Water charge concerns echo media reports

A new draft report on Ireland from the European Commission calls to mind friction between Dublin and Brussels over the reworked water scheme.

Following the suspension of metered charging and the introduction of a low cap on the charge, the report warns that incentives to conserve water will weaken.

It then goes on to cite “fiscal risk” arising from the uncertainty surrounding a Eurostat ruling due in April on whether the liabilities of Irish Water can be carried off the State balance sheet. “If it were to fail the test the inclusion of Irish Water in the general government accounts would increase the budget deficit by around 0.3 per cent of GDP.”

All of this serves to echo media reports two months ago on the views of a source close to the commission who questioned the new regime. Citing uncertainty over the Eurostat ruling, the source raised concern that the reworked scheme could jeopardise the Government’s fiscal plan. The source also questioned the efficiency of the flat charge.

There was acute displeasure in the Coalition when the concerns of the source were reported, prompting a severe rebuke for visiting troika inspectors.

When Minister for Finance Michael Noonan complained about all of this to economics commissioner Pierre Moscovici (left), the commissioner’response was to to distance himself from criticism of the scheme and blame journalists.

There was never any judgment on government policies –“in particular as regards the fiscal outlook in Ireland” – and only factual information was provided to local media representatives, he said.

“The media reports in relation to the latest developments concerning the water sector reform and the fiscal outlook do not reflect the commission’s position.”

Really? There was no contradiction between media reports on the concerns within the commission and the commission’s own document.

The only contradiction is on Mr Moscovici’s part.