she wanted but it was too long to read out.

Deputy McDonald countered  “the minister might have time to read ten name or perhaps more”

Minister Howlin reluctantly read out 13 names from the list.  Why thirteen, was this an bad omen?

Top 13 Ministerial Pensions for year 2014

Medb is queen of Connacht

The information was a red rag to a bull.  Deputy McDonald went on the attack  and cornered Minister Howlin.  He was on shaky ground.  Well who wouldn't be, having to defend the indefensible, especially a labour man in this age of austerity defending some very questionable expenditure?

Donn Cuailnge was out and running loose. The list in the Minister's hand containing huge amounts of euro, would put paid to any reasonable arguments or explanation.  Perhaps he knew that. He was on dangerous ground.

Deputy McDonald on her thundering chariot began the attack. She said she was struck by the contrast between the recipients of the payments and “workers within the civil and public service who do not earn a living wage.”

Minister Howlin replied “Obviously there are many in the public sphere in receipt of analogous pensions, including senior judges, senior members of An Garda Síochána, senior administrators in the public service and senior academics.”

If you look up 'analogous' you will find 'comparable' but really having discovered what 'analogous' meant, it still  did not explain the Minister's reason why he brought into the fray even more payments and even more senior people.

He lost it, why did he have to mention these other additional pensions? Mentioning more expenditure only added more weight to Deputy McDonald's arguments about state pensions.

By the way how much airgead, euros is the State paying out to former ministers, taoisigh, senior state officials including senior Garda, judges and senior academics etc, etc? That would be some list.

While Deputy McDonald was digging in her heels and getting ready to pounce, Minister Howlin stumbled on “ It is important that pensions comprise an important part of the package available to get people to work in the public service. We will have to start discussing how we can ensure we get quality people to work in the public service because there will be pressures associated with the filling of senior positions when recovery comes and there will be much more lucrative opportunities in the private sphere.”

There is still a little lingering, niggling thought about this so called expertise and it's cost . The Irish state has forked out hundreds of millions in wages, annual pensions to ministers, former ministers, senior judges, senior members of An Garda Síochána, senior administrators in the public service and senior academics etc, etc. All for what?

Click Image

Deputy McDonald wasn't persuaded by  Minister Howlin's arguments. She claimed that despite all the Financial Emergency Measure in the Public Interest, FEMPI, legislation, changes and reforms that the minister introduced, that there is a “central disparity within the system, in which small numbers of people are overpaid and over-pensioned but as one moves down the chain people are on poverty wages, and we talk about the working poor but these are the working poor in the employment of the State - and the failure even to acknowledge that is quite astonishing.”

Ah no Brendan, let it go, let it go. When a person is beaten they innevitably try to laugh it off or blame it someone else. In this case Minister Howlin did both cynically accusing Deputy McDonald of “milking for political gain" and then went on to blamed the Attorney General.

The Minister replied “I know this is an area the Deputy likes to milk for political reasons but, in truth, she knows that with respect to people of legal entitlements to pensions, we have brought in reductions to those pensions in so far as we can go on the advice that we have from the Attorney General.”

Minister Howlin pulled out his only remaining weapon  “If we are going to have quality people working in the public sphere, we need to acknowledge that we are going to have to pay a reasonable rate for those jobs.”

His blunted sword did not even dent Deputy Lou McDonald's shield, she had him beat now.  She pounced, “At every level”.

Reaching deep into a now far off past, a nostalgia for youthful idealism, the Minister pleaded “ I am the son of a trade unionist and that in no way undermines the absolute case for having a fair rate at the lower end. It is something that I have spent my entire working life working for and my party's focus is to ensure that those who are the weakest are protected and that we support collective bargaining and provide decent wage rates for people who are least paid in society."

Ah, Brendan, you should have just handed over Donn Cúailnge to Deputy Mary Lou McDonald and left it at that .

Former Fianna Fail Taosigh Bertie Ahern and Brien Cowen
Image: Peter Morrison

Original Article Kildarestreet.com

Full List of Ministerial Pensions for year 2014 Pension € per annum

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Political Promises In Spring Statement As Government Allows Super-Rich To Make Huge Gains While It Crucifies The Poor With Austerity And Water Charges

Deputy Seamus Healy TD (Tipperary) Speaking in Dáil Tuesday April 28 2015

 

This Spring Statement is effectively an election manifesto of sorts with the bulk of the promises made to be implemented after the next general election. It is a series of political promises but we know well what happens to political promises. They are made to be broken, according to the former Minister for Communications, Energy and Natural Resources, Deputy Rabbitte, who said that is what politicians do at election time – they make promises they fully intend to break after the election. That is what happened in 2011 and this Government cannot be trusted or believed. What we have heard today in this Spring Statement is effectively pie in the sky.

