Problems with water charges mounting for Government

Fri, Aug 31, 2012, 01:00

ANALYSIS: Opposition to the new water charge is likely to grow if all households cannot be metered

MINISTER FOR the Environment Phil Hogan gave a hostage to fortune last April when he set a target for water meter installation to start this year and charges to follow in 2014.

There has been little evidence of progress since. This is not necessarily surprising given the massive undertaking involved in setting up a new water utility from scratch, and in the transfer of services, infrastructure and staff from 34 city and county councils to one subsidiary of Bord Gáis.

Bord Gáis has issued tenders in the last few weeks seeking to put together a panel of consultants to provide advice on the establishment of the utility, Irish Water, and its management over the next four years. It is also in talks with the Department of the Environment, local authorities and unions over an implementation plan for the new entity. However, it is not yet able to say when it will advertise tenders for water meters.

The Government is committed under the EU/IMF rescue plan to start charging households for water in 2014. However, it is not committed to the installation of water meters. The Government could decide to apply a flat charge to all households or a charge based on household size, but it has determined metering is the fairest way to charge.

Less than a week after Mr Hogan made his announcement last April, a senior Dublin City Council official said approximately one-third of homes could not be metered, because they shared supply pipes with neighbours, or their mains water supply entered the house under their back gardens. This was not just a problem with apartments but with a large proportion of the national housing stock, particularly in estates built from the 1940s to 1960s.

The Government initially dismissed the claim. It later accepted these houses were not suitable for meters but put the national figure closer to 20 per cent. The local authority professional officers section of Siptu, which represents council engineers, agrees metering is the fairest way of charging but said the cost of upfront universal metering could not be justified.

It puts this cost at more than €1.2 billion, and has advised the Government to introduce meters over a number of decades, as has been done in the UK and keep to a flat charge until all meters are in place and a system that has public confidence has been established.

The Government has said there will be no upfront charge for meters but householders will pay an average of €39 per annum over 20 years as part of a standing charge. Water industry experts dispute this figure saying costs over and above putting a meter in the ground, such as reading and maintaining meters and running a billing system, have not been taken into account. All these charges will have to be paid as part of a standing charge for the meter, estimated by industry figures at between €100 and €150, before the per unit usage charges are applied.

Given the opposition to the flat rate household charge it is understandable the Government would be reluctant to introduce a flat water charge, but if all households cannot be metered, claims the charge is unfair could become more vocal.

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