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Dáil
‹ Leaders' Questions

Irish Water transparency and costs

Summary

Barry Cowen challenges the €180 million establishment cost of Irish Water and seeks clarity on Freedom of Information, consultation, charges, allowances and subsidies. Brendan Howlin rejects claims that it is a white elephant, defending it as necessary infrastructure to replace an inadequate fragmented water system; interjections raise local leaks and alleged conspiracies.

In January this year the chief executive of Irish Water confirmed on RTE that in excess of €180 million was spent on setting up Irish Water. Many Cabinet members, as well as Members of the Oireachtas and the public, were made aware of the extent of those costs. The Oireachtas was subsequently drip-fed information about the make-up of that €180 million, including, for example, €85 million spent on consultancy fees. Irish Water was set up under a cloud of secrecy from Bord Gáis, despite warnings about taking this avenue from the Opposition and PricewaterhouseCoopers, which in 2011 confirmed that would be a more expensive route. We now have massive duplication as tiers of upper and middle management are recruited while local authorities will continue to maintain and repair water works for the next 12 years at least.

The Government defended setting up this white elephant - a bonus-driven quango - by stating it would save the State €2 billion by 2021. The savings that will be made are actually water charges. We were told in the aftermath of January's debacle by the Taoiseach, among others, that what Paddy needs to know, Paddy will know at the earliest opportunity.

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The Government's position was meant to be set out well in advance of local elections in May, let alone the first billing in October. Is the Minister satisfied that Irish Water comes under the full auspices of the Freedom of Information Act? Is he satisfied that Irish Water and the Department of the Environment, Community and Local Government are acting in an open and transparent manner? Is the Minister satisfied the public knows where the Government stands with the free allowance, public and low-income subsidies and first-fix pricing policies, for example? Is the Minister happy that since the debacle last January and all that ensued, based on the commitments made by the members of the Government, including the Taoiseach, that the process will become much more open and transparent? The public will be asked to pay for a system that might not be fit for practice in the near future but they should at least know what they are facing well in advance not only of the May elections but, more importantly, the arrival of the first bills in January next year.

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Brendan Howlin Minister for Public Expenditure and Reform Labour Party

I do not accept the Deputy's contention that the biggest new public utility company in a generation, Irish Water, is a white elephant. The status quo is the difficulty rather than what will happen in future. The status quo is a fragmented, under-invested delivery system for the most important of public resources to people, which is water. There are 34 local authorities using €1.2 billion in taxpayers' money to provide an unsuccessful and inadequate system. There are 18,000 people on the public water supply with a boil notice or other restriction in place. An Environmental Protection Agency, EPA, report has stated that remedial action is required on 16% of supplies at risk, including schemes such as the Dublin and Cork supplies. There are constraints on capacity for the people of Dublin, which constitute a third of the population, as we experienced last year. Unaccountable water loss amounts to 40% of capacity, which means 40% of our water leaks, and 36% of water treatment plants were not up to EPA standards. If we do not take remedial action, we will probably face legal action in the European courts. That is the bad system in place and this Government is determined to find the wherewithal to invest and improve the process. That is the genesis of Irish Water, which will bring a series of benefits for us.

The Deputy asked a number of specific questions. He asked if Irish Water is currently within the ambit of the freedom of information system and I am sure it is, as I signed the order, which became operable during the course of last month. It is completely open to the freedom of information process. The Deputy asked if there will be issues in the migration of 34 local authorities and staff to a new single consolidated entity, and of course there will be. If we had taken a different course of action, these would have been the difficulties raised by the Deputy. There would be talk of not giving fair deals to each local authority and the workers instead of having a proper system to migrate local authority workers into an integrated entity.

We are now working on the next phase and it will be a matter for the regulator to determine the pricing structure. That will be done in good time, as promised by the Taoiseach, to allow people to make the budgetary adjustments that will be necessitated when charging for water commences at the end of this year and bills arrive next year.

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I thank the Minister for his initial response. He indicated this will be done "in good time" but I remind the Minister that the consultation process initiated by the Government and led by the Commission for Energy Regulation, CER, began a number of weeks ago and neither the Government nor Irish Water has made a submission. There has been no consultation, even at committee level, in this regard. How can the Government expect full engagement from ourselves and the public if we do not know the costs? We have no idea of them despite the commitment made this House by the Taoiseach and Government Members that the process would be open, transparent, consultative and all-encompassing. There is nothing encompassing about the fact that the Cabinet has yet to discuss this, let alone make a submission to the CER and allow it to continue with the business of setting a price process in motion.

The Minister and I meet members of the public on a daily basis in the course of the current election campaign and they have been left in the dark as the secrecy continues. There has been no effort by anybody representing the Government to change this, and the silence from the Minister and his Department on the issue is deafening. It is high time the Government did as it said it would; it must match rhetoric with action. The Minister of State behind the Minister, Deputy Howlin, referred to the derogatory term of "Paddy", meaning the general public. I accept it is a derogatory term which should not be used but it was used by the Taoiseach. The public needs information but it is not being told anything because of continuing secrecy. Nothing has changed and it is high time there were changes.

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What about the leaks in Donnycarney and Clontarf?

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The Deputy is creating a conspiracy-----

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What about the leaks?

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I do not know what the other Deputy is mumbling about.

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I am talking about leaks in Donnycarney and Clontarf.

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The Deputy referred to conspiracy and problems but in truth we must deal with enough real problems without having imaginary problems. There are real issues to be dealt with in the country. God knows the legacy of the Deputy's party's term in Government.

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Bernard Durkan Deputy Bernard J. Durkan Fine Gael

Hear, hear.

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The Minister could not resist that.

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One of the big issues we need to deal with as a people is to create proper infrastructure. Nothing is more important for our people's health and well-being, and for those who might invest in our State, than to have a decent water system. I do not for a second believe the Opposition Members believe the current system provided by 34 local authorities, in which one third of the wastewater plants are suspect and where 18,000 people are subject to boil water notices is adequate. Is that their position? After the boom times when, apparently, we were awash with money, as one member of the former Cabinet said, we still have that dreadful infrastructural deficit. We will deal with that. We have said we would.

To deal with the specific point the Deputy raised, my understanding is that the regulator began the process in April. It is a two-phase process. There will be inputs from Government but we have to await a determination from our soundings with EUROSTAT of how much money will ensure this State company remains off balance sheet. The Deputy knows that full well.

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