Seamus Healy Independent TD for Tipperary South

Fine Gael-Labour Party Promises of 2011

Pat Rabbitte that is what politicians do at election time Click Image

It is important to note what this Fine Gael-Labour Party coalition promised in 2011 and what it did with its promises and commitments. We heard a lot about a democratic revolution but we hear very little about it nowadays. Fine Gael told us that it would burn the bondholders and that not another cent would be given to the banks. The Labour Party went even further and said that it would be Labour’s way and not Frankfurt’s way. Its infamous Tesco-style advertisements promised no cuts to child benefit, opposition to domestic water charges and so forth. It contained very specific promises and lines such as “Look what Fine Gael have in store for you” and “Fine Gael – Every Little Hurts”. The Labour Party in government went on to cut child benefit, with a loss of up to €1,500 for many families. A Labour Party Minister is now implementing the introduction of domestic water charges, having gone around north Tipperary in the last election campaign asking people to vote for him to ensure that Fine Gael could not introduce such charges. We were also told that the Labour Party would protect the vulnerable, a point to which I will return later.

Minister for Public Expenditure Brendan Howlin

This Fine Gael-Labour Party Government continued the austerity of the Fianna Fáil-Green Party Government and did exactly the opposite to what it had promised. Government policy in the past four years has deliberately increased the income and assets of the super rich in society. It ensured that austerity affected only low and middle income families while there was a recovery for the wealthy and the super rich. The Minister for Public Expenditure and Reform, Deputy Howlin, spoke about sharing the fruits of economic growth. He said that a functioning society is a fair one, where the fruits of economic growth are shared among all of the people, which demonstrates both dishonesty and hypocrisy. We know for a fact, as referred to by other speakers, that very wealthy people have increased their income and assets hugely during the course of this recession. An article in the Sunday Times last weekend pointed out that Ireland’s super wealthy now have a combined wealth that surpasses the heights reached at the peak of the Celtic tiger era. Ireland’s 250 richest people have increased their wealth by more than 15% in the past year to €75 billion, equivalent to 30% of Irish GDP. The number of Irish billionaires has increased from nine last year to 13 this year. There have been huge increases in the financial assets of the super rich as confirmed by the Central Statistics Office. The increase in assets from the time of the bust in 2008 to 2013 was €93 billion or an increase of 51% of GDP and there have been further increases since then. The situation is exactly the same with regard to income.

Wealthiest People In Ireland

Sunday Independent Click image

A very small proportion of very wealthy people have huge incomes. The 10,000 wealthiest have average incomes of €595,000 per year, a figure supplied to me by the Minister, Deputy Noonan. That wealth situation was confirmed about a month ago by the Sunday Independent rich list of the 300 wealthiest people in Ireland. Those 300 people have €84 billion between them. So the super-rich have done very well out of this recession while ordinary people have paid for it which they had no hand, act or part in creating.

On the other hand, it is instructive to look at what has happened to ordinary low and middle-income families. A recent Central Statistics Office report, the SILC report, shows that 400,000 children are living in households experiencing multiple forms of deprivation, of whom 135,000 are suffering daily material deprivation. The number of children living in consistent poverty has doubled from 6% to almost 12%.

The Labour Party claimed it would protect the vulnerable and particularly social welfare recipients. What is the record of the Labour Party and the Tánaiste in social welfare? She protected the social welfare recipients and low and middle-income families but I am afraid the cuts she introduced in recent budgets have devastated ordinary people and undermined the social welfare system.

It is important to mention some of those cuts, which I call the dirty baker’s dozen cuts: child benefit was cut by up to €1,500 per annum per family; cuts to the back-to-school allowance; cuts to maternity benefit; cuts to the fuel allowance; abolition of the telephone allowance; cuts to the household benefits package; cuts to jobseeker’s allowance; new qualifications for State pensions particularly affecting women who are out of the workforce to rear their families; the carer’s respite grant was cut by €325; farm assist payments cut; back-to-education allowance cut; exceptional needs payment cut; increase in eligibility for State pensions; taxation of maternity benefit; abolition of illness benefit for widows and lone parents who work; huge cuts, of course, to one-parent families with another huge cut coming on 2 July; cuts to rent allowance; and abolition, unbelievably, of the very small bereavement grant.

Michael Noonan FG Minister, Dept of Finance Spring Economic Statement  Click image

The so-called recovery is a recovery for those who are already wealthy and it certainly means continued austerity for low and middle-income families. The public does not trust or believe the Government. They know that what the Government says does not transfer into action. They know that middle and low-income families have been crucified by the Government. They want to see the Government going to the country and calling a general election. The Government has absolutely no mandate for what it has done. The public believe that it simply cannot be trusted. This Spring Statement is simply an election manifesto of sorts, one that the public will not believe and one that should be put to the country sooner rather than later.

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