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Businesses owe €90m in water rates

THE amount of money owed to councils in commercial water charges has trebled in just one year to €90m.

Local authorities are now collecting as little as 27pc of the amounts owed to them, an Irish Independent investigation reveals.

The revelations will cast doubt on the feasibility of plans by some political parties to introduce water metering as a way to generate funds for cash-strapped councils to pay for water treatment.

Despite commercial water charges having been in place for more than a decade, businesses struggling to survive are refusing to pay.

Detailed probes by auditors showed that in 2008 €29m was outstanding to councils and arrears now stand at almost €90m.

Audit reports commissioned by the Department of the Environment into council finances also indicate that the amount outstanding could be far higher than stated.

This is because many councils do not reveal how much they are owed, only publishing the percentage of bills they have managed to collect.

But despite the number of bills going unpaid, few firms are going without water as councils are refusing to shut off supplies as they do not want to be seen to be forcing businesses to shut.

The low collection rate also means that plans by the Greens, Fianna Fail and Fine Gael to use the National Pension Reserve Fund to install meters at a cost of €600m may have to be called into question.

This is because there is no guarantee of a return on the investment, based on the experience in the commercial sector.

The audit reports show:

  • Despite commercial water metering being in place for more than a decade, many local authorities are finding the scheme a nightmare to administer.
  • Wexford is collecting just 27pc of the money owed, Meath 30pc and Clare 30pc. Few councils are taking in more than 70pc.
  • The total amount outstanding to local authorities stands at almost €88m.
  • Dublin City Council is owed the most (€21.4m) followed by Cork County (€14.4m) and Wexford (€11.3m). Fingal is owed €7.1m, a rise of 27pc in just a year.
  • Just four businesses in Meath have been disconnected, despite a total of €6m owed in unpaid charges. Dun Laoghaire Rathdown has disconnected seven companies.
  • In Clare, the collection of water rates fell from 65pc in 2008 to just 30pc in 2009, due mainly to delays in issuing bills.

One local authority, Offaly County Council, said that "customer resistance" and problems with metering are resulting in a low collection rate of just 29pc. It is owed €2.3m in unpaid charges.

"We have experienced difficulties ... due to installation issues," the council told the auditor. "The current economic climate and the general difficulties that businesses are experiencing are also making collection difficult."

All of the main political parties except Labour are backing the introduction of domestic water charges.

Irish Independent