Tuesday 21 October 2014

Steeper water bills for families of young children and teens

Yet Irish Water staff set to get €7,000 bonus each

Paul Melia and Niall O'Connor

Published 16/01/2014 | 02:30

Minister for the Enviroment Phil Hogan pictured with Karin Dubsky[ left] Coastwatch International Co ordinator and  Grainne Blumenthal, Mallow Co Cork  at the launch of  the Cosatwatch Autumn 2013 survey results at the  Haughton lecture theatre in the Museum Building in Trinity Cillege Dublin yesterday.
Pic Frank Mc Grath
Minister for the Enviroment Phil Hogan pictured with Karin Dubskyand Grainne Blumenthal at the launch of the Cosatwatch Autumn 2013 survey results.

PARENTS of young children and teenagers face the prospect of being hit with a second tier of water charges under a plan to be considered by the regulator.

The Commission for Energy Regulation (CER) -- which will be formally appointed as water regulator over the coming weeks -- said different tariffs may be applied to households using large volumes of water, which will result in higher bills.

Although some households may be given an extra allowance of 'free' water to help reduce bills, the regulator is considering introducing a number of tariffs based on consumption.

Last night, it emerged staff at Irish Water will receive bonuses of up to 10pc of salary depending on the quality of their performance.

The Dail Public Accounts Committee (PAC) heard that the bonus scheme is based on one at Bord Gais, where average bonus payments worth €7,000 have been paid out to its 300 staff.

Defending the spend on bonuses, Irish Water managing director John Tierney said the company has moved away from the practice of paying increments and that a pay freeze is in place until 2016.

But the payment of bonuses was criticised by ministers Joan Burton and Brian Hayes.

Meanwhile, the first Leaders' Questions after the Dail Christmas break was dominated by the controversy over Irish Water -- with Taoiseach Enda Kenny rejecting claims that the agency was shrouded in secrecy, saying he was aware of the overall €180m costs of its formation.

Details of how charges to consumers will be decided came after the Public Accounts Committee began examining spending in Irish Water.

It has emerged in recent days it had spent €86m on outside consultants, and that staff were entitled to annual bonuses.

The spending in the company is key, because the costs incurred by Irish Water will be taken into account when the regulator decides how much 1.3 million households will be expected to pay.

The Department of the Environment told the committee it had received details of consultant spending in March last year, and that the costs "appeared to be reasonable".

"The department has worked closely with NewERA and Bord Gais/Irish Water to ensure that the costs arising, in putting the organisation and its systems in place, are outweighed by the benefits over time to consumers," Secretary General Geraldine Tallon said.

"We recognised from the outset the need for independent scrutiny of this position by the CER. The oversight arrangements put in place were designed to feed into this process and ensure that ultimately the costs arising proved to be value for money for the customer."

But there are still no confirmation of the charges householders can expect to pay when bills land through letterboxes from January next year.

Proposals will be published in April by the CER on how they will be calculated, and they will be based, in part, on a submission from Irish Water which will set out how much it will cost to operate, maintain and upgrade the network and the cost of proposed future investment.

Commissioner Paul McGowan, from the CER, said the company's submission on costs would be published.

He told the PAC: "We will consult publicly on the submission from Irish Water.

"Our normal method of working is to publish submissions from utilities, our comments on it, take into account responses and publish our decision.

"It is our intention that the charge would identify the cost of providing clean water in, and the provision of wastewater out. We have yet to determine how the charges will be structured."

Among the issues to be considered include whether a standing charge will be imposed; if it would have to be paid regardless of whether water was used, and if the rate per cubic metre (1,000 litres) should vary depending on consumption.

This means that one rate could be applied for a certain volume of usage, which would increase when this threshold was passed. Similar systems are in place for refuse collection, where higher tariffs apply for large users.

It is not yet clear if the free allowance will be based on the size of the household, or the size of the family, and it is understood that Irish Water prefers the former option as it would be less bureaucratic and easier to implement.

A CER spokesman told the Irish Independent: "There's numerous strands to the charging structure -- how much will be fixed, how much is variable, a standing charge and the unit element.

"There may be different rates for different consumption levels, and the Government wants a certain allowance to be free which are among the issues we have to consider."

It will be April before the CER sets out how it proposes structuring water charges and details what different criteria will be used to determine annual bills and a final decision won't be made until August.

REVIEW

Separately, the CER said it would carry out a "detailed review" of costs incurred by Irish Water over the coming months. Those costs would be fed into the charging structure, with the costs ultimately being repaid by customers.

Speaking in the Dail the Taoiseach yesterday insisted that the investment in the semi-state company will ensure the public can access safe and quality water in the future.

Mr Kenny said he takes responsibility for the "policy" which underpins Irish Water and added that he was aware of the overall €180m costs of its formation.

He rejected a claim by Fianna Fail leader Micheal Martin that Irish Water has been shrouded in secrecy.

"This is a public utility in public ownership, therefore there is nothing that should be secret about it and there is nothing that will be secret about it'" he said.

Irish Independent

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