Sunday 25 September 2016

Water charges protest drowned out real grievances over the property tax

The main political parties are obsessed with water charges protestors, but are ignoring real fears over property tax, says Willie Kealy

Published 09/08/2015 | 02:30

'There is a myth that we are already paying for our water through general taxation. Not true. What general taxation has bought us in the past is a system with 50pc of the water wasted through leaks'
'There is a myth that we are already paying for our water through general taxation. Not true. What general taxation has bought us in the past is a system with 50pc of the water wasted through leaks'

When water charges were first introduced, people took to the streets in their tens of thousands to protest.

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When property tax was introduced, there was no such protest.

When we gave people a choice in our most recent Sunday Independent/MillwardBrown poll as to whether they would rather see the Government do something about water charges or property tax, more people (20pc) picked water charges over property tax (11pc).

This was puzzling for many people, given that property tax will take much more out of the pockets of those affected than water charges are ever likely to.

It is also a puzzle given that it is clear that there is a purpose to water charges. They were originally conceived to pay for a better water service and to encourage conservation. Each of these is a worthy and vital objective.

In return for property tax, you will get nothing appreciable from a neutered local government. It is just another tax.

Maybe because it is a tax and, therefore, enforceable by the Revenue Commissioners, those who feel sore about this imposition reckon they can't do anything about it. The revenue have draconian powers and you will pay it one way or another, so what's the point? If you don't pay voluntarily they will take it from your wages or your social welfare or your pension.

But with water charges there is no penalty for non-payment. So it might appear to make sense to say: 'Why pay a bill I don't have to pay?' This is especially so when the same poll showed that there are about as many people who believe water charges are not here to stay (36pc) as those who believe they are (37pc). This is despite the fact that practically every political entity with a real chance of forming the next government accepts the need for water charges - Fine Gael, Fianna Fail, Labour and Renua, with just Sinn Fein, People Before Profit, the Socialist Party and the Social Democrats for abolition.

Water charges were introduced by Phil Hogan in a way that would hardly have been feasible in North Korea. It was effectively a decree that took no account of democratic politics. And it was centralised in an organisation called Irish Water that will go down in the annals as a byword for inefficiency and waste - two of the conditions it was supposed to eliminate.

When Hogan went to Brussels, those who were left behind found they had to take account of politics. So, little by little, virtually every aspect of the original Irish Water plan was whittled away.

They would not reduce your water to a trickle if you didn't pay. They would give you generous allowances or free water before charging you by the litre - though even that had to be scrapped in turn and replaced with an initial flat rate, so small that it will not pay the enormous running costs of Irish Water, replete with consultants fees, over-manning and bonus culture.

Fianna Fail and Renua say they would scrap Irish Water and keep the charges, which presumably means starting from scratch with a new body. So much money has been invested in setting up Irish Water that this would be madness. Better a root-and-branch reform to change an over-priced bill- collecting agency to a proper water authority.

These parties - and others that believe in keeping the water charges - could also do themselves a bit of good with the electorate by removing one of the big fears people have about Irish Water: that it is destined for inevitable privatisation. While we might see the State control of property tax as a straitjacket that constricts us, the privatisation of Irish Water would be much more scary than keeping it in public ownership. At least it is subject to some democratic restraints right now. There is legislation guaranteeing it won't be privatised, but that can be altered without recourse to the people. A promise to hold a referendum on the issue could prove attractive.

There is a myth that we are already paying for our water through general taxation. Not true. What general taxation has bought us in the past is a system with 50pc of the water wasted through leaks. Add to that a culture of "boil water" notices and cryptosporidium. Under the old system - which is largely still the existing system - there was no incentive to conserve water. You could leave the taps running all night, as some do if the temperature drops to zero to prevent their pipes freezing, and suffer no consequences. For a while, when it looked as if we were all about to be made responsible for the water we use, we dropped our consumption dramatically - to 511m litres a day in the greater Dublin area. But as soon as the Government caved in to pressure and temporarily switched to a flat rate, we went back to our bad old ways to bring consumption back up to its constant 540m litres. So we need water meters to tell us exactly how much water each of us is using so we can pay our fair share of the cost of a proper supply, and no more.

From the beginning, we were told that everyone would have a meter and that there would be no charges until that happened because the whole idea was to conserve water, and without meters you cannot do that in a way that is fair to all. But that was just one of the many lies that were told.

Lies and appeasement have been the mark of the Government's attempt to deal with the water issue. What else could you call the €100-a-head conservation grant for all who sign up to Irish Water - not just those who pay? This is a cheque for €100 that will be issued to all and sundry - in theory, to spend on water conservation measures - but there is probably nobody in the country who will actually use it for that purpose. It is nothing more than a bribe.

Phil Hogan also brought in the property tax, or, as it was then known, the Household Charge. It went down about as well as the water charges at first, but any problems with that were quickly nipped in the bud when it was transformed into a tax. It was a good tactic and it worked. But water is deemed to be a human right - tell that to the people of Boyle. Besides, there was the matter of the sleight-of-hand trick, which recently came unstuck, to get it off the books, and the long-term plan for privatisation to consider.

Property owners did not get out of the traps quickly enough and take to the streets - if they were ever going to. And, of course, they are an easy mark for criticism, with one economist recently saying if elderly couples want to live in slightly larger homes, they are entitled to, but they must pay for the privilege. This takes no account of the fact that a slightly larger home may be no more than a three or four-bedroom house. It may be shared with grown-up children who have had to return to the nest through economic necessity, or never been able to leave it. It is the home they have probably scrimped all their lives to be able to enjoy in their retirement with attendant much-reduced income. They're not on the streets in their tens of thousands so they can be ignored.

The truth is that many of those who marched against water charges do not care about property tax or those who will have to pay it, because they are not among them. And those liable for property tax are probably less likely to be out on the streets throwing water bombs at politicians or holding ministers hostage in their cars. But there is one other characteristic that distinguishes the property owner - that's everyone who owns a small apartment or a two-bedroom house as well as those in bigger homes - they do tend to go out and vote come election time. And most of them are likely to be traditional supporters of Fine Gael, Labour or Fianna Fail - something that is less likely to be applicable to the water charges protestors.

That is something the main political parties, obsessed with the water charges, would do well to keep in mind. Revenge at the ballot box can do far more lasting damage than any number of street protests.

Sunday Independent

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