Having made an unholy mess of its efforts to introduce water charges, the Government has added to the confusion in advance of a general election. There is no question of abolishing charges. The damage caused by relying on an excessively narrow tax base before the economic crash continues to reverberate through the fiscal system. Irish Water will remain. But questions persist over whether those who refuse to pay will continue to receive so-called conservation grants.
It is a difficult issue to address without making water charges an election issue. Efforts by Minister for the Environment Alan Kelly to do so fell foul of Michael Noonan and handed yet another stick to the Opposition. Government parties had hoped to campaign on the basis of managerial competence: receiving plaudits for releasing the State from bailout status and presiding over a rapidly growing economy. But its handling of Irish Water tells a different story. Since Phil Hogan departed for Brussels, his successor Minister for Environment Alan Kelly has been forced by political pressure to introduce a cap on water charges and introduce a €100 conservation/registration grant for all householders, without exception. The fact that non-payers will benefit from the grant infuriated law-abiding citizens and Mr Kelly, in response, proposed to limit future access.
In its efforts to keep Irish Water off its balance sheet, the Government intervened to reduce potential charges, engaged in creative accounting and involved the Department of Social Protection. That, in turn, caused Eurostat to criticise the financial basis of the business and to reject its status as an independent, semi-State company.
Fianna Fáil, an early proponent of water charges, joined Sinn Féin in calling for Irish Water's abolition. It was open season. Barry Cowen regarded as "farcical" a standard practice that PPS numbers are supplied when payments are made through the Department of Social Protection.
The notion of returning to a discredited, fragmented local authority system is risible. Irish Water achieved a poor, 43 per cent, payment rate last June, but some 70 per cent of households had registered, thereby becoming liable for future charges. Structures put in place by Mr Hogan were flawed and disagreement persists within Government concerning remedial action. Mr Kelly wishes to bring down the operating costs of Irish Water and, at the same time, speed up a reduction in its workforce. He also favours pushing out the timescale for its transition to a semi-State company, thereby reducing concerns about privatisation. These are reasonable objectives but, in an election context, are potentially toxic and could add impetus to the anti-water charge campaign. Government handling of these issues has been characterised by incompetence – and it has little time to get it right.