Water charges and ability to pay
Micheál Martin challenged the Government over leaked proposals for water charges, including the standing charge, average bills, free allowance and protection for people unable to pay. The Taoiseach said no figures or scheme had been approved, defended further consideration of affordability and vulnerable groups, cited infrastructure needs and disputed Martin’s claims about media leaks, while criticising Fianna Fáil’s earlier support for charging.
Yesterday the Taoiseach was asked questions in the House about the new water tax and standing charge and he gave very little information to the Members of the House. He referred to a draft memo from Irish Water but played down its implications. He failed to mention anything about a draft memo going to Government this morning for a special meeting on water charges and the water tax issue, the details of which are covered extensively today in The Irish Times and Irish Independent.
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We learned, for example, that the average cost will be between €250 and €300 and that the free allowance will consist of a seven minute power shower, a three minute tap run to brush one's teeth and two flushes of the toilet and that is basically it. That is the level of detail that was available this morning. There will be an annual standing charge, we were told, applying to all households irrespective of how much water they use. Basically, householders will pay for every drop of water used beyond the most basic morning routine. We have also learned that social welfare protection for low income families and particularly for pensioners has been ruled out.
I remember the Tánaiste saying, very eloquently, in 2010 that he was against water charging because water is a necessity, and that he always believed essential services like water should be delivered as a public service. Despite this, for some reason the Government has set up a very expensive and complicated regime in Irish Water, costing €180 million, despite that water will still be produced and delivered by the very same people who have been delivering it for decades.
I have a number of questions for the Taoiseach. Were the Labour Party Ministers informed about this level of detail in advance of it being circulated to the media by the Government? Was a memo brought to Government today on the new water tax and was a decision taken? Can the Taoiseach confirm that the free allowance is as revealed in The Irish Times and Irish Independent? We meet many people throughout the country in the course of our duties who say they have no more to give with all the other charges they have had to cope with, particularly pensioners who have been very hard hit by the previous two budgets.
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Will there be an ability to pay provision in the regime? Will there be any link to a person's income or capacity to pay?
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Only for the newspapers we would be hearing nothing.
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I thank Deputy Martin for his range of questions. There is a lot on the Government agenda that has to be considered. This morning, at a meeting I called to deal with a number of matters, we approved the publication of the legislation dealing with free general practitioner care for children under six, the publication of the Bill dealing with climate change and carbon emissions, and the changes recommended by the Minister for Education and Science to the Bill previously known as the Teaching Council Bill. We also had our first discussion on a proposal from the Minister for the Environment, Community and Local Government on the introduction of water charges. This is all about equity, equality, affordability and fair pricing. The situation, as Deputy Martin is only too well aware, is that we have a completely inferior infrastructure for water in many parts of the country. This State has failed to invest properly in that infrastructure over the years and that is why the Irish Water utility was created in order that it can borrow money off the Government's balance sheet to provide the infrastructure for water for consumers and businesses and to maintain our attractiveness as a location for setting up businesses.
Deputy Martin asked a number of questions. The Ministers' memo sets out a range of issues that are important. The Government, comprising the two parties, Fine Gael and the Labour Party, is united in supporting the Government's priority that water charges would be fair, affordable and as equitable as possible. We started that discussion this morning. The Government noted the importance, in the context of our recovery plan, of ensuring Irish Water, like Bord Gáis and the ESB, would be classified as a commercial semi-State body, the finances of which are separate from the Government's. In that way, Irish Water can fund much higher levels of investment to fix the inferior infrastructure we have. We also noted the official advice from the Minister for the Environment, Community and Local Government that the level of taxpayer subvention for Irish Water, consistent with it being classified as a commercial State company, could not exceed €537 million in 2015 and 2016. That equates to an annual average metered charge of €240. The Government has not signed off on these figures. There has been intensive engagement between the Department of the Environment, Community and Local Government and the Central Statistics Office in recent weeks in order to understand the statistical rules that apply here in the context of how EUROSTAT conducts its business. Deputy Martin will be aware that the requirement to pass a market corporation test means that income from customers, ex-VAT where applicable, must be greater than 50% of production costs, including both consumption of fixed capital and interest. These are important elements. The CSO, in explaining the rules, has explained the maximum level of subvention that will be available.
The Government will continue to discuss the question of how to make this as affordable and fair as possible for different categories of families. There are vulnerable groups here. One includes those who live on their own and who may be very vulnerable, including pensioners. Another is families with children, where there is an obvious requirement for extra water. The question of the scale of metering, the level of assessment and the general issues that apply in respect of all these things must be agreed. Deputy Martin mentioned standing charges, which is a matter in respect of which the Minister will give detailed policy directions to the regulator, who starts the public consultation process tomorrow in respect of the structuring of the tariff. The regulator will move on later to a more detailed analysis dealing with the actual charges.
In answer to Deputy Martin, the issues he has raised, including vulnerability, ability to pay and standing charges, are all matters the Government will consider in the next two weeks, taking into account the overall headline figures under the rules as explained by the CSO in order for us to keep in line with the EUROSTAT requirements. If the market corporation test is failed, there would be an additional-----
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If we were to fail the market corporation test, the consequence would be a €700 million capital cost being incurred by Irish Water which would impact on the Government deficit and would have serious implications in that regard.
In explaining the rules, therefore, the CSO has set out what the maximum subvention can be for 2015 and 2016. I want to make it clear that the Government has not signed off on any of these figures. We think it is important to discuss the elements surrounding that, including categories, vulnerability, ability to pay and levels of metering. We hope to conclude that within the next two weeks.
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The Taoiseach is anything but clear this morning. No one could decipher anything from what he is saying. If the Taoiseach had turned on "Morning Ireland" this morning and heard the political correspondent, Ms Martina Fitzgerald, he would have heard that the Government was bringing this memo to Cabinet today and that this was going to be announced today. By the end of "Morning Ireland" the Labour Party was rushing in some news that they had been told nothing about this.
The first question I asked the Taoiseach was if the Labour Party Ministers were told in advance about the details of the Minister, Deputy Hogan's, memo before it was circulated to the media. The memo was circulated to the media and it should be published now in deference to this House and the public. The public are being treated with absolute contempt regarding this matter. They are not that concerned about passing some corporate market test that the Taoiseach is going on about.
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With the greatest of respect, the people I meet, including pensioners, are basically concerned about what bill they will receive in the last quarter of this year. That is what people want to know. They were aghast when they saw the €180 million extravagance surrounding the establishment of Irish Water. That annoyed and angered many people. There was secrecy surrounding that.
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The Taoiseach endeavoured to keep it under the radar for quite some time. He then said he would publish everything well in advance of the local elections but he has not done so. He keeps trying either to leak or soften the blow, but the public want to know how much they will be paying for water by the end of this year. It is a basic and simple request. The only reason they do not know is because the Taoiseach and the Minister have deliberately delayed it until now. It is about time we found out the actual details. The Taoiseach also said that the Government has not signed off, but what does that mean in real terms?
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Is it because Labour angrily raised the leaks to the newspapers this morning and the Taoiseach has deferred it from today? What are the implications of that? The Taoiseach did not answer the question of whether there will be an ability to pay provision in the regime that is being announced. The memo that was circulated to the media says that any welfare protection has been categorically ruled out by the Government.
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That is categorically in the memo, according to RTE's reporting today and the newspapers.
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Let us be clear that I do not speak for any reporter on RTE. If the memo the Deputy speaks of was circulated then I would have assumed that a very competent reporter, like the one speaking on "Morning Ireland" this morning, would have had the details of what was contained in the memo. She was obviously very clear in the fact that she did not have the details to which the Deputy referred.
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It is in all the newspapers that the level is €537 million. That is the exact figure.
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It is like the water-pipe, leaking all over the place.
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We are talking about fairness, affordability and a workable scheme to provide infrastructure for the next 50 years for business and domestic consumers alike. The average charge as set out by the CSO's rules means that the bill for an average meter charge next January is €60. What it means-----
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I will have to ask the Taoiseach to finish because they are not listening to him and we are over time.
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When I said to Deputy Martin that the Government had not signed off on a memo, on a proposal from a Minister, it means that the Government has the right to discuss all of the issues surrounding that, including vulnerable groups, affordability, assessments, metering, standing charges and all these things.
I take very little notice of those who are opportunistic hypocrites, of which Deputy Martin is the leader